Abstract/Summary

This study investigates the selection of generalists and specialists as an organisational response to the complexity of firms’ international operations. Drawing on the concept of executive job demands, we identify institutional ambiguity and economic sophistication as two distinct sources of country environmental complexity resulting from a firm’s foreign investment and predict how they affect the selection of new executives at multinational firms. Our hypotheses associate institutional ambiguity and economic sophistication with the appointment of executives with generalist and specialist backgrounds respectively. We also examine how the two sources of environmental complexity interact and test multiple alternative specifications to enhance our understanding of environmental complexity as a determinant of executive job demands in the context of international business. Our empirical analyses are performed on a sample of 478 executive appointments occurring in 133 UK-based manufacturing firms, observed between 2008 and 2018. Findings show general support for our main hypotheses. We discuss the theoretical and practical implications of our findings as well as directions for future research.