Published Online:https://doi.org/10.5465/amj.2017.0114

Newcomers contribute to organizational innovation by bringing in new knowledge and ideas, on the one hand, and by collaborating and exchanging with incumbents, on the other. We propose that an organization’s ability to use these contributions is influenced by hiring rate, hiring rate change, and hiring rate dispersion, which affect both the flow of new ideas into the organization and the level of collaboration between newcomers and incumbents. Using four years of data from a large, multi-industry sample, we find that hiring rate and hiring rate dispersion increase organizational innovation. We also find that increases in hiring rates from year to year are positively related to innovation for organizations with more collaborative work practices, while the relationship between hiring rate dispersion and innovation is less positive when organizations have more collaborative work practices. This study highlights how temporal patterns of hiring influence human capital acquisition and development.

REFERENCES

  • Agresti, A. 2007. An introduction to categorical data analysis (2nd ed.). Hoboken, NJ: Wiley. Google Scholar
  • Ahuja, G., & Lampert, C. M. 2001. Entrepreneurship in the large corporation: A longitudinal study of how established firms create breakthrough inventions. Strategic Management Journal, 22: 521–543. Google Scholar
  • Arthur, J. B., & Aiman-Smith, L. 2001. Gainsharing and organizational learning: An analysis of employee suggestions over time. Academy of Management Journal, 44: 737–754.LinkGoogle Scholar
  • Balkin, D. B., Markman, G. D., & Gomez-Mejia, L. R. 2000. Is CEO pay in high-technology firms related to innovation? Academy of Management Journal, 43: 1118–1129.LinkGoogle Scholar
  • Becker, B., & Gerhart, B. 1996. The impact of human resource management on organizational performance: Progress and prospects. Academy of Management Journal, 39: 779–801.LinkGoogle Scholar
  • Bishop, J. W., & Scott, K. D. 2000. An examination of organizational and team commitment in a self-directed team environment. Journal of Applied Psychology, 85: 439–450. Google Scholar
  • Brymer, R. A., Molloy, J. C., & Gilbert, B. A. 2014. Human capital pipelines: Competitive implications of repeated interorganizational hiring. Journal of Management, 40: 483–508. Google Scholar
  • Call, M. L., Nyberg, A. J., Ployhart, R. E., & Weekley, J. 2015. The dynamic nature of collective turnover and unit performance: The impact of time, quality, and replacements. Academy of Management Journal, 58: 1208–1232.LinkGoogle Scholar
  • Chadwick, C., & Dabu, A. 2009. Human resources, human resource management, and the competitive advantage of firms: Toward a more comprehensive model of causal linkages. Organization Science, 20: 253–272. Google Scholar
  • Chan, S. C. 2014. Paternalistic leadership and employee voice: Does information sharing matter? Human Relations, 67: 667–693. Google Scholar
  • Cowherd, D. M., & Levine, D. I. 1992. Product quality and pay equity between lower-level employees and top management: An investigation of distributive justice theory. Administrative Science Quarterly, 37: 302–320. Google Scholar
  • Crossan, M. M., & Apaydin, M. 2010. A multi-dimensional framework of organizational innovation: A systematic review of the literature. Journal of Management Studies, 47: 1154–1191. Google Scholar
  • Dalton, D. R., & Todor, W. D. 1979. Turnover turned over: An expanded and positive perspective. Academy of Management Review, 4: 225–235.LinkGoogle Scholar
  • Deery, S. J., & Iverson, R. D. 2005. Labor-management cooperation: Antecedents and impact on organizational performance. Industrial & Labor Relations Review, 58: 588–609. Google Scholar
