Focusing on entrepreneurial ventures created by employees leaving a firm, our study examines the differential impact of knowledge transfer and knowledge spillovers on both parent and spin-out performance. While extant research often uses knowledge transfer and spillover interchangeably, our study distinguishes between the two based on the “rivalness” of the relevant knowledge. We theorize that both knowledge transfer (proxied by the size of the exiting employee team) and knowledge spillovers (proxied by the experience of the exiting employee team) will aid spin-out performance. However, knowledge transfer, being more rival, will have a greater adverse impact than knowledge spillovers on parent firm performance. Using U.S. Census Bureau linked employee-employer data from the legal services industry, we find support for our hypotheses. Our study thus contributes to extant literature by highlighting a key dimension of knowledge—rivalness—and the differential competitive dynamics effect of resources with varying degrees of rivalness
Based on the premise that there is incomplete information on the true quality of both young workers and young firms, we posit that human capital composition in a firm will vary over its lifecycle. When firms are new and young, we hypothesize that senior managers will be unwilling to hire younger workers, because the unknown quality of young workers may increase the risks associated with firm viability and short term needs to combat the liability of newness. This results in younger firms having more homogeneous work forces. As firm quality is revealed over time, we hypothesize that the heterogeneity in human capital composition will increase, given that the resolution of firm level uncertainty permits managers to seek benefits of complementarities between junior and senior workers. We find support for our hypotheses using employee-employer linked microdata from the legal services industry.
We explore the role of human capital in sustainably building technological capabilities. We examine the use of inventor bricolage (i.e., the use of existing inventors in a new domain) as a strategy for utilizing existing resources to overcome constraints. We explore the use of inventor bricolage in de novo (startup) and de alio (diversifying) entrant firms in the photovoltaic technology space. Using a database of 1202 patents from 130 firms, we find that relative to existing firms, de novo firms are more likely to engage in inventor bricolage while de alio firms are less likely to engage in inventor bricolage. These findings suggest that inventor bricolage may be a sustainable strategy for the most resource-constrained technology firms. Further, we find that patents resulting from inventor bricolage are more highly cited when developed in incumbent firms than in either de novo or de alio firms. Thus, while inventor bricolage is a sustainable human asset utilization strategy, it is a necessary but not sufficient strategy in successfully building technological capabilities.
Shared experience allows players to learn the strengths and weakness of their teammates and learn how their teammates will respond to dynamic conditions. This knowledge allows the development of routines among players which facilitate high performance in the highly fluid, complex, and interdependent context of professional basketball. However, these shared routines are fragile to changes in context and personnel. Using data from the National Basketball Association, we examine the role of routine disruption through outbound and inbound mobility on individual performance. We find that when one player changes teams mid-season (which represents a large shock to the value of the player’s existing routines but only a small shock to those of the incumbents) the mover’s performance is dramatically adversely affected, but the incumbents on the new team are largely unaffected. However, when multiple players change teams together (which represents a relatively smaller shock for the movers and a larger shock to the routines of the incumbents), the performance of the movers is less adversely affected, but the performance of the incumbents is more adversely affected. Our findings indicate that the costs of disrupting the routines of existing players may outweigh the benefits of upgrading the talent in an organization.
We examine the role of human capital scope in technology development teams where integration and coordination of knowledge embodied in individuals is critical. In particular, we examine the conditions under which individuals are utilized by their project manager as either a technical specialist or a multi-functionalist, and hypothesize that individual, project, and firm determinants play a role in this strategic human capital decision. We use data garnered from 570 key technical personnel spanning 171 firms in 125 high-risk technology development teams from the National Institute of Science and Technology’s Advanced Technology Program. At the individual level, we find that intellective skills (know-why) and action-centered skills (know-what and know-how) are negatively related to an individual team member being utilized as a technical specialist. At the project level, we find that project size is positively related to utilization as a technical specialist. We also find that the resources allocated by a project manager’s firm to the project are positively related to an individual’s utilization as a specialist. Our results indicate that the interplay of individual, project and firm characteristics impact how human capital is utilized in contexts of knowledge integration.