Top Management Team Basic Values, Behavioral Integration, and Firm Strategic Flexibility

An essential foundation of Upper Echelons Theory is the idea that the personal values of executives play an important role in firm decision-making. As such, the connection between CEO values and organizational outcomes has received ample scholarly attention. However, CEOs represent only one member of a firm’s top management team (TMT), which is the collective entity recognized as responsible for guiding strategic decisions and actions. To expand our understanding of the role of the entire TMT’s values, we leverage Basic Values Theory to examine how TMT values influence the intra-team dynamics involved in firm decision-making. Specifically, we explore the process through which TMT prioritization of self-transcendence versus self-enhancement influences TMT behavioral integration and subsequent firm strategic flexibility. Given the acknowledged importance of situational factors in this process, we also consider how TMT interdependence and firm rigidity moderate the relationship between behavioral integration and firm strategic flexibility.