Top management team composition and views of viable strategies

Abstract

Purpose – The purpose of this paper is to form propositions about the relationship between the cognitive composition of the top management team and its view of the viable strategy for a firm. Design/methodology/approach – The cognitive style of 58 members of ten top management teams were analyzed using the Myers Briggs Type Indicator (MBTI) and the strategy types based on Miles and Snow typology were defined using the paragraph approach. Descriptive statistics were used in the analysis. Findings – Based on data from the ten top management teams in the spa industry, this study proposes that the cognitive composition of the top management team affects the strategies they prefer. Further, it is proposed that intuitive-thinking top management teams prefer either a prospector or an analyzer strategy. A defender or an analyzer strategy is preferred by sensing-thinking top management teams. Defining the composition of the top management team using the cognitive style is proposed to be a more promising way to explain the homogeneity or heterogeneity of the team than traditional measures such as age or education in this context. Practical implications – For the top management teams, the results of this study emphasize the importance of knowing the cognitive composition of the top management team and especially taking it into consideration during strategic decision-making. Originality/value – This study extends existing research by illuminating the relationships between the cognitive composition of the top management team and the strategy type and also confirms several results drawn from previous studies concerning manager-strategy relationships. This paper also attempts to inspire researchers to take cognitive composition into consideration when studying the influences the top management team has on a firm’s strategy.