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  • 2021
  • Working Paper
  • HBS Working Paper Series

Multi-location Workers in Multinational Firms? Tradeoffs in Contextual Specialization of Employees and Organizational Outcomes

By: Hise O. Gibson, Ryan W. Buell and Prithwiraj Choudhury
  • Format:Print
  • | Language:English
  • | Pages:49
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Abstract

We study how “contextual specialization,” the act of focusing workers’ organizational tasks within a particular locational context, and “contextual non-specialization,” the practice of diversifying workers’ organizational tasks among multiple locational contexts, affects individual performance outcomes. Operations and strategy scholars have studied the effect of context on the performance of the firm, but the focus has been in a singular context. In this paper, we study the decision of a multi-location firm to deploy human capital across multiple contexts and identify a tradeoff between achieving immediate productivity gains through contextual specialization, and long-term productivity gains through contextual non-specialization. We exploit a natural experiment where individuals employed with the United States Army Corps of Engineers (USACE) in Europe are treated with an exogenous shock in HR policy related to how long they can be employed in Europe. We exploit this exogenous shock to study how contextual non-specialization and contextual specialization at the employee level affects project performance. We find that employees engaged in the contextually-specialized manner can initially be extremely productive; however, over the long-term these employees begin to plateau and eventually stagnate. We also find that employees working in the contextually-non-specialization environment, can initially be unproductive; however, over the long-term these employees become the most productive.

Keywords

Talent and Talent Management; Performance; Experience and Expertise; Selection and Staffing; Strength and Weakness; Personal Development and Career

Citation

Gibson, Hise O., Ryan W. Buell, and Prithwiraj Choudhury. "Multi-location Workers in Multinational Firms? Tradeoffs in Contextual Specialization of Employees and Organizational Outcomes." Harvard Business School Working Paper, No. 22-007, August 2021.
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About The Authors

Hise O. Gibson

Technology and Operations Management
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Ryan W. Buell

Technology and Operations Management
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Prithwiraj Choudhury

Technology and Operations Management
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More from the Authors
  • Your Company Needs a Space Strategy. Now. By: Matthew Weinzierl, Prithwiraj (Raj) Choudhury, Tarun Khanna, Alan MacCormack and Brendan Rosseau
  • Role of Context in Knowledge Flows: Host Country versus Headquarters as Sources of MNC Subsidiary Knowledge Inheritance By: Mike Horia Teodorescu, Prithwiraj Choudhury and Tarun Khanna
  • Tulsa Remote: Moving Talent to Middle America By: Prithwiraj (Raj) Choudhury
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