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Academy of Management Review

2013, Vol. 38, No. 1, 109131.


http://dx.doi.org/10.5465/amr.2011.0201

CONTEXT-EMERGENT TURNOVER (CET)


THEORY: A THEORY OF
COLLECTIVE TURNOVER
ANTHONY J. NYBERG
ROBERT E. PLOYHART
University of South Carolina
We develop a theory of collective turnover that emphasizes its microfoundation
origins and unit-level consequences. Collective turnover is the quantity and quality of
depletion of employee knowledge, skills, abilities, and other characteristics (KSAOs)
from the unit, meaning that it is the collective loss of unit KSAOs. We ground our
theory of collective turnover within the nomological network of human capital resources and resource-based theory. We then use this framework to examine the
dynamic relationships between collective turnover and human capital resources and
their effects on unit performance. We also describe the moderating impact of context
(climate and environmental complexity) and time. Thus, we present context-emergent
turnover (CET) theory.

lack a comprehensive, unifying framework for


understanding what collective turnover is, as
well as its effects on unit performance. Dess and
Shaw (2001) highlighted important differences
between collective and individual turnover, yet
more than a decade later their calls to develop
collective-level turnover theory have gone
mostly unheeded. Recently, Hausknecht and
Trevor (2011) noted that most collective turnover
research still relies on individual-level theories
and assumptions, despite the potential for collective turnovers consequences to be multiplicatively greater than assumed at the individual
level because of disruption and coordination
losses that cannot be observed at the individual
level. They state that this research lacks a rigorous analysis of its major antecedents and consequences, as well as its key emergent themes
and implications (2011: 353), and that collective level theory has been absent from much of
the [collective turnover] research reviewed here
(2011: 379).
In this article we address this deficiency by
developing a theory of collective turnover. We
ground this theory in the recognition that collective turnover is the aggregate quantity and
quality of employee knowledge, skills, abilities,
and other characteristics (KSAOs) depleted from
the unit. Functionally, then, collective turnover
is the depletion of human capital resources. The
theory developed here has three broad theoretical contributions. First, it describes the emer-

After thousands of studies on individual turnover, scholars are increasingly turning their attention to the study of collective turnoverthe
aggregate levels of employee departures that
occur within groups, work units, or organizations (Hausknecht & Trevor, 2011: 353). Such attention is understandable given the growing
recognition that collective turnover can have important consequences for organizational productivity, performance, andpotentially competitive advantage (Hancock, Allen, Bosco,
McDaniel, & Pierce, in press; Hausknecht & Holwerda, in press; Hausknecht & Trevor, 2011; Park
& Shaw, 2011; Shaw, 2011). Further, the consequences of collective turnover may be quite different from the consequences of individual turnover (Dess & Shaw, 2001; Shaw, Duffy, Johnson, &
Lockhart, 2005). The paramount importance of
understanding collective turnover is highlighted in the strategic human resource management (HRM) literature, where collective turnover is seen as the primary mechanism driving
human capital depletion (Gardner, Wright, &
Moynihan, 2011; Lepak & Shaw, 2008). Thus, examining collective turnover is vital for understanding how it affects a firms ability to use
human capital to achieve competitive advantage (Delery & Shaw, 2001).
Yet despite the growth of empirical collective
turnover research, most theory continues to be
based on individual-level conceptualizations
(Hausknecht & Trevor, 2011; Shaw, 2011). We still
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gent nature of collective turnover, and it identifies its consequences and relationships within
the nomological network of human capital resources as defined within the strategic HRM literature (e.g., Lepak, Liao, Chung, & Harden,
2006) and the resource-based views (RBVs)
treatment of intangible resources (e.g., Coff &
Kryscynski, 2011). Consequently, we explore the
emergence process of collective turnover and
emphasize the microfoundations of resource depletion. Second, the theory develops the dynamic and reciprocal nature of collective turnover and human capital resources by focusing
attention on the timing and flows of collective
turnover. Finally, the theory explicates how context, conceptualized in terms of climate and environmental complexity, influences collective
turnover and its consequences. Thus, we present
context-emergent turnover (CET) theory.
The implications of these theoretical contributions help explain previous research inconsistencies using a holistic but parsimonious theory
and generate future research prospects by offering guidelines for exploring the influences and
consequences of collective turnover.1 These implications (1) explain the nomological network
of collective turnover; (2) identify when individual and collective turnover effects are likely to
be similar and when they are likely to be different; (3) identify when collective turnover will
have positive, negative, or no consequences on
unit2 performance; and (4) provide a foundation
for conceptualizing collective turnover and,
thus, help evaluate the validity of collective
turnover measures.
We first summarize existing turnover research, noting the dominance of individuallevel studies and the recent extension to the
collective level. Our review is focused and brief

1
We briefly consider antecedents, but our primary focus
is on consequences. This is for four reasons. First, CET theory, which is firmly grounded in the RBV literature, lends
itself to focusing on unit consequences more than the antecedents of collective turnover. Second, CET theory has clear
applications for future research and practical opportunities
for units to mitigate the assumed negative consequences of
turnover. Third, space constraints do not allow us to consider
all potential antecedents along with consequences. Fourth,
most collective turnover studies have examined consequences; thus, this is the area that can benefit the most from
a unifying framework.
2
We use the term unit to signify collective levels of employees (e.g., groups, departments, organizations, etc.).

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because much of this research has recently been


reviewed (i.e., Hausknecht & Trevor, 2011; Shaw,
2011). We then introduce CET theory to explain
the nature of collective turnover and identify its
relationships to human capital resources
through the RBV lens.
THE NEED FOR COLLECTIVE
TURNOVER THEORY
Turnover research has primarily focused on
predicting individual turnover (for reviews see
Griffeth, Hom, & Gaertner, 2000, and Holtom,
Mitchell, Lee, & Eberly, 2008). Such studies
largely examine psychological antecedents to
turnover that culminate in a stay-leave decision
(e.g., Hom, Caranikas-Walker, Prussia, & Griffeth, 1992; Mobley, 1982). Recent advancements
in turnover research (e.g., the unfolding model of
turnover) have emphasized phenomena that are
external to the employee, such as shocks (Lee &
Mitchell, 1994), localized unemployment rates
(e.g., Gerhart, 1990; Hulin, Roznowski, &
Hachiya, 1985; Trevor, 2001), and organizational
influences such as pay growth (e.g., Nyberg,
2010; Trevor, Gerhart, & Boudreau, 1997).
During the past decade, interest in collective
turnover has been growing (e.g., Hausknecht &
Holwerda, in press; McElroy, Morrow, & Rude,
2001; Shaw, Delery, Jenkins, & Gupta, 1998;
Shaw, Gupta, & Delery, 2005; Takeuchi, Marinova, Lepak, & Liu, 2005). Researchers have examined relationships between collective turnover and sales growth (e.g., Batt, 2002), net
performance (e.g., Glebbeek & Bax, 2004), efficiency (e.g., Kacmar, Andrews, Van Rooy, Steilberg, & Cerrone, 2006), productivity (e.g., Shaw,
Gupta, & Delery, 2005), and various moderators
of the collective turnoverunit performance relationship, such as percentage of newcomers (e.g.,
Hausknecht, Trevor, & Howard, 2009) and labor
segment (e.g., Siebert & Zubanov, 2009). In a few
studies researchers have also examined antecedents to collective turnover, such as coworker
demographics (e.g., Sacco & Schmitt, 2005), coworker embeddedness (e.g., Felps et al., 2009),
and downsizing (Trevor & Nyberg, 2008).
It is common for collective turnover researchers to generalize individual-level theory and
findings to the unit level (Hausknecht & Trevor,
2011). At first glance this seems reasonable, because in many collective turnover studies researchers sum individual turnover to determine

