![]() Moreover, hubristic managers may view the possibility of formulating and implementing a diversification strategy more favorable than rational managers ( Picone, 2021). Driven by arrogance, the hubristic manager overlooks alternative scenarios, ignoring the decision tree and the consequences of each scenario ( Shipman and Mumford, 2011) however, rapid, centralized decision-making is positively correlated with sales growth and profitability, especially in contexts characterized by temporary ( Dagnino et al., 2021) or high-speed competitive advantages. For example, hubris generates a persevering approach to formulating and implementing business strategy, as managers remain focused on their goals and tenaciously committed to the actions to be taken despite technological and competitive challenges that may cast doubt on the effectiveness of the strategy ( Picone et al., 2021a). Studies on hubris have mainly explored its negative effects on organizational performance ( Sadler-Smith and Cojuharenco, 2021) nevertheless, recently, some studies have defined a good side of hubris in contrast to the dark side ( Haynes et al., 2015 Picone et al., 2014, 2021a Zeitoun et al., 2019). We focus on hubris because it represents a widespread psychological trait among managers ( Hiller and Hambrick, 2005) and is often considered a necessity for holding top positions ( Goel and Thakor, 2008). (2021a, 2021b), we focus on managerial hubris – that is, a personality trait considered among the most influential in management decision-making ( Abatecola and Cristofaro, 2019, 2020 Hayward and Hambrick, 1997 Roll, 1986 Zeitoun et al., 2019) the focus on hubris helps us understand why firms formulate and implement a given strategy that is ambitious and outside the norm compared to what is postulated by strategy studies. On this thread, our study follows a reductionist approach in behavioral strategy studies, which considers the psychological attributes of managers/leaders to understand the logics pursued within strategic decision-making processes ( Powell et al., 2011). top management behavior, entry decisions, competitive interaction, firm heterogeneity) that is microfoundational ( Felin et al., 2015) namely, it uses a psychology-based understanding of individuals’ actions and interactions to explain strategy phenomena.Īccording to behavioral strategy, the diversity of the manager’s personal attributes is an antecedent variable that should be considered when trying to predict organizational performance ( Picone et al., 2021a). By enriching the management background with insights from cognitive and social psychology studies, behavioral strategy is an approach to fundamental issues in strategic management (e.g. It is an approach to the study of traditional strategic management problems that aims at drawing on evidence rather than making assumptions about human behavior ( Gavetti, 2012 Levinthal, 2011 Lovallo and Sibony, 2010).īehavioral strategy is an approach that considers the psychological attributes of the manager to understand the logic pursued within decision-making and strategic processes ( Powell et al., 2011). Behavioral strategy refers to the application of insights from psychology and behavioral economics to strategic management research and practice ( Powell et al., 2011). How can a manager lead an organization or a team in a particularly turbulent time? How can management cope with chaos and uncertainty? Some scholars have therefore begun to talk about behavioral strategy. ![]() How do you steer a ship through a storm? For centuries, scholars have been concerned with answering questions like this, particularly focusing in recent decades on the business context. The full terms of this licence maybe seen at Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. ![]() This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Copyright © 2022, Francesca Loia, Davide de Gennaro and Paola Adinolfi.
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