Performance feedback and risk relationship: a cross-cultural examination

Official URL: http://risc01.sabanciuniv.edu/record=b2275784 (Table of Contents)

Investigating the boundary conditions of performance feedback and risk relationship has been the focus of attention of considerable amount of research in the behavioral theory of the firm literature. These studies have mainly studied how such firm level factors as size and resources or environmental factors as environmental turbulence, environmental dynamism or opportunities may moderate the performance feedback and risk relationship. However, research focusing on national culture as an environmental factor and as a likely boundary condition of performance feedback and risk relationship is scarce. On this ground this study investigated how national culture (i.e. uncertainty avoidance, future orientation, performance orientation, and power distance) moderates the performance feedback and risk relationship. My findings indicate that national culture moderates the performance feedback and risk relationship, in a way that culture can play a significant moderating role both when performance declines below and rises above aspiration levels. Furthermore, the moderation effect is not constant as firms’ focus of attention shifts from aspirations to survival or bankruptcy.