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Diversity in organizations
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This article was originally published in the International Encyclopedia of the Social
& Behavioral Sciences, 2nd edition, published by Elsevier, and the attached copy
is provided by Elsevier for the author’s benefit and for the benefit of the
author’s institution, for non-commercial research and educational use including
without limitation use in instruction at your institution, sending it to specific
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From Gonzalez, J.A., Zamanian, A., 2015. Diversity in organizations. In: James D. Wright
(editor-in-chief), International Encyclopedia of the Social & Behavioral Sciences,
2nd edition, Vol 6. Oxford: Elsevier. pp. 595–600.
ISBN: 9780080970868
Copyright © 2015 Elsevier Ltd. unless otherwise stated. All rights reserved.
Elsevier
Author's personal copy
Diversity in organizations
Jorge A Gonzalez and Azadeh Zamanian, University of Texas-Pan American, Edinburg, TX, USA
Ó 2015 Elsevier Ltd. All rights reserved.
Abstract
The study of diversity in organizations addresses the implications of workplace diversity from social justice, legal compliance,
and organizational performance standpoints. Diversity in groups and organizations is associated with social categorization
and information/decision-making processes, which respectively are related to adverse and beneficial attitudes and behaviors.
Diversity scholars have attempted to shed light into these mixed results by addressing the role of categorical and relational
demography, diversity types, curvilinear and interactive effects, and complex conceptualizations of diversity. Diversity
management strategies, such as affirmative action and management-led diversity initiatives, have been designed to reduce
discrimination and stimulate the beneficial effects of diversity.
Diversity refers to the extent in which members of an entity, view of the firm, organizational racial diversity is considered
such as a group or organization, differ from one another. This a resource that is valuable, rare, and difficult to imitate and thus
encompasses a very broad range of individual attributes, a source of sustained competitive advantage (Richard, 2000).
although most attention has been given to differences in These ideas emphasize the benefits organizations draw from
gender, race/ethnicity, and age. Diversity in attributes, such as their compatibility with constituents in a complex and diverse
nationality, culture, education, function, tenure, ability, sexual environment, such as potential employees, business partners,
orientation, religion, values, personality, goals, and many and customers. Therefore, social justice, legal compliance, and
others is gaining attention. The field is mainly concerned with performance goals are not necessarily incompatible. Govern-
the outcomes and management of individual differences in ment legislation, such as affirmative action emphasizes the
organizational settings, including work groups and organiza- accomplishment of social justice goals through legal compli-
tions. Its importance lies on the fact that the workplace in many ance. Moreover, the ‘business case’ for diversity is based on the
nations is growing increasingly diverse. For instance, women appeal of the idea that organizational performance and social
and racial and ethnic minorities now constitute the majority of justice goals are compatible.
workers in the USA (Bureau of Labor Statistics, U.S. Depart-
ment of Labor, www.BLS.gov).
Diversity Outcomes
Despite the appeal of the business case for diversity, reviews of
Diversity and the Goals of Its Study the literature have revealed that diversity in groups and orga-
nizations has the potential for both positive and negative
Most diversity research addresses the implications of workplace outcomes (van Knippenberg and Schippers, 2007; Williams
diversity taking a social justice, legal compliance, or organiza- and O’Reilly, 1998)
tional performance standpoint. Social justice goals include the These seemingly paradoxical results have been synthesized
reduction of bias and discrimination, and the enhancement of into two theoretical perspectives: social categorization and
inclusion in the workplace. These objectives center on information/decision making. The social categorization
increasing the presence and inclusion of traditionally under- perspective describes how people categorize themselves and
represented or disenfranchised social groups: women, racial/ others into groups to make sense of a complex environment.
ethnic minorities, and older workers. The social justice It relies on social identity and social categorization theories,
perspective includes the study of workplace discrimination and which posit that people display in-group favoritism in their
the implementation of diversity management programs. Such social interactions. These theories are complemented with the
programs may be designed to meet legal compliance goals, similarity-attraction paradigm, which holds that people are
such as following affirmative action and equal opportunity attracted to others who possess similar psychological attributes,
legislation. Nonetheless, diversity management also includes but infer similarity through observable demographic attributes.
