• Back to the future: Analyzing the consequences of future orientation on strategic flexibility.

      Fehre, Kerstin; Widmann, Bettina (2016)
      Referring to the attention-based view of the firm, our study addresses the relationship between executives' future orientation and strategic flexibility. We examine the impact of the future orientation of top-level managers on two distinct facets of strategic flexibility, specifically strategic flexibility as an ex ante potential and an ex post observable status. Based on panel data for large German companies from 2003 to 2011, we find empirical evidence that a higher level of future orientation leads to higher levels of both types of strategic flexibility. Especially, the influence on the ex post observable type in terms of realized strategic flexibility is highly significant. Thus, we provide additional empirical evidence for three under-researched domains: the consequences of future orientation, the antecedents of strategic flexibility, and the precise distinction of strategic flexibility.
    • Forward-looking reporting caught between company performance and the economic situation

      Fehre, Kerstin; Hoefer, Julia (2015)
      This research explores both the impact of company performance and economic situation on the degree of future orientation in company reporting and the textual emphasis within forward-looking statements (company-external vs. company-internal prospective information). The examination is built on annual reports of all German HDAX companies during the period from 2003 to 2012. The results of the regression analysis reveal that high profitability and an improvement in the economy lead to an increased future orientation in company reporting. Hence, companies in an advantageous position send signals of long-lasting positive developments to capital markets. Results concerning the textual emphasis of the companies' forward-looking reporting demonstrate that the degree of forward-looking external statements increases due to company's profitability and to a downturn in the economy. In contrast, the degree of forward-looking internal statements increases due to an improvement in the economic situation. Furthermore, the economic situation positively directs the relation between performance and prospective internal reporting. Thus, forward-looking reporting focuses on the company's environment more strongly only if the economic situation is in decline (problem-oriented attention control) or if the current advantageous position of the company is preserved by the consideration of potential opportunities and risks arising from the company's environment.
    • Hampering the change: Consequences of the CEO's strategic commitment under managerial discretion

      Behr, Henning; Fehre, Kerstin (2015)
      CEOs play a central role for the strategic outcomes of their firms. Although research has provided many insights about the factors determining CEOs' openness toward strategic changes, the consequences of these attitudes have not been sufficiently investigated. To assess the consequences of willingness for change at the CEO level, we used the concepts of Commitment to the Status Quo (CSQ) (i.e., the belief in the enduring correctness of current strategies) and evaluate its effects for strategic persistence under the moderating role of managerial discretion. Our sample is based on 178 publicly traded firms in Germany over 10 years. Our results show that CSQ at the CEO level is crucial for strategic development only in situations of sufficiently high managerial discretion. Namely, a significant impact of the CEO's mental attitude is observable only in scenarios with high product differentiability, high market growth, bad past performance, or small companies.
    • The diffusion of MBA programs in Germany: An empirical analysis through a neo-institutional lens

      Fehre, Kerstin; Schulz, Ann-Christine (2018)
      In this study we investigate determinants of the adoption of US-type MBA programs among German universities. Drawing on neo-institutional theory we argue that the diffusion of MBA programs in Germany is closely connected to the relevance debate of management education and propose that growing concerns over the legitimacy of German business schools have spurred the adoption of these programs. In an empirical analysis of 83 universities in Germany, we show that the adoption of MBA programs is positively associated with the size of the institution, its status, and the relative significance of the business school within the university. These findings expand our understanding of the underlying factors that influence the adoption and spread of this important business education program among academic institutions and elucidate why MBA programs spread among Germany universities despite their different educational tradition. This paper received the best paper price in graduate management education.
    • The effectiveness of combinations of corporate social responsibility activity (CSRA) and communication as strategies for regaining legitimacy

