Date of Award

Summer 2014

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Program/Concentration

Business Administration-Strategic Management

Committee Director

William Q. Judge

Committee Member

Thomas M. Madden

Committee Member

M. Lance Frazier

Abstract

This study develops a new construct, strategic caring, defined as actions taken by top managers within stakeholder relationships to improve the well-being of both the stakeholders and the firm. This construct is based on a review of the multidisciplinary caring literature from which a definition of individual caring was developed through content analysis, and then subjected to conceptual inferences to the organizational level of analysis. Strategic caring focuses on a broad set of firm stakeholders, and this stakeholder orientation suggests that a firm can take actions to improve the well-being of these many stakeholder groups and perform as well as, or better, that firms that do not. It is proposed that in the short-term, strategic caring will have an inverse-U relationship with firm performance.

For this study, the upper echelons theory was used as a framework to suggest that national institutions would impact top managers' decisions which would impact firm performance for a wide array of firms operating throughout the global economy. Archival data were collected at the national and firm level as a preliminary investigation of strategic caring. Specifically, a global sample of over 9,000 firms from over 40 countries and 10 GICS industry sectors is used to develop and test a hierarchical linear model that investigates the relationships among national level institutions, organizational discretion, and strategic caring. Finally, the relationship between strategic caring and financial performance is tested using ordinary least-squares regression models.

In this study, there was relatively weak support for the relationship between national institutions and strategic caring. However, there was a positive relationship between national freedom of the press and strategic caring. In addition, there was also partial support that there is a nonlinear relationship between strategic caring and firm performance. Surprisingly, a negative relationship was found between national humane orientation norms and strategic caring. There were also linear relationships found between strategic caring and market performance (positive) and firm profitability (negative).

This study contributes to the upper echelons theory by providing evidence that the national institutional context is weakly related to firm outcomes suggesting that the industry context and/or individual characteristics of the members of the top management team may be more influential than national institutions. Nonetheless, I did find that some institutions are systematically related to strategic caring. Furthermore, strategic caring was found to be systematically related to short-term financial performance outcomes. When managers implement organization-wide initiatives based on strategic caring, they must carefully consider the expected costs and benefits of the initiatives as they attempt to balance short-term and long-term financial impacts.

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DOI

10.25777/a79c-3k72

ISBN

9781321346978

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