Recently, Ms. Gao Xing’s research group from the School of Economics and Management, including Ms. Wang Xifan, a master’s student in Management Science and Engineering, and Ms. Wang Ying, a master’s student in Logistics Engineering and Management, along with their collaborators, published an academic paper titled A Duopolistic Analysis of CEO Competitive Aggressiveness with R&D Investment in Production and Operations Management (POM), a leading international journal in management.
Production and Operations Management (POM) is widely regarded as one of the top 24 international journals by the UT Dallas College of Business (UTD24) and is highly influential in the field of operations management.
Introduction to the paper
As market competition intensifies, an increasing number of corporate CEOs are demonstrating competitive aggressiveness, aiming to surpass their rivals through technological innovation. For instance, in 2021, Intel CEO Pat Gelsinger unveiled ambitious plans to outpace competitors such as GlobalFoundries, UMC, and Samsung by heavily investing in chip manufacturing processes. Inspired by this business phenomenon, the study constructs a dual oligopoly game model to analyze the impact of CEO competitive aggressiveness on technological innovation, industry profitability, and corporate hiring strategies.
Key findings of the study include the following:
Impact on Technological Innovation:
When both firms select competitively aggressive CEOs, if the degree of aggressiveness is relatively low, the strategic advantage of outcompeting rivals through technological innovation diminishes. In this case, increasing CEOs’ competitive aggressiveness hinders rather than promotes technological innovation.
Effect on Industry Profits:
When the degree of CEO competitive aggressiveness is weak, selecting such CEOs intensifies competition and harms industry profits. Conversely, when the aggressiveness level is strong, technological innovation's positive effect on industry profits becomes more pronounced, and firms with competitively aggressive CEOs may actually enhance industry profitability.
Corporate Hiring Strategies:
When CEO competitive aggressiveness is weak, both firms tend to hire aggressive CEOs to gain a competitive edge. However, when aggressiveness reaches a higher level, firms adopt differentiated hiring strategies: one firm selects a competitive and aggressive CEO, while the other opts for a traditional and conservative CEO. This differentiation mitigates excessive head-to-head confrontation, ultimately benefiting both firms.
This study sheds light on the complex interplay between CEO behavior and firm strategy, offering valuable insights into the broader implications of leadership choices on technological innovation and industry dynamics.
The publication of this academic paper not only highlights the research achievements and academic caliber of the master’s students from the School of Economics and Management but also serves as a significant testament to the School’s progress in advancing disciplinary development and enhancing graduate training programs.
Original link: https://journals.sagepub.com/doi/10.1177/10591478241238971
Contributed by: the Department of Management Science and Engineering
Reviewed by: Cui Xuerong
