Boards as Strategy Makers: The Antecedents and Consequences of Board Involvement in Strategic Decision Making
Date of Award
Doctor of Philosophy
Dennis J. Duchon
Anne D. Smith, Donde A. Plowman, Stephanie A. Bohon
This study describes the antecedents and consequences of the direct involvement of boards in forming the strategies of the organizations they serve. If boards are involved directly and early in the strategic decision making process rather than being held at the periphery, board members may become important assets to their organizations as strategy makers beyond their limited contributions as monitors or advisors. By providing a look inside the “black box” of decision making in board rooms, this research addresses a gap in the strategy and board literatures and has important practical implications for executives and board members who are interested in utilizing their boards to the greatest advantage for their organizations.
Board members and chief executive officers who are currently making strategic decisions in a hospital context detailed their involvement in the decision making process in their responses to surveys designed for this study. Utilizing structural equation modeling for analyzing these responses, this study indicates that board members who bring human capital, social capital, and Board Capital (human and social capital in concert) to the board room are more likely to participate early in the strategic decision making process by raising or clarifying issues, generating or evaluating alternatives, or choosing strategies rather than only coming into the process at the end to review and accept or reject the recommendations of the top management team. And when board members are directly involved in forming strategy, the strategic decisions are more likely to be implemented and the implemented strategies are more likely to result in positive financial outcomes. Thus, boards as strategy makers impact the strategic decision making process and the organization in important ways.
This study has shown that there are identifiable antecedents and positive consequences of boards acting as strategy makers.
Eickhoff, Karen Ford, "Boards as Strategy Makers: The Antecedents and Consequences of Board Involvement in Strategic Decision Making. " PhD diss., University of Tennessee, 2012.