Discussion and Conclusion

Knowledge and innovation are highly related to human talent since, after all, humans are the ones who directly possess knowledge, and innovation is mostly a group activity. In this regard, although many non-traditional talents hold great potential for leading innovation, to date, the majority of MNEs have preferred traditional talent and impeded the development of their own innovative capacity. In other words, MNEs have been hesitant to recognize and value non-traditional expatriates’ talents when it comes to selecting expatriates for IAs (Hewlett, Luce, & West, 2005). With social identity theory, uncertainty identity theory, similarity-attraction paradigm, and attraction-selection-attrition framework as backdrops, we discuss why non-traditional talents have been excluded in IAs and what relationships between diverse human capital and innovation might exist.

As the global economy has become more knowledge- and innovation- based, the demand for talented expatriates has grown continuously (Scullion, 1994); this results in a global talent shortage that is one of the biggest challenges facing MNEs at present. Increasing talent shortages across the globe pose a significant threat to MNEs; yet simultaneously, they increase the recruiting opportunity for talent with non-traditional backgrounds, including sexual orientation. Indeed, in recent years, there has been a growing number of MNEs that are coming forward to include more diverse talent in their IAs. In support of this trend, we address that MNEs should cast nets beyond traditional talent pools, particularly taking LGBT talents into consideration to fill expatriate positions.

Diversity has long been overlooked in innovation research, albeit with increasing recognition of its importance as a key driver of innovation. According to a study conducted by the Center For Talent Innovation (Center For Talent Innovation, 2013), MNEs embracing inherent diversity, such as sexual orientation and religious background in the workplace, have much greater possibilities for innovation. This is not only because of an influx of diverse inputs that diverse talent generates, but also because diversity triggers more open, frequent, and creative information processing that is oftentimes lacking in homogeneous groups (Milliken & Martins, 1996). Consistent with this, several scholars have demonstrated that homogeneous groups may hinder innovative thoughts and ideas (Bantel & Jackson, 1989; Cox, 1993; Nijstad & De Dreu, 2002).

I nnovation is not a single level of matter. In other words, neither individual-level factors nor organizational-level factors alone can fully explain innovation (Van Everdingen & Waarts, 2003; Waarts & Van Everdingen, 2005); rather, including multilevel factors provides a richer understanding and a clearer direction for innovation. In short, as four case findings have shown, innovation hinges on various levels, including individual-level (micro), organizational-level (meso), and national-level (macro). Table 5.1 provides details of contextual factors at three levels affecting innovation. In addition, Fig. 5.1 depicts a model for integrating multilevel sources on innovation.

Table 5.1 Three levels of innovation factors


Key factors affecting innovation

Individual level (Micro)

  • • Perceived fairness of the equality
  • • Perceived organizational support

Organizational level (Meso)

  • • Open discussion
  • • Diversity training
  • • Organizational diversity
  • • Inclusive corporate culture
  • • Diversity-friendly workplace
  • • Equal employment opportunity
  • • Diverse employee resource groups
  • • Organizational guidelines and regulations
  • • TMT's favorable attitudes toward diversity

National level (Macro)

  • • Culture of tolerance and acceptance
  • • LGBT-related legislation (e.g., non-discrimination laws, equal rights, marriage equality)

The Center For Talent Innovation study (2013) reported further that diverse and innovative MNEs are highly correlated with market growth. More specifically, 75 percent of respondents who work for MNEs with diversity are more likely to have a marketable idea implemented. Similarly, Gunday et al. (2011) found positive effects of innovations on firm performance.

Innovation model

Fig. 5.1. Innovation model

On balance, with increasing needs for MNEs to promote innovation in order to compete in today’s global business environment (Subramaniam & Youndt, 2005), the more an MNE values non-traditional diversity, the greater the innovation and productivity (Cox, Lobel, & McLeod, 1991; McLeod, Lobel, & Cox, 1996).

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