Essays on CEO cognitive complexity: Effects on corporate strategy, performance, and survival
Doctor of Philosophy
The Chief Executive Officer’s (CEO’s) job involves a substantial amount of information processing. This dissertation explores the organizational implications of CEOs’ way of processing information, or cognitive style, in multiple contexts. I particularly focus on CEOs’ cognitive complexity, or their degree of differentiation and integration of information, and examine how it influences their corporate strategies and performance outcomes not only in general business settings but also in high-growth environments as well as crisis situations. First, I examine the influence of CEOs’ cognitive complexity on their firms’ growth strategies and how these relationships change as the industry in which they compete grows itself. Second, I focus on a particular research context, the recent financial crisis of 2007-2008, to examine how firm acquisitions prior to the crisis, in part driven by their CEOs’ cognitive complexity, influence acquisitions during the crisis which in turn may affect firms’ subsequent survival. Finally, while maintaining the focus on the recent financial crisis, I broaden the focus on firm strategies to their corporate restructuring activities—i.e., acquisitions and divestitures—to examine how these two strategies unfolded within each course and across each other, by comparing pre- and during-crisis periods. Further, I examine the role of CEOs’ cognitive complexity in these ‘cross-strategy’ effects and the specific impacts of during-crisis restructuring activities on firms’ subsequent performance and survival.