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collective turnover rates (e.g., Batt, 2002; Kacmar


et al., 2006; Morrow & McElroy, 2007). Hence, if
the measurement is a simple sum of individuallevel turnover, then one might assume that individual theory could also be used to explain
collective turnover. However, this approach is
potentially fallacious (Rousseau, 1985). Multilevel theory identifies when higher- and lowerlevel phenomena are likely to be isomorphic
(the degree to which higher- and lower-level
phenomena are identical) and how higher-level
phenomena emerge from lower-level phenomena. Kozlowski and Klein (2000) described emergent phenomena as collective constructs that
originate from the behavior, affect, and cognition of individuals. The nature of interactions
among unit members, and the context within
which they interact, is what contributes to the
emergence of collective phenomena from lowerlevel origins. Bliese (2000) noted that total isomorphism is rare; partial isomorphism is more
common and suggests that lower- and higherlevel constructs have similarities but also differences. For example, climate is the shared perception of what is important and rewarded by
the organization (James & Jones, 1974; Reichers
& Schneider, 1990; Schneider, 1987) and is distinct from its individual-level origins. Similarly,
it is inappropriate to generalize individual-level
turnover findings to collective turnover because
when emergent phenomena are partially isomorphic, generalizations across levels are not
warranted (Kozlowski & Klein, 2000; Rousseau,
1985; Schwab, 1991).
Collective turnover is an emergent phenomenon that is only partially isomorphic with individual turnover. Although collective turnover
originates from individual turnover, it is different conceptually and empirically. Conceptually,
individual turnover is based on an employees
decision to stay or leave (for involuntary turnover, it is based on a supervisors decision).
When an employee leaves, that employee takes
all of his or her knowledge, skills, expertise, and
other contributions (e.g., performance). Individual turnover consequences are traditionally
considered from the basis of replacement costs
and lost individual productivity; context and social relationships are rarely considered (Dess &
Shaw, 2001). In contrast, collective turnover involves aggregated individual turnover decisions and may result in less or more detrimental
consequences than simple replacement costs.

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These losses will depend on employee KSAOs,


context, social relationships, and employee
roles in the unit (Shaw, 2011).
Therefore, the consequences of collective turnover are potentially much greater than those
recognized at the individual level (Hausknecht
& Holwerda, in press; Hausknecht & Trevor, 2011;
Shaw, 2011). Empirical research reinforces the
partial isomorphism expectation that the two
constructs are not identical. For instance, individual withdrawal behavior has different determinants and consequences than collective withdrawal behavior (Hulin, 1991). Similarly, Shaw,
Duffy, Johnson, and Lockhart (2005) found that
social capital losses explain declines in unit
performance above and beyond what would be
expected from turnover rates and that these are
more pronounced when rates are low.
Because individual and collective turnover
are only partially isomorphic, generalizing individual-level turnover assumptions and theories
can fail to uncover the processes that explain
collective turnovers nature and relationships
with other constructs. Hausknecht and Trevor
(2011) have illustrated one example of this problem: individual-level turnover theory suggests
that through replacing poorer performers involuntary turnover is positively related to performance. However, a collective turnover perspective suggests that involuntary turnover may be
negatively related to performance because of
coordination disruptions and erosions of climate. Attempts to reconcile these findings are
essentially cross-level fallacies that mix and
match theory and findings from multiple levels.
Another example is the potential benefits of voluntary turnover (Dalton, Todor, & Krackhardt,
1982; Hollenbeck & Williams, 1986). The argument is that voluntary turnover is good if replacements are higher quality or if new ideas
are brought to the unit. This seems reasonable
when considering a single replacement; however, at the collective level it is likely to depend
on many factors, a few being the employees
role, relationships, and institutional knowledge
and the time needed to find replacements.
Thus, collective and individual turnover constructs are different theoretically and empirically and have different antecedents and consequences. Generalizing individual-level theories
of turnover to the collective level is unlikely to
be appropriate; instead, new theory must be developed (a point made forcefully by Hausknecht

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& Trevor, 2011). A theory of collective turnover


must account for its microfoundations (Felin &
Hesterly, 2007; Gerhart, 2005), often described as
understanding individual-level phenomena in
the context of firm-level theorizing (Foss, 2011).
Because collective turnover is the depletion of
human capital resources, it is necessary to embed a theory of collective turnover within human
capital resource theory (Ployhart & Moliterno,
2011; Wright & McMahan, 2011). In human capital resource theory, emergence, time, and context are vital (Bowen & Ostroff, 2004; Lepak et al.,
2006; Ployhart & Moliterno, 2011). Consequently,
understanding collective turnover requires understanding emergence, time, and context. We
next develop such a theory.
CET THEORY
In this section we develop key propositions for
CET theory. Our fundamental points are that
collective turnover emerges from individual
KSAOs, collective turnover contains qualitative
and quantitative components, and collective
turnover represents the depletion of human capital resources. These points, in turn, have ramifications for collective turnovers relationships
with human capital. Consequently, an understanding of collective turnover must come
through embedding it within a nomological network of human capital resources.3
The Nature of Collective Turnover
Collective turnover defined. Collective turnover is the quantity and quality of KSAO depletion from the unit. Collective turnover is derived
from the KSAOs of employees who leave the
unit, thus emphasizing the microfoundations
and cross-level nature of collective turnover. By
defining collective turnover as emerging from
KSAOs, we explicitly recognize that it has a
temporal component and that it is affected by
context, particularly climate and environmental
complexity (Kozlowski & Klein, 2000). As a result,
CET explains why collective turnover conse-

3
We note that CET theory is not specific to involuntary or
voluntary turnover. Our propositions encompass both because CET theory is intended to explain the nature and
effects of both voluntary and involuntary collective turnover.
After describing the theory, we revisit the role of voluntary
and involuntary turnover within CET theory.

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quences frequently will be greater than individual consequences.


CET theory further breaks from traditional research by proposing that collective turnover
contains both quantitative and qualitative components that change over time. Quantitative
components represent the rate of unit turnover
that is, the percentage of employees who leave
the unit. Qualitative components represent the
types of KSAOs lost (e.g., cognitive ability) and
the degree of competence or quality of those
KSAOs (e.g., high versus low cognitive ability).
Thus, collective turnover represents the proportion of employee depletion and these employees cumulative KSAOs. Qualitative aspects of
collective turnover are typically ignored in existing research, but the quantitative component
is, by itself, deficient because it negates a complete understanding of collective turnovers
KSAO microfoundations. Stated differently, if
collective turnover emerges from individual
KSAOs, then neglecting to consider those
KSAOs will cause us to miss what is perhaps the
most important element of collective turnover.
As will be seen, quality is generally expected to
have greater impact on unit performance than
quantity.
Collective turnover is distinct from human
capital resources. As the aggregate loss of
KSAOs, collective turnover is functionally the
depletion of human capital resources. This is a
simple but vitally important perspective, because it means that an understanding of collective turnover must be embedded within the nomological network of human capital resources
and RBV. One cannot fully appreciate the nuances of collective turnover, its meaning, its determinants, and its consequences without understanding its relationship to human capital
resourcesand vice versa (Nyberg, Moliterno,
Hale, & Lepak, in press). Thus, embedding collective turnover within resource-based theory
more richly conceptualizes both collective turnover and human capital resources and builds on
calls to study their interrelationship (Dess &
Shaw, 2001; Hausknecht & Trevor, 2011; Shaw,
2011). Collective turnover may result in either a
net positive or net negative change in the value
of the human capital resource, depending on the
quantity and quality of the human capital depleted. For example, losing a few low-quality
employees may increase the value of the human
capital resource, leading to improved unit per-

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formance, whereas losing high-quality employees may decrease the value of the human capital resources and hurt unit performance.
Furthermore, the timing of these losses may
lead to profound differences. For instance, losing one employee per month for a year may
have a very different impact on the unit than
losing twelve employees in one month.
Hence, understanding the meaning of collective turnover requires understanding its relationships with human capital resources, which,
in turn, requires a grounding in resource-based
theory (Molloy, Chadwick, Ployhart, & Golden,
2011; Nyberg et al., in press). Human capital resources are intangible unit-level constructs that
can possess the characteristics needed to influence unit performance and competitive advantage (Hatch & Dyer, 2004; Wright, Dunford, &
Snell, 2001; Wright & McMahan, 1992; Wright,
McMahan, & McWilliams, 1994). Although human capital resources exist at the unit level,
they are based on the aggregation of individual
KSAOs such that human capital resources
emerge from individual-level KSAOs (Ployhart &
Moliterno, 2011; Wright & McMahan, 2011).4 The
extent to which emergence occurs depends on
the nature of member interaction (Kozlowski &
Klein, 2000). First, environmental complexity
represents the amount of coordination required
by the units task demands (Van de Ven, Delbecq, & Koenig, 1976). Second, climate represents the degree to which unit members have a
shared sense of what the unit expects, rewards,
and supports (Bowen & Ostroff, 2004; Schneider,
Bowen, Ehrhart, & Holcombe, 2000; Schneider &
Reichers, 1983). Climate influences how members interact, communicate, trust, and share
knowledge; hence, it is a conduit through which
human capital resources are connected to
KSAOs (Kozlowski & Ilgen, 2006; Schneider et al.,
2000). Thus, human capital resources emerge
from KSAOs as a function of environmental complexity demands and a supportive climate.
Positioning collective turnover within resource-based theory helps clarify the similarities and differences between collective turnover
and human capital. In terms of similarities, both

