Cognitive Diversity, Managerial Characteristics and Performance Differences across the Cleantech Firms

Abstract

Continuous change in the energy sector towards more sustainable solutions has raised the importance of managers' abilities to interpret changes in their environments and translate those perspectives into strategic choices. This study examines managerial interpretation on changing business environment opening the relationship of cognitive diversity, board composition, and performance differences across the cleantech firms. The authors' empirical study employs both indirect and direct cognitive measures for analysis of cognitive maps collected through surveys from the cleantech firms. The study utilizes the hybrid cognitive mapping technique with distance ratio to investigate cognitive diversity and bridges it with the firms' performance. The study also advances and operationalizes the distance ratio as a measure for the analysis of cognitive maps to utilize more information available in the maps. The results indicate that the managerial characteristics showing firm-level economic expertise creates high-level cognitive diversity and high financial volatility in performance among the cleantech firms.

The Role of Managerial Cognitive Capability in Developing a Sustainable Innovation Ecosystem: A Case Study of Xiaomi

“…Third, existing literate related to managerial capabilities highlights that managerial cognitive capabilities have a profound impact on corporate performance [13,93]. However, most studies focus primarily on individual entrepreneurs [15].…”

Relation between managerial cognition and industrial performance: An assessment with strategic cognitive maps using fuzzy-set qualitative comparative analysis

“…Despite its exploratory nature, this study has offered some insight into our understanding of the novel distance ratio measure (DR 2 ) by Bergman et al (2020) and set-theoretic scores (F 2 and F 4 ) by Stoklasa et al (2017Stoklasa et al ( , 2018. As far as we know, this is the first time that the distance ratios together with the fsQCA have been used to explore the knowledge from the strategic cognitive frames.…”

“…The company performance was measured using the net profit values that were collected along with other financial statistics of the selected companies. A detailed description regarding this data can be found in the publication of Bergman et al (2020).…”

“…The formulas of Langfield-Smith and Wirth (1992) and also Markoczy and Goldberg (1995) have been widely used by managerial and organizational cognition researchers and easier-to-use tools have been developed like cognizers (Clarkson and Hodgkinson, 2005) to do the analysis. Since we were also using the modified form from Bergman et al (2020) and applying fsQCA, we used the MATLAB TM software and made our own codes to perform the analysis.…”

“…Applying different distance ratio measures may provide other options for examining the cognitive structures. We also applied a new distance ratio measure that was recently introduced byBergman et al (2020) as an enhancement of the one presented in Equation (1). This generalization was presented by adding unit area information, in other words, d(x, y) = 1 cannot be exceeded, by taking into account the number of non-zero elements in both maps as follows:…”