Graduation Year

2022

Document Type

Dissertation

Degree

Ph.D.

Degree Name

Doctor of Philosophy (Ph.D.)

Degree Granting Department

Marketing

Major Professor

Douglas E. Hughes, Ph.D.

Committee Member

Erwin Danneels, Ph.D.

Committee Member

Nathan Hartmann, Ph.D.

Committee Member

Avinash Malshe, Ph.D.

Committee Member

JeeWon (Brianna) Paulich, Ph.D.

Keywords

sales organization, sales-finance interface, sales-marketing interface, salesforce power

Abstract

This dissertation investigates the role of sales executives in top management teams (TMTs) in driving firm performance. Chapter I offers an overview of the dissertation. Chapter II (“The double-edged sword of sales force power in top management teams”) investigates the impact of salesforce power (i.e., the sales department’s influence in TMT) on organizational performance. The study examines two internal factors (i.e., marketing department power and sales growth) and two environmental factors (i.e., competitive dynamics and market size) that may either weaken or strengthen the influence of salesforce power on organizational performance. Using a panel data set of 10,751 firm-years observations from multiple data sources across 658 publicly listed companies in the United States between 2001 and 2019, the results from seemingly unrelated regressions show that the role of salesforce power is a double-edged sword. First, it is positively associated with the firm’s ROA, but then also negatively associated with the firm’s Tobins’ q. The relationship between sales force power and a firm’s ROA is weaker for firms with higher sales growth. The relationship between sales force power and that firm’s ROA and Tobins’ q is stronger for firms that are operating in industries with greater competitive dynamism and weaker for firms in the larger markets. Sales and marketing functions play critical roles in generating market knowledge and revenue. A key factor that prevents sales-marketing’s collective learning activities is power asymmetry because it directs the actors’ attentions to self-protection or self-enhancement rather than engaging in risky market learning activities and knowledge sharing. Chapter III (“We learn more when we work together! How successful firms manage the department power between sales and marketing”) proposes that power asymmetry toward sales or marketing is associated with greater firm performance when that firm has a power balancer. The moderating effects of power balancers (e.g., organizational time horizon, learning orientation, customer power, and institutional investor power) are examined using a sample of 8,599 firm-year observations of 622 firms over 19 years (2001 to 2019). All hypotheses are supported except for the moderating role of organizational time horizon. The study thus offers several theoretical implications and actionable guidelines for senior managers. In addition to these two studies, Chapter IV provides a discussion that concludes the dissertation and discusses its limitations and opportunities for further research.

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