How does inconsistent negative performance feedback affect the R&amp;D investments of firms? A study of publicly listed firms

Lv, David Diwei; Chen, Weihong; Zhu, Hui; Lan, Hailin

doi:10.1016/j.jbusres.2019.04.045

Cited by 72 publications

(53 citation statements)

References 75 publications

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“…Our results form a basis for deeper investigation into the micro-psychological foundations of managerial behavior where distinct psychological processes can constitute the aggregate perceptions of performance that we measured (Plambeck and Weber, 2009). Third, our study introduces a new form of (in)consistency of performance feedback (Audia and Brion, 2007;Blagoeva et al, 2019;Joseph and Gaba, 2015;Lucas et al, 2018;Lv et al, 2019). Building on this stream of research, we examined the (in)consistency between perceptual and objective performance feedback.…”

Section: Contributions To Researchmentioning

confidence: 89%

How do managerial perceptions of performance feedback affect innovation?

Saraf

Dasgupta

Blettner

2021

Strategic Organization

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Although managers’ perceptions are core to the Performance Feedback Theory, few empirical studies measure managerial perceptions of their organization’s performance and theorize on the (in)consistency between perceptual and objective performance feedback. Based on longitudinal survey data of Canadian organizations, we examine how this (in)consistency affects the propensity for innovation in organizations. Our analysis broadly validates that inconsistency between the two types of feedback it dampens innovation. Second, positive perceptions strengthen the relationship between positive objective performance feedback and innovation, leading to increased innovation, whereas negative perceptions strengthen the relationship between negative performance feedback and innovation, echoing the problemistic search hypothesis. We also find that perceptions moderate the effect of objective performance feedback differently in the social and historical dimensions as well above and below the aspiration thresholds.

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Section: Contributions To Researchmentioning

confidence: 89%

How do managerial perceptions of performance feedback affect innovation?

Saraf

Dasgupta

Blettner

2021

Strategic Organization

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“…That is, enterprise managers will compare the gap to judge the success or failure of the enterprise operation, which affects organizational change, technological innovation, and other behavioral decisions. There is evidence that there may be a significant U-shaped relationship between performance expectation gap and enterprise innovation input [23,24].…”

Section: Market Expectation Gap and Enterprise Innovation Inputmentioning

confidence: 99%

Can the Gap and Rating of Market Expectation Promote Innovation Input of China Manufacturers?

Jiang

2020

Sustainability

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Under the strategic background of Made-in-China to Mind-in-China, how the capital market expectation affects enterprise innovation input has reached no coincident conclusion. This paper uses Chinese A-share manufacturing listed companies from 2010 to 2017 to investigate the internal mechanism among the gap and rating of market expectation and enterprise innovation input, and further explores the moderating effects of institutional coverage and government subsidies. The results show that: firstly, innovation input will first decrease and then increase with the market expectation gap increase. However, innovation input will first increase and then decrease with the market expectation rating increase. Secondly, when the institutional coverage and government subsidies increase, innovation input will remarkably transform from the first decrease and then increase into the first increase, then decrease with the market expectation gap increase. Finally, when institutional coverage is high and government subsidies are low, innovation input will remarkably transform from the first increase and then decrease into the first decrease, and then increase with the market expectation rating increases. These research findings can provide some academic support and policy references for managers to deal with effectively external performance pressures, institutional coverage, and optimize government subsidies to promote manufacturers’ innovation-driven upgrading.

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“…As the twin cores of corporate governance structure, the size of the board (BS) and the independence of a board (BI) affect the heterogeneity of the top management team [33,51], thereby affecting R&D investment decisions [52]. BS is defined as the total number of directors on board [33], and BI is defined as a percentage of the independent directors on the board [4,33,51]. Whether BS and BI can incentivize managers to promote R&D remains a subject of debate [53].…”

Section: Corporate Governance Structure Impacting Randd Investmentmentioning

confidence: 99%

“…According to Jensen and Meckling (1976) [60], an important prerequisite of the sound development of firms is that their equity is moderately concentrated, and the major shareholder has neither dictatorial power over excessively concentrated equity nor passive decision for excessively scattered equity. An excessively large shareholding ratio of the first major shareholder has a negative effect on technological innovation and corporate performance [33,51]. The shareholding ratio of the first major shareholder is used to measure the degree of equity concentration [21,36].…”

Section: Corporate Governance Structure Impacting Randd Investmentmentioning

confidence: 99%

Corporate Governance Structure, Financial Capability, and the R&D Intensity in Chinese Sports Sector: Evidence from Listed Sports Companies

2019

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Innovations are the foundation of an enterprise's sustainable development, which is particularly important for sports firms in an evolving Chinese sport industrial environment. Analyzing publicly-listed sports firms on The New Third Board (NTB) in China, this study examined the influence of corporate financial capability and corporate governance structure on firms' R&D intensity through a series of multiple regression models. Findings revealed that corporate financial capability is an important determinant of R&D intensity, and corporate governance structure has a small but meaningful effect on R&D intensity. Specifically, for Chinese sports firms, several financial capability indicators, such as return on equity, accounts receivable turnover, assets turnover, and profit growth rate, have positive relationships with R&D intensity; however, other financial capability indicators, such as leverage and cash flow, have negative relationships with R&D intensity. Limited evidence was found to support the notion that corporate governance significantly influences R&D intensity, although sports firms with good governance mechanisms are more likely to increase the positive effects of financial capabilities on R&D intensity while decreasing the negative effects. Discussions were centered on planning and executing R&D activities in sports companies.

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How does inconsistent negative performance feedback affect the R&D investments of firms? A study of publicly listed firms

Cited by 72 publications

References 75 publications

How do managerial perceptions of performance feedback affect innovation?

How do managerial perceptions of performance feedback affect innovation?

Can the Gap and Rating of Market Expectation Promote Innovation Input of China Manufacturers?

Corporate Governance Structure, Financial Capability, and the R&D Intensity in Chinese Sports Sector: Evidence from Listed Sports Companies

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