The Differentiated Effects of Human Resource Diversity on Corporate Innovation

Abstract

By linking theoretical perspectives on human resource diversity to the distinction between knowledge exploration and exploitation, this paper contributes to the growing research literature on diversity and innovation by following up on the original argument by March [1991] that different dimensions of organizational learning depend on different inputs and processes. Empirically, the paper draws on a unique dataset constructed by merging Norwegian employer–employee register data for 2004–2008 with Community Innovation Survey (CIS) data covering the years 2008–2010. Bivariate probit regressions with controls for innovation strategy find patenting propensities more responsive to the diversity of experience-based knowledge accumulated in firms, than the propensities to improve production processes or introduce new products onto the market. The latter depends foremost on firms’ investments in innovation, and responds positively to human resource diversity only when the financial commitment of firms to development work is limited.

Collected worker experiences and the novelty content of innovation

“…This has led to a substantial volume of research that is concerned with how employee diversity along dimensions such as age, gender, ethnicity and education affects firm performance (van Knippenberg, De Dreu, and Homan 2004, Kearney, Gebert, and Voelpel 2009, Horwitz and Horwitz 2007, van Knippenberg and Schippers 2007 and innovation (Mohammadi, Broström, and Franzoni 2017, Bogers, Foss, and Lyngsie 2018, Østergaard, Timmermans, and Kristinsson 2011. We extend this by examining first whether experiences described in the dimension similarity-diversity per se influences the novelty content of innovation (Nooteboom 2000, Solheim andHerstad 2018) and do so under the assumption that broader experiences translate into a larger potential for truly new products and practices:…”

“…Recent studies at the regional level suggest that 'related variety' enhances incremental innovations, while unrelated variety is more conducive to radical innovation (Castaldi, Frenken, andLos 2015, Miguelez andMoreno 2018). Firm-level studies of collected experiences are more recent (Östbring, Eriksson, and Lindgren 2018), and include Solheim and Herstad (2018) who follow March (1991) in suggesting that the differences in perspectives associated with unrelated variety (URV) might be particularly important for explorative organizational learning while related variety (RV) support exploitation expressed as streams of incremental changes. This is reflected in two hypotheses capturing different relationships between innovation and experience variety: H2a: Intra-firm related variety of collected experiences is positively associated with incremental innovation H2b: Intra-firm unrelated variety of collected experiences is positively associated with radical innovation Several moderators of the relationship between variety and innovation might be at play.…”

Samanhengar mellom utanlandskfødd arbeidskraft og innovasjon: er det kjønnsmessige og geografiske skilnader?

“…Gitte er gitt til oss ved fødsel, som til dømes alder og fødeland, medan erverva er tileigna i løpet av livet, som utdanning og erfaring. Studiar av mangfald og innovasjon ser på begge (Solheim & Herstad 2018;Østergaard, Timmermans & Kristinsson 2011) og trekk fram at mangfald er som eit tviegga sverd. Auka mangfald kan på den eine sida gi fleire perspektiv og auke innovasjonsevna.…”

Fostering Innovation Through Workplace Diversity

“…The key to increasing innovation capability could therefore be to introduce diversity in different ways; for example, by including people from different places or with diverse industrial backgrounds. In a recent study I carried out with Sverre J. Herstad on 2,942 Norwegian enterprises (Solheim and Herstad, 2017), we investigated how different types of diversity affect different types of innovation. We applied a unique data-set (made available from Statistics Norway) compiled by Linked Employer-Employee Data (LEED), which was merged with the Community Innovation Survey (CIS).…”