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Thinking Broad and Deep: Why Some Directors Exert an

Outsized Influence on Strategic Change
Razvan Lungeanu, Edward J. Zajac

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 ORGANIZATION SCIENCE
Articles in Advance, pp. 1–20
http://pubsonline.informs.org/journal/orsc/ ISSN 1047-7039 (print), ISSN 1526-5455 (online)

Thinking Broad and Deep: Why Some Directors Exert an Outsized

Influence on Strategic Change
Razvan Lungeanu,a Edward J. Zajacb
a
Northeastern University, Boston, Massachusetts 02115; b Northwestern University, Evanston, Illinois 60208
Contact: r.lungeanu@northeastern.edu, http://orcid.org/0000-0002-8075-7112 (RL); e-zajac@kellogg.northwestern.edu,
http://orcid.org/0000-0002-4453-7147 (EJZ)

Received: July 28, 2016
Revised: June 8, 2017; February 7, 2018;
July 10, 2018; August 2, 2018
Accepted: August 8, 2018
Published Online in Articles in Advance:
April 8, 2019
https://doi.org/10.1287/orsc.2018.1258
Copyright: © 2019 INFORMS
Abstract. This study addresses the oft-debated questions of whether, when, and how
corporate board members help shape firm strategy by advancing a new perspective on
heterogeneous director influence that introduces the notion of the deep/broad director.
Specifically, we take a sociocognitive and sociopolitical perspective on governance to
suggest that deep/broad new outside directors, whose expertise results from a blend of
depth and breadth of experience, will have an outsized influence in shaping firm strategy.
We test our theory using an extensive multiyear data set that tracks all firms that went
through an initial public offering in the United States across multiple business cycles (1997,
2001, and 2004) until 2011. Focusing on new outside directors in their first year of service
(and controlling for selection issues), our results support our main prediction that those
directors whose prior experiences are both deep and broad are the most influential di-
rectors for strategic change. We find this result to be robust for multiple indicators of
strategic change. We also explore whether the outsized influence of the deep/broad di-
rector on strategic change may vary by differences in a board’s openness to strategic
change. We conclude by highlighting the relevance of our approach and findings for future
research and debates on director selection and director expertise.

Supplemental Material: The supplementary file is available at https://doi.org/10.1287/orsc.2018.1258.

Keywords: corporate governance • boards of directors • strategic change • newly public firms • broad and deep expertise • adaptive expertise

Introduction stand as a challenge to the more conventional skepticism

The relevance of directors for a firm’s strategic decisions
has become a central theme in corporate governance
research (Golden and Zajac 2001, Hillman and Dalziel
2003). Directors are aware of their role in the strategic
direction of the firm (Finkelstein and Mooney 2003) and
are increasingly pressured to become more actively
involved in firm affairs (Finkelstein et al. 2008). Indeed,
the location of directors at the apex of the firm pro-
vides an opportunity for influence through expertise and
guidance in strategic decision making (Carpenter and
Westphal 2001, Garg and Furr 2017) and is accompanied
by an expectation to share their wide range of experi-
ence, knowledge and judgment and advise manage-
ment on significant issues facing the firm (Business
Roundtable 2016).
Research that has explicitly considered the relevance
of directors’ advice and counsel for strategic decisions
has typically used a sociocognitive lens (e.g., Rindova 1999)
to suggest that the involvement of expert directors in
strategic decision making can lead to more frequent
(and/or more successful) specific corporate-level activities,
such as acquisitions (McDonald et al. 2008), diversification
(Carpenter and Westphal 2001), or globalization (Sanders
and Carpenter 1998). Whereas these important studies
surrounding director influence, they also share two
characteristics that we believe unduly limits their im-
pact. First, director expertise has usually been defined as
domain-specific and thus useful for examining corre-
spondent specific and discrete corporate-level moves
(e.g., how acquisition expertise affects a firm’s future
acquisitions). Second, a typical reliance on aggregated
directors’ demographic characteristics (Finkelstein and
Mooney 2003) may mask the underlying mechanisms
by which directors influence strategy. As a result, past
studies relating directors’ expertise to corporate gov-
ernance issues including advice on strategy (Finkelstein
et al. 2008, Filatotchev and Allcock 2013) have tended
to sidestep fundamental questions about the nature of
expertise (as has been studied in psychology and cog-
nition research; cf. Hatano 1982 and Schwartz et al. 2005)
and/or individual-level mechanisms that provide di-
rectors with influence in board decision making (Johnson
et al. 2013).
The present study addresses these issues by developing
and testing a sociocognitive and sociopolitical perspective
on whether, when, and how a single individual director
can influence business-level strategy, particularly in the
context of the early life of the firm after an initial public

