||This study employed upper echelon perspective, social capital perspective, and strategic leadership and leadership style perspectives to examine the effects of CEO transformational leadership and CEO dominance on the three internal social capital dimensions, i.e. structural, relationship, and cognitive capital, of top management team (TMT). It also investigated the effects of the TMT internal social capitals on firm performance, and the mediating roles of the TMT social capital in the CEO leadership-performance relationship. |
The unit of analysis is at the firm level. Structural equation modeling conducted with LISREL was employed to test the fitness of overall hypothesized model and the significance of hypothesized relationships among studied variables. Empirical results showed that the theoretical models fit the data very well, and most of hypotheses are supported; the significance of top executives and interactions on firm outcomes were significantly ascertained. Specifically, CEO dominance may produce negative effects on TMT network density and trust while CEO transformational leadership may promote TMT network density, trust, and shared vision. On the other hand, TMT network density may foster firm performance. Finally, results showed that TMT network density mediated the relationships of CEO leadership and firm performance.
This study has significant implications for upper echelons perspective, the integration of strategic leadership and leadership style research, and the applications of social capital perspective. Research findings also exhibit valuable insights for the strategic implications of TMT dynamics in business practices. Limitations and future directions were discussed for further extensions.