Christopher R. Reutzel

Signaling Theory: A Review and Assessment

Signaling theory is useful for describing behavior when two parties (individuals or organizations) have access to different information. Typically, one party, the sender, must choose whether and how to communicate (or signal) that information, and the other party, the receiver, must choose how to interpret the signal. Accordingly, signaling theory holds a prominent position in a variety of management literatures, including strategic management, entrepreneurship, and human resource management. While the use of signaling theory has gained momentum in recent years, its central tenets have become blurred as it has been applied to organizational concerns. The authors, therefore, provide a concise synthesis of the theory and its key concepts, review its use in the management literature, and put forward directions for future research that will encourage scholars to use signaling theory in new ways and to develop more complex formulations and nuanced variations of the theory.

The Power and Effects of Entrepreneurship Research

This study summarizes and analyzes average statistical power and effect sizes in empirical entrepreneurship research. Results show that statistical power was higher than expected, and was particularly high in studies employing archival measures. Statistical power has also increased over time. Effect sizes were higher than expected, a finding that remained consistent for different levels of analysis and across multiple subdomains. We discuss these findings, compare them to related disciplines, and draw implications for the design of future studies.

Mediation in Strategic Management Research: Conceptual Beginnings, Current Application, and Future Recommendations

Mediating effects allow strategic management researchers to understand “black box” processes underlying complex relationships whereby the effect of an independent variable is transmitted to a dependent variable through a third variable. Since the seminal work of Baron and Kenny (1986), advancements have been made in mediation analysis. Thus, literature on the latest techniques for analyzing mediating and intervening varibales is presented. In addition, strategy literature published in the Academy of Management Journal and the Strategic Management Journal between 1986 and 2005 employing tests of mediation is reviewed to better understand how mediation techniques are used by strategy scholars. Finally, implications and limitations of current mediation analysis in strategy research are discussed, and recommendations are provided to strategy scholars examining mediation.

Female directors and IPO underpricing in the US

Purpose – The purpose of this study is to explore how initial public offering (IPO) investors view female presence on boards of directors in the USA. Design/methodology/approach – This study utilizes hierarchical regression and analyzes data collected from firms undertaking their IPO’s in the USA during 1997 and 2007. Findings – The findings of this study suggest that US IPO investors react negatively to female presence on the board of directors. However, this negative effect has weakened post-Sarbanes-Oxley Act. Research limitations/implications – The results of this study may not generalize to other settings. Practical implications – Gender bias against females in the boardroom exists but appears to be weaker post-Sarbanes-Oxley. Social implications – One hurdle to greater female representation in entrepreneurial ventures in the USA may be weakening as a result of greater awareness of female director contributions to board functioning. Originality/value – First, the study represents one of the few attem...

Human resource management executive presence in top management

Purpose This study aims to draw upon research from strategic human resource management (HRM) and strategic management to examine how HRM demands influence the likelihood that chief executive officers (CEOs) will staff top management with a human resource (HR) executive. Design/methodology/approach The theory and hypotheses developed in this study are tested on a sample of US initial public offering firms from the calendar year 2007, using logistic regression. Findings The results of hypothesis tests suggest that HR executive presence in top management is positively related to the HRM demands faced by a CEO stemming from product/service innovation strategies, the number of HRs employed by the firm and CEO’s financial orientation. Research limitations/implications The results of this study may not generalize to other settings. This study does not simultaneously consider the role of other structural forms which may increase or reduce the degree of HRM demands faced by the CEO. This study extends prior research on executive job demands by expanding the understanding of factors which give rise to HRM sources of executive job demands. Study results suggest that CEOs with financial orientations are more likely to staff their top management teams with an HR executive, which suggests that in the face of executive job demands stemming from a particular functional area, CEOs delegate responsibility for that function to another member of top management. This finding suggests that CEOs can, and in fact do, recognize the limitations engendered by their experiences and that when confronted with a specific type of executive job demand that does not align with their expertise, they take steps to address their individual limitations by appointing others that are more capable of addressing the particular source of executive job demand. Practical implications Study results suggest that product/service innovation strategies, CEO’s financial background and the number of HRs employed by the firm increase the likelihood of HR functional representation in top management. Originality/value The theory and results of this study extend the focus of extant research on factors giving rise to HRM’s functional representation in top management. Although prior research has emphasized the role of ownership characteristics and risk preferences in the adoption of this structural form, this study examines the role of CEO HRM demands. This approach allows for the integration of the upper echelons theory with the strategic HRM literature and provides an empirical examination of CEO job demands arising from the HRM function.

Leader gender and firm investment in innovation

The purpose of this paper is to examine the influence of business leader gender on the pursuit of innovation opportunities. Extant research suggests that leader gender represents an important characteristic that shapes firm behavior in various ways. The authors build upon this research by relating business leader gender, perceptions of environmental munificence and distributive justice to firm investment in innovation.,This study examines the survey responses of 469 business leaders in India. These individuals were primarily responsible for their firms. Their responses to survey questions were analyzed using ordinary least squares regression.,The results of this study suggest that female-led firms exhibit less investment in innovation than male-led firms. Results also suggest that female business leaders perceive less environmental munificence as well as distributive justice. Finally, study results suggest that the effect of gender on firm investment in innovation is mediated by perceptions of distributive justice.,This study provides an empirical link between business leader gender and firm investment in innovation. In doing so, it acknowledges and provides insight into the gendered nature of the initiation of innovation processes and leadership. Finally, the finding that business leader perceptions of distributive justice mediate the relationship between business leader gender and investment in innovation extends current understanding of the mechanisms underlying the lower investment in innovation rates exhibited by female-led firms.

The role of top managers in determining investment in innovation: The case of small and medium-sized enterprises in India

This article examines the role of top managers in shaping the innovation investment actions of small and medium-sized enterprises (SMEs) in India. Survey responses from 477 top managers of Indian SMEs suggest that investment in innovation is influenced by top manager perceptions of innovation opportunity attractiveness, as well as ability to appropriate innovation investment value. Specifically, the results indicate an inverted U-shaped relationship between top manager entrepreneurial orientation and firm investment in innovation. They also suggest that top manager perceptions of environmental munificence, firm resource management capabilities, and organizational controls are positively related to firm investment in innovation.