1

2 Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
offering (IPO). Specifically, our theory addresses the
mechanisms of influence originating at the level of the
individual director (rather than the group), and we
extend this model to also consider how board context
can interact with a director’s expertise to increase in-
fluence, generating a potential multiplicative effect on
firm strategy. Furthermore, although we acknowledge
the relevance of domain-specific expertise, we also see
an unmet need to address the relevance of more general
director expertise, which we additionally suggest is likely
to be particularly valuable in shaping broader orga-
nizational issues, such as the formulation of a firm’s
business-level strategy (Westphal and Fredrickson 2001).
On the nature of director expertise, we find it noteworthy
that U.S. courts have suggested that
directors are not specialists, like lawyers or doctors.
They must have good sense, perhaps they must have
acquaintance with affairs; but they need not—indeed,
perhaps they should not—have any technical talent.
They are the general advisers of the business.1
We first introduce the notion of the influential deep
and broad director. Specifically, we synthesize and build
on insights from cognition research on individual ex-
pertise (Hatano and Inagaki 1984, Barnett and Koslowski
2002, Yonelinas 2002, Schwartz et al. 2005, Ericsson 2006)
and from social psychology research on persuasion
(McGinnies 1973, McGinnies and Ward 1980, Kaufman
et al. 1999) to theorize that an individual director’s in-
fluence is tied to the blend of depth and breadth of
experience-based expertise that he or she brings to the
board. We then test this notion by examining whether
new outside directors whose experiences are both deep
and broad will be particularly consequential in reshaping
a firm’s business-level strategy.
In this way, we provide several points of departure
from prior research that has also used a sociocognitive
lens to address board expertise and/or board influence
on strategic issues (Rindova 1999, Westphal 1999, Golden
and Zajac 2001, McDonald et al. 2008). First, although we
concur with the benefit of addressing a board’s expertise
(see Withers et al. 2012 for a review), we see even greater
benefit in shifting focus from the expertise-based rele-
vance of the aggregate board to that of individual di-
rectors. Specifically, such a shift allows us to analyze the
likely intraboard variation in the individual blend of ex-
pertise possessed by some board members, where the
blend integrates familiar notions of focused versus
general expertise (Gruber 2010), depth versus breadth
(Haynes and Hillman 2010), and uniformity versus va-
riety (Crossland et al. 2014). Whereas scholars studying
boards and strategic change have maintained varying
beliefs about whether boards impel, impede, or have no
influence on strategic change (Golden and Zajac 2001),
we focus on how the nature of director expertise and
board context will provide individual directors with
Lungeanu and Zajac: Thinking Broad and Deep
differential influence in board decision making. Specif-
ically, we propose specific theoretical mechanisms that
allow a deep/broad director to influence strategic change
and also analyze the extent to which some expertise-
endowed individual directors exert “minority influence”
on firm decisions (Hambrick et al. 2015, p. 335).
Our second point of departure is our choice of context
in which we analyze how or why a director with po-
tentially synergistic deep and broad expertise can exert
an outsized influence on the board (relative to directors
with deep or broad expertise)—namely, changes in a
firm’s business-level strategy. Our study thus comple-
ments prior governance research that has examined how
isolated elements of an individual director’s experience
can influence discrete corporate moves in the same
domain, such as acquisitions (Kroll et al. 2008) or op-
erations (Krause et al. 2013). Indeed, our emphasis on
the relevance of an individual director’s deep/broad
expertise for firm strategy fits well with the general
notion that a board’s effectiveness is a function of not
only its independence and integrity (Johnson et al. 2013)
but also its ability to understand and address complex
business issues, such as firm strategy (Golden and Zajac
2001, Hambrick et al. 2015). Whereas the primary aim
of our study is to provide an original contribution to the
sociocognitive governance literature, we also see our
work as linked to recent developments in the manage-
ment literature and in cognition research on expertise.
In both research domains, the earlier emphasis on ap-
plying routine expertise to similar contexts (see, e.g., Chi
et al. 1981, Ericsson and Charness 1994, and Ericsson and
Lehmann 1996) has shifted to considering expertise that
is conceptually adaptive and transferrable to dissimilar
contexts (Ericsson and Smith 1991, Holyoak 1991, Barnett
and Koslowski 2002, Gruber 2010, Gruber et al. 2013). As
we will discuss, drawing from this research on expertise
allows us to more precisely address how and why a
deep/broad director is likely to be a significant “mover
and shaker” of firm strategy.
Finally, we also utilize an empirical context that we
view as particularly appropriate for operationalizing
the notion of director deep/broad expertise and for
testing the effects of such expertise on firm strategy.
Specifically, we focus on the early life of the firm post-
IPO, a strategic decision point where there is greater
need for the development of “guidelines for action”
(Zald 1969, p. 107; Lynall et al. 2003). As a new venture
transitions from the private into the public domain, the
strategic decisions made by the pre-IPO board are
carried through the IPO event (Garg 2013, Garg and
Furr 2017) but do not necessarily address the challenges
of the new public context. In such newly public ven-
tures, directors are more likely to engage in providing
advice and counsel on strategic issues at a business
level (Garg and Eisenhardt 2017) because such firms
are generally smaller, younger, and less structurally
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
complex than more established public companies. In
sum, newly public ventures form a relevant but seldom
studied context to reveal the potential strategic role of
directors (Filatotchev and Bishop 2002, Filatotchev et al.
2006, Bruton et al. 2010, Garg and Furr 2017). In terms of
our key firm-level outcomes resulting from heteroge-
neous director influence, we intentionally depart from
the more typical emphasis on discrete corporate moves,
such as acquisitions. We focus on the firm’s formulation
of business-level strategies, a core activity in strategic
decision making (Mintzberg et al. 1976, Baer et al. 2013).
This necessitated constructing a unique, hand-collected
set (via 10-K reports) of 60 business-level strategy tactics
(Zott and Amit 2008) used by 472 firms over a recent 15-
year period (totaling 3,422 firm-years), along with
measuring the unique accumulation of deep/broad
expertise for all 750 newly appointed outside directors
for these firms (totaling 9,355 firm-years) and for all
incumbent directors such that we could address endo-
geneity concerns.
The Value of Broad and Deep Director
Expertise
Historically, when director expertise has been the sub-
ject of interest in the corporate governance literature or
in the business press, the tendency has been to focus
inquiry of director expertise along either the depth or,
albeit more rarely, breadth dimension (Kroll et al. 2008,
Lester et al. 2008, Mansharamani 2012). Before we argue
for the merits of considering the blend of broad and deep
expertise, we wish to first note that the one-sided focus is
understandable, given that the single components of
depth or breadth each have their own developmental
path and contextual appropriateness in the application
of the expertise. For example, one might believe that
each industry is idiosyncratic in terms of its dynamics,
its reward systems, its regulatory practices, or more
generally, its industry “recipes” (i.e., critical elements of
the industry environment) (Kroll et al. 2008). Alterna-
tively, one might believe that a director’s more varied
exposure to industry- or firm-specific structures, oper-
ations, and internal dynamics can provide a richer
and more generalizable knowledge of these attributes
(Carpenter and Westphal 2001, Certo 2003).
However, directors are executives at the apex of their
organizations, and their role is to oversee the work of
many functions in a firm, which necessitates a combination
of depth and breadth that cuts across narrow speciali-
zations and tasks. In this context, although one could
debate the relative merits of a director’s repeated ex-
posure to a particular industry or strategy (i.e., routine
expertise) versus the expertise gained from experiences
that encompass a broader set of each, we remain agnostic
as to the relative merits of depth versus breadth of
experience. Instead, we suggest that the most powerful
form of director expertise is one that reflects a combination
3
of depth and breadth. Whereas prior governance research
has not addressed the value of this combination, one can
find examples where corporations explicitly address the
desirability of attracting directors who have a blend of
depth and breadth. Consider this quote from Amgen Inc.:
In seeking individuals to join the Board of Directors or to
fill director vacancies on the Board of Directors, the
Committee considers the following to be minimum
qualifications that a candidate must possess: (1) Demon-
strated breadth and depth of management and leadership
experience, preferably in a senior leadership role in a large
or recognized organization.2
Amgen Inc. is not the only company that seeks
directors who combine depth and breadth of expertise;
similar statements can be found for other U.S. companies
(e.g., Wells Fargo, Prudential Financial, BioAmber Inc.,
Amag Pharmaceuticals Inc.). Interestingly, in the United
Kingdom, the business community has institutionalized
the desirability of director depth and breadth by making
deep expertise in multiple areas (such as sales, marketing,
finance, and operations) a prerequisite for directors seeking
to earn the chartered director qualification (Stern 2008).
Although the corporate examples above intuitively
highlight the potential value of a director having both
deep and broad expertise, they do not seek to provide
a theoretical justification for seeking directors with
such a cognitive combination. Organizational research
on managerial cognition (e.g., Walsh 1995) does ad-
dress theoretical questions in this area; however, its
emphasis has historically tended to assume a depth-
versus-breadth trade-off. Indeed, an oft-cited conclu-
sion in this literature is that attaining mastery status in
a domain requires thousands of hours of sustained
practice (Chase and Simon 1973, Simon and Chase
1988), which implies a trade-off between expertise
depth and breadth, given the inevitable finiteness of
one’s human life and career. However, the notion that
achieving depth of expertise in one domain requires
forgoing exploration of other domains has been chal-
lenged by recent research in psychology, for example,
by Macnamara et al. (2014), who show that achieving
a mastery status (as judged through performance)
varies widely across domains of activity, suggesting
that having a strong depth and breadth of expertise
(i.e., deep expertise across domains) is possible within
the constraints of one’s human life.
Perhaps unsurprisingly, most research on expertise
has focused on the acquisition of routine expertise, as
well as its advantages and disadvantages. This includes
work on how individuals gain routine expertise from
experience in a specific domain or with a specific type
of decision (see Ericsson and Charness 1994). Benefits
of routine expertise include automaticity (Dane and
Pratt 2007) and rapid decision making (Glaser and
Chi 1988), whereas drawbacks include difficulty in