are unit-level phenomena that emerge from the


KSAOs of employees within the unit. Both also
share qualitative components (e.g., high or low
levels of knowledge), and both fluctuate over
time and exist, in theory, indefinitely (Molloy et
al., 2011). Yet collective turnover and human
capital resources are profoundly different. They
are not mirror images of each other, and collective turnover is not simply the reverse of human capital resource emergence. Rather, they
are distinct conceptually and empirically. First,
and perhaps most fundamental, they have different roles within the nomological network of
intangible resources. Human capital resources,
on the one hand, should enhance unit performance because they are strategically valuable
and controlled by a firm, enabling it to conceive of and implement strategies that improve
its efficiency and effectiveness (Barney, 1991:
101). Collective turnover, on the other hand,
rarely helps implement or conceive of a units
strategy (e.g., Delery & Shaw, 2001). Organizations try to develop strategies for reducing turnover, but the emphasis is generally on reducing
the erosion of valuable human capital resources
rather than leveraging collective turnover for
organizational profit. Thus, for organizations,
the most meaningful ramification of collective
turnover is primarily the extent to which it depletes human capital resources and affects unit
performance.5
Second, collective turnover contains a quantitative component that is usually independent of
the quantitative component of human capital
resources. Quantity within human capital resources is not usually considered but is essentially the base rate or total number of unit
employees. In contrast, collective turnover
quantity represents the erosion (reduction) from
this base rate. This can be seen in the typical
collective turnover rate metric, which is the
number of employees who leave divided by the
total number of employees (i.e., the denominator
is the base rate; Hausknecht & Trevor, 2011).
Collective turnover and human capital resource

Alternative conceptualizations of human capital resources exist (e.g., as individual investment decisions in
economics), but we limit our discussion to the resourcebased and strategic HRM treatment of human capital
resources.

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Strategic choices to remove underperforming employees


can occur, such as when a coaching staff is fired after a
losing season, but even in this situation the longer-term
emphasis is on accumulating higher-quality human capital
resources. Downsizing may be a notable exception (see
Trevor & Nyberg, 2008, for a detailed discussion of this topic),
but considering it in detail is beyond the scope of this article.

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quantities are independent if there are replacements. Suppose a unit loses 40 out of 100 employees but replaces them immediately. In this
situation the quantitative component of collective turnover is 40 percent while the quantitative
component of human capital is 100 percent because human capital remains at (or quickly returns to) full capacity. In fact, with immediate
replacement, collective turnover rates can fluctuate up and down without having a discernible
effect on the quantitative component of human
capital. Only if one assumes the situation where
collective turnover losses are not replaced will
the quantitative components of collective turnover and human capital be related in a deterministic manner. And in this situation a bizarre
consequence can theoretically occur such that
human capital disappears if collective turnover
is 100 percent.
Third, collective turnover and human capital
resources are qualitatively different. One obvious difference is that the units human capital is
based on the KSAOs of employees who remain,
whereas collective turnover is based on the
KSAOs of employees who have left; hence, the
composition of the two constructs differs in
terms of employees and their KSAOs. For example, if very high-quality employees leave the
unit, then the KSAO quality of collective turnover will be greater than the KSAO quality of the
human capital resource. Even though both collective turnover and human capital resources
originate in KSAOs, they are based on the
KSAOs of different people (i.e., those still employed versus those no longer employed). If one
holds replacements constant, then collective
turnover must represent very different qualities
of KSAOs than human capital resources. Furthermore, employees remaining in the unit are
likely to have a different performance composition than those departing the unit (Nyberg, 2010;
Shaw, 2011).
Finally, collective turnover and human capital
resources are likely to have different antecedents, since the practices and policies that contribute to human capital resource accumulation
differ from those that contribute to resource depletion (i.e., collective turnover; Sirmon, Hitt, &
Ireland, 2007; Takeuchi, Tesluk, Yun, & Lepak,
2005). Indeed, this is the logic underlying highperformance work systems and the desire to
bundle complementary practices so as to simultaneously achieve different HR goals, such as

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increasing human capital accumulation while


reducing collective turnover (Becker & Huselid,
2006; Huselid, 1995; Sirmon et al., 2007). Even
when antecedents are shared by both collective
turnover and human capital resources, the effects of the antecedents are likely to be different.
For example, recruiting likely has a stronger
effect on accumulation than retention, and climate likely has a stronger effect on retention
than accumulation (Lepak et al., 2006; Schneider, 1987).6
Thus, even though collective turnover represents the depletion of human capital resources
and is embedded within the RBV, there are profound conceptual differences between collective
turnover and human capital resources. They are
related but distinct constructs, not unlike positive and negative affectivity or procedural and
distributive justice. As implied above, one may
have high or low rates of collective turnover and
high or low qualities of turnover while independently having high or low quantities and qualities of human capital. It is only if one assumes
there are no replacements that human capital
resources and collective turnover will have a
quantitatively deterministic relationship, but
even in this situation the relationship will be
qualitatively independent. Finally, as we will
see, the differences between collective turnover
and human capital resources are even more pronounced when we examine their consequences.
Postulate 1: Collective turnover is the
quantity and quality of KSAO depletion from the unit.
Postulate 2: Collective turnover is distinct from human capital resources.
Postulate 3: The quantitative and
qualitative components of collective
turnover independently reflect human
capital resource depletion.

6
It is beyond the scope of this article to discuss antecedents in detail. However, research in strategy points out that
some practices are more useful for accumulating resources
than for stopping the depletion of resources (Eisenhardt &
Martin, 2000). Even at the individual level one may find a
KSAO related to job performance (e.g., cognitive ability) but
a different construct (e.g., job satisfaction) related to turnover
(Maltarich, Nyberg, & Reilly, 2010).

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The Collective TurnoverHuman Capital


Resource Nomological Network
CET theory breaks from existing research by
not equating collective turnover exclusively
with negative unit performance consequences.
By recognizing quantitative and qualitative
components, we gain a greater understanding of
why relationships between collective turnover
and unit performance differ in magnitude and
direction. Embedding collective turnover within
resource-based theory and human capital resources further helps to identify how and why
collective turnover impacts unit performance
via direct, mediating, and moderating effects.
Figure 1 provides an organizing framework
that identifies four paths through which collective turnover influences the units performance.
Path a in Figure 1 shows the direct effect of
collective turnover on unit performance. Path b
shows the indirect (mediated) influence that collective turnover has on unit performance via its
influence on the human capital resource. Path c
shows the moderating effect that collective turnover has on the human capital resourceunit
performance relationship. Path d shows the
moderating effect that collective turnover has on
the human capital resource emergence process.

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At first glance some of these four paths may


seem intuitive. However, most turnover research
has not explicitly considered the various relationships between collective turnover and human capital suggested in Figure 1. Thus, even
these straightforward relationships may help
reorient and direct future research. Furthermore,
these relationships quickly become complex
when time and context are considered. For example, in Path b the timing of measurement is
important such that human capital resources
must be assessed after collective turnover. Thus,
time and climate (contextual influences) permeate the entire system of relationships such that
the strength of the relationships may be affected
by time and climate. Going forward, we first
discuss each of the specific paths and then in
subsequent sections turn our attention to the
influence of time and context (e.g., climate).
Finally, before developing the specific paths
in Figure 1, we summarize why collective turnover or human capital resources may influence
unit performance and competitive advantage.
Unit performance is usually assessed in terms of
accounting (e.g., controllable profit), financial
(e.g., sales), and market-based (e.g., marketshare, customer satisfaction) metrics, as well as

FIGURE 1
CET Theory Consequencesa

Human capital

Unit performance

(c)
(b)

(d)

(a)
Collective
turnover

KSAOs

Although not shown, it is assumed that time and climate influence the relationships in the entire figure.

