Affective Events theory: A strategic perspective”. In Zerbe, W.J., Hartel, C.E.J. and Ashkanasy, N. M. (Ed.) Research on Emotion on Organizations. Volume 4: Emotions, Ethics, and Decision-Making (pp.1-34) Bingley, UK: Emerald Group Publishing/JAI Press. AFFECTIVE EVENTS THEORY: A STRATEGIC PERSPECTIVE

Although there has been increasing interest in the role of affect in work settings, the impact of moods and emotions in strategic decision making remains largely unexplored. In this essay, we address this shortcoming by proposing a conceptual model of strategic decision making that incorporates, at its core, the impact of affective states on cognitive processes that are integral to the decision outcome. The model is based on the principles of Affective Events Theory, which holds that environmental exigencies generate ‘affective events’ that cause emotional reactions in organizational members which, in turn, determine members’ attitudes and behaviors. We extend this model to include the effect of the extra-organizational environment, and propose that emotions ‘infuse’ those cognitive processes that are critical to the strategic decision process. We conclude that strategic decision making in organizations is not always a controlled, deliberate, purely cognitive process, as it is often described. Rather, we contend that the moods and emotions that managers experience in response to positive and negative workplace events have a significant affect on strategic decision making processes and ultimately, organizational-level outcomes. We discuss the implications of our model for theory, research, and practice.