Unpacking the CEO–Board Relationship: How Strategy Making Happens in Entrepreneurial Firms

We examine how venture CEOs effectively engage their boards in the strategy-making process. Using the inductive multiple-case study approach, we track CEO–board interactions inside and outside the boardroom in depth and over time through rare observations of board meetings and rich interview access to CEOs and their boards of directors. Our primary theoretical contributions are to the resource dependence perspective. We clarify the resource versus power tradeoff as a fundamental tension in venture CEO–board relationships. Further, we add a much-needed process framework to resource dependence by highlighting how venture CEOs use four behaviors to resolve this tradeoff in an effective strategy-making process. Finally, we contribute a fresh view of the venture CEO–board relationship—i.e., spotlighting the CEO (not board) and boards as CEO–director dyads (not groups). We conclude by noting implications for other key corporate governance perspectives, and indicating boundary conditions for our framework. Overall, we deepen the conversation at the nexus of resource dependence theory and venture governance.