What bandwagons bring: Effects of popular management techniques on corporate performance, reputation, and CEO pay

This paper examines some of the important organizational consequences of po pular management techniques. Using informational reports on quality, empowe rment, and teams, as well as a measure of the implementation of total quali ty management programs, we found that companies associated with popular man agement techniques did not have higher economic performance. Nevertheless, these same companies were more admired, perceived to be more innovative, an d rated higher in management quality. Higher pay was also given to chief ex ecutives when their companies were associated with these management trends. These results provide strong support for institutional theory, demonstrati ng how both internal and external legitimacy can be gained by using popular management techniques. They also extend institutional theory from its usua l emphasis on organization-environment relations to new within-firm dynamic s.