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Chapter 2
INDIVIDUAL DIFFERENCES, MENTAL ABILITY,
AND PERSONALITY

The purpose of this chapter is to explain some foundation ideas on several key topics about individual
behavior in organizations. The chapter begins with an explanation of the nature and consequences of
individual differences. Attention is then focused on three major topics closely linked to individual
differences: demographic diversity, mental ability, and personality.

Learning Objectives

1. Explain how individual differences influence the behavior of people in organizations.

2. Describe the key factors contributing to demographic diversity.

3. Explain how mental ability relates to job performance.

4. Identify major personality variables that influence job performance.

5. Explain how emotional intelligence is an important part of organizational behavior.

I. INDIVIDUAL DIFFERENCES
People show substantial individual differences, or variations in how they respond to the same
situation based on personal characteristics. Behavior is a function of the person interacting with is
or her environment [B = f (P x E)]. Behavior is therefore determined by the effects of the
individual and the environment on each other. Also, individual differences moderate how people
respond to situations. Seven consequences of individual differences that have a major impact on
managing people are as follows:

1. People differ in productivity.

2. Quality of work varies because people vary in their propensity for achieving high-quality
results.
3. Empowerment is effective with some workers, but not with all.
4. A given leadership style does not work with all people.
5. People differ in their need for contact with other people.
6. Company management will find that commitment to the firm varies considerably.
7. Workers vary in their level of self-esteem that in turn influences their productivity and
capacity to take on additional responsibility.

The sampling of individual differences cited is usually attributed to a combination of heredity and
environment. The manager should therefore create a positive environment for workers.

II. DEMOGRAPHIC DIVERSITY

Demographic diversity refers to differences in background factors about the work force that
help shape worker attitudes and behavior. The U.S. work force has become increasingly diverse.

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 A. Sex and Gender Differences
The overall evidence suggests that there are few differences between men and women in
such factors as ability and motivation that will affect their job performance. Gender
differences in communication patterns have been noted. Men typically communicate to
convey information or establish status. Women are more likely to communicate to establish
rapport and solve problems. A researcher has noted that men are more likely to value equity,
whereas women opt for equality. Shibley Hyde observes that onverinflated claims of gender
differences can do harm in the workplace, such denying people opportunities.

B. Generational and Age-Based Differences

People may behave differently on the job based somewhat on the behaviors and attitudes of
many members of their generation. The four generations currently in the workforce are
traditionalists, baby boomers, generation X, and Generation Y. Constance Patterson says that
every generation is influenced by major economic, political, and social events of its era, such
as the Great Depression, the women’s movement, and advances in information technology.

Generational differences can sometimes cause clashes, especially among members of the
same workgroup. For example, baby boomers may believe that generation Xers are too
impatient and willing to reject reliable work procedures. Generation Xers may perceive baby
boomers as always trying to please people and being inflexible to change.

Age differences in the workforce include a focus on mental and physical capabilities. Labor
shortages may also contribute to more seniors working longer. Many older people will be
working longer because of decreased value of many pension funds. A study of 24,000
government workers found that age and experience predicted performance better for jobs
requiring higher levels of complexity to master. Advances in technology help workers
compensation for mental losses, such as less acute memory, associated with age. Older
workers have lower absenteeism, illness, and accident rates, higher job satisfaction, and
more positive work values.

C. Ethnic, Racial, and Cultural Differences

Ethnic and racial differences in job performance and behavior are usually attributable to
culture rather than ethnicity itself. For example, some ethnic groups take long lunch breaks
because of their culture, not the fact of being a particular nationality. Demographic diversity
will often give an organization a competitive advantage. A study with insurance workers
found that an individual’s demographic similarity to the work group positively influenced
the individual’s perception of group productivity and commitment to the work group. Job
satisfaction tends to higher for employees when others of similar demographic characteristics
are present in the workplace.