  • Diaz-Diaz, N. L., & Saa-Perez, P. D. 2012. Novelty of innovation and the effect of existing and recently hired R&D human resources. Innovation (North Sydney, NSW), 14: 74–89. Google Scholar
  • Dobni, C. B. 2008. Measuring innovation culture in organizations: The development of a generalized innovation culture construct using exploratory factor analysis. European Journal of Innovation Management, 11: 539–559. Google Scholar
  • Dougherty, D. 1992. Interpretive barriers to successful product innovation in large firms. Organization Science, 3: 179–202. Google Scholar
  • Eisenhardt, K. M., & Martin, J. A. 2000. Dynamic capabilities: What are they? Strategic Management Journal, 21: 1105–1121. Google Scholar
  • Gnanadesikan, R., & Kettenring, J. R. 1972. Robust estimates, residuals, and outlier detection with multiresponse data. Biometrics, 28: 81–124. Google Scholar
  • Gong, Y., Cheung, S.-Y., Wang, M., & Huang, J.-C. 2012. Unfolding the proactive process for creativity: Integration of the employee proactivity, information exchange, and psychological safety perspectives. Journal of Management, 38: 1611–1633. Google Scholar
  • Greve, H. R. 2003. A behavioral theory of R&D expenditures and innovations: Evidence from shipbuilding. Academy of Management Journal, 46: 685–702.LinkGoogle Scholar
  • Groysberg, B., & Lee, L.-E. 2009. Hiring stars and their colleagues: Exploration and exploitation in professional service firms. Organization Science, 20: 740–758. Google Scholar
  • Groysberg, B., Lee, L.-E., & Nanda, A. 2008. Can they take it with them? The portability of star knowledge workers’ performance. Management Science, 54: 1213–1230. Google Scholar
  • Hagedoorn, J., & Duysters, G. 2002. External sources of innovative capabilities: The preferences for strategic alliances or mergers and acquisitions. Journal of Management Studies, 39: 167–188. Google Scholar
  • Hamilton, B. H., & Nickerson, J. A. 2003. Correcting for endogeneity in strategic management research. Strategic Organization, 1: 51–78. Google Scholar
  • Hannan, M. T., & Freeman, J. H. 1989. Organizational ecology. Cambridge, MA: Harvard University Press. Google Scholar
  • Hausknecht, J. P., & Holwerda, J. A. 2013. When does employee turnover matter? Dynamic member configurations, productive capacity, and collective performance. Organization Science, 24: 210–225. Google Scholar
  • Herstad, S. J., Sandven, T., & Ebersberger, B. 2015. Recruitment, knowledge integration and modes of innovation. Research Policy, 44: 138–153. Google Scholar
  • Hsu, D. H., & Ziedonis, R. H. 2013. Resources as dual sources of advantage: Implications for valuing entrepreneurial‐firm patents. Strategic Management Journal, 34: 761–781. Google Scholar
  • Huselid, M. A. 1995. The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38: 635–672.LinkGoogle Scholar
  • Jain, A. 2016. Learning by hiring and change to organizational knowledge: Countering obsolescence as organizations age. Strategic Management Journal, 37: 1667–1687. Google Scholar
  • Jann, B. 2014. Plotting regression coefficients and other estimates. Stata Journal, 14: 708–737. Google Scholar
  • Johannessen, J.-A., Olsen, B., & Lumpkin, G. T. 2001. Innovation as newness: What is new, how new, and new to whom? European Journal of Innovation Management, 4: 20–31. Google Scholar
  • Kimberly, J. R., & Evanisko, M. J. 1981. Organizational innovation: The influence of individual, organizational, and contextual factors on hospital adoption of technological and administrative innovations. Academy of Management Journal, 24: 689–713.LinkGoogle Scholar
  • Laursen, K., & Salter, A. 2006. Open for innovation: The role of openness in explaining innovation performance among UK manufacturing firms. Strategic Management Journal, 27: 131–150. Google Scholar
