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Decisional comprehensiveness and firm performance: towards a more complete understanding

2008; Wiley; Volume: 21; Issue: 5 Linguagem: Inglês

10.1002/bdm.607

1099-0771

C. Chet Miller,

Business Strategy and Innovation

Abstract Organizational prosperity and even survival can be threatened unless strategic decisions are made through an effective process. But what does an effective decision‐making process look like? Analysts and executives have struggled over the years to answer this question. Recently, however, empirical research has produced a consistent answer for one of the most fundamental aspects of strategic decision‐making: comprehensiveness. This recent work suggests that higher levels of comprehensiveness are positive for firms facing turbulent conditions but are irrelevant for firms facing stable conditions. While this consistency would seem to be positive, it presents a puzzle: Why are comprehensiveness and performance unrelated in stable environments? In such environments, problems generally believed to plague comprehensive decision‐making are less severe. The theory building and empirical results of the present research suggest a solution to the puzzle: comprehensiveness and performance exhibit a relationship more complex than previous studies have been designed to detect. Copyright © 2008 John Wiley & Sons, Ltd.