III. MENTAL ABILITY (COGNITIVE INTELLIGENCE)

Mental ability is a major source of individual differences that affects job performance and
behavior. Intelligence is the capacity to acquire and apply knowledge, including solving
problems. Mental ability tends to predict job performance. Some researchers believe that a large
component of mental ability is inheritable, based on such evidence as identical twins who are
reared apart having similar intelligence. The argument that environment is the major contributor
to intelligence centers around evidence that an enriched environment often helps people increase
their intelligence test scores. Also, IQs have been on the rise. Based on hundreds of studies, it
appears that heredity and environment contribute about equally to traditional intelligence.
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A. Components of Intelligence
A standard theory of intelligence explains that intelligence consist of a g (general) factor
along with s (special) factors that contribute to problem-solving ability. The g factor helps
explain why some people perform so well in so many different mental tasks (the have the
right stuff). As shown in Exhibit 2-1, seven components of intelligence have been
consistently noted.

B. The Triarchic Theory of Intelligence (Emphasis on Practical Intelligence) To overcome the

limited idea that intelligence involves mostly the ability to solve abstract problems, the
triarchic theory of intelligence has been proposed, presented in Exhibit 2-2. The theory
holds that intelligence is composed of three different subtypes: analytical, creative, and
practical. The practical subtype is the type of intelligence required for adapting to your
environment to suit your needs. Practical intelligence incorporates the ideas of common
sense, wisdom, and street smarts. Analytical intelligence (also called fluid intelligence) may
decline from early to late adulthood. However, the ability to solve problems of a practical
nature (crystallized intelligence) is maintained or increased through late adulthood. So being
older makes you wiser.

C. Multiple Intelligences
According to the theory of multiple intelligences, people know and understand the world in
distinctly different ways, or look at it through different lenses. The eight intelligences or
faculties are: linguistic, logical-mathematical, musical, spatial, body/kinesthetic, intra-
personal, interpersonal, and naturalist. Your profile of intelligences influences how you will
best learn, and to which types of jobs you are best suited.

IV. PERSONALITY DIFFERENCES

Personality characteristics contribute to success in many jobs, and many job failures are caused
by personality problems. Personality refers to the persistent and enduring behavior patterns of
an individual that are expressed in a wide variety of situations.

A. Eight Major Personality Factors and Traits

All eight factors to be mentioned have a substantial impact on job behavior and performance.
1. Neuroticism (reflects emotional instability versus emotional stability)
2. Extraversion (notice the British spelling)
3. Openness (well-developed intellect)
4. Agreeableness (friendly and cooperative)
5. Conscientiousness (dependability and thoroughness)
6. Self-monitoring of behavior (adjusting how we appear to others)
7. Risk taking and thrill seeking (craving constant excitement)
8. Optimism (a tendency to experience positive states)

Research with 132,000 subjects that people generally become more responsible, organized,
and focused with age.

1. Research Evidence about Personality and Job Behavior

Based on a cross-cultural study, it was concluded that personality structure is universal.
Any of the above eight factors can be important for good job performance, with
conscientiousness having the best research support. Four studies showed that good social
skills are needed to for conscientiousness to be related to aspects of job performance
linked to interpersonal effectiveness. The combination of intelligence (“can do”) with
conscientiousness (“will do”) is especially important for job performance, such as
 extraversion most frequently associated with effective leadership. Personality factors are
also important for performance as a team member.

Another study showed that high self-monitors tend to receive better performance ratings
and more promotions than do low self-monitors, and are also more likely to merge as
leaders.

2. The NEO Personality Inventory for Measuring the Big Five Factors
The NEO Personality Inventory measures the five factors, and six more specific traits or
factors with each domain. Exhibit 2-3 lists the factors and associated facets of the
Inventory. The exhibit can be used for self-reflection, by the student thinking through his
or her standing on each of the Big Five factor and its related facets.

B. Emotional Intelligence
How effectively people use their emotions has a major impact on their success. The topmost
layers of the brain govern analytical intelligence. The innermost areas of the brain govern
emotion, such as dealing with rage. Emotional intelligence refers to qualities such as
understanding one’s feelings, empathy for others, and the regulation of emotion to enhance
living. Four key factors recently included in emotional intelligence are as follows: (Note
that the components of EI keep changing.)

1. Self-awareness (understanding own feelings)

2. Self-management (such as controlling impulsiveness and being honest)
3. Social awareness (such as having empathy for people, and intuition about organizational
problems)
4. Relationship management (includes a variety of interpersonal skills)

High emotional intelligence is associated with the ability to cope with job setbacks.
Emotional intelligence underscores the importance of being practical minded and having
effective interpersonal skills to succeed in organizational life.