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sustained competitive advantage (see Crook,


Todd, Combs, Woehr, & Ketchen, 2011, and Richard, Devinney, Yip, & Johnson, 2009, for distinctions between different types of unit performance). These unit performance outcomes are
affected by many factors, but those most relevant here involve the productivity, efficiency,
and coordination of employees. Human capital
resources are generally expected to positively
influence these processes (Crook et al., 2011; Nyberg et al., in press). In contrast, collective turnover is generally expected to negatively impact
these processes (Hancock et al., in press;
Hausknecht et al., 2009; Kacmar et al., 2006).
More generally, research suggests that collective turnover decreases group efficiency by
making coordination difficult, reducing prosocial behavior, and reducing communication
(Kozlowski & Ilgen, 2006; Lepak et al., 2006). However, as described below, in some cases collective turnover may have positive effects, such as
when subversive members leave. Importantly,
only productivity losses are observable at the
individual level; coordination and efficiency
losses can only be detected at higher levels.
Direct effects. In most existing collective turnover research, scholars have examined the direct effects of collective turnover rates on unit
performance (Hausknecht & Trevor, 2011). These
direct relationships are usually expected to be
negative. In contrast, CET theory proposes that
the extent to which collective turnover produces
negative, no, or positive effects on unit performance is determined by the quantity and quality of KSAOs lost. Consider four collective turnover scenarios. First, when collective turnover is
of low quantity and low quality, it is unlikely
that collective turnover will produce a strong
effect on unit performance. Even if there is a
detectable effect, the relationship may actually
be positive because the unit is losing lowquality employees. Second, when collective
turnover is of low quantity and high quality, the
consequences may be stronger and slightly to
moderately negative. Although good employees
will be lost, the losses may not be at a rate that
will cause great disruption. Third, when collective turnover is of high quantity and low quality,
the consequences may be negative and moderately strong. Although the lost employees are of
lower competence, the high rate of loss may
create performance disruptions that also erode
the units climate and coordination. Fourth,

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when collective turnover is of high quantity and


high quality, the effects are likely to be strongly
negative and severe. In this scenario organizations must rely on the performance of the remaining lower-quality employees. In such a scenario, even if the unit replaces employees
quickly, the erosion of climate is likely to lead to
reduced productivity and efficiency. Thus, the
quantity and quality of collective turnover may
interact to determine the magnitude and direction of collective turnovers consequences. The
generally negative relationship between quantity and unit performance is likely to be even
more negative when the loss involves highquality versus low-quality employees. This direct effect is depicted by Path a in Figure 1.
Proposition 1: The quality and quantity mix of collective turnover will determine the direction and strength of
the collective turnover unit performance relationship.
Mediating effects. Collective turnover can
also impact unit performance indirectly by influencing the human capital resource. The RBV
predicts that valuable resources can influence
unit performance through strategy enactment or
through enabling the development of strategy
(Barney, 1991). Because collective turnover is the
depletion of human capital resources, collective
turnover necessarily alters that resource and,
consequently, unit performance. This influence
results from the reduction in the stock and quality of the human capital resource.
In terms of stock, a critical mass of valuable
human capital must be present for it to influence
unit performance (Dierickx & Cool, 1989). If there
is no critical mass of valuable human capital,
then human capital resources cannot influence
unit performance, even if the stock of capital
present is of high quality. For example, service
orientation is a valuable human capital resource in many retail units, but a store with too
few employees, even if those employees are
highly service oriented, will not be able to provide adequate customer service (Ployhart,
Weekley, & Ramsey, 2009). The precise critical
mass threshold likely differs according to many
factors, such as industry, environmental complexity, and competitive environment. More important, the relationship between a valuable human capital resource and unit performance is
affected by the stock of the KSAOs within the

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unit. Collective turnover can erode the stock of


human capital resources, possibly even depleting this stock to the point of falling below a
critical mass and, hence, influencing unit performance through changing the human capital
resource.
The degree to which collective turnover influences unit performance via the human capital
resource also depends on the specific quality of
KSAOs lost. The depletion of human capital resources will be more impactful if collective turnover involves employees with high-quality
KSAOs. Consider two identical units with identical human capital resources and identical
rates of turnover. If collective turnover were simply a rate, then both units would see the same
human capital stock erosion resulting in the
same impact on unit outcomes. However, if Unit
A loses higher-quality employees than Unit B,
the negative effects of human capital changes
on unit outcomes may be greater for Unit A.
Alternatively, if Unit A has a higher turnover
rate but loses lower-quality employees, the indirect negative effect of turnover on performance may be weaker for Unit A than Unit B. But
if the critical mass of human capital is already
diminished, then losing even moderate-quality
employees can be damaging (and more damaging than if the unit were fully staffed). Finally,
the opposite effect can occur where collective
turnover indirectly influences unit performance
by enhancing the human capital resource. For
instance, if collective turnover involves only
low-quality KSAOs or those employees who are
disrupting the units climate (e.g., destroying
trust), then collective turnover can increase unit
performance through strengthening the human
capital resource. As such, the quality of collective turnover may be more important than the
rate of turnover. These mediated relationships
are depicted in Path b in Figure 1.
Proposition 2: The quality and quantity mix of collective turnover will indirectly influence unit performance
through its effects on the human capital resource.
Moderating effects. It is also the case that
collective turnover can moderate the human
capital resourceunit performance relationship.
High levels of collective turnover may weaken
the human capitalunit performance relationship by interfering with coordination, diverting

117

attention toward training for new employees, or


creating additional responsibilities for remaining employees. For example, collective turnover
disrupts communication, the shared and tacit
understanding of each others behavior, and the
ability to adapt and coordinate effectively
(George & Bettenhausen, 1990). Collective turnover may further erode a climate of trust, because such a climate takes time to develop
(Colquitt, Scott, & LePine, 2007). In contrast, collective turnover can strengthen a climate of trust
if disruptive unit members leave and the unit
becomes more harmonious and cohesive,
thereby promoting greater efficiency (Dalton &
Todor, 1979), which will enhance the human capital resourceunit performance relationship. In
combination, it is likely that high levels of collective turnover will create greater disruption,
thus decreasing the human capital unit performance relationship more so than will lower levels of collective turnover. This moderating effect
is depicted in Path c in Figure 1.
Proposition 3: Collective turnover will
moderate the human capital resource
unit performance relationship such that
high levels of collective turnover will
likely weaken the relationship between
the units human capital resource and
the units performance.
Moderating human capital resource emergence. Collective turnover (quality and quantity)
may also indirectly deplete human capital resources and, hence, may influence the human
capital resource unit performance relationship
by affecting the process of human capital resource emergence. This influence on emergence
is most likely to occur through changes to the
units climate. A supportive climate facilitates
human capital resource emergence (cf. Ployhart
& Moliterno, 2011), and to the extent collective
turnover erodes a supportive climate, human
capital resource emergence will be weakened.
When employees leave a unit, all of their contributions leave, including their relationships
with other employees and their contributions to
the units climate. High levels of collective turnover will increase barriers to communication
and diminish the likelihood that employees will
invest in each other because of a reduced expectation of relational stability, further impeding
human capital resource emergence. Thus, by affecting unit climate, collective turnover may

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also affect the process of human capital resource emergence.


