The relationship between organizational redundancy and firm performance—A modificatory role of governance institution

Chen Xiaohong; Wang Siying

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Science Research Management ›› 2012, Vol. 33 ›› Issue (9) : 78-86.

The relationship between organizational redundancy and firm performance—A modificatory role of governance institution

Chen Xiaohong, Wang Siying

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Abstract

Through the empirical study on Chinese manufacturing companies, the relationship between organizational redundancy and firm performance is explored, and the moderating role of governance institution on it is verified. Conclusion shows that the inverse U-shaped curves is able to describe the relationship, and some redundant resources, which are good for enterprises copying with the external circumstance pressures, would help improving firm performance, however too much redundant resources would finally lead to excessive costs and damage the performance. Meanwhile, with the improvements of micro institutions-corporate governance, management level, and management efficiency, the organizational redundancy would have less influence on the firm performance.

Key words

organizational redundancy / governance institution / firm performance

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Chen Xiaohong, Wang Siying. The relationship between organizational redundancy and firm performance—A modificatory role of governance institution[J]. Science Research Management. 2012, 33(9): 78-86

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