management-led diversity initiatives, which tend to be moti- Diverse groups and organizations are subject to faulty social
vated by social justice objectives, and designed to stimulate the categorization processes and therefore have more affective
inclusion of a range of social backgrounds broader than the one conflict than homogeneous ones (Ashkanasy et al., 2002), as
established by the law. well as lower trust, communication, cooperation, helping,
Organizational performance goals rely on the value diversity cohesiveness, satisfaction, and commitment. For these reasons,
offers to organizations (Cox and Blake, 1991). Consistent with diverse groups and organizations may ultimately perform
the ‘business case’ for diversity or ‘value-in-diversity’ hypothesis, poorly in comparison with homogeneous ones.
some scholars suggest that diversity is a source of sustained In contrast, the information/decision-making perspective
competitive advantage and leads to greater organizational holds that diversity is related to a wider range of, skills, abilities,
performance. For instance, with basis on the resource-based expertise, and perspectives (Cox and Blake, 1991; Watson et al.,
International Encyclopedia of the Social & Behavioral Sciences, 2nd edition, Volume 6 http://dx.doi.org/10.1016/B978-0-08-097086-8.22024-2 595
International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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596 Diversity in organizations
1993). This variety in knowledge provides a broad cognitive study. Such interaction approach can reveal asymmetrical
resource base that permits greater creativity and innovation in social group effects. For example, relational demography
group tasks and decision making. For instance, diversity studies have shown that being different in terms of gender or
reduces the possibility of groupthink – a premature consensus race is typically more detrimental to work attitudes for men and
or conformity that leads to poor decisions. Instead, diversity Whites than for women and non-Whites (e.g., Tsui et al., 1992).
enhances the opportunities for dissent, debate, the rise of Interestingly, Chatman and O’Reilly (2004) found that women
a devil’s advocate, and other factors associated with substantive were more likely than men to be affectively attached to same-
or beneficial task-related conflict. In effect, this can lead to gender groups, but that women were also more likely to
better decision making. For instance, divergent viewpoints in leave same-gender groups. This was attributed to status, which
a team can result in team reflexivity – a careful consideration of was higher in male-dominated groups. The interactive
its functioning – which can lead to increased team learning and approach can combine categorical and relational demography
effectiveness. Overall, diverse groups and organizations have effects with organizational-level diversity. This would suggest
the opportunity to be more effective thanks to a broader that relational demography effects depend on organizational
cognitive base. diversity and would likely present weaker adverse effects in
An integration of these two perspectives suggests a more heterogeneous organizations.
nuanced consideration of diversity and the intervening
processes that lead to its attitudinal, behavioral, and perfor-
Diversity Typologies
mance outcomes. Different individual attributes may present
different processes and outcomes, and a combination or As stated earlier, diversity encompasses a broad range of indi-
interaction of such attributes may present complex processes. vidual attributes. Many diversity studies focus on a single
Diversity effects may also be contingent on a variety of attribute (e.g., 43% of diversity studies reviewed by Jackson
moderators or contextual circumstances. Furthermore, it is et al., 2003). One reason may be that scholars and managers
important to consider that diversity is a compositional are often interested in a single dimension of diversity. For
construct, meaning that it is an attribute of groups and orga- instance, people are often seen as having either gender or a race,
nizations rather than individuals, but individual-level dissim- but not both. Nonetheless, diversity scholars and managers are
ilarity from others also has an important role in the field. increasingly paying attention to a multiplicity of individual
attributes to answer the question of whether all differences
make a difference. This has given rise to individual attribute
Categorical and Relational Demography
typologies.
