(A) study on the effects of diversity and similarity of experiences on employee performance: A data analytics approach

Abstract

The trade-off between specialization and generalization has been of great interest to managers related to human capital. While there have been several attempts to unveil the effect of specialization vs. generalization on performance, they generally rely on simple task analyses or lab experiments, which limits further generalization on real-world firms. Based on HR data of individuals working for a prominent manufacturing company in Korea, our data set constitutes of individuals’ annual work performance and cumulated experience during their entire tenure at the company. Using this extensive data set, we examine how specialized and diverse experiences affect overall individuals’ performance. According to our analysis results, an individual’s specialized experience, measured by the amount of cumulated time working on the focal field which the individual currently works on, positively increases the individual’s performance. As per diverse experience, the individual’s breadth of diverse experience, measured by the number of distinct fields on which the individual has worked, is positively associated with the performance on the focal field, while the depth of diverse experience, measured by the amount of cumulative time working on different fields, is negatively associated with the performance. Contribution of our work is of practical significance to the field of human resource management, offering implications on where managers should look for in individual’s resume.