Managerial competence as a determinant of organizational performance

Cockerill, Tony (1990) Managerial competence as a determinant of organizational performance. Doctoral thesis, University of London: London Business School.

Abstract

Despite the important contribution made by managers to modern economies, little research has been undertaken into the behaviour of managers that is related to organizational performance. Upper level managers (i.e., executives) have been studied least. Consequently, this thesis has created and tested hypotheses on the relationship between managerial behaviour (i.e., competence) and organizational effectiveness at executive level. In addition, the thesis has also created and tested hypotheses on the relationship between managerial competence and individual variables. Directed by Campbell et al's (1970) model of managerial effectiveness, a review was made of the literature on organizational performance, managerial behaviour, environmental and individual variables. Based on this review, a revised model of managerial effectiveness was created from which a model of executive effectiveness in dynamic environments was derived. Eighteen hypotheses were drawn from the latter model for testing in this study. Behavioural and Individual data were collected by means of observation, job analysis interview, biographical Interview, Kirton's Adaption-Innovation Inventory and Ghiselli's Self-Description Inventory from a sample of 30 executives working for an international financial services organization. A short-term and long-term measure of the performance of the units managed by the 30 executives was gathered. A statistically significant, positive relationship was found between eleven "High Performance Managerial Competencies" (HPMC) and the long-term competence/performance of organizational units. Managerial competence was found to be related to three individual factors: Adaption-Innovation, Decision-making Style and Supervisory Ability. Furthermore, results appertaining to environmental variables as well as the development of the HPMC are reported and discussed. A validated model of managerial effectiveness is presented. Finally, the managerial and research implications of the research are discussed.