Abstract

Quality decision-making for founders of small firms can be critically important for firm success and survival. Using a longitudinal sample of 164 small firm founders, we examine the main and moderating effects of illusions of control, time stress, and prior industry experience on the decision quality associated with a business decision. As predicted, illusions of control have a negative effect on decision quality. Additionally, both time stress and prior industry experience significantly enhance this relationship, such that higher levels of stress and experience lead to much lower decision quality for founders of small firms.

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