How CEOs and TMTs Build Adaptive Capacity in Small Entrepreneurial Firms

Yair Friedman*, Abraham Carmeli, Asher Tishler

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Research suggests that a CEO may have more influence in the context of small entrepreneurial firms, but it is still unclear how a company's chief executive facilitates strategic decision-making. Little is known about the ways in which these individuals build strategic capabilities, such as the capacity to adapt to changing environments. This study addresses these issues and develops a model indicating that transformational leadership facilitates behavioural integration and comprehensiveness in the decision process among members of the top management team (TMT), which in turn enhances organizational capacity to adapt to environmental changes. Survey results shed light on the complex way in which CEOs facilitate processes within the TMT and enhance small entrepreneurial firms’ capacity to adapt, thereby increasing their viability. This study contributes to the literatures on Upper Echelon Theory, strategic decision-making, and dynamic capabilities by shedding light on the ways in which transformational leaders influence behavioural and decision-making processes.

Original languageEnglish
Pages (from-to)996-1018
Number of pages23
JournalJournal of Management Studies
Issue number6
StatePublished - 1 Sep 2016


  • adaptability
  • behavioural integration
  • comprehensiveness
  • small entrepreneurial firms
  • top management teams
  • transformational leadership


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