The road less travelled: An exploratory study of the association between top management team dissimilarity and innovation capability

Abstract This study extends the upper echelons literature by shedding light on the role of top management team (TMT) dissimilarity, a specific conceptualization of team diversity. TMTs are typically composed of members from different functional areas who have unique information and values. The perception of the degree to which TMT members view themselves as dissimilar from other team members affects the TMT’s decision-making and, therefore, organizational outcomes. However, research does not address this perspective of TMT diversity. We examine how informational and value dissimilarity among TMT members is associated with incremental and radical innovation capability. We survey top managers from various industries and use partial least squares structural equation modeling analysis to explore the association between TMT dissimilarity and innovation capability empirically. The findings show that informational dissimilarity is positively associated with incremental innovation capability. Value dissimilarity is negatively associated with incremental innovation capability, whereas it is positively associated with radical innovation capability.