TMT—You’re DYNAMITE!

Functional Diversity Equals Team Conflict

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TMT—You’re DYNAMITE!: Functional Diversity Equals Team Conflict

The question of whether diversity brings value to an organization is a lot less straightforward than it may seem.  The Kimono isn’t bashful about digging rather deep into the question of the true value of diversity in the workplace.  Our snooping brought us to a seminal article written by seven leading strategy scholars.  It’s entitled “Top Management Team (TMT) Diversity, Group Process, & Strategic Consensus” and it can be found in the much heralded Strategic Management Journal.

The Research 

This team of researchers gathered a bunch of data from 76 high-technology firms both in the U.S. and Ireland.  First, they wanted to find out if demographic diversity of senior executives impacted strategic consensus (i.e., could they agree!).  They also wanted to see if diversity of backgrounds influenced team conflict and whether the teams would attempt to employ agreement seeking behaviors, such as singing Kum Ba Yah (see pretty video HERE) before aligning and getting to consensus. 

So Many Types of Diversity…

While most of us think of diversity in terms of skin color or gender, these scholars tried to dig a bit deeper.  Specifically, they looked at four different measures of diversity: functional diversity (background in Marketing, OPS, Finance, or HR), age diversity (were you young or signing up for AARP?), educational diversity (did you flunk out of community college or did you have your MBA?), and employment diversity (were you a rookie or a seasoned veteran?). 

The Takeaway 

To get at the answer, they pulled out the big guns and used Structural Equation Modeling (SEM) to best understand these relationships.  Although diversity’s all the rage, the results of their work offer us some caution.  They found that diversity, in general, negatively impacted strategic consensus.  This was particularly true of functional and educational diversity.  In other words, as more functional backgrounds were involved (HR, OPS, IT, HR, Accounting, & Finance), there was less of a chance at aligning around strategic priorities.  Same goes for educational diversity.  Functional diversity also had a strong and statistically significant influence on interpersonal conflict; more functional diversity = greater team conflict (I hate you!).  And this, in turn, hurt the chances of arriving at strategic consensus.  

The Kimono is a big tent and we’re all for inclusion.  But embedding diversity into your team isn’t always easy, especially when not everybody’s wearing a Kimono……

To infinity and beyond!

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