      Fehre, Kerstin; Weber, Florian (2018)
      A number of scandals have challenged the social legitimacy of companies. Since corporate social responsibility (CSR) is about the pursuit of public and stakeholder objectives beyond the bottom line, a company’s level of commitment to such altruistic aims is reflected in its CSR investments. It follows, then, that companies can use CSR as a vehicle for improving their legitimacy in the eyes of stakeholders and of society in general. Little research exists on the effectiveness of CSR strategies for improving legitimacy. The present study addresses this lacuna by examining how CSR communication and activity impact legitimacy. My results indicate that neither CSR communication nor CSR activity have a stand-alone effect on legitimacy. Nonetheless, CSR is important with respect to legitimacy. CSR strategies consisting of different combinations of talk and action are ranked in order of their legitimacy impact, and then this hypothetical ranking is empirically tested against a sample of German companies. Some hypotheses are confirmed while others are rejected. CSR strategies combining low levels of communication with high levels of CSR action emerge as the most effective for (re)gaining legitimacy, while those combining high levels of communication with low levels of action emerge as the worst in this regard.
    • The impact of commitment to the status quo on managerial discretion

      Behr, Henning; Fehre, Kerstin (Academy of Management, 2018)
      Managerial discretion has been frequently used in management literature to explain why top executives have more or less influence on firms’ success. However, very limited evidence exists on how managerial characteristics shape individual levels of discretion. We empirically analyze how the CEO’s commitment to the status quo (CSQ) affects the personal level of discretion. Our results show that high CSQ reduces the level of managerial discretion. Thus, our study contributes to both the literature on managerial discretion by uncovering rare evidence on its dependence on managerial characteristics and the literature on CSQ by identifying a new dimension of CSQ consequences.
    • Time for future is now - CEO temporal focus and firms' strategic responses to water challenges

      Fehre, Kerstin; Widmann, Bettina (Academy of Management, 2018)
      This study examines how CEO temporal focus – the extent to which CEOs devotes their attention to the past, present, and future – shapes strategic responses to global grand challenges such as natural resource scarcity. Analyzing water scarcity as one of the global risks of highest concern, we propose that CEO attention to the present and future are critical in addressing the inherent time conflict of managing natural resource scarcity. Using an 11- year panel data set of large- and medium-sized German firms, we find support for our three hypotheses: CEOs who are high in present focus tend to integrate water scarcity in their firm’s strategy only as a pure threat. However, to tackle the grand challenge of water scarcity – in terms of recognizing and implementing valuable water-related business opportunities – they need to be future-oriented. Additionally, we find evidence that future-oriented CEOs shy away from identifying water scarcity as a pure threat without initiating specific mitigating and value-creating strategic actions. These findings contribute to the literature on strategic implications of CEOs’ subjective view of time.
    • Time for future is now: CEO temporal focus and firms' interpretation of grand challenges

      Fehre, Kerstin; Oehmichen, Jana; Widmann, Bettina (2018)
      This study examines how CEO temporal focus – the extent to which CEOs devote their attention to the past, present, and future – shapes firms’ interpretation of the grand challenge water scarcity. We propose that CEO temporal focus influences interpretations of water scarcity either as threat or as opportunity. Using a panel data set of German firms, we find support for our three hypotheses: CEOs who are high in present focus tend to interpret water scarcity as threat. However, to tackle water scarcity ,in terms of interpreting water scarcity as opportunity, they need to be future-oriented. Further, future-oriented CEOs shy away from interpreting water scarcity as a pure threat. These findings contribute to the literature on strategic implications of CEOs’ subjective view of time.
    • Who drives the change? Revisiting the CEO's strategic commitment

      Behr, Henning; Fehre, Kerstin (2014)
      The Upper Echelons Theory has been proved to play an important role in strategic management research. Former studies have shown significant effects of CEO-specific demographic data on a firm's strategic outcome. For a further validation of those results, we reevaluate the existing results based on the concept of the commitment to the status quo (CSQ) on a German sample. Furthermore, we extend past research and investigate the impact of selected characteristics of CEO turnovers on CEOs' strategic commitment. We find evidence that supports existing findings about antecedents of CSQ, i.e. CEO tenure and past performance are good determinants for CEO's CSQ. Contrariwise, the influence of other factors like firm size or slack resources has to be reconsidered in international context. Our results further suggest that especially newly appointed CEOs after a forced turnover have the lowest commitment to current strategies and therefore the largest potential to overcome organizational inertia.