The Palgrave Encyclopedia of Strategic Management

Living Edition
| Editors: Mie Augier, David J. Teece

Upper Echelons Theory

  • Donald C. HambrickEmail author
Living reference work entry


Explicitly set forth by Hambrick, Donald C. (born 1946) and Phyllis A. Mason (1984), upper echelons theory is the idea that top executives view their situations through their own highly personalized lenses. These individualized construals of strategic situations arise because of differences among executives in their experiences, values, personalities and other human factors. Using the upper echelons perspective, researchers have examined the effects of top management team (TMT) composition and processes on organizational outcomes, as well as the influences of chief executive officer (CEO) characteristics on company strategy and performance. Dozens of studies have confirmed the basic logic of upper echelons theory (comprehensively reviewed in Finkelstein et al. Strategic leadership: theory and research on executives, top management teams, and boards. Oxford University Press, New York, 2009), pointing to the conclusion that if we want to understand strategy we must understand strategists.

This is a preview of subscription content, log in to check access.


  1. Barney, J.B. 1991. Firm resources and sustained competitive advantage. Journal of Management 17: 99–120.CrossRefGoogle Scholar
  2. Carpenter, M.A., M.A. Geletkanycz, and W.G. Sanders. 2004. The upper echelons revisited: Antecedents, elements, and consequences of top management team composition. Journal of Management 60: 749–778.Google Scholar
  3. Chatterjee, A., and D.C. Hambrick. 2007. It’s all about me: Narcissistic CEOs and their effects on company strategy and performance. Administrative Science Quarterly 52: 351–386.Google Scholar
  4. Crossland, C., and D.C. Hambrick. in press. Differences in managerial discretion across countries: How national-level institutions affect the degree to which CEOs matter. Strategic Management Journal.Google Scholar
  5. Cyert, R.M., and J.G. March. 1963. A behavioral theory of the firm. Englewood Cliffs: Prentice Hall.Google Scholar
  6. DiMaggio, P.J., and W.W. Powell. 1983. The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review 48: 147–160.CrossRefGoogle Scholar
  7. Finkelstein, S., and D.C. Hambrick. 1990. Top management team tenure and organizational outcomes: The moderating role of managerial discretion. Administrative Science Quarterly 35: 484–503.CrossRefGoogle Scholar
  8. Finkelstein, S., D.C. Hambrick, and A.A. Cannella. 2009. Strategic leadership: Theory and research on executives, top management teams, and boards. New York: Oxford University Press.Google Scholar
  9. Hambrick, D.C., and S. Finkelstein. 1987. Managerial discretion: A bridge between polar views of organizations. In Research in organizational behavior, ed. L.L. Cummings and B.M. Staw. Greenwich: JAI Press.Google Scholar
  10. Hambrick, D.C., and G.D.S. Fukutomi. 1991. The seasons of a CEO’s tenure. Academy of Management Review 16: 719–742.Google Scholar
  11. Hambrick, D.C., and P. Mason. 1984. Upper echelons: The organization as a reflection of its top managers. Academy of Management Review 9: 193–206.Google Scholar
  12. Hambrick, D.C., T.S. Cho, and M.-J. Chen. 1996. The influence of top management team heterogeneity on firms’ competitive moves. Administrative Science Quarterly 41: 659–684.CrossRefGoogle Scholar
  13. Hannan, M.T., and J.H. Freeman. 1977. The population ecology of organizations. American Journal of Sociology 82: 929–964.CrossRefGoogle Scholar
  14. Henderson, A.D., D. Miller, and D.C. Hambrick. 2006. How quickly do CEOs become obsolete? Industry dynamism, CEO tenure, and company performance. Strategic Management Journal 27: 447–460.CrossRefGoogle Scholar
  15. Jensen, M., and E.J. Zajac. 2004. Corporate elites and corporate strategy: How demographic preferences and structural position shape the scope of the firm. Strategic Management Journal 25: 507–524.CrossRefGoogle Scholar
  16. Li, J.T., and D.C. Hambrick. 2005. Factional groups: A new vantage on demographic faultlines, conflict, and disintegration in work teams. Academy of Management Journal 48: 794–813.CrossRefGoogle Scholar
  17. Lieberson, S., and J.F. O’Connor. 1972. Leadership and organizational performance: A study of large corporations. American Sociological Review 37: 117–130.CrossRefGoogle Scholar
  18. March, J.C., and H.A. Simon. 1958. Organizations. New York: Wiley.Google Scholar
  19. Miller, D., and C. Droge. 1986. Psychological and traditional determinants of structure. Administrative Science Quarterly 31: 539–560.CrossRefGoogle Scholar
  20. Mischel, W. 1977. The interaction of person and situation. In Personality at the crossroads: Current issues in interactional psychology, ed. D. Magnusson and N.S. Endler. Hillsdale: Lawrence Erlbaum.Google Scholar
  21. Palmer, D.A., and B.M. Barber. 2001. Challengers, elites, and owning families: A social class theory of corporate acquisitions in the 1960s. Administrative Science Quarterly 46: 87–120.CrossRefGoogle Scholar
  22. Peteraf, M.A. 1993. The cornerstones of competitive advantage: A resource-based view. Strategic Management Journal 14: 179–191.CrossRefGoogle Scholar
  23. Peterson, R.S., D. Brent Smith, P.V. Martorana, and P.D. Owens. 2003. The impact of chief executive officer personality on top management team dynamics: One mechanism by which leadership affects organizational performance. Journal of Applied Psychology 88: 795–808.CrossRefGoogle Scholar
  24. Porter, M.E. 1980. Competitive strategy: Techniques for analyzing industry and competitors. New York: Harper & Row.Google Scholar
  25. Simon, H.A. 1945. Administrative behavior. New York: Free Press.Google Scholar
  26. Simsek, Z., J.F. Veiga, M. Lubatkin, and R.N. Dino. 2005. Modeling the multilevel determinants of top management team behavioral integration. Academy of Management Journal 48: 69–84.CrossRefGoogle Scholar

Copyright information

© The Author(s) 2016

Authors and Affiliations

  1. 1.Department of Management and OrganizationPenn State Smeal College of BusinessUniversity ParkUSA