Turnover and Knowledge Loss: An Examination of the Differential Impact of Production Manager and Worker Turnover in Service and Manufacturing Firms

This research examines the comparative effects of production manager and worker turnover in service and manufacturing settings. We suggest that, due to the centrality of human action in services and the ability of manufacturers to insulate the technical core, service and manufacturing companies are...

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Bibliographic Details
Published in:Journal of management studies 2014-11, Vol.51 (7), p.1025-1057
Main Authors: Eckardt, Rory, Skaggs, Bruce C., Youndt, Mark
Format: Article
Language:English
Subjects:
Employee turnover
Impact analysis
Labour turnover
Management theory
Managers
Manufacturers
Manufacturing
organizational capital
production knowledge loss
Production management
service and manufacturing
Service industries
Service industry
Studies
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Summary:This research examines the comparative effects of production manager and worker turnover in service and manufacturing settings. We suggest that, due to the centrality of human action in services and the ability of manufacturers to insulate the technical core, service and manufacturing companies are differentially dependent on and impacted by the loss of production manager and worker knowledge. The results from a survey of 150 service and manufacturing firms provide partial support for this notion and show that turnover impacts these organizations differently. More specifically, we find that: (1) the negative impact of production worker turnover on firm performance is greater in service settings than in manufacturing settings; and (2) the negative impact of production worker turnover on firm performance is greater than the impact of production manager turnover in service firms. In addition, our findings show that organizational capital moderates the turnover–performance relationship for production workers in service firms.
ISSN:0022-2380
1467-6486
DOI:10.1111/joms.12096