  • March, J. G. 1991. Exploration and exploitation in organizational learning. Organization Science, 2: 71–87. Google Scholar
  • Maurer, I., Bartsch, V., & Ebers, M. 2011. The value of intra-organizational social capital: How it fosters knowledge transfer, innovation performance, and growth. Organization Studies, 32: 157–185. Google Scholar
  • McCain, B. E., O’Reilly, C., & Pfeffer, J. 1983. The effects of departmental demography on turnover: The case of a university. Academy of Management Journal, 26: 626–641.LinkGoogle Scholar
  • McKinley, W., Latham, S., & Braun, M. 2014. Organizational decline and innovation: Turnarounds and downward spirals. Academy of Management Review, 39: 88–110.LinkGoogle Scholar
  • Nahapiet, J., & Ghoshal, S. 1998. Social capital, intellectual capital, and the organizational advantage. Academy of Management Review, 23: 242–266.LinkGoogle Scholar
  • Nifadkar, S. S., & Bauer, T. N. 2016. Breach of belongingness: Newcomer relationship conflict, information, and task-related outcomes during organizational socialization. Journal of Applied Psychology, 101: 1–13. Google Scholar
  • Nohria, N., & Gulati, R. 1996. Is slack good or bad for innovation? Academy of Management Journal, 39: 1245–1264.LinkGoogle Scholar
  • Nyberg, A. J., & Ployhart, R. E. 2013. Context-emergent turnover (CET) theory: A theory of collective turnover. Academy of Management Review, 38: 109–131.LinkGoogle Scholar
  • Oke, A., Prajogo, D. I., & Jayaram, J. 2013. Strengthening the innovation chain: The role of internal innovation climate and strategic relationships with supply chain partners. Journal of Supply Chain Management, 49: 43–58. Google Scholar
  • Ortega, J. 2001. Job rotation as a learning mechanism. Management Science, 47: 1361–1370. Google Scholar
  • Paruchuri, S., Nerkar, A., & Hambrick, D. C. 2006. Acquisition integration and productivity losses in the technical core: Disruption of inventors in acquired companies. Organization Science, 17: 545–562. Google Scholar
  • Ployhart, R. E., & Moliterno, T. P. 2011. Emergence of the human capital resource: A multilevel model. Academy of Management Review, 36: 127–150.LinkGoogle Scholar
  • Ployhart, R. E., Nyberg, A. J., Reilly, G., & Maltarich, M. A. 2014. Human capital is dead; long live human capital resources! Journal of Management, 40: 371–398. Google Scholar
  • Podsakoff, P. M., MacKenzie, S. B., Lee, J.-Y., & Podsakoff, N. P. 2003. Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88: 879–903. Google Scholar
  • Preenen, P. T., Vergeer, R., Kraan, K., & Dhondt, S. 2017. Labour productivity and innovation performance: The importance of internal labour flexibility practices. Economic and Industrial Democracy, 38: 271–293. Google Scholar
  • Raghunathan, S. P. 1995. A refinement of the entropy measure of firm diversification: Toward definitional and computational accuracy. Journal of Management, 21: 989–1002. Google Scholar
  • Rao, H., & Drazin, R. 2002. Overcoming resource constraints on product innovation by recruiting talent from rivals: A study of the mutual fund industry, 1986–94. Academy of Management Journal, 45: 491–507.LinkGoogle Scholar
  • Rappaport, A., Bancroft, E., & Okum, L. 2003. The aging workforce raises new talent management issues for employers. Global Business and Organizational Excellence, 23: 55–66. Google Scholar
  • Reagans, R., & McEvily, B. 2003. Network structure and knowledge transfer: The effects of cohesion and range. Administrative Science Quarterly, 48: 240–267. Google Scholar
  • Reilly, G., Nyberg, A., Maltarich, M., & Weller, I. 2014. Human capital flows: Using context-emergent turnover (CET) theory to explore the process by which turnover, hiring, and job demands affect patient satisfaction. Academy of Management Journal, 57: 766–790.LinkGoogle Scholar