4 Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
adapting to new contexts within an expertise domain
(Lewandowsky et al. 2007), failure to address changes in
task conditions (e.g., Rudolph et al. 2009), and difficulty
to change the attributes of the domain stimuli that
prompt automatic responses (e.g., Bilalić et al. 2008).
Hatano (1982) points out that routine expertise is efficient
for a limited set of problems and cannot be recombined
to address new problems. These drawbacks have been
highlighted as far back as the Dearborn and Simon
(1958) work showing that what executives consider as
the most important problem facing their company is
typically related to their specialized area of expertise.
Examples of overcoming such limitations are notably
rare in management research. In their qualitative study
on managerial cognition, Gavetti and Menon (2016)
suggest that deep domain experts may be able to de-
tect strategic opportunities in another domain—in the
specific situation whereby the two domains are struc-
turally similar and managers are capable of extracting
deep analogies between domains. Dane (2010) suggests
that routine experts can become more flexible—if they
engage in a dynamic environment within their domain of
expertise or focus on tasks outside their domain. Gruber
(2010) has also argued that entrepreneurs typically iden-
tify market solutions in line with their prior experience
and that searching for alternative solutions should ar-
guably be easier with a broader set of experience.
Cognition scholars have also discussed possible
mechanisms of transfer and influence to novel prob-
lems, domains, or contexts (Hatano 1982, Hatano and
Inagaki 1984, Holyoak 1991). Research in psychology
has emphasized how individuals constantly seek out
underlying rules and principles to make sense of the
surrounding world, automatically extracting underly-
ing organizing principles and abstract rules (Murphy
and Medin 1985) and forming categories and concepts
(Carey 1985) that then allow more informed decision
making and applications across domains. According to
Hatano (1982), some experts become effective in new
domains because they develop conceptual (rather than
procedural) knowledge through experiential episodes
in a variety of domains in which they engage with the
goal of understanding rather than executing. Barnett
and Koslowski (2002) argue that these individuals
become capable of theory-based reasoning and un-
derstanding solutions and problems at abstract and
conceptual (rather than operational) levels. These ob-
servations are congruent with insights from manage-
ment research (Hoisl et al. 2010) showing that inventors
who gain an abstract understanding of the technology
problem-solving process are better able to search for
new knowledge, understand it, and engage in knowl-
edge recombination.
In sum, there is agreement among researchers in the
cognition and general management literatures that
some experts can form broad principles applicable
Lungeanu and Zajac: Thinking Broad and Deep
across observations and domains in a cohesive manner
and become the basis for extrapolating from familiar to
unfamiliar contexts. The discussion above suggests that
for an individual, attaining deep expertise requires
a high degree of similarity among problems or con-
texts, and attaining broad expertise requires variation
in type of experiences. To attain both depth and
breadth, an individual requires (and can pursue) deep
exposure in a domain as well as breadth of prior ex-
periences across domains. The combination of depth
and breadth provides the basis to contrast situations
and understand what is experienced (rather than just
execute). As a result, such directors have a mindful
(deep and broad) understanding of different contexts or
rules of the game. The larger set of experiences accu-
mulated across domains, and the deep understanding
of each, increases the ability to engage in theory-based
reasoning and understand problems and solutions at
a conceptual level.
Given our focus on how and why deep/broad di-
rectors are more influential for business-level strategy,
we contextualize our study in two ways. First, the early
life of the firm post-IPO provides a good context to test
the effects of individual directors on firm strategies. The
IPO event, the starting point for our longitudinal ob-
servations, is a strategic decision point in a firm’s life
where top management perceives it is where “board
power is most likely to be asserted,” as part of the
development of guidelines for action, as noted in our
introduction (Zald 1969, p. 107). Boards of growing firms
devote an inordinate amount of time to strategic issues as
noted by Adams (2003), Hayes et al. (2004), and Kor and
Misangyi (2008), and therefore directors recruited in
the first years after the IPO may be inclined to greater
involvement in strategy (Garg 2013). Second, we
conceptualize the two elements of depth and breadth of
experience as follows. Depth reflects time spent as an
executive in a company, industry, or with a unique
strategy dominantly employed by these companies.
This element corresponds to the notions of uniformity
and exploitative behavior (Lavie and Rosenkopf 2006).
Breadth reflects the number of different companies,
industries, and unique strategies. This element cor-
responds to the notions of experiential breadth (Gruber
2010), variety (Crossland et al. 2014), and exploratory
behavior (Levinthal and March 1993). Our study
highlights how various combinations of depth and
breadth of prior experiences manifest themselves in
unique expertise profiles that reflect distinct thinking,
frame of reference, and perceptions (Westphal and
Fredrickson 2001). Given that individuals can expe-
rience both depth and breadth in their careers, we see
as a distinct possibility that some directors will pos-
sess a blend of the two and, furthermore, that these
directors will exert an outsized influence on a firm’s
strategy.
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Mechanisms of Deep/Broad Director Influence
One advantage of theoretically and empirically ana-
lyzing how and why the deep/broad director is par-
ticularly influential in shaping firm strategy is that
both our general constructs and our specific indicators
(discussed in Methods) involve measurable director
and firm-level attributes. This allows us to conduct a large-
scale empirical study that relies on publicly available data
sources to capture observed variation in specific types
of directors (i.e., broad and deep versus broad or deep
directors) and use this variance in predicting differ-
ences in specific firm-level outcomes (i.e., strategic
change). However, as is the case in any such variance-
based study, there are also process-based mechanisms
that—although largely unobservable—also merit dis-
cussion (and ideally, up-close observation in future
studies of board dynamics). Specifically, the mecha-
nisms underlying a deep/broad director exerting an
outsized influence in the boardroom are likely based on
some combination of (1) the director’s greater capability
to engage in theory-based reasoning, extract broad
principles of action across domains, and formulate
solutions to new problems and (2) the director’s ele-
vated credibility in the eyes of their fellow directors
when engaging in strategic decision making in the
boardroom.
In terms of capability, the value of individual-level
expertise that is rooted in both the depth and breadth of
individual experience has been the subject of study in
cognition research, but not in the corporate governance
literature. As noted earlier, the development of deep/
broad expertise requires deep involvement in various
contexts with different rules of the game, an under-
standing of the underlying principles of past solutions,
and a requirement to justify solutions based on expertise
(Hatano 1982). When directors possess deep knowledge
across a larger catalogue of example situations they more
easily understand the principles of past solutions and can
abstract rules of action that are applicable across contexts.
Attaining efficiency in a particular domain frees attentional
capacity that enables people to concentrate, learn, and
understand aspects that require nonroutine adaptation
(Schwartz et al. 2005). This conclusion is supported by
research on learning transfer that suggests that flexible
adaptation to new settings depends on understanding
(rather than memorizing) concepts and procedures
(Bransford et al. 2000, Schwartz et al. 2005).
From this perspective, a deep/broad director will
benefit from (1) expertise breadth that allows him or
her to recognize problems and offer informed but
differing viewpoints—even if not yet steeped in the
specifics of the new firm (Finkelstein and Mooney
2003, p. 107)—and (2) expertise depth that allows him
or her to propose viable solutions that add richness to
discussions. Consider how multiple case examples/anal-
ogies that accompany deep/broad expertise perhaps
5
allow directors to adopt an outside view (Kahneman and
Lovallo 1993) or to avoid being deceived by superficial
similarities, which is more likely when drawing from
a single case or domain (Gavetti et al. 2005, Lovallo et al.
2012). Studies on perceptual learning, expertise, problem
solving, and cognitive therapy have all suggested that,
because of individual limitations in memory or schemas
to understand new situations, each new situation ex-
perienced will change how new situations are cogni-
tively processed and engaged with, rather than adding
distinct knowledge to an existent repertoire (Bassok and
Holyoak 1989, Bransford and Stein 1993, Greeno et al.
1993, Marton and Booth 1997, Schuyler 2003). These
deep/broad directors are more likely to focus on aspects
of solutions and problems that are generalizable across
cases and to generate a larger number of strategic options
(Lovallo et al. 2012). This way, a deep and broad expert
director helps address the issue of limited exploration
of decision alternatives identified by Finkelstein and
Mooney (2003, p. 106) as one challenge in board process.
In terms of credibility, it is noteworthy that tradi-
tional discussions that emphasize the merits of depth
versus breadth of expertise also share a common as-
sumption regarding the credibility of the expertise
holder. We see no basis for denigrating the credibility
of directors holding one type of expertise over the
other. Rather, we simply posit that among the directors
on a board, it will be the deep/broad director (with his
or her blend of breadth and depth of expertise) that will
be seen as not only particularly credible to the chief
executive officer (CEO) and the board in specific areas,
as McDonald et al. (2008) suggest, but also credible
when engaging in boardroom debates across the va-
riety of issues and domains in which deep domain-
specific knowledge also applies. Although credibility is
an ascribed multidimensional notion, refinements of
the concept show how two attributes remained reflective
of credibility: the extent to which a person is perceived as
being trustworthy and competent (Hovland et al. 1963).
Trustworthiness reflects a person’s perceived reliability
and dependability, and competence refers to the extent
to which a speaker is perceived to be capable of making
correct assertions (McGinnies and Ward 1980). Across
psychology and management literatures, a highly cred-
ible source is commonly found to induce more persua-
sion than a low credibility one (McGinnies 1973, Petty
et al. 1998)—that is, more able to modify another per-
son’s attitude toward an issue in a way that protects
feelings and relationships (Samter and Burleson 1990).
Original research using a cross-country sample has
shown that the simultaneous presence of both trust-
worthiness and competence provides the most favor-
able condition for persuasion (McGinnies and Ward
1980). By contrast, individuals lacking in expertise may
be seen by others as blustering, and their credibility will
suffer (Tormala et al. 2006).

