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Abstract
This thesis attempts to answer the question of why some top managers have the confidence that they can control their environments, while others do not. Based on two perspectives - information processing theory and managerial cognition -this thesis proposes that informational and perceived organizational contexts have different roles in influencing top manager's perception of control. To investigate this proposition, two studies were conducted focusing on Indonesia's competitive pharmaceutical industry.
The first study examines how top managers' perception of control is influenced by the interplay of informational and perceived organizational contexts. Employing a quasi-experimental design, the study manipulated the types of environments that top manager's face, namely external and internal environments. Data was collected from 46 top managers through case scenarios-questionnaires and analysed through moderated multiple regression. Findings show that (1) informational context influences top managers' perception of control in a more complex way than previously understood, (2) perceived organizational context acts as a significant moderator between informational context and top manager's perception of control, and (3) different factors affect perception of control over internal and external environments differently.
The second study endeavours to understand how organizational identity, which is a powerful aspect in perceived organizational context, is associated with top manager's perception of control. The study uses an interpretive approach to analyse 18 interviews with top managers and seeks to contribute to the literature by employing Bruner's schema accessibility principle. It finds that (1) decision integration, desired future image, and information sharing are keys in making identity dimensions accessible, thus enabling the activation of organizational identity concepts in the minds of top managers, and (2) top manager's perception of control is associated with the extent to which they are able to activate their organizational identity.
The thesis integrates findings from the two studies and builds a framework to better understand top manager's perception of control. It concludes by discussing findings and the integrated framework in relation to strategic decision making and organizational action.