As described, the nature of interactions
among unit members and the context within
which they interact (described below) are what
contribute to the emergence of collective phenomena from lower-level origins. Thus, the
emergence process from KSAOs to the units human capital resource is also influenced by the
relationship among individual employees with
those KSAOs. Hence, collective turnover, to the
degree that it changes those relationships, can
also influence the emergence process. For example, if collective turnover reduces the number
of employees within the unit, those who remain
will need to interact in different ways, which, in
turn, may influence the quality of the units human capital. This moderating effect on the human capital resource emergence is depicted in
Path d in Figure 1.
Proposition 4: Collective turnover will
influence the process of human capital resource emergence.
Next, we expand the relationships shown in
Figure 1 to consider how they are affected by
time and context. To keep the presentation manageable, we focus our attention on the direct
(Path a) and moderating (Path c) relationships in
Figure 1, because these are likely to be of the
greatest immediate interest. However, the logic
of the propositions that follow extends naturally
to the mediated (Path b) and emergencemoderating (Path d) relationship shown in Figure 1.
The Role of Time
Flows. Realizing that collective turnover depletes human capital resources implies a temporal dynamic between the two constructs that
is not observable at the individual level. As an
intangible resource, human capital does not
have a predetermined life spanin theory, it
can continue indefinitely as members who leave
are replaced with new members (Molloy et al.,
2011). Furthermore, the stock and quality of intangible resources, like human capital, can fluctuate over time because of changes in collective
turnover, recruitment, and selection (Dierickx &
Cool, 1989; Schneider, 1987; Sirmon et al., 2007).
Consequently, understanding the flow (both in
and out) of human capital resources is critical

January

and requires a longitudinal perspective, which


leads to greater awareness of the role of replacements in the consequences of collective
turnover.
This process can be described by adapting
Dierickx and Cools (1989) bathtub metaphor. A
tub needs a sufficient amount of water at a sufficient temperature to effectively clean a person.
The amount of water in the tub is its stock, and
the temperature of the water is its quality. Water
flows in and out of the tub; it can be accumulated (opening the tap) or depleted (opening the
drain) to influence the stock. Similarly, there is a
flow to human capital. Both the number of people within a unit (level of water) and the quality
of the human capital (water temperature)
change over time. Management needs to control
the acquisition and development of human capital to offset erosion due to collective turnover
(e.g., Schneider, 1987; Sirmon et al., 2007). This, in
turn, means that collective turnover may not always weaken the human capitalunit performance relationship. For example, a unit with a
strong inflow of human capital of similar (or
better) quality to that leaving the unit may produce a situation where collective turnover
does not affect the human capital resourceunit
performance relationshipit may even enhance
it. Alternatively, if human capital is depleted
faster than it can be replaced, or if the quality of
human capital lost is greater than the quality of
human capital gained by replacement, then collective turnover will weaken the human capital
resourceunit performance relationship. Using
the bathtub metaphor, the former instance occurs when the water drains faster than it is
replaced; the latter instance occurs when the
temperature of the water from the tap is colder
than the water being drained from the tub. Human capital resources and collective turnover
are related dynamically and reciprocally over
time, and change in one may influence change
in the other.
Proposition 5: The relationship between human capital resources and
collective turnover is dynamic over
time. Flows of human capital resources into the unit will affect the
quality and consequences of collective turnover flows, and vice versa.
Although collective turnover depletes human
capital, it also allows for replacement. That is,

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Nyberg and Ployhart

the direction of the discrepancy between collective turnover and human capital accumulation
also influences collective turnovers consequences. The relative difference in inflows versus outflows is more important than simply the
existence of change (Dierickx & Cool, 1989), and
researchers need to account for replacements
when evaluating turnover effects (e.g., Hausknecht & Holwerda, in press; Trevor & Nyberg,
2008). For instance, assuming equal rates, it is a
different situation when the quality of collective
turnover outflows is greater than the quality of
human capital inflows, compared with the opposite scenario (Subramaniam & Youndt, 2005).
Human capital resource erosion occurs when
collective turnover exceeds replacement capital
inflows; expansion occurs when human capital
inflows exceed collective turnover. Thus, the
discrepancy (erosion or expansion) between human capital inflows and collective turnover outflows has both a direct effect on unit performance and a moderating effect on the human
capitalunit performance relationship.
Proposition 6a: The direction of the
discrepancy between human capital
resource inflows and outflows (collective turnover) will influence the direction and magnitude of the collective
turnoverunit performance relationship. Erosion will have a negative effect on unit performance, whereas expansion will have a positive effect.
Proposition 6b: The direction of the
discrepancy between human capital
resource inflows and outflows (collective turnover) will influence the magnitude of the moderating effect of collective turnover on the human capital
resource unit performance relationship. Erosion will reduce the effect of
human capital on unit performance,
whereas expansion will increase the
effect.
Timing of collective turnover. Thinking of collective turnover in terms of flows leads to the
realization that the strongest influence on the
human capitalunit performance relationship
may not be the absolute level of collective turnover but, rather, whether the rate and/or quality
of collective turnover is increasing or decreasing over time (Hausknecht & Holwerda, in press).

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When constructs are dynamically related, levels


of one influence levels of the other (Dierickx &
Cool, 1989), and looking at cross-sectional relationships divorced from the trajectory of the constructs can be severely misleading (see Maxwell
& Cole, 2007, for empirical illustrations). For example, Ployhart et al. (2009) found that changes
in human capital resources were more strongly
related to financial performance metrics than
the stock of human capital resources. The
changes in collective turnover may more
strongly affect the dynamic human capital resourcesunit performance relationship than the
absolute level of collective turnover at a given
point in time (i.e., its stock).
The rate and timing of change are also important to consider. For example, suppose the collective turnover of Unit A is greater than the
collective turnover of Unit B. Assuming all else
is equal, one would expect the collective turnover of Unit A to be more detrimental. However,
if Unit As collective turnover is decreasing rapidly while Unit Bs collective turnover is increasing, the detrimental effects of Unit Bs turnover
may actually be worse than Unit As, even
though Unit A has a higher collective turnover
rate. Similarly, a fast erosion of human capital
resources is likely to be more disruptive to coworkers and the units climate than a slow erosion. For example, one may expect different unit
effects on performance and climate when one
employee leaves per month for a year versus
when twelve employees leave in one month,
especially if the size of the group is small. The
outcomes of these differently timed events will
likely depend on a number of factors, including
the size of the unit, the industry, the employees
who remain, the events triggering the departures, and the expectations that the remaining
employees have for the future. Hausknecht and
Holwerda (in press) discuss issues of timing in
some detail.
One reason the rate or timing of collective
turnover changes is likely to be more impactful
than an absolute amount is because turnover
likely contributes to a climate of turnover and
a contagion effect on those who remain (Felps et
al., 2009).7 For example, observing other members of ones unit leave is likely to produce a
shock to ones employment, contributing to visu-

We thank an anonymous reviewer for this suggestion.

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Academy of Management Review

alizing multiple pathways to leaving (Lee &


Mitchell, 1994). This may be especially true for
new employees who are not fully embedded.
Fast increases in turnover also disrupt communication and performance, requiring remaining
employees to take on additional responsibilities
while newer employees are learning the job and
their role (e.g., Kacmar et al., 2006; Shaw, Duffy,
Johnson, & Lockhart, 2005). Finally, increasing
collective turnover rates may weaken the job
embeddedness of the remaining employees by
weakening their links to others within the firm.
This could, in turn, reduce the remaining employees perceptions of fit and the expected sacrifices that might occur if they were to leave
(Lee, Mitchell, Sablynski, Burton, & Holtom, 2004).
Proposition 7: The timing and rate of
collective turnover change will have a
stronger influence on the dynamic human capital resourceunit performance relationship than the absolute
level of collective turnover.
The Role of Context
Incorporating context provides a major break
from individual-level turnover predictions and
findings. We conceptualize context in two ways,
reflecting the social (climate) and technical (environmental complexity) features of organizations (Katz & Kahn, 1978).8
Climate. Climate is a shared sense of what
the unit rewards, supports, and considers important (Ostroff, Kinicki, & Tamkins, 2003; Reichers
& Schneider, 1990). Climate influences the attitudes, cognitions, and behaviors of those within
the unit (Bowen & Ostroff, 2004; Ostroff, 1993;
Ostroff et al., 2003). It is therefore a form of context because it is a unit-level construct mediating the relationship between objective unit
characteristics, policies, practices, and procedures and employees shared psychological reactions (Bowen & Ostroff, 2004; Campbell, Dunnette, Lawler, & Weick, 1970). As a form of
contextual influence, climate affects collective
turnover and human capital resources in numerous ways. It affects who is attracted to, selected
by, and remains in the unit (Schneider, 1987).
8
We thank an anonymous reviewer for encouraging us to
more deeply examine climates role.