6 Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
To illustrate, consider the case of an outside director
with a 40-year career spanning five companies in five
different industries, and with experience with different
business-level strategies. We would expect such a director
to be more mindful of the relevance of industry differ-
ences (e.g., in dynamics, reward systems, and regulatory
practices), company differences (e.g., in structures, op-
erations, and internal dynamics), and of the complex
interdependencies that exist among various strategies
(e.g., attempting innovation or marketing differenti-
ation while also pursuing company-wide cost reduction).
This deep/broad director can influence strategic change
by using his or her learned abilities to understand the
different facets of a new business problem discussed in
the board room; to compare, contrast, and abstract prior
contexts and solutions; to provide an informed solution
to the problem; and then to proactively and confidently
advocate during boardroom debates. Such characteris-
tics mirror those that scholars of “minority influence”
have suggested will prompt others to consider more
strongly the opinions of such an individual (relative to
those lacking depth or breadth of expertise). The credi-
bility of this director is likely enhanced if his or her many
years of experience crosses these domains.
Prior research and direct observations suggest a nat-
ural conservatism in board behavior and that boards
are likely not the primary change agent in their firms
(Golden and Zajac 2001, Finkelstein and Mooney 2003,
Johnson et al. 2013). Our arguments are not antithetical
to this conclusion because we address those individu-
al characteristics that may make some individual di-
rectors (rather than the board) be particularly influential
on the board (Johnson et al. 2013). Specifically, we have
argued that a director with both deep and broad ex-
pertise has a greater capability to anticipate potential
issues when formulating solutions to new problems, to
articulate opinions, as well as greater credibility vis-à-vis
board incumbents. This motivates our main hypothesis
regarding the outsized influence of the deep/broad
director on firm strategy, which we examine in terms
of the magnitude and direction of subsequent changes
in that firm’s strategy after a new outside director joins
an existing board (we do so after addressing the po-
tential endogeneity of director selection—see methods
section). With respect to the magnitude of change, we
expect that new directors who are deep/broad directors
will be more influential in moving a firm’s business-level
strategy, relative to deep directors (i.e., with expertise
deeply rooted within a domain, but with little breadth)
or broad directors (i.e., with expertise that varies con-
siderably across domains, but with little depth). In
phrasing this key hypothesis, we make no assumptions
as to whether strategies influenced are new or familiar
to the firm or to the deep/broad director, nor do we
examine the direction of change (retrenching to do less
or expanding to do more of a strategy). Rather, we want
Lungeanu and Zajac: Thinking Broad and Deep
to capture the fact that new directors who are deeper
and broader exert more influence in driving strategic
change than new directors who lack this combination.
We phrase our hypothesis as follows.
Hypothesis 1a. New outsider directors with deep and
broad expertise will be more influential in changing that
firm’s strategy (in terms of magnitude) than will new outside
directors with deep or broad expertise.
Note that our main hypothesis above compares the
relative influence of a new deep and broad director
(versus a new deep or broad director) on the level
a focal firm’s subsequent strategy, defined in terms of
magnitude (i.e., nondirectional strategic change). This
allows us to assess the general influence of the deep/
broad director as a “mover” of firm strategy. However,
we can augment our prediction regarding the outsized
influence of a deep/broad director on firm strategy by
assessing the influence of a deep/broad director as
a “shaker” of firm strategy. Specifically, given a general
inclination of boards to be change averse (Finkelstein
and Mooney 2003, Johnson et al. 2013), an even more
conservative test of deep/broad director influence
would consider how such a director might influence
directional strategic change. In other words, might an
outside director with deep/broad expertise who has
just joined the board have an experience-based pref-
erence for a strategy, suggesting an increased likeli-
hood of a focal firm moving toward that preferred
strategy? A new deep/broad director changing the
type of strategy pursued by the firm would be a strong
indicator of influence, and we consider this possibility
with the following hypothesis.
Hypothesis 1b. New outsider directors with deep and
broad expertise will be more influential in changing that
firm’s strategy (in the direction of his or her strategic ex-
periences) than will new outside directors with deep or broad
expertise.
Board Openness to Change as a Potential
Moderator
So far, we have established our key prediction that
a deep/broad expert director will have a strong relative
influence on strategic change (where change is con-
sidered both in nondirectional and directional terms).
We discussed why having the combination of deep/
broad expertise affords the director greater capability
and credibility in the boardroom. We now shift focus
from key characteristics of the director to those of the
board itself, which allows us to consider how some
boards might be more or less open to a new director
seeking to influence firm strategy. We draw from the
literatures on boards of directors and strategic change
to suggest that boards may differ significantly in the
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
extent to which they are subject to coalition and cohort
effects (we examine these using board turnover and
board tenure heterogeneity).
Scholars of strategic change have argued that dif-
ferences in board turnover imply differences in the
context in which strategic decisions are being made
(Goodstein and Boeker 1991). Low board turnover
solidifies relationships through numerous mutual fa-
vors over time that perpetuate incumbents’ power;
interests become vested in a pattern of organizational
activities that promotes convergence toward a specific
strategic orientation. Such a situation does not change
our earlier discussion regarding how and why a new
outside director with deep/broad expertise will be
particularly influential in shaping firm strategy; how-
ever, it does suggest that the level of the deep/broad
director’s influence may be moderated by board
turnover. In other words, the strong relationship hy-
pothesized in Hypothesis 1 may be weaker for low
turnover boards, where the large number of incumbent
directors are more likely to view the new deep/broad
director’s influence attempts as destabilizing to the
power of the incumbents.
Stated from the other end of the continuum, where
board turnover is higher, there is greater fragmentation
of the coalition, opening routes for the creation of new
coalitions, and increasing the odds of disrupting existing
bases of power for incumbent directors. Such fragmen-
tation reduces the stability and homogeneity of per-
spectives, providing different baselines for perceptions of
reliability and competence vis-à-vis the new deep/broad
outside director. Thus, the situation of high board turn-
over can provide fertile ground to the deep/broad new
outside director to exert influence on strategic change.
We can also make a comparable argument when
considering a related but distinct characteristic of
boards; namely, dispersion of tenures on the board af-
fects influence on strategic change. An established re-
search perspective on tenure heterogeneity is that a low
score on this attribute (i.e., homogeneity) is reflective of
single cohorts, which provides “the opportunity for the
development of group solidarity and sponsorship in the
contest for resources and control” (McCain et al.
1983, p. 627). Individuals are typically loyal to and
supportive of the cohort they identify with, and they are
thus likely to exhibit an increased sense of confidence in
members of their cohort and consider them more reli-
able than outsiders. A single cohort on the board also
decreases awareness of the need for change and ho-
mogenizes opinions and priorities. As tenure hetero-
geneity increases, so does awareness of the need for
change, which can open up avenues to incorporate new
viewpoints in the process of decision making.
Taken together, these arguments regarding a board’s
differential openness to strategic change suggest the
following moderator hypotheses.
7
Hypothesis 2. The influence of the new deep/broad director
on firm strategy (as hypothesized in Hypotheses 1a and 1b)
will be lower for boards with relatively low turnover.
Hypothesis 3. The influence of the new deep/broad director
on firm strategy (as hypothesized in Hypotheses 1a and 1b)
will be lower for boards with relatively homogeneous levels of
tenure.
Methods
Sample
To test our key hypotheses regarding the influence of
deep/broad directors on firm strategy, we chose the
context of directors in newly public firms—that is, firms
that have recently gone public through an IPO. During
a firm’s early post-IPO stage, there is a particularly
strong need for the development of “guidelines for
action” (Lynall et al. 2003), which in turn provides a
useful context with which to assess directors’ potential
strategic role.
Our sample is the full set of private firms that went
public in the United States in 1997, 2001, or 2004, which
generated an extensive panel data set of 472 firms. Our
logic for choosing these specific years was twofold:
first, we wanted to capture IPOs across the boom and
the bust of the IPO market that started in 1999 and
ended in 2002; and second, as we will show, the highly
time-intensive nature of our coding of business-level
strategies made it unfeasible to collect data on all IPO
firms across all years. We did, however, track the
yearly evolution of our 472 firms and their boards up to
2011, totaling 3,422 firm-year observations. We used
the IPO SDC Platinum and Ritter databases to define
the population of IPOs; we obtained data on CEO, top
management team, and board demographics from the
firms’ 10-K files. We also used the VentureExpert da-
tabase to capture data on venture capital (VC) involve-
ment in the firms.
Dependent Variables
As discussed, we examine two outcomes of interest. First,
we want to capture a director’s influence in moving
a firm’s strategy in any new direction. We define non-
directional strategic change as the extent to which—upon
the addition of a new outside director—a firm moves
strategic emphases scores for each of the seven generic
strategies. We operationalize this indicator as the sum
of the absolute differences between a firm’s strategic
emphases scores on each of the seven generic strategies
at t1 and t0 . Finding support for nondirectional strategic
change would also address any remaining endogeneity
concerns (see in Robustness Checks and Post Hoc Ana-
lyses) related to the possibility that firms select directors
knowing the director’s preferred strategic emphasis and
anticipating the director’s influence in moving a firm’s
strategy in that particular strategic direction.

