Top Management Team Characteristics and Performance of Ugandan State Agencies

Abstract

Conceptually, there is no consensus on the definition and measurement of TMT characteristics and performance of Ugandan state agencies (USA) and how they are related to each other, strategy implementation, and the external environment. Contextually, there is a lack of empirical studies on TMT characteristics, strategy implementation, and performance of Ugandan state agencies in the specific context of Uganda, which has its own political, economic, social, technological, ecological, and legal factors that may affect these variables. Thus, the main objective of this study was to examine the effect of strategy implementation and the external environment on the connection between TMT characteristics and the performance of state agencies in Uganda. Four specific objectives were formulated, and corresponding hypotheses were tested. The upper echelons, environmental dependence, and dynamic capabilities theories guided this study. The study was carried out through a cross-sectional, descriptive research design, and data was gathered using a structured questionnaire from 152 Uganda state agencies. The findings revealed a statistically significant influence of TMT characteristics on the performance of Ugandan state agencies. p<0.05). Strategy implementation partially mediates the relationship between TMT characteristics and performance (Indirect effect of strategy implementation, b=.385, p<0.05 and the direct effect, b = .267, p<0.05). The external environment moderates the relationship between TMT characteristics and performance (Interaction term b=.857, t=3.773, p<0.05, ΔR2=.041, F=14.233). The results further indicate that the total independent effect (R2 = .632, F = 84.621, p<0.05) of TMT characteristics, external environment and strategy implementation on the performance is significantly different from their individual effects. The study concludes that strategy implementation and the external environment affect the relationship between TMT characteristics and the performance of Ugandan state agencies. The findings showed that TMT characteristics can influence the performance of the USA and this influence is subject to strategy implementation and external environment. The study also concludes that when the total effects of the study variables are greater than their individual effect. Based on the study findings, the study recommends that TMT characteristics (behavioural, demographic and psychological) should be a major consideration in the recruitment process of TMTs. Future studies should use longitudinal designs, qualitative methods, and international comparisons to address gaps the limitations of this study. Theoretically, this study contributes to the upper echelons theory by showing that TMT characteristics have a direct and positive impact on organisational performance and that this effect is mediated by strategy implementation and moderated by the external environment. Methodologically, this study demonstrates the applicability and suitability of a cross-sectional design and a positivistic framework for examining the relationship among the variables. This study implies that the managers of state agencies should pay attention to the characteristics of their TMTs and ensure that they have a balanced mix of demographic, psychological, and behavioural traits that can enhance their decision-making and performance.