We propose that while positive performance feedback is positively related to firm sentiment, negative performance feedback is negatively associated with the firm sentiment. Additionally, overconfident Chief Executive Officers (CEOs) will improve the positive relationship between positive performance feedback and firm sentiment and reduce the negative relationship between negative performance feedback and firm sentiment. Using 7,182 firm-year observations for the 2004−2017 period, we show that positive performance feedback positively affects firm sentiment, and negative performance feedback negatively influences firm sentiment. We also found that higher levels of CEO overconfidence will minimize the negative impact of negative performance feedback on firm sentiment. Our research extends the current discourse on organizational impression management (proxied by firm sentiment) and CEO overconfidence research as we provide a nuanced relationship between firm performance feedback and organizational impression management. Our findings have theoretical and practical implications for corporate governance leaders and shareholders.
The increasing integration of digital technologies in business processes calls for a deeper understanding of their impact on business model efficiency. This study explores how digital alignment, composed by strategic decision support and operational support, affects business model efficiency, while also examining the extent to which strategic flexibility moderates this relationship. To test the proposed hypotheses, we adopt a quantitative approach on a sample of Italian small and medium-sized enterprises in the manufacturing industry. In particular, a regression analysis, complemented by a necessary condition analysis, is performed. We find that digital alignment, both in terms of strategic decision support and operational support, fosters business model efficiency. Strategic flexibility strengthens the relationship between strategic decision support and business model efficiency. To the best of our knowledge, this study is the first to operationalise digital alignment as composed of strategic decision support and operational support. Accordingly, this study contributes to the extant literature on digital alignment and business models.