Date of Award

2006

Document Type

Thesis

Publisher

Edith Cowan University

Degree Name

Bachelor of Business Honours

School

School of Business

Faculty

Faculty of Business and Law

First Supervisor

Dr Scott Gardner

Abstract

This exploratory study examined the nature of the recently conceptualised notion of executive hubris; and in particular the effect it may have on how chief executive officers in small to medium sized enterprises make their strategic management decisions. It was designed to explore executive hubris and strategic decision making in a limited sample of executives. On this basis the results are limited to this study and are not generalisable. A core aim of the study however; was to test qualitatively and quantitatively in a fundamental, exploratory way; Hambrick and Hiller's (2005) propositions that executive hubris has an effect on how these decisions are made; employing basic descriptive statistical data, specifically with a view to attempt to provide assistance and direction to future researchers. The limited body of current research on the possible effects of executive hubris on the decision-making process was explored, with reference to the Human Resource Management; Management; Psychology; Small Business; and Strategic Management literatures. References to the Psychology 1iterat1U'e however; were limited to specific references to Hambrick and Hiller's (2005) framework for exploring the possible effect of executive hubris on the decision-making and the allied Core Self Evaluation construct. The blendii1g of the literature facilitated an understanding of the connection between the conceptual basis of executive hubris and its possible effect on the business strategies and decision making process of chief executive officers in Small and Medium Sized Enterprises. A recent foundation study conducted between April and June 2005, comprising an extensive review of the relevant literature and six preliminary interviews, was employed to inform the design of the core study and fine tune the core self evaluation instrument based on feedback from the preliminary sample of respondents. The core study conducted between July and October 2005 comprises a dual-phase qualitative exploration; and a preliminary descriptive statistical exploration of executive hubris. A tendency toward elevated self evaluation of four key personality traits; executive hubris was reported by seven CEOs in SMEs in a regional city of 1.1M people within South Western Australia between July and October 2005. Results of the study suggest that executive hubris has a negative effect on a small to medium enterprise's chief executive officer's decision-making process and decision quality. To mitigate its negative effects, chief executive officers should aim to raise self-awareness of executive hubris in their personality, employing the CSE instrument as a useful and relevant mitigation tool.

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