Author:

Keywords:

diversity, innovation, internationalization, MNCs, R&D, Top Management Teams (TMTs), Social Sciences, Management, Business & Economics, R&, D, top management teams, FIRM PERFORMANCE, MODERATING ROLE, CORPORATE ENTREPRENEURSHIP, MULTINATIONAL-ENTERPRISES, INSTRUMENTAL VARIABLES, NATIONALITY DIVERSITY, KNOWLEDGE INTEGRATION, MARKET VALUE, INNOVATION, STRATEGY, 1503 Business and Management

Abstract:

We investigate how international diversity in Top Management Teams (TMTs) contributes to the effectiveness of geographically dispersed R&D strategies in enhancing innovation performance. Both international work experience and nationality diversity may enhance the effectiveness of geographically dispersed R&D when there is alignment between the countries of work experience and nationality of TMT members, on the one hand, and firms’ R&D locations on the other. This influence is stronger for international work experience diversity than for nationality diversity, as the former provides more task-related knowledge to coordinate R&D activities and is less associated with the risk of social categorization. We find partial support for these notions in a panel analysis of the innovation performance of 165 leading MNCs based in Europe, Japan and the United States.