It Depends: Environmental Context and the Effects of Faultlines on Top Management Team Performance

Danielle Cooper (), Pankaj C. Patel () and Sherry M. B. Thatcher ()
Additional contact information
Danielle Cooper: Department of Management, College of Business, University of North Texas, Denton, Texas 76201
Pankaj C. Patel: Department of Marketing and Management, Miller College of Business, Ball State University, Muncie, Indiana 47306
Sherry M. B. Thatcher: Management Department, Darla Moore School of Business, University of South Carolina, Columbia, South Carolina 29208

Organization Science, 2014, vol. 25, issue 2, 633-652

Abstract: Informational faultlines, the alignment of team member task-related attributes to form subgroups, are important in explaining team performance. Although informational faultlines may promote specialization and division of labor, they may also increase communication and coordination costs. Integrating work on the categorization-elaboration model, social identity theory, and contingency theory, we posit that facets of a team’s external environment moderate the effects of informational faultlines on performance. Using a sample of 380 top management teams, we examine moderation effects of environmental dynamism, complexity, and munificence. We find that informational faultline strength positively affects firm performance under low environmental dynamism, high complexity, and high munificence, but it negatively affects firm performance under high environmental dynamism, low complexity, and low munificence. We discuss the implications of our findings for theory and practice.

Keywords: faultlines; top management teams; organizational environment; subgroups; social identity theory; categorization-elaboration model (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
http://dx.doi.org/10.1287/orsc.2013.0855 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ororsc:v:25:y:2014:i:2:p:633-652

Access Statistics for this article

More articles in Organization Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().