Engaging Differences: How Socially Diverse Organizations Can Mobilize Their Resources More Effectively

Abstract

Diversity is a goal for many organizations, yet it is not always connected to improved performance. This study advances diversity-performance research by examining the effect of engaging social differences. The analysis uses data from a national study of organizations containing information on the race, gender, class, and religion of each organization’s leaders as well as information on the type and content of interactions occurring among them. The data also contain multiple measures of organizational output, specifically the organization’s performance in forming alliances, developing strategies, organizing constituents, and mobilizing people. The analysis focuses on organizations with a diverse leadership team, examining the teams’ social interactions to assess whether engaging members’ social differences is associated with better performance. Additionally, qualitative data illustrate how engaging social differences impacts organizational outcomes. The study finds that teams whose members regularly participate in bridging cultural activities and discuss their social differences achieve greater output. Overall, this study indicates that an organization’s ability to realize the performance benefits of having a diverse leadership team is related to how the leaders interact with each other. The findings suggest that diverse organizations can improve their performance by ensuring that their members interact in ways that engage their social differences.