January

Climate also affects collective turnover (Carr,


Schmidt, Ford, & DeShon, 2003) and human capital resource emergence (Ployhart, Weekley, &
Baughman, 2006; Schneider, Smith, Taylor, &
Fleenor, 1998). The relationships among climate,
collective turnover, and human capital resources are also likely to be reciprocal, since
climate will change as a result of collective
turnover and human capital resource accumulations (Ostroff et al., 2003; Schneider, 1987).
It is beyond the scope of this article to consider all such interrelationships implied in Figure 1, so we emphasize the most novel of these
that is consistent with our focus on understanding collective turnovers consequences. Specifically, we posit that climate will moderate the
collective turnoverunit performance relationship (Path a in Figure 1). Climate may offset
collective turnovers effects on performance. For
example, a strong climate for teamwork may
lead members to expand their work roles and
cover the tasks and responsibilities of those
leaving the unit. Similarly, a strong climate may
help maintain job satisfaction and commitment
in the face of collective turnover and, hence,
reduce the likelihood of future collective turnover. However, climate may also exacerbate collective turnovers effects on unit performance.
For example, losing higher-quality employees
may lead to a turnover contagion effect (Felps et
al., 2009), such as can occur on executive teams
when a CEO suddenly leaves (Shen & Cannella,
2002). Likewise, to the extent that climate perceptions are consistent with the units strategic
focus (e.g., Schneider et al., 2000) and collective
turnover occurs for those individuals with the
KSAOs most valuable for that strategic focus,
the loss of valuable employees will be magnified by the erosion of climate.
Proposition 8: Climate will moderate
the collective turnoverunit performance relationship.
Environmental complexity. Environmental
complexity is the nature of interconnections and
interdependence required by unit task demands
(Bell & Kozlowski, 2002; Van de Ven et al., 1976).
Environmental complexity lies on a continuum
from simple to complex. Increasing environmental complexity demands greater reciprocal interaction, two-way communication, stronger social
networks, synchronized coordination, and more

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Nyberg and Ployhart

interdependence among members (Bell & Kozlowski, 2002). There are four workflow structures
along the environmental complexity continuum
(Van de Ven et al., 1976). Pooled structures occur
when collective performance is the simple sum
of individual performance contributions. Intensive workflow structures occur when collective
performance depends on distributed expertise
and high collaboration among team members.
Falling between pooled and intensive workflow
structures are sequential and reciprocal workflow structures, with the latter being more complex than the former. Figure 2 provides a visual
summary of environmental complexity. The
greater the environmental complexity, the
greater collective turnovers direct effect on unit
performance and the greater its moderating effect on the human capital resourceunit performance relationship.
First, environmental complexity influences
(moderates) the direct effect of collective turnover on unit performance. In general, greater
environmental complexity is associated with
greater collective turnover consequences, because more complex environments require more

121

synchronous member interaction, coordination,


communication, and adaptation (Hackman, 1987;
Kozlowski & Ilgen, 2006; Marks, Mathieu, &
Zaccaro, 2001). Consider the consequences of
collective turnover between pooled and intensive workflow structures (i.e., very simple versus very complex environments). In the pooled
workflow structure, tasks are largely independent, there is no need for coordination, and the
human capital resource is simply the sum of
individual contributions (an example might be
a box store, such as Wal-Mart, or drivers in a
trucking company). In the intensive workflow
structure, tasks are interdependent, requiring
highly synchronized interaction and communication, and the human capital resource is the
combination of member KSAOs and relationships (an example might be a surgery team or
a team-based manufacturing organization,
such as Toyota). Collective turnover will be
much more damaging in the intensive workflow structure (e.g., where members must rely
on each other) because there is greater disruption of member communication and coordination (Shaw et al., 2005).

FIGURE 2
The Effect of Environmental Complexity on Collective Turnover

Simple

Environmental complexity

Complex

Types of workflow structure

Sequential

Pooled

Reciprocal

Intensive

Sum

j
i

Individual-collective isomorphism
Greater

Lesser
Consequences of turnover

Lesser

Greater
Multilevel comparison of turnovers consequences

Individual = collective

Individual < collective

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Academy of Management Review

Proposition 9: Environmental complexity will moderate the collective


turnoverunit performance relationship. As environmental complexity increases, the direct effect of collective
turnover on unit performance will become stronger.
Environmental complexity also interacts
with collective turnover to moderate the human capital resourceunit performance relationship. We noted earlier how, depending on
the specific combination of quantitative and
qualitative components, collective turnover
can strengthen or weaken the human capital
resourceunit performance relationship. This
moderating effect is further compounded by
environmental complexity.
Collective turnover produces a stronger moderating effect on the human capital resource
unit performance relationship as environmental
complexity increases, because in highly complex environments units must have diverse yet
complementary types of human capital to effectively accomplish the units task (Bell, 2007; Kozlowski, Gully, Nason, & Smith, 1999; Steiner,
1972). Unit-specific human capital, the proximal
human capital determinant of unit performance
(Hatch & Dyer, 2004), becomes intertwined
within unit members and within a particular
task context, which facilitates member pacing,
synchronization, and coordination (Liebeskind,
1996). Therefore, when collective turnover occurs, complementary forms of human capital are
lost, and replacements need sufficient time for
members to adapt and learn each others routines (Marks et al., 2001). For example, the retail
industry experiences enormous (often over 50
percent) annual turnover without a fatal effect
on profitability because in many retail industries employees can be replaced relatively easily, and the change in personnel may not affect
efficiency as greatly as it would in a more complex environment. On the other hand, within
intensive contexts, collective turnover can negate the effects of human capital resources on
unit performance. For instance, if astronauts
suffered similarly high levels of collective turnover, it could make mission completion untenable because of the time it takes to train and
assimilate astronauts into situations where
close coordination is needed among team
members.

January

Proposition 10: There is a three-way


interaction among collective turnover,
environmental complexity, and human capital resources. The moderating effect of collective turnover on the
human capital resourceunit performance relationship will increase as
environmental complexity increases.
For both Propositions 9 and 10, it is also likely
that various combinations of quantitative and
qualitative components of collective turnover
will produce different consequences in different
types of environmental complexity. High rates of
collective turnover or loss of high-quality employees is likely to always be problematic, but
the magnitude may be greater as environmental
complexity increases. For example, losing highquality employees may be relatively unimportant within a pooled workflow, but the same turnover may be fatal in an intensive workflow.
Similarly, losing low-quality employees may not
have as much effect in a pooled workflow as in
an intensive workflow. As discussed, this is
because of the highly coordinative nature of intensive task demands and because collective
turnover has greater consequences when environmental complexity increases. Indeed, research suggests that unit performance in intensive task environments is often determined by
the lowest-ability members (e.g., Steiner, 1972);
hence, removing these employees may help unit
performance. For instance, LePine, Hollenbeck,
Ilgen, and Hedlund (1997) found that the weakest link on a team negatively influenced the
teams performance. Thus, in situations where
collective turnover removes the weakest performers, unit performance may improve.
Proposition 11a: The quantitative and
qualitative components of collective
turnover will interact with environmental complexity to influence the direct effects of collective turnover on
unit performance.
Proposition 11b: The quantitative and
qualitative components of collective
turnover will interact with environmental complexity to influence the
moderating effects of collective turnover on the human capital resource
unit performance relationship.

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Nyberg and Ployhart

In concluding our CET theory discussion, we


revisit the idea that prompted the need for a
theory of collective turnover: the partial isomorphism of collective and individual turnover. By understanding the role of context, it is
possible to identify conditions where collective and individual turnover are likely to produce similar consequences and where they
are likely to be different. Only in low-complexity environments (pooled workforce structure),
in a single point in time, should collective and
individual turnover produce very similar consequences, because in this situation individual KSAOs and turnover are simply pooled or
summed to the unit level (see Figure 2). Hence,
given that members are independent, individual-level turnover consequences may be similar to the unit level (although not identical,
and we maintain that the conceptual meaning
of collective and individual turnover likewise
differs). However, as environmental complexity increases and/or as time is considered, individual turnover underestimates collective
turnover effects. This occurs because of the
interactive and synchronous nature of the
units environmental complexity, and, hence,
the losses that occur because of turnover
are not simply KSAOs and performance but
also losses of knowledge within a social network (Shaw et al., 2005). The more the units
performance depends on member coordination, the greater the consequences of collective turnover will be, but such interdependence cannot be observed or detected at the
individual level or in a single time period
(Dess & Shaw, 2001). For instance, in service
environments where workers need to rely on
each other, increased turnover rates lead to
poorer communication within groups, resulting in lower customer satisfaction (Kacmar et
al., 2006).
Proposition 12a: As environmental
complexity increases, individual-level
turnover consequences increasingly
will underestimate collective turnover
consequences.
Proposition 12b: As observation periods increase, individual-level turnover consequences increasingly will
underestimate collective turnover
consequences.

