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In the driving seat: Executive’s perceived control over environment

Author

Listed:
  • Gavin M Schwarz
  • Karin Sanders

    (School of Management, UNSW Business School, UNSW Sydney, Sydney, NSW, Australia)

  • Dave Bouckenooghe

    (Goodman School of Business, Brock University, St. Catharines, ON, Canada)

Abstract

This study investigates executives’ perceived control over their environment. Drawing on managerial cognition and upper echelons theory, we test a model that specifies perceived control over environment as made up of organizational routines (i.e. information processing capability and decision comprehensiveness) and executive understanding of performance (i.e. organizational effectiveness and organizational slack). Findings from a scenario study of 46 executives in 14 pharmaceutical firms show perceived control over the internal environment can be explained by information processing capability, and the interactions between organizational routines and resources. Perceived control over the external task environment can be explained by information processing. This difference accounts for the extent to which executives perceive that they can control their environment, adding to the more traditional view focused on the requirements for a strategic fit to environment. JEL Classification: M10, M12, L20

Suggested Citation

  • Gavin M Schwarz & Karin Sanders & Dave Bouckenooghe, 2020. "In the driving seat: Executive’s perceived control over environment," Australian Journal of Management, Australian School of Business, vol. 45(2), pages 317-342, May.
    • Handle: RePEc:sae:ausman:v:45:y:2020:i:2:p:317-342
    DOI: 10.1177/0312896219895065
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    More about this item

    Keywords

    Executives; external task environment; internal environment; organizational effectiveness; organizational routine; organizational slack; perceived control;
    All these keywords.

    JEL classification:

    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

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