Human resource redeployability and entrepreneurial hiring strategy

Hietaniem, L, Santamaria, S, Kacperczyk, A and Peltonen, J (2024) Human resource redeployability and entrepreneurial hiring strategy. Strategic Management Journal, 45 (2). pp. 272-300. ISSN 0143-2095

Abstract

The timing of talent acquisition is a central decision for new ventures. On one hand, hiring after demand is proven minimizes losses. On the other hand, hiring before demand is proven allows new ventures to start developing unique capabilities. We resolve this tension by proposing that the timing depends on human resource redeployability. We test our theory with the population of Finnish ventures showing that portfolio entrepreneurs hire more employees early on because of higher redeployment potential and that they hire employees with more transferable skills in order to benefit from the redeployment option. To probe our mechanisms, we examine how talent acquisition strategies in portfolio and standalone ventures vary with external conditions that reduce or amplify the benefits of redeployment.