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INVOLUNTARY AND VOLUNTARY


TURNOVER AS SPECIAL CASES OF
COLLECTIVE TURNOVER
Voluntary and involuntary turnover represent
two distinct constructs of individual-level turnover (McElroy et al., 2001; Shaw et al., 1998). At
the individual level, voluntary turnover is considered more essential than involuntary turnover (e.g., Trevor et al., 1997; Williams & Livingstone, 1994) because units have less control over
voluntary turnover than involuntary turnover
(Dalton et al., 1982). Hence, most individual-level
research focuses on the predictors of voluntary
turnover, and these two constructs are usually
considered independently of each other (Maltarich et al., 2010).
However, within CET theory we do not distinguish between voluntary and involuntary turnover. Collective turnover is the depletion of human capital resources. As such, the reason for
the turnover is not as relevant in terms of how
human capital influences unit performance;
what matters for collective turnover is the quantity and quality of human capital depletion. This
is an important difference because it provides
the opportunity to generate a more parsimonious explanation of collective turnover. For example, it is likely that a major difference between involuntary and voluntary turnover is the
qualitative component captured in CET theory
such that involuntary turnover reflects lowerquality KSAOs while voluntary turnover reflects
higher-quality KSAOs.9 If true, then CET incorporates both involuntary and voluntary turnover
into a more concise theoretical framework and
further allows precise predictions to be made for
when the two types of turnover will be similar
and different.
We recognize that distinctions between involuntary and voluntary turnover remain important
at the individual level. Furthermore, distinctions
between the causes of involuntary and voluntary collective turnover may contribute to understanding the causes and consequences of climate erosion and turnover contagion. Each
turnover type may also have different influences
on later turnover. For example, high voluntary
collective turnover may beget more voluntary
turnover because of the shock of employees departure, which may, in turn, cause the remain9

We thank an anonymous reviewer for this suggestion.

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Academy of Management Review

ing employees to reconsider their role with the


unit (Lee & Mitchell, 1994). Voluntary turnover
may also reduce job embeddedness if it is wellliked employees who are leaving (Lee et al.,
2004). In contrast, involuntary collective turnover
(e.g., when disruptive members are forced out)
may reduce subsequent voluntary turnover
among the remaining higher-performing employees and positively affect unit performance
(Nyberg, 2010). Therefore, we expect differences
between involuntary and voluntary turnover to
matter, but what matters most for understanding
the effects of collective turnover is the quantity
and quality of human capital resource depletion. This assumption is obviously one of considerable scholarly interest and should be
tested with empirical research.
IMPLICATIONS
CET theory ties turnover constructs together
across levels of analysis to form a holistic model
of collective turnover. The theory posits a simple
but profound observation: collective turnover is
the quantity and quality of KSAO depletion from
the unit. As a form of human capital resource
depletion, collective turnover contains both
quantitative and qualitative components. Depending on the specific combination of quantity
and quality, collective turnover may produce
positive or negative effects on unit performance.
Collective turnover may also strengthen or
weaken the human capital resourceunit performance relationship. CET theory incorporates
time by showing how human capital resources
and collective turnover are related dynamically
and reciprocally. Additionally, CET theory
shows that as environmental complexity increases, the consequences of collective turnover
become greater and diverge more from individual-level turnover effects.
Further, CET theory shows how the nature and
consequences of collective turnover cannot be
divorced from the nomological network of human capital resources. Embedding collective
turnover in this nomological network helps to
explain inconsistencies in the empirical literature, including when collective turnover will
have positive, negative, or no relationship with
unit performance and when collective turnover
will weaken or strengthen the human capital
unit performance relationship. Moreover, collective turnover does more than deplete human

January

capital; it also erodes climate and disrupts unit


coordination and communication (Dess & Shaw,
2001). Through embedding collective turnover
within the nomological network of human capital resources, CET theory offers a number of
implications for understanding past research
and directing future research.
Understanding Past Research
CET theory offers a means to explain discrepant findings in the extant turnover literature. For
example, individual-level turnover research
suggests that involuntary turnover positively affects performance, but collective turnover research suggests that all turnover is negatively
related to unit performance (Hausknecht &
Trevor, 2011). At the individual level, involuntary
turnover is assumed to result in poor performers
being replaced by higher performers, but even if
true, this ignores collective phenomena and processes. For example, CET theory suggests that
collective turnover may (1) be detrimental to climate and disruptive to human capital resource
emergence (Proposition 4), (2) lower the stock of
human capital resources to the point of diminishing a human capital effect (Proposition 2),
and (3) affect unit performance differentially depending on the flows of the human capital resource in and out of the unit (Propositions 5, 6a,
and 6b), as well as the timing of the turnover
(Proposition 7). Thus, CET theory explains why
involuntary collective turnovers impact will differ from individual-level findings; one reason is
that collective turnover disrupts unit coordination, and such disruptions cannot be observed or
detected at the individual level.
Another example concerns potential benefits
of moderate voluntary turnover (Dalton et al.,
1982; Hollenbeck & Williams, 1986). At the individual level, it is expected that voluntary turnover is good if replacements are higher quality
or if new ideas are brought to the unit. This is
reasonable when considering an individual replacement; however, at the collective level, it
likely depends on many other factors, including
the quality and quantity of the mix of collective
turnover (Propositions 1 and 2), the flow of collective turnover (Propositions 5, 6a, and 6b), the
units climate (Proposition 8), and the environmental complexity of the unit (Propositions 9, 10,
11a, and 11b). Thus, CET theory explains when
and why collective turnovers impact can be

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Nyberg and Ployhart

positive or negative; the replacement quality of


human capital is only one small part of a total
story that cannot be observed or detected at the
individual level.
Directions for Future Research
Going forward, CET theory raises many questions that should be tested to examine its validity and to extend its contribution. For example,
what is the relative importance of quality versus
quantity in explaining collective turnover effects, and does this relative importance change
over time or by context? It will also be useful to
empirically examine the role of context (climate
and environmental complexity). For example,
does climate act as a buffer or magnifier of
collective turnovers effects on unit performance? Rigorous empirical testing of the predictions specified in this article will be necessary
to garner confidence in the theory.
CET theory also opens several new research
directions. One immediate and potentially farreaching implication is for scholars to study the
effects of human capital and turnover jointly.
For too long human capital and turnover have
been studied in relative isolation, as though
they are independent phenomena. When viewed
from resource-based or human capital perspectives, human capital resources and collective
turnover are clearly distinct yet related, and to
study one while neglecting the other seems less
likely to illuminate the nature of both. Although
some human capital resource studies control for
turnover and many turnover studies control for
elements of human capital, researchers should
study both phenomena simultaneously (e.g.,
Kacmar et al., 2006), particularly their dynamic
and reciprocal relationship over time (e.g.,
Sacco & Schmitt, 2005; Van Iddekinge et al.,
2009). Examining the dynamic relationships between human capital resources and collective
turnover is vital for understanding collective
turnovers consequences. We would further add
that research should refine CET by considering
relationships between generic and specific human capital resources and collective turnover.
For example, collective turnover may more
strongly moderate the specific human capital
unit performance relationship than the generic
human capitalunit performance relationship.
Another area of study is the several likely
antecedents of collective turnover. First, climate

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may be the most proximal antecedent of collective turnover (Ostroff et al., 2003). This is important (and parsimonious) because it means that
organizational and HR policies, practices, and
procedures may (at least partially) influence collective turnover indirectly through climate. Second, researchers should examine the cross-level
antecedents of individual turnover to see how
they relate to the emergence of collective turnover. Climate will be a likely influence, but so
too will economic factors (e.g., unemployment
rates) and psychological factors (e.g., commitment). Turnover research has largely been conducted within level, either individual or collective, and more could be understood about both
by testing cross-level turnover models.
Studies should also investigate the relationship between KSAOs and individual performance within CET theory. In the interest of
space and parsimony, and consistent with resource-based theory and human capital resource emergence (Coff & Kryscynski, 2011; Ployhart & Moliterno, 2011), we did not elaborate on
the role of individual performance in CET theory. Empirical relationships between KSAOs
and individual performance are moderate
(Schmidt & Hunter, 1998), and the two construct
domains are not identical. Thus, KSAOs and
performance have different roles within resource-based theory and CET theory. For instance, while intelligence is correlated with individual performance (Schmidt & Hunter, 1998),
performance depends on additional features,
such as motivation and opportunity (Campbell
et al., 1970; Nyberg, Fulmer, Gerhart, & Carpenter, 2010; Vroom, 1964). Future research should
examine the potential ramifications of excluding individual performance from CET theory. It
will also be useful to examine social capitals
role in relation to specific KSAOs, because social and human capital are likely linked (Lepak
& Shaw, 2008) since collective turnover can diminish social capital (Dess & Shaw, 2001), and
these diminished unit-level relationships can
also lead to additional collective turnover, thus
further damaging unit performance.
CET theory differences in various contexts
should also be explored. Collective turnover
within one level (e.g., small groups and teams or
lower-skill jobs) may have both different antecedents and different consequences than collective turnover at other levels (e.g., organization or
higher-skill jobs). This raises two potential is-

