Abstract
Do Chief Strategy Officers (CSOs) impact firm performance? Although the CSO has become an established role in the top management team (TMT), academic research remains inconclusive regarding its performance implications (Breene, Nunes, & Shill, 2007; Menz & Scheef, 2014). Based on the upper echelons and contingency theory, we argue that the benefit of CSO presence to firm performance depends on the level of strategic activity a firm engages in. We derive how certain CSO capabilities are relevant to firm performance and argue that the number of organizational strategic moves moderates the effect. Specifically, we test for an organizations' number of strategic acquisitions, joint ventures (JVs), and market entries relative to industry peers. We test our model on a multi-source dataset of more than 300 firms from the S&P 500 between 2005 and 2019. Our findings indicate that CSO presence is not beneficial per se but is especially beneficial for firms engaging in a high number of JVs and market entries. This study contributes to the upper echelons theory, the literature on organizational embeddedness of strategic decision-making, and reconciles the existing literature on the performance implications of CSOs.
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