How does CEO narcissism affect strategic consensus? A serial mediation model linking CEO narcissism, middle manager engagement, market culture and strategic consensus

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Dornez, Chantale
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Research suggests that CEO narcissism has a significant impact on various firm outcomes such as innovation, growth, and financial performance. However, some of the findings have been mixed. These inconclusive findings indicate a need to better understand how CEO narcissism affects the key antecedents to firm performance, such as strategic consensus, and the intervening processes through which this effect occurs. This study addresses this issue by developing a serial mediation model of the effect of two underlying types of narcissism—rivalry and admiration—on strategic consensus. Specifically, I propose that CEO narcissistic rivalry and CEO narcissistic admiration have opposite indirect effects on strategic consensus through two mediating variables: (1) middle manager engagement and (2) market culture. Using survey data collected from 96 Chinese firms (including responses from 96 CEOs and 503 middle managers) in 2018 and 2019, I found that CEO narcissistic rivalry increases the degree of strategic consensus through reduced middle manager engagement and, in turn, increased market culture. Meanwhile, CEO narcissistic admiration reduces the degree of strategic consensus by increasing middle manager engagement and, in turn, reducing market culture. This research helps refine our understanding of the organizational impact of CEO narcissism by examining the different types of narcissism (rivalry and admiration), providing empirical support for the differential impact of the two subtypes of narcissism on strategic consensus, and theorizing the mediating process through which CEO narcissism impacts strategic consensus.
CEO, Narcissism, Rivalry, Admiration, Middle Manager Engagement, Market Culture, Strategic Consensus