  • Rollag, K. 2007. Defining the term “new” in new employee research. Journal of Occupational and Organizational Psychology, 80: 63–75. Google Scholar
  • Schumpeter, J. A. 1934. The theory of economic development (R. Opie, Trans.). Cambridge, MA: Harvard University Press. Google Scholar
  • Shatte, A., Perlman, A., Smith, B., & Lynch, W. D. 2017. The positive effect of resilience on stress and business outcomes in difficult work environments. Journal of Occupational and Environmental Medicine, 59: 135–140. Google Scholar
  • Shaw, J. D., Delery, J. E., Jenkins, G. D., & Gupta, N. 1998. An organization-level analysis of voluntary and involuntary turnover. Academy of Management Journal, 41: 511–525.LinkGoogle Scholar
  • Shipp, A. J., Furst-Holloway, S., Harris, T. B., & Rosen, B. 2014. Gone today but here tomorrow: Extending the unfolding model of turnover to consider boomerang employees. Personnel Psychology, 67: 421–462. Google Scholar
  • Singh, J., & Agrawal, A. 2011. Recruiting for ideas: How firms exploit the prior inventions of new hires. Management Science, 57: 129–150. Google Scholar
  • Slavova, K., Fosfuri, A., & De Castro, J. O. 2016. Learning by hiring: The effects of scientists’ inbound mobility on research performance in academia. Organization Science, 21: 72–89. Google Scholar
  • Smith, K. G., Collins, C. J., & Clark, K. D. 2005. Existing knowledge, knowledge creation capability, and the rate of new product introduction in high-technology firms. Academy of Management Journal, 48: 346–357.LinkGoogle Scholar
  • Smith, R. L., Ager, J. W., Jr., & Williams, D. L. 1992. Suppressor variables in multiple regression/correlation. Educational and Psychological Measurement, 52: 17–29. Google Scholar
  • Spence, M. 1973. Job market signaling. Quarterly Journal of Economics, 87: 355–374. Google Scholar
  • Statistics Canada. 2007. Guide to the analysis of the Workplace and Employee Survey 2004. Ottawa, Canada: Statistics Canada. Google Scholar
  • Stinchcombe, A. L. 1965. Social structure and organizations. In J. March (Ed.), Handbook of Organizations: 142–193. Chicago, IL: Rand McNally. Google Scholar
  • Sung, S. Y., & Choi, J. N. 2014. Do organizations spend wisely on employees? Effects of training and development investments on learning and innovation in organizations. Journal of Organizational Behavior, 35: 393–412. Google Scholar
  • Teece, D. J., Pisano, G., & Shuen, A. 1997. Dynamic capabilities and strategic management. Strategic Management Journal, 18: 509–533. Google Scholar
  • Tzabbar, D. 2009. When does scientist recruitment affect technological repositioning? Academy of Management Journal, 52: 873–896.LinkGoogle Scholar
  • Tzabbar, D., Aharonson, B. S., & Amburgey, T. L. 2013. When does tapping external sources of knowledge result in knowledge integration? Research Policy, 42: 481–494. Google Scholar
  • Tzabbar, D., & Kehoe, R. R. 2014. Can opportunity emerge from disarray? An examination of exploration and exploitation following star scientist turnover. Journal of Management, 40: 449–482. Google Scholar
  • Williams, C., Chen, P. L., & Agarwal, R. 2017. Rookies and seasoned recruits: How experience in different levels, firms, and industries shapes strategic renewal in top management. Strategic Management Journal, 38: 1391–1415. Google Scholar
  • Zhou, H., Dekker, R., & Kleinknecht, A. 2011. Flexible labor and innovation performance: Evidence from longitudinal firm-level data. Industrial and Corporate Change, 20: 941–968. Google Scholar
Academy of Management
  Academy of Management
  555 Pleasantville Road, Suite N200
  Briarcliff Manor, NY 10510-8020, USA
  Phone: +1 (914) 326-1800
  Fax: +1 (914) 326-1900