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sues. First, collective turnover may have different characteristics at two different unit levels
(e.g., when considered at the team versus the
organization level). Second, bundling multiple
levels (or jobs) together when investigating collective turnover may lead to erroneous conclusions. That is, researchers may be wise to consider jobs or bundles of jobs with similar
complexity levels when conducting collective
turnover research because it could be that complexity is a driving force in determining the consequences of collective turnover. If this is true,
then combining jobs or levels of different complexities may mask consequences. For example,
if there is a minimal effect of collective turnover
in lower-complexity jobs but a strong effect of
collective turnover in more complex jobs, bundling them may underestimate the importance
of collective turnover in the more complex jobs
and overestimate the effect of collective turnover in less complex jobs. Moving in this direction, Trevor and Nyberg (2008) examined exempt
and nonexempt employees separately to explore the ramifications of downsizing on subsequent collective voluntary turnover for these two
distinct groups. However, a more nuanced focus
on the quality of employees leaving or the specific jobs (and the relevance of those specific
jobs to the unit) will provide a greater understanding of collective turnovers impact on the
units performance.
Finally, in future research there should be a
more fine-grained consideration of time and the
timing of collective turnover and human capital
resource replacements. We focused broadly on
the concept of resource and collective turnover
stocks and flows, but clearly when collective
turnover occurs may also be important. For example, Hausknecht et al. (2009) found that turnover was more disruptive when there was a
greater concentration of newcomers, suggesting
that the timing of collective turnover may affect
its consequences. One may also consider the
consequences of the time needed to fill a vacancy. Our discussion of flows and human capital resource erosion versus expansion assumed
replacements could be found quickly, but this
may oftentimes be untenable for key positions.
Indeed, long delays in finding adequate replacements may further magnify collective turnovers consequences. Thus, researchers should
also consider the duration of vacancies or where
in the units development cycle collective turn-

January

over occurs. Furthermore, the timing of collective


turnover is likely to have different consequences
depending on environmental complexity such that
timing matters more as complexity increases.
Measurement and Analysis Implications
CET theory offers a means to provide a more
complete understanding of collective turnover
and, consequently, has several measurement
ramifications. Collective turnover is primarily
measured using rates, which is effectively the
sum of the individual turnover decisions
(Hausknecht & Trevor, 2011; Shaw, 2011). However, at the collective level, attention to how
turnover impacts unit performance may be better served by focusing on the quality and quantity of the employees who collectively leave, because the loss of KSAO competence (quality) is
likely to be more important than a simple turnover rate, and the qualitative component better
captures the nature of KSAO depletion from human capital resources.
Rather than only operationalizing collective
turnover as a rate, researchers should, when
feasible, consider collective turnover in terms of
quantity and quality. That is, for a given KSAO
type or composite of KSAOs, collective turnover
involves two important dimensions: rate and
quality. KSAO types may range from cognitive
(e.g., ability, knowledge, skill) to noncognitive
(e.g., personality, interests, values; see Ployhart
& Moliterno, 2011). Consequently, future research should explore measures of collective
turnover that capture both dimensions while
paying attention to the type of KSAO being measured. One approach is to develop a weighted
composite of collective turnover, where the
KSAO scores of those who quit are weighted by
their sample size. Another approach is to extend
existing rate metrics. For example, for a specific
type of KSAO, measures may be constructed that
operationalize rate and quality, such as [(number quit KSAO scores of those who quit)/(total
number in unit)]. A final approach is to measure
the KSAOs of interest, similar to Shaw et al.
(2005) in their study of social networks and collective turnover (see also Hausknecht & Holwerda, in press, for further discussion of this issue).
In terms of data and analysis, there are several ways to provide a richer operationalization
of collective turnover within the human capital

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Nyberg and Ployhart

nomological network. For example, if KSAO


scores are available for employees, and if it is
possible to identify who is still employed and
who has left, one may create two variables. The
human capital resource variable can be created
by aggregating individual KSAOs to the unit
level for those individuals still employed (as
done in Ployhart et al., 2009). The collective turnover variable can be created by using the above
operationalizationspecifically, collective turnover 1 * [(number quit KSAO scores of
those who quit)/(total number in unit)]. These
two variables can then be used independently
and/or interactively to examine unit performance consequences. The weighting by 1 for
collective turnover represents the depletion or
loss of human capital resources. Because the
KSAO scores of human capital and collective
turnover are based on different people, the correlation between these two variables will likely
be considerably less than 1 and negative.
These are just examples, and it is beyond the
scope of this article to develop or propose specific measures. However, the possibilities afforded by CET theory offer many directions for
developing and evaluating future collective
turnover measures (see also Hausknecht & Holwerda, in press). That said, it will not always be
possible to measure quantity and quality in a
single study. For example, it may not be possible to measure the KSAOs of interest, or one may
need to rely on proxy measures (e.g., GPA) rather
than individual KSAO scores (intelligence). It
may not even be possible to obtain measures of
proxies. Testing CET theory will require researchers to follow methodologies similar to
multilevel strategic HRM studies, such as Shaw
et al. (2005), Takeuchi, Tesluk, Yun, and Lepak
(2005), Nishii, Lepak, and Schneider (2008), and
Ployhart et al. (2009). Such studies are challenging but not impossible. When such rich, multilevel data collections are not possible, we believe there is still value in studies measuring a
single component of collective turnover, but authors should take additional lengths to at least
theorize and conceptualize the latent nature of
their collective turnover measure (e.g., what
types of KSAOs are likely captured in the turnover rate measure). Similarly, if a researcher
only has access to a single type of KSAO, it
would be helpful to the readers if the researcher
would consider the potential consequences in

127

the studys limitations and directions for future


research.
CONCLUSION
Despite the organizational ramifications of
turnover, most turnover research remains at the
individual level (Holtom et al., 2008), and collective turnover research is stinted by a lack of
collective turnover theory (Hausknecht & Trevor,
2011; Shaw, 2011). This article addresses this
deficiency by developing a theory of collective
turnover. CET theory defines collective turnover
as the quantity and quality of KSAO depletion
from the unit. We ground collective turnover theory within the RBV, thus proposing that collective turnover is inherently the depletion of human capital resources. Consequently, CET
theory emphasizes the emergent and dynamic
nature of collective turnover and its reciprocal
relationship with human capital resources over
time. CET theory also integrates contextual (climate and environmental complexity) influences
on collective turnover. In sum, CET is a theory of
context-emergent turnover and posits that, as a
form of human capital resource depletion, collective turnover contains both quantitative and
qualitative components.
Developing a holistic theory of collective turnover expands our ability to explore collective
turnover antecedents and consequences in
ways that have not been fully recognized. CET
theory provides a framework for theorizing
about collective turnover, explaining past empirical collective turnover inconsistencies, and
altering the focus of collective turnover from an
exclusive examination of individual leavers to
an expanded focus on human capital resource
depletion. Collective turnover is of great theoretical and practical interest, and it is our hope
that CET theory facilitates a greater understanding of this important organizational
phenomenon.
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Anthony J. Nyberg (anthony.nyberg@moore.sc.edu) is an associate professor in the


Darla Moore School of Business at the University of South Carolina. He received his
Ph.D. from the University of WisconsinMadison. His research focuses on strategic
human resource management, human capital, compensation, and employee movement.
Robert E. Ployhart (ployhart@moore.sc.edu) is the Bank of America Professor of Business Administration at the Darla Moore School of Business, University of South
Carolina. He received his Ph.D. from Michigan State University. His primary interests
include human capital, staffing, recruitment, and advanced statistical methods.

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