8 Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Second, we want to capture the directional influence
of a director on a firm’s strategy. We define directional
strategic change as the extent to which—upon the ad-
dition of a new outside director—a firm moves strategic
emphasis directionally toward the strategic emphasis of
that director (we also address endogeneity concerns, as
discussed in Robustness Checks and Post Hoc Analyses).
This indicator of strategic change captures such changes
in a firm’s strategy in the year after a new outside director
is appointed. It is operationalized as the difference
between (a) the squared root of the squared difference
between the firm’s Likert score on strategy Si at t0 and
the director’s Likert score on strategy Si at t0 and (b)
the squared root of the squared difference between the
firm’s Likert score on strategy Si at t1 and the director’s
Likert score on strategy Si at t0 . Strategy Si denotes the
strategy in the director’s portfolio that has the highest
Likert score. This measure captures the difference
between two Euclidean distances: that between the
firm one year after director appointment and the di-
rector at appointment, and that between the firm and
the new director both at appointment. This measure’s
advantage is that it accounts for the difference between
the director’s and firm’s original strategic emphases
(at the time of appointment t0 ). A higher positive
value means that the firm shifts its strategic emphasis
at t1 in a direction closer to the director’s strategic
emphasis at t0 .
Given our large sample of 472 focal firms (resulting
in 3,422 firm-years/10-K reports) and the 750 new
directors these firms added (resulting in 9,355 firm-
years of prior experience/10-K reports), assessing our
dependent variable required a complex, two-stage
manual/automated process. We provide a summary
description of the process here and a more detailed
account in Appendix 1 in the supplementary file.
In the first stage, we manually coded (on a seven-
point Likert scale) the weight placed by a focal firm on
each of the 60 business-level tactics first identified by
Zott and Amit (2008) as representing seven generic
business-level strategies: innovative differentiation, mar-
keting differentiation, cost leadership, breadth, quality
differentiation, service differentiation, and corporate strat-
egy (product and market diversification, and interna-
tionalization). Specifically, the authors and six raters
analyzed firm 10-K reports for business-level tactics
and met every three months during the project’s four-
year duration to address any disagreements and es-
tablish consensus on the coding scheme (all but one
rater remained on the research team throughout this
period). The manual coding process allowed us to
develop a comprehensive dictionary of terms reflecting
each business-level tactic.
In the second stage, we used this dictionary of terms to
develop an automated coding procedure (again based on
a seven-point Likert scale) and found adequate reliability
Lungeanu and Zajac: Thinking Broad and Deep
between the manual and automatic coding approaches.
Thus, we relied on the automatic procedure to recode the
weight placed by our focal firms on each business-level
tactic, which were then aggregated to generate a Likert
score for each of the seven generic strategies noted above.
To create a comparable strategic emphasis score for the
newly appointed outside director, we again used our
automatic coding approach, this time applying it to all
those firms where the director had worked (either as
a manager or board member). We performed this anal-
ysis for a total of 750 directors and 9,355 firm-years, again
using 10-K reports. We aggregated the resulting generic
strategies’ scores first at the firm level (i.e., director’s prior
firms) and then at the level of each focal director.
Having established Likert scores for each seven ge-
neric strategies for both the new outside director and
for the focal firm, we could now capture the degree to
which the firm changes each strategy (nondirectional
strategic change), as well as moves its strategic em-
phasis toward that of the new director (directional
strategic change). As we mentioned, we measure the
former as the sum of the absolute differences between
a firm’s strategic emphases scores on each of the seven
generic strategies at t1 and t0 , and we measure the latter
by first defining strategy Si to be that strategy with the
highest emphasis (as measured by the Likert score) for
a new outside director in the year of nomination and
then calculating the degree to which the firm moves
emphasis toward that of Si.
Director Depth/Breadth Variable
Our main predictor variable is director depth/breadth,
which captures the depth and breadth of a director’s
prior experiences with different firms, industries, and
dominant strategies (i.e., Si). We assess depth by first
examining the number of years of experience a director
has had in each of these different domains, and we apply
a three-year minimum threshold to these experiences to
ensure the temporal depth required to translate experi-
ence to expertise (see our additional analyses for ro-
bustness checks using one- to seven-year minimums).
We then sum the number of in-depth experiences across
the three domains (firms, industries, and strategies) for
each director (in separate analyses, we also used a mul-
tiplicative measure with similar results to those reported
in this paper). The resulting indicator captures both the
depth and breadth of a director’s expertise by consid-
ering a time/history component that reflects the con-
ditioning of breadth in domains by the depth of expertise
in those domains. This ensures the appropriate fit be-
tween the measure and the core argument that a “blend”
of the two is better (instead of the claim that more of each
is better, as studies in past governance research have
assumed). This also avoids conflating expertise with
director age; indeed, it opens a reasonable possibility that
two equally deep/broad directors would have different
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
ages. Given the novelty of our measure, we provide a
descriptive illustration of the distribution of depth/
breadth scores across new outside directors and in-
cumbent directors, as well as the makeup of the in-
dicator in terms of number of companies, industries,
and dominant strategies in Figures 1–4.
Moderator and Control Variables
To test Hypothesis 2, we define board turnover as the
number of directors leaving the board during the year
divided by the total number of board members at the
beginning of the year. For Hypothesis 3, we calculate
board tenure heterogeneity as the variance of member
tenures on the board, divided by the mean of tenures
(Hambrick and D’Aveni 1992, Boeker 1997). We use the
natural logarithm for both moderator indicators.
We control for a range of additional factors (our
results are robust to the inclusion of a larger set of
covariates, and we enumerate these in Appendix 3 in
the supplementary file). For example, we control for
those attributes that can affect the propensity of a new
outside director’s becoming involved in strategic change,
such as director age (in years) and director prestige in
binary (yes/no) terms, such that a director is considered
prestigious if he or she meets at least two of three criteria:
a degree from an elite educational institution listed in
Finkelstein’s (1992) list of 20 institutions (educational
prestige), experience as vice president or above at an S&P
500 company (employment prestige), or experience as
outside director with an S&P 500 firm (directorial pres-
tige) (Pollock et al. 2010). To determine directors’ prior
employment and outside directorships, we construct
Figure 1. New Outside Directors—Depth/Breadth
9
a lagged-year list of S&P 500 firms for each year of study.
Having a new outside director with prior experience as
a consultant (dummy variable coded as 1 if the director
has held the position of senior manager and above in
a consulting firm; 0 otherwise) may account for an in-
creased propensity to become involved in strategic
change. Similarly, we control for graduate education (1 if
the director has a Ph.D. or MBA degree; 0 otherwise).
Finally, we control for cohort collusion among newly
appointed directors when there are multiple hires (1 if
a firm added more than one director in a given year;
0 otherwise).
We control for several firm-level characteristics that
might affect strategy change, such as firm age and firm
size. Given that VC backing at IPO can also affect the
choice of strategy immediately post-IPO as well as the
firm’s long-term decision making (Jain and Kini 2000),
we control for this variable (1 if a firm received financial
backing from VCs prior to IPO; 0 otherwise).
We use several variables to control for board and
executive level differences across firms. Specifically, we
control for the outside director ratio using the number of
outside directors, defined as directors who do not hold
any current or past executive positions in the focal firm
(e.g., Daily et al. 2002), divided by the total number of
directors. We account for the possibility of particularly
powerful/experienced incumbent directors by calcu-
lating outside director with CEO experience (ratio) as the
percentage of outside directors on the board that have
been CEOs of other firms, and for board size, expressed
as the total number of directors. We control for par-
ticularly powerful CEOs by including the following

10
Figure 2. Incumbent Outside Directors—Depth/Breadth
variables: CEO prestige (1 if the CEO possesses any two
of the three educational, employment, or directorial
prestige credentials noted above; 0 otherwise); CEO
tenure, based on the number of years as CEO; and CEO
duality (1 if CEO is also the chairman of the board;
0 otherwise). Finally, we account for idiosyncratic in-
dustry and year effects using industry [Standard In-
dustrial Classification two-digit code (SIC2)] and fiscal
year (but we do not use firm-level fixed effects, given
our large cross-sectional panel).
Figure 3. New Outside Directors—Depth/Breadth Components
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Model Estimation and Results
To address empirically the possibility of endogeneity in
new director selection, we employ a two-stage Heckman
regression model (Heckman 1979). The procedure in-
volves constructing a probit model to predict director
selection (Acharya and Pollock 2013) and then employing
the inverse Mills ratio from this first-stage equation in the
second-stage ordinary least squares (OLS) equation to
separately predict nondirectional strategic change and di-
rectional strategic change, respectively. Appendix 2 in the
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Figure 4. Incumbent Outside Directors—Depth/Breadth Components
supplementary file describes the selection of instruments
and controls for the first-stage selection equation, and
it shows bivariate correlations as well as the first-stage
selection model predicting director selection.
Table 1 provides the descriptive statistics and a
correlation matrix for all variables in the study. Table 2
presents the results of the second-stage Heckman re-
gression model used to test Hypothesis 1a, which
posited that new directors with deep and broad ex-
pertise will exert a stronger influence (relative to other
new directors whose expertise is either deep or broad)
on a firm’s subsequent strategy. For these results,
strategic change is defined in terms of its overall mag-
nitude (i.e., nondirectional strategic change). Table 3
shows the results of the second-stage Heckman re-
gression model used to test Hypothesis 1b, which
posited that deep/broad directors will also exert a
stronger directional influence on a firm’s subsequent
strategy. For these results, directional strategic change
is captured in terms of the movement of a firm’s
strategy toward that strategy most familiar to the new
director. In Tables 2 and 3, Model 1 includes control
variables only, and Model 2 simply adds the moderator
variables. Model 3 shows the significance of adding
director depth/breadth to test Hypotheses 1a and 1b, and
Models 4 and 5 show the results obtained when testing
interaction effects (Hypotheses 2 and 3). Model 6 in
each table includes all variables. The results shown in
Model 3 of Tables 2 and 3 indicate strong support for
both Hypotheses 1a and 1b, with a statistically positive
coefficient for director depth/breadth for both non-
directional strategic change (p < 0.05) and directional
strategic change (p < 0.001), respectively. We discuss
11
the substantive implications of these effects in the post
hoc analyses section below.
Hypotheses 2 and 3 establish the potential board-
level moderators (based on a board’s differential open-
ness to strategic change) of our main hypothesized
relationships (Hypotheses 1a and 1b). The results of
these interaction effects, which generally indicate sup-
port for Hypotheses 2 and 3, are shown in Model 6 of
Table 2 for nondirectional strategic change and Model 6
of Table 3 for directional strategic change. As predicted,
the influence of the deep/broad director on strategic
change will be less positive for those boards less open
to change (i.e., characterized by low director turnover
and greater homogeneity of tenure). Stated in positive
terms, Model 6 in Table 2 and Table 3 supports
Hypothesis 2 by showing that the influence of the
deep/broad director on strategic change is greater
when he or she joins a board experiencing high turn-
over (p < 0.001 for nondirectional strategic change and
p < 0.05 for directional strategic change). Model 6 in
Table 3 supports Hypothesis 3, in that we find that
the influence of the deep/broad director on strategic
change is greater when joining board with high tenure
heterogeneity—but only in terms of directional stra-
tegic change (p < 0.05). We also illustrate these findings
in Figures 5–7, which show how the relationship be-
tween the addition of a deep/broad director and esti-
mated changes in firm strategy differ in different board
contexts. Specifically, we map the effects of director
depth/breadth on nondirectional and directional strategic
change based on high (mean +1 S.D.) and low (mean −1
S.D.) levels for the moderators. In each case, the graphs
highlight the significant differences discussed above.
 12

