In With the Old? Examining When Boomerang Employees Outperform New Hires

Abstract

As most careers now span across organizations, former employees represent a growing source of potential hires for many organizations. Yet, we know little about whether and when firms benefit by rehiring former employees. To answer these questions, we adopt a knowledge-based view of hiring to develop new theory about how returning former employees? (?boomerangs?) post-hire performance might differ from that of external hires who have no previous experience with the firm(?new hires?). We theorize that, relative to new hires, boomerangs? familiarity with the organization?s social system will allow them to more effectively engage in coordination and overcome internal resistance from organizational incumbents. As a consequence, boomerangs should have a particular advantage in roles that require a higher degree of coordination and in units that are likely to be more resistant to outsiders. Comparing the post-hire performance of 2,053 boomerangs and 10,858 new hires over an eight-year period in a large health care organization, we find that, upon being (re)hired into the organization, boomerangs outperform new hires in their initial job spell and that this performance advantage is larger in jobs requiring greater internal coordination and in contexts characterized by greater internal resistance to external hires.

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