Research about diversity at the individual level of analysis is One typology describes whether individual attributes are
concerned with simple demographic effects, as well as the task related or not. In this case, differences in education,
extent in which an individual is similar or different from function, and tenure provide a variety of task-related infor-
referent others. The simple or categorical demography mation, whereas differences in race/ethnicity, gender, and age
approach assesses the behaviors associated with specific indi- do not (Pelled et al., 1999). The rationale behind this distinc-
vidual attributes. This would include, for example, the study of tion is that task-related diversity stimulates substantive conflict,
the behavior associated with being Hispanic or comparing the which drives people to consider multiple points of view,
attitudes or managerial attributes of men and women at work. perspectives, and opinions, while nontask-related diversity
The relational demography approach refers to the extent in leads to affective conflict that can be detrimental.
which an individual is different in an attribute or category from Another typology differentiates across surface- and deep-
referent others, such as other members of a work group or level diversity. Surface-level diversity refers to differences in
a particular person (Riordan, 2000). Relational demography observable demographic attributes, such as race, ethnicity,
studies typically take the social categorization perspective. Most gender, and age, while deep-level diversity refers to differences
studies have found that people who are different from others in psychological attributes, such as personality traits, beliefs,
tend to be less committed to their organizations and satisfied and values (Harrison et al., 1998). This distinction holds that
with their jobs, and more likely to be absent and quit their jobs both surface- and deep-level diversity may harm group social
(e.g., Tsui et al., 1992). Studies concerned with dyads show integration, cohesion, and in effect performance. However, the
similar results. For instance, being demographically different effects of surface-level diversity weaken through time, while
from a supervisor is related to lower employee commitment, those of deep-level diversity become stronger as group
a more adverse relationship, and lower assessment of employee members get to know one another. This typology diverges from
performance from such supervisor (e.g., Tsui and O’Reilly early conceptualizations of organizational demography, which
1989). Relational demography includes the effects tokenism, assessed cognitive (deep-level) diversity in management groups
or being extremely different from others in a group, such as of using demographic (surface-level) attributes as a proxy.
being the sole woman in an otherwise completely male group. Despite the logical appeal of typologies, meta-analyses that
Tokenism emphasizes the particular effects of visibility and have studied them, particularly the task/nontask distinction,
suggests the adverse effects of dissimilarity not only depend on have not provided conclusive results (e.g., Horwitz and
the feelings, thoughts, and demographic identity salience of the Horwitz, 2007). These meta-analyses either have not shown
token person, but also on the way that other group members different outcomes for task and nontask diversity on group
perceive and treat such person. cohesion and performance, or have found inconsistent
Relational demography can be combined with categorical evidence about the role of social integration processes. These
demography and group diversity to cross levels of analysis in its inconclusive results stimulated the development of the
International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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Diversity in organizations 597
categorization-elaboration model, which suggests that both member perceptions of the fairness of the organization’s
task and nontask diversity dimensions affect the elaboration of diversity-related structural characteristics and values. A positive
task-related information and social categorization processes or inclusive diversity climate can counter the adverse effects of
(van Knippenberg and Schippers, 2007). A more recent meta- relational demography on workplace attachment, particularly
analysis exploring specific attributes rather than a task/non- for people of color. It can also enhance the positive effects of
task typology showed more nuanced effects. Functional and diversity on performance (Gonzalez and DeNisi, 2009; McKay
educational backgrounds were positively related to team crea- et al., 2007). Diversity climate is similar to the concept of
tivity, innovation, and performance, while educational diver- diversity perspectives or paradigms. Ely and Thomas (2001)
sity was related to performance only in top management teams. described three different diversity perspectives, which refer to
Also, racial and sex diversity had small adverse effects on the manner in which organizational members express and
performance (Bell et al., 2011). Another meta-analysis sug- manage diversity-related tensions. The discrimination-and-
gested that the main effects of various forms diversity was fairness perspective is present when organizational members
small, but that its effect were strong once contingent modera- believe that the point of diversity initiatives is to reduce
tors and contextual circumstances were considered (Joshi and discrimination and enhance fairness. In contrast, an access-
Roh, 2009). and-legitimacy perspective consists of beliefs