Table 1. Descriptive Statistics and Bivariate Correlations (N = 750)

Variable Mean SD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

1 Nondirectional strategic change 2.02 1.81

2 Directional strategic change −0.73 0.93 0.04
3 Depth/breadth 6.08 3.11 0.05 0.13
4 Board turnover 0.14 0.14 0.03 −0.08 0.08
5 Board tenure heterogeneity 1.35 0.65 −0.06 −0.05 0.04 0.03
6 Age 53.60 8.62 0.05 0.04 0.16 −0.02 0.00
7 Prestige 0.31 0.46 −0.03 0.07 0.26 −0.03 −0.03 0.08
8 Consultant 0.31 0.46 0.06 −0.03 0.09 0.03 −0.02 0.07 0.03
9 Graduate education 0.42 0.49 −0.03 0.07 0.07 0.03 0.03 −0.05 0.17 0.00
10 Multiple hires 0.48 0.50 0.11 0.04 0.11 0.30 0.09 0.01 0.00 0.01 −0.01
11 Firm age (ln) 2.68 0.71 −0.06 −0.03 0.08 −0.08 0.32 0.08 0.02 0.00 0.03 −0.06
12 Firm size 4.98 1.62 −0.02 0.04 0.14 −0.16 −0.01 0.10 0.10 −0.02 0.02 −0.04 0.27
13 VC backing at IPO 0.66 0.47 −0.05 0.01 0.12 −0.05 −0.09 0.03 0.13 0.03 0.05 −0.02 −0.05 0.10
14 Outside director ratio 0.71 0.12 0.03 0.01 0.10 −0.03 −0.09 0.03 0.11 0.01 0.05 0.08 0.12 0.23 0.19
15 Outside director with CEO experience (ratio) 0.18 0.14 −0.04 0.12 0.22 0.01 −0.08 0.03 0.16 −0.04 0.03 0.01 0.08 0.15 0.11 0.28
16 Board size 8.35 1.99 0.01 0.07 0.06 −0.25 −0.12 0.03 0.03 0.01 0.01 0.10 0.06 0.47 0.15 0.20 0.07
17 CEO prestige 0.48 0.50 0.00 0.17 0.07 −0.03 −0.16 0.02 0.10 −0.02 0.07 0.01 −0.07 0.13 0.15 0.11 0.09 0.15
18 CEO tenure in position 5.32 6.00 −0.08 −0.01 −0.03 −0.21 0.37 0.08 −0.02 −0.04 −0.09 −0.09 0.20 0.03 0.00 −0.19 −0.06 −0.09 −0.12
19 CEO duality 0.47 0.50 0.04 −0.05 −0.03 −0.09 0.04 −0.02 −0.06 0.01 −0.09 −0.03 −0.08 0.06 −0.12 −0.23 −0.03 −0.03 −0.10 0.24
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Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS 13

Table 2. Heckman OLS Regression Models of Nondirectional Strategic Change

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Depth/breadth 0.10* −0.03 0.03 −0.07

(0.02) (0.03) (0.05) (0.05)
Depth/breadth × Board turnover 0.30*** 0.29***
(0.13) (0.13)
Depth/breadth × Board tenure 0.10 0.05
heterogeneity (0.03) (0.03)
Board turnover 0.03 0.03 −0.21** 0.03 −0.21**
(0.56) (0.55) (1.02) (0.56) (1.03)
Board tenure heterogeneity −0.01 −0.01 −0.02 −0.08 −0.06
(0.14) (0.14) (0.14) (0.26) (0.25)
Age 0.06† 0.06† 0.05 0.05 0.05 0.05
(0.01) (0.01) (0.01) (0.01) (0.01) (0.01)
Prestige −0.02 −0.02 −0.04 −0.03 −0.04 −0.02
(0.15) (0.15) (0.15) (0.15) (0.15) (0.15)
Consultant 0.06† 0.06† 0.06 0.05 0.06 0.05
(0.15) (0.15) (0.15) (0.15) (0.15) (0.15)
Graduate education −0.04 −0.04 −0.04 −0.04 −0.04 −0.04
(0.14) (0.14) (0.14) (0.14) (0.14) (0.14)
Multiple hires 0.06 0.05 0.04 0.05 0.04 0.05
(0.13) (0.14) (0.14) (0.14) (0.15) (0.15)
Firm age (ln) 0.06 0.06 0.06 0.06 0.06 0.06
(0.13) (0.14) (0.14) (0.14) (0.14) (0.14)
Firm size 0.06 0.06 0.05 0.04 0.05 0.04
(0.06) (0.06) (0.06) (0.06) (0.06) (0.06)
VC backing at IPO −0.05 −0.05 −0.06 −0.06 −0.06 −0.06
(0.18) (0.18) (0.18) (0.18) (0.18) (0.18)
Outside director ratio 0.08† 0.08† 0.09† 0.08† 0.09† 0.09†
(0.68) (0.68) (0.69) (0.69) (0.70) (0.69)
Outside director with CEO experience −0.01 −0.01 −0.02 −0.02 −0.02 −0.02
(ratio) (0.56) (0.56) (0.56) (0.55) (0.56) (0.55)
Board size 0.03 0.04 0.04 0.03 0.04 0.03
(0.05) (0.05) (0.05) (0.05) (0.05) (0.05)
CEO prestige 0.04 0.04 0.04 0.04 0.04 0.04
(0.14) (0.14) (0.14) (0.14) (0.14) (0.14)
CEO tenure in position −0.10* −0.09† −0.09† −0.09† −0.09† −0.09†
(0.01) (0.01) (0.01) (0.01) (0.01) (0.01)
CEO duality 0.04 0.04 0.04 0.04 0.04 0.04
(0.14) (0.15) (0.14) (0.14) (0.14) (0.14)
Inverse Mills ratio 0.01 0.01 0.01 0.01 0.01 0.01
(0.40) (0.40) (0.40) (0.40) (0.40) (0.40)
Industry (SIC2) fixed effects Yes Yes Yes Yes Yes Yes
Fiscal year fixed effects Yes Yes Yes Yes Yes Yes
Constant 2.01 1.93 1.82 2.12 2.06 2.24
(1.64) (1.66) (1.68) (1.67) (1.69) (1.66)
Observations 750 750 750 750 750 750
R2 0.16*** 0.16*** 0.17*** 0.18*** 0.17*** 0.18***

Notes. All, except Constant, are standardized beta coefficients. Robust standard errors are in
parentheses. Two-tail effects.
†
p < 0.1; *p < 0.05; **p < 0.01; ***p < 0.001.

Robustness Checks and Post Hoc Analyses
We performed a battery of robustness checks and post
hoc analyses, which we describe in further detail in
Appendix 3 of supplementary file. First, models using
other instruments for the first-stage Heckman model
predicting director selection provided results similar to
those reported here (Heckman 1979). Second, we per-
formed a two-stage least squares estimation procedure,
and results showed that the Heckman/OLS estima-
tion is appropriate. Third, to address the possibility that
firms may be seeking new outside directors who are
particularly broad and deep (relative to the population),
 Lungeanu and Zajac: Thinking Broad and Deep
14 Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS

Table 3. Heckman OLS Regression Models of Directional Strategic Change

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Depth/breadth 0.13*** 0.04 −0.07 −0.14

(0.01) (0.02) (0.03) (0.03)
Depth/breadth × Board turnover 0.21* 0.19*
(0.08) (0.08)
Depth/breadth × Board tenure 0.30* 0.27*
heterogeneity (0.02) (0.02)
Board turnover −0.08† −0.08† −0.26** −0.09* −0.24**
(0.29) (0.29) (0.56) (0.28) (0.57)
Board tenure heterogeneity −0.03 −0.04 −0.04 −0.23** −0.21*
(0.07) (0.06) (0.06) (0.12) (0.12)
Age 0.04 0.04 0.02 0.03 0.03 0.03
(0.00) (0.00) (0.00) (0.00) (0.00) (0.00)
Prestige 0.00 0.00 −0.02 −0.02 −0.02 −0.01
(0.08) (0.07) (0.08) (0.08) (0.08) (0.08)
Consultant −0.01 −0.01 −0.02 −0.02 −0.01 −0.02
(0.08) (0.08) (0.08) (0.08) (0.08) (0.08)
Graduate education 0.05 0.05 0.05 0.05 0.04 0.04
(0.07) (0.07) (0.07) (0.07) (0.07) (0.07)
Multiple hires 0.02 0.05 0.04 0.04 0.05 0.05
(0.07) (0.07) (0.07) (0.07) (0.07) (0.07)
Firm age (ln) −0.04 −0.03 −0.03 −0.03 −0.03 −0.02
(0.07) (0.07) (0.07) (0.07) (0.07) (0.07)
Firm size 0.04 0.03 0.02 0.02 0.03 0.02
(0.03) (0.03) (0.03) (0.03) (0.03) (0.03)
VC backing at IPO −0.04 −0.04 −0.04 −0.04 −0.04 −0.04
(0.09) (0.09) (0.08) (0.08) (0.08) (0.08)
Outside director ratio −0.04 −0.04 −0.04 −0.04 −0.03 −0.03
(0.33) (0.33) (0.33) (0.33) (0.33) (0.33)
Outside director with CEO experience 0.11** 0.11** 0.09* 0.10* 0.10** 0.10**
(ratio) (0.25) (0.25) (0.25) (0.25) (0.25) (0.25)
Board size 0.05 0.02 0.02 0.02 0.02 0.02
(0.03) (0.03) (0.03) (0.03) (0.03) (0.03)
CEO prestige 0.13** 0.13** 0.13** 0.13** 0.13** 0.13**
(0.08) (0.08) (0.08) (0.08) (0.08) (0.08)
CEO tenure in position 0.06 0.05 0.06 0.06 0.06 0.06
(0.01) (0.01) (0.01) (0.01) (0.01) (0.01)
CEO duality −0.03 −0.04 −0.04 −0.04 −0.03 −0.04
(0.08) (0.08) (0.08) (0.08) (0.08) (0.08)
Inverse Mills ratio −0.09 −0.10 −0.09 −0.09 −0.09 −0.09
(0.21) (0.21) (0.21) (0.21) (0.21) (0.21)
Industry (SIC2) fixed effects Yes Yes Yes Yes Yes Yes
Fiscal year fixed effects Yes Yes Yes Yes Yes Yes
Constant −0.53 −0.34 −0.41 −0.30 −0.04 0.02
(0.85) (0.86) (0.84) (0.84) (0.85) (0.86)
Observations 750 750 750 750 750 750
R2 0.16*** 0.16*** 0.18*** 0.18*** 0.18*** 0.19***

Notes. All, except Constant, are standardized beta coefficients. Robust standard errors are in parentheses.
Two-tail effects.
†
p < 0.1; *p < 0.05; **p < 0.01; ***p < 0.001.

we calculated the depth/breadth score for the entire
sample of new outside directors in our focal firms and
found that the effect of depth/breadth on strategic
change is strong even when new outside directors are
less deep/broad than the population from which they
were selected. Fourth, analyses using two additional
indicators (Lungeanu et al. 2016) for nondirectional
strategic change showed supportive results for each of
these two indicators, adding confidence that deep/
broad directors do exert an outsized influence on firm
strategy. Fifth, we consider thresholds other than our
three-year period for director experience to convert into
expertise and found that the goodness of fit was best
(smallest Akaike information criterion) using a value of
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Figure 5. Interaction Plot of Depth/Breadth and Board
Turnover—Nondirectional Strategic Change
three years. Sixth, results remained unchanged after
recalculating depth/breadth of expertise using a mul-
tiplicative measure or using Farjoun (1994) industry
reclassification based on similarity in knowledge re-
quired across industries. Seventh, to address the sub-
stantive significance of our results, we use the example
of innovative differentiation to show that one-unit in-
crease in the predicted value of our strategic change
measure results in a sizable 30% increase in research
and development (R&D) intensity in the following year
(and a similarly large 26% increase in R&D intensity
at t + 2 years).
Discussion
We began by suggesting that sociocognitive and so-
ciopolitical approaches to corporate governance re-
search had made valuable contributions regarding the
relevance of highly function-specific or event-specific
types of director expertise and influence but had yet to
address other forms of director expertise and influence.
This motivated our study, leading us to advance and
test theory and mechanisms for the outsized influence
of the deep/broad director, defined in terms of a di-
rector’s possessing expertise that originates from both
deep and broad prior experiences. We discussed how
an individual director’s having both depth and breadth
of prior experiences implies a powerful combination
of greater capability and credibility (i.e., the enhanced
ability to understand novel situations, provide argu-
ments, engage in discussions, and articulate strategic
solutions attuned to contextual dissimilarities), and
that this combination provides the platform to exert
an outsized influence in shaping a firm’s strategic
direction.
The evidence in support of our main hypothesis
represents the first systematic empirical result show-
ing that individual deep/broad directors have an
15
Figure 6. Interaction Plot of Depth/Breadth and Board
Turnover—Directional Strategic Change
outsized influence on a firm’s business-level strategy.
By identifying how a specific version of director expertise
provides insight into which directors are more likely to
be the strategic movers and shakers in the boardroom,
we contribute a new perspective on the longstanding
debate in the corporate governance literature regarding
whether directors have the capability (experience) and
ability (opportunity) to influence strategy. Our study
highlights that the debate is better served by acknowl-
edging the likely heterogeneity across individual di-
rectors on the question of influence. We show that our
theoretical focus on deep/broad expertise is consistent
with advances made in psychology and cognition re-
search regarding the nature of expertise, allowing us to
predict and show that some new outside directors, de-
spite the lack of a historically established position in
the firm, can still exert a significant influence in the
trajectory of a firm’s strategic direction. In addition, we
also show that this significant influence can be amplified
or attenuated by a board’s openness to strategic change.
Scholars studying boards and strategic change have
varied in their beliefs about whether boards impel,
impede, or have no effect on strategic change (Rindova
1999, Westphal 1999, Golden and Zajac 2001, McDonald
et al. 2008), and a debate continues to exist regarding the
(in)sufficient director knowledge, time, or influence that
that directors have for involvement in strategic change.
Our theoretical focus on the depth and breadth of an
individual director’s expertise as generating board-
room influence, together with our supportive empirical
findings in the context of newly public firms, provides
greater nuance and understanding on whether directors
are able and/or capable to become involved in strategic
decision making. Our focus has been on building on
prior sociocognitive and sociopolitical views of corpo-
rate governance by establishing a theoretical framework,
empirical context, and rigorous empirical analysis to

16
Figure 7. Interaction Plot of Depth/Breadth and Board
Tenure Heterogeneity—Directional Strategic Change
provide insight into how and why deep/broad directors
are influential in shaping firms strategy.
We would welcome future research that extends our
work to consider more closely the performance impli-
cations of our approach and findings. However, we hope
that such work would go beyond simply assessing the
firm-level performance consequences of director influ-
ence and would consider instead the relevance of a variety
of individual-, board-, and firm-level contingencies
surrounding such performance expectations (see, e.g.,
Golden and Zajac’s 2001 study, which shows how
differences in organizational performance after strategic
change were significantly contingent on the fit between
board and management views on strategy).
We also see our sociocognitive approach, which
builds on individual-level theories on expertise from
psychology and communications, as complementing
the human capital framework typically used in cor-
porate governance research. Although that approach
has motivated important work assessing the relevance
of a board’s human capital breadth and depth (Haynes
and Hillman 2010, Filatotchev and Allcock 2013), we
have sought to show that there is additional value in
a sociocognitive perspective that addresses how and
why a blend of depth and breadth of expertise can be
found at the level of the individual director (Gavetti
and Menon 2016) and how such cognitive inputs can
serve as a platform for individual-director influence on
strategic decision making (Rindova 1999). Our theo-
retical development also complements and extends
recent research on the merits of “quad-qualified” direc-
tors for effective monitoring (Hambrick et al. 2015), which
suggested that deep domain expertise is one necessary
trait of the quad-qualified director. Our study shows
that a blend of depth and breadth of expertise can reside
at an individual level and can provide necessary ca-
pability and credibility to exert influence.
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
Our theory suggests that capability and credibility are
independent traits that covary together (e.g., Kahneman
and Klein 2009). As a result, deep and broad experts
can see strategic issues from multiple vantage points,
can engage in generating strategic options, and can
credibly transfer expertise in contexts different from
those previously experienced. These benefits suggest the
existence of a third mechanism that may increase a deep/
broad director’s influence. Specifically, it is possible that
a deep/broad director’s confidence when justifying and
advocating recommendations is higher, because they
understand interdependencies among various solutions
and their contingent applicability to (also) interdependent
problems. However, confidence can be a double-edged
sword. On one hand, a deep/broad expert director can be
confident and simultaneously circumspect about raising
points of view and more likely to speak up and have
his or her voice heard (Finkelstein and Mooney 2003
On the other hand, anomalies (i.e., overconfidence)
can exist when confidence is not accompanied by req-
uisite capability. We welcome future research on the
conditions in which excessively confident directors exert
influence on firm strategy and/or firm performance and
whether the simultaneous presence of deep and broad
expertise can help avoid psychological biases such as
overconfidence.
Broadly speaking, we see our work as not only rele-
vant for the governance literature and its relatively recent
attention to social cognition and individual psychology
but also relevant for other literatures seeking to move
from functional aspects of expertise to broader concep-
tualizations of expertise that consider its heterogeneity
within the same individual (Gardner et al. 2012). For
example, we see our theoretical elaboration as com-
plementing emergent research on the microfoundations
of dynamic capabilities. Specifically, recent studies
emphasized the necessity to (a) conceptualize capabilities
at an individual level (Felin et al. 2012) and (b) consider
more fully the cognitive aspect of capabilities and
related work in psychology (Gavetti et al. 2007). We
address these points by focusing on the sources of an
individual’s capability and credibility to generate and
communicate novel solutions to complex problems.
This suggests that there is value in future research
developing new theory that acknowledges the likely
heterogeneity in deep/broad expertise across dynamic
contexts, thus addressing the debate on the relevance
of dynamic capabilities in static and dynamic envi-
ronments (Barreto 2010).
Having established that deep/broad directors exert
an outsized influence on business-level strategy, our
additional moderator hypotheses shed light on how board
context can affect the degree of influence a deep/broad
director can wield. Specifically, we consider socio-
political factors, and we predict and find that boards
with more stable cohorts/coalitions are relatively less
Lungeanu and Zajac: Thinking Broad and Deep
Organization Science, Articles in Advance, pp. 1–20, © 2019 INFORMS
open to the influence of the deep/broad director. Our
supportive findings suggest that there may be other
contingencies that increase/decrease the influence of
the deep/broad director. For example, one could address
the possibility that such influence may be affected by
other stakeholders, such as a powerful CEO or in-
dependent board chair. Thus, we see value in future
research establishing boundary conditions for the
relationship we observe and, more generally, disen-
tangling the relationship between the influence of
deep/broad directors, board and managerial charac-
teristics, and firm behavior and firm performance.
We also see our study as offering a methodological
contribution in that we have sought to overcome several
known limitations of prior studies seeking to link boards
to firm strategy. For example, whereas most prior studies
in the governance literature measure strategy with a
limited set of archival variables that reflect discrete
moves (e.g., acquisition choices), we were able to more
comprehensively capture the business-level tactics a
firm may potentially pursue. Prior studies have also
typically focused on firms in the manufacturing and
service sectors, making it challenging to generalize their
findings to other populations (Kraatz and Moore 2002).
Our study includes firms in a wide variety of industries.
Also, most prior studies are confined to large public
companies, which makes findings hard to generalize to
early-stage firms in which directors tend to be more
active and their influence more visible (Lynall et al. 2003).
We chose to test our theory of deep/broad directors’
influence on firm strategy in the context of newly public
firms, which we view as particularly well suited to
a study of director influence. Directors are more likely to
be engaged in providing advice and counsel on strategic
issues at a business level in newly public firms (at or
after IPO) (e.g., Garg 2013), which are smaller and less
complex than established public companies. Although
we see our theory as applicable to more traditional large-
firm contexts, we also acknowledge that board dy-
namics in such large firms may obscure the direct effects
that we revealed in our study. We welcome future re-
search that tests the applicability of our findings re-
garding the involvement of directors in formulating
business-level strategy in the context of larger public
corporations, especially given observations regarding
the “increasing importance of strategic involvement as
the expectations of boards change” from voting on, to
involvement in, major strategic decisions (Finkelstein
and Mooney 2003, p. 105).
Relatedly, our focus on director depth and breadth of
experience led us logically to emphasize certain prior ex-
periences (firms, industries, and strategies). If one were
to address the potential relevance of expertise depth/
breadth for other executives (e.g., senior- or middle-
level managers focused on strategy implementation),
17
additional or different dimensions might also capture
the types of experiences and mechanisms most rele-
vant for such executives and outcomes. Given that our
operationalization of director expertise encompasses
a very large array of experiences as they relate to in-
dustries, companies, and strategies, as well as the depth
of these experiences, we hope that our demonstration
of the relevance of this expanded notion of experience-
based expertise could generate interest in establishing
a more multifaceted consideration of a new director’s
“qualifications.” Ideally, the potential benefit of ex-
plicitly recognizing a larger range of prior experiences
in the evaluation of outside directors’ behavioral and
operational qualities would extend to considering how
such expertise-based factors would interact with other
sociopolitical and social psychological dynamics
within the board (Westphal and Zajac 1995).
Finally, we wish to emphasize that our focus on
highlighting the relevance of combining depth and
breadth of expertise does not imply possible alter-
natives for accumulating knowledge and building
expertise. For example, Gavetti and Menon’s (2016)
fascinating qualitative study of Charles Merrill sug-
gests that an individual with limited breadth and
extreme depth can perhaps understand new domains,
provided the domains are structurally similar. Al-
though a deep domain expert may jump across do-
mains and thus provide innovative solutions for the
new domain, recent research in psychology and
cognition suggests that such jumps are notable for
their rarity (Kahneman and Klein 2009). In any event,
we hope our work can provide a foundation for future
research, whether large-scale or case-based research,
that can examine how different combinations of deep
and broad expertise can result in meaningful differ-
ences in strategically relevant outcomes for firms.
Acknowledgments
The authors acknowledge the helpful comments of Robert
Dewar, J. P. Eggers, Sam Garg, Henrich Greve, Donald
Hambrick, Paul Hirsch, Vilmos Misangyi, Klaus Weber, and
David H. Zhu; seminar participants at IESE Business School,
INSEAD, Northeastern University, and Purdue University;
and Organization Science Senior Editor Giovanni Gavetti and
two anonymous reviewers. They also thank the Zell Center
for Risk Research at Northwestern University for providing
financial assistance and David Torres, Nadia Hlebowitsh, and
Margaret Hlebowitsh for their data collection assistance.
Endnotes
1
See Barnes v. Andrews, 298 F. 614, 618 (S.D.N.Y. 1924), quoted in
Strine et al. (2010, p. 9).
2
Amgen Inc. Board of Directors Guidelines for Director Qualifications
and Evaluations. Accessed January 5, 2018, https://www.amgen.com/
about/how-we-operate/corporate-governance/board-of-directors
-guidelines-for-director-qualifications-and-evaluations/.

18
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Razvan Lungeanu is assistant professor of entrepreneur-
ship and innovation at the D’Amore-McKim School of
Business, Northeastern University. His research has been
published in major academic journals and emphasizes be-
havioral perspectives on firms’ choices among modes of
development (alliances, mergers and acquistions, internal
research and development), corporate governance, and
business strategy. He received his PhD from the Kellogg
School of Management, Northwestern University.
Edward J. Zajac is the James F. Beré Professor of Man-
agement and Organizations at the Kellogg School of Man-
agement, Northwestern University. His research, which has
been published widely in major academic journals, empha-
sizes the integration of economic and behavioral perspectives
on strategic alliances, corporate governance, and organiza-
tional adaptation and change.