Simulation modeling provides a powerful methodology for advancing theory and research on complex behaviors and systems, yet it has been embraced more slowly in management than in some associated social science disciplines. We suspect that part of the reason is that simulation methods are not well understood. We therefore aim to promote understanding of simulation methodology and to develop an appreciation of its potential contributions to management theory by describing the nature of simulations, its attractions, and its special problems, as well as some uses of computational modeling in management research.Managerial behaviors and organizational outcomes increasingly are recognized to be the result of the interaction of multiple interdependent processes. Progress in understanding these phenomena depends, in part, on the ability to incorporate more complexity into management theory and to conduct research on the consequences of the resulting theory.Traditional approaches to theory development are limited in their ability to analyze multiple interdependent processes operating simultaneously. Even when the individual processes are well understood, analyzing their interdependent behavior poses difficulties, because the processes involved may interact in complicated and unforeseen ways. And because the interactions typically produce nonlinear system behavior with feedback, empirical analysis using the general linear model has limited value, especially when (as is typical) samples are sparse in the regions of greatest interest.In studying the complexities of managerial and organizational behavior, a more systematic methodology for theory development and analysis may prove useful. Specifically, we believe that simulation or computational modeling has unique advantages in this respect (Axelrod, 1997;Taber & Timpone, 1996). Well suited for the study of complex behavioral systems, simulations show greatest utility for gaining theoretical insight through developing theories and exploring their consequences (Cohen & Cyert, 1965).Yet researchers in the academic field of management have been slow to take advantage of simulation methods. Scholars in some related social science disciplines, most notably psychology, seem to be far ahead, and the application of simulations by management practitioners to set policy and study organizational problems is quite extensive (Carley, 2003). So management theorists have the opportunity to benefit by taking fuller advantage of simulation methods.Our aim in this article is to provide an explanation and overview of simulation methodology. By doing so, we seek to encourage management scholars to become users of simulation methods and to become better informed consumers of simulation-based research. An understanding of what simulations are and how they work is a prerequisite for appreciating the potential contributions of simulation analysis to management theory, as well as for identifying problems and shortcomings in simulation work.We thank Xia Zhao for research assistance and the anonymous ...

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Manuscript Type: EmpiricalResearch Question/Issue: How and to what extent does national culture influence the composition and leadership structure of the boards of directors of multinational firms? Research Findings/Insights: Societal norms about corporate structure are treated as components of national culture. Hofstede's measures of national culture were shown to predict the board composition and leadership structure of firms based in that culture. The hypotheses were tested with data on 399 multinational manufacturing firms based in 15 industrial countries. The results suggest that national culture can have strong effects on corporate governance and should be considered in any transnational study. Theoretical/Academic Implications: The predictive accuracy of the culture variables provides strong support for the argument that norms embedded in a society's culture affect organizational structure, at least at the board level. The results of the study contribute to our understanding of institutional theory in explaining observed variations in corporate board composition and leadership structure across countries. By linking board composition to the cultural environment, institutional theory provides an explicit framework for analyzing variations in board structure across national boundaries. Practitioner/Policy Implications: When considering board composition and leadership structure, it is important to consider national culture norms. The findings of the study also have important implications for multinational firms setting up boards for their subsidiaries in different countries.