Past Performance, Organizational Aspiration, and Organizational Performance: The Moderating Effect of Environmental Jolts

• Main Authors: Chunjia Hu, Haili Zhang, Michael Song, Dapeng Liang
• Format: Article
• Language: English
• Published: MDPI AG 2019-08-01
• Series: Sustainability
• Subjects: sustainable development; past performance; organizational aspiration; organizational performance; environmental jolt; behavioral theory of the firm
• Online Access: https://www.mdpi.com/2071-1050/11/15/4217

Previous research has implied that past performance and organizational aspiration may have an important effect on the sustainable growth of organizational performance. Under the conditions of environmental jolts, their relationships are more complicated to discern. However, few studies have undertaken this investigation. Using data from 183 U.S. firms, this study proposes and tests a theoretical model of the relationships between past performance, organizational aspiration, and organizational performance at different environmental jolt levels. Through hierarchical regression analysis, the empirical findings suggest that low levels of environmental jolt weaken the positive relationship between organizational aspiration and organizational performance, while high levels of environmental jolt magnify the positive influence of past performance on organizational performance. Most importantly, the empirical findings reveal that at low levels of environmental jolt, past performance has no effect on organizational performance, while organizational aspiration has no effect on organizational performance when the level of environmental jolt is high. These interesting findings provide some implications for managers and enrich the theory of sustainable development.