Making the Most of the Revolving Door: The Impact of Outward Personnel Mobility Networks on Organizational Creativity

Abstract

We examine the impact of key personnel’s loss to competition on their former employers’ creative performance. Using archival data on the career histories of designers and the creative performance of their fashion houses between 2000 and 2010, we find that a house’s outward centrality in the network of personnel mobility—resulting from personnel departures—has an inverted U-shaped relationship with the house’s creative performance. This relationship is moderated by the house’s inward centrality in a network of personnel mobility stemming from hiring competitors’ employees, the tenure of its creative directors, the accomplishments of these directors, and the house’s status. Our results suggest that organizations can enhance their creativity by relying on ideas obtained through relationships with their former employees long after these employees left to work for the competition. However, this effect is contingent upon characteristics of the organization that may be associated with its capacity to absorb these ideas and its ability to signal legitimacy of the resulting output to the external audiences.