Dr. Deepak Datta
Professor and Eunice and James L. West Chair of Business
CEO Experiences: Effects on the Choice Of FDI Entry Mode
Herrmann, Pol; Datta, Deepak. forthcoming 2005, Journal of Management Studies.
Drawing on the strategic management and international business literatures, this study examines the relationships between the experiences of newly selected CEOs and their choice of foreign direct investment (FDI) entry modes. Based on a sample of 380 foreign market entry events involving acquisitions, greenfield investments, and joint ventures, our findings indicate that CEOs with less firm experience preferred acquisitions and greenfield investments to joint ventures and, older CEOs were more likely to opt for joint ventures over greenfield investments. In addition, CEOs with throughput functional experience favored acquisitions over joint ventures and greenfield investments. Finally, CEO international experience was associated with a greater propensity to choose greenfield investments and acquisitions over joint ventures and also greenfield investments over acquisitions. The implications of the findings from the perspective of theory and managerial practice are discussed, along with possible directions for future research.
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Herrmann, Pol; Datta, Deepak. Mar2005, British Journal of Management, Vol. 16 Issue 1, p69, 10p.
Drawing on the executive demography and the upper-echelons perspectives, this paper examines the relationships between top management team (TMT) characteristics (educational level, tenure, age, international experience and functional background) and firm international diversification. The study is based on a sample of 112 relatively large, internationally diversified US-based firms in the manufacturing sector. Findings indicate that firms with higher levels of international diversification are likely to have TMTs characterized by higher educational level, shorter organizational tenures, younger executives and greater international experience. In addition, findings indicate that the relationships between TMT characteristics and international diversification are more dominant in better-performing than in lower-performing firms.
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Human Resource Management and Labor Productivity: Does Industry Matter?
Datta, Deepak; Guthrie, James P.; Wright, Patrick M.. Feb2005, Academy of Management Journal, Vol. 48 Issue 1, p135, 11p.
There has been growing interest in the degree to which human resource systems contribute to organizational effectiveness, yet limited research attention has been paid to the contextual conditions that moderate the efficacy of these practices. In this study, we examined how industry characteristics affect the relative importance and value of high-performance work systems. Findings indicate that the impact of these human resources systems on productivity is influenced by industry capital intensity, growth, and differentiation
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Datta, Deepak.; Rajagopalan, Nandini; Yan Zhang. Jun2003, British Journal of Management, Vol. 14 Issue 2, p101, 14p.
Drawing on the upper echelons, managerial discretion and strategic contingency perspectives we examine the relationships between newly chosen CEOs' openness to change and firm strategic persistence in the post-succession phase. This study is different from prior studies on the consequences of CEO succession in that it focuses on specific characteristics of the new CEO (that reflect his/her knowledge-base and cognitive orientations) and the industry context rather than purely on the event of succession. Based on a sample of 132 successions in 118 firms in the US manufacturing sector, and after controlling for industry concentration, board power, firm size and pre-succession performance, we find a negative relationship between CEOs' openness to change and post-succession strategic persistence. Interestingly, our findings indicate that this relationship is moderated by industry characteristics in that the negative association between CEO openness to change and strategic persistence is significant in high-discretion but not in low-discretion industries. Contributions of the paper to the CEO succession and strategic change literatures along with the managerial implications of our findings are discussed in the concluding section of the paper.
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CEO Successor Characteristics and the Choice of Foreign Market Entry Mode: An Empirical Study.
Herrmann, Pol; Datta, Deepak. 2002 3rd Quarter, Journal of International Business Studies, Vol. 33 Issue 3, p551, 19p.
Based on the upper echelons theory, this study of 126 CEO successions and 271 foreign market entry events examines the relationships between successor CEO characteristics and choice of entry mode. Results indicate that CEO position tenure, throughput functional background, and international experience are associated with full-control entry modes. Additionally, these relationships were observed in the subgroup of high-performing firms but not in the low-performing subgroup.
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Industry structure and CEO characteristics: An empirical study of succession events.
Datta, Deepak; Rajagopalan, Nandini. Sep98, Strategic Management Journal, Vol. 19 Issue 9, p833, 20p.
Examines the relationship between industry structure and the characteristics of chief executive officer (CEO) succession, while assessing the performance implications of the association between industry structure and CEO successors. Factors which influence the selection of a CEO successor; Description of CEO succession; Basis of succession events.
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Corporate strategy, executive selection, and firm performance.
Guthrie, James P.; Datta, Deepak. Summer98, Human Resource Management, Vol. 37 Issue 2, p101, 16p.
This article focuses on three interrelated topics of corporate diversification strategy, selection of executives and the performance of the firm. The choice of a chief executive officer (CEO) is significant to business organizations. Recent trends have served to magnify the significance of the CEO selection process. Chief among these trends is the general heightening of product market competition and an increase in shareholder activism, especially within the institutional investor segment. It is now widely accepted that the typical CEO has a large impact on shaping a company's strategy, its core competencies and its competitive advantage. Results of this study indicate that corporate strategy does not manifest a relationship with the level of firm experience of selected CEOs, but does interact with selection decisions to impact organizational effectiveness. Using the full sample, findings indicated an inverse relationship between the firm tenure of selected CEOs and subsequent improvement in firm performance. Those classified as outsiders tended to yield superior performance relative to those classified as insiders. Additional analyses revealed that the source of this general finding is due to the impact that tenure or insider/outsider status has on post-succession performance change in relatively non-diversified firms.
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Contextual Influences on Executive Selection: Firm Characteristics and CEO Experience.
Guthrie, James P.; Datta, Deepak. Jul97, Journal of Management Studies, Vol. 34 Issue 4, p537, 24p.
Examines relationships between antecedent organizational characteristics and the pre-succession experience of persons who are choses as chief executive officers (CEO's). Information on the study used to carry out this examination; Method of the study; Results of the study
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Datta, Deepak.; Puia, George. 1995, Management International Review (MIR), Vol. 35 Issue 4, p337, 23p.
This study examines shareholder value creation 112 large cross-border acquisitions undertaken by U.S. firms between 1978 and 1990. In addition to empirically examining the wealth effects of acquiring firms, the study examines the impact of relatedness and cultural distance on such wealth effects. Implications of study findings for academic researchers and managers are discussed.
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Executive Succession: Organizational Antecedents of CEO Characteristics.
Datta, Deepak; Guthrie, James P.. Sep94, Strategic Management Journal, Vol. 15 Issue 7, p569, 9p.
The choice of a chief executive officer (CEO) is a key organizational decision with important implications for firm effectiveness. Perhaps as a consequence of concerns over the U.S. competitiveness in world markets, interest in CEO selection has been particularly keen in recent years. In the academic context, one issue that has elicited significant interest is the fit between the characteristics of organizations and the individuals occupying the CEO position. As originally suggested by organizational theorists, firms displaying different characteristics of operating in different contexts may recruit and hire leaders with different backgrounds and skills. This general proposition has been incorporated in the strategic leadership literature, which holds that the notion of generalist general managers is essentially bankrupt and that the value of a particular CEO's background or experience partly depends on the unique set of contingencies facing a firm. Thus, CEO succession outcomes should reflect the antecedent conditions found in organizations.;
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Strategic Decision Processes: Critical Review and Future Directions.
Rajagopalan, Nandini; Rasheed, Abdul M. A.; Datta, Deepak . Summer93, Journal of Management, Vol. 19 Issue 2, p349, 36p.
This article develops an integrative framework of strategic decision processes based on a reveiw of the past literature. The framework incorporates environmental, organizational, and decision-specific antecedents of process characteristics, and their process and economic outcomes. Key empirical studies are reviewed in the context of the framework and major patterns and contradictions are identified. Based on this review, useful implications for theory building, research methods and managerial practice are identified and several directions for future research are presented.
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Factors Influencing Wealth Creation From Mergers and Acquisitions: A Meta-Analysis.
Datta, Deepak; Pinches, George E.; Narayanan, V. K.. Jan92, Strategic Management Journal, Vol. 13 Issue 1, p67, 18p.
This article provides a meta-analytic synthesis of the findings of studies on wealth creation or the market performance of mergers and acquisitions where market performance or shareholder wealth gains refers to the stock market appraisal of specific merger transactions. This study analyzes the empirical literature concerning the influence of various factors on shareholder wealth creation in mergers and acquisitions using a multivariate framework. Overall, results indicate that while the target firm's shareholders gain significantly from mergers and acquisitions, those of the bidding firm do not. Findings also indicate that the use of stock financing has a significant impact on the wealth of both the target and bidding firms' shareholders. The presence of multiple bidders and the type of acquisition influence the bidders' return, while regulatory changes and tender offers influence the targets' returns. The study also provides a comparison of its findings with that of previous narrative reviews and discusses their implications from the viewpoint of managers and researchers.
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Diversification and Performance: Critical Review and Future Directions.
Datta, Deepak.; Rajagopalan, Nandini; Rasheed, Abdul M. A.. Sep 91, Journal of Management Studies, Vol. 28 Issue 5, p529, 30p.
This article uses an integrative theoretical framework to review existing empirical research on the diversification-performance relationship along the three different research streams which have studied this relationship. The article highlights the considerable diversity in the findings across studies in each stream and identifies certain key theoretical and methodological issues which might help to explain the observed diversity. Also discussed is a contingency-based perspective and several useful directions for future research.
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Organizational Fit and Acquisition Performance: Effects of Post-Acquisition Integration.
Datta, Deepak. May 91, Strategic Management Journal, Vol. 12 Issue 4, p281, 17p.
The continuing popularity of mergers and acquisitions in the U.S. is probably a reflection of the widespread belief among managers that acquisitions provide a quicker and seemingly easier route to achieving growth and diversification objectives. The article examines the impact of organizational differences between acquiring and acquired firms on post-acquisition performance. Based on 173 acquisitions in the U.S. manufacturing industry, this study indicates that differences in top management styles have a negative impact on performance in acquisitions characterized by both high and low levels of post-acquisition integration. However, no such relationship was observed between differences in the reward and evaluation systems and post-acquisition performance in either the high or low integration subgroups. In the concluding part, implications of the findings, along with directions for future research, have been discussed. The findings of this study have important implications from the perspective of executives associated with mergers and acquisitions.
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Datta, Deepak; Grant, John H.. Mar90, Journal of Management, Vol. 16 Issue 1, p29, 16p.
This study examines the degree of autonomy provided by acquiring companies to the management of acquired firms in the managing of post-acquisition operations as well as the relationships between such autonomy and the perceived success of the acquisition. Results show that in unrelated acquisitions the extent of autonomy is significantly greater than in related acqusition. Also, autonomy is positively associated with superior performance in unrelated acquisitions, but the relationship is not significant in related acquisitions. Implications for future research and management practice are discussed.
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Datta, Deepak; Narayanan, V. K.. Sep 89, Journal of Management, Vol. 15 Issue 3, p469, 15p.
This paper investigates the central methodological and substantive controversies surrounding the relationship between concentration and performance which lies at the heart of many strategy content models. We introduce the technique of meta-analysis to evaluate the nature of the relationship and to empirically assess the controversies using existing data. Our findings suggest that the relationship is moderated by industry definition and time period of data and is not affected by methodological artifacts. The implications of the findings are discussed with particular reference to the problems of aggregation that are likely to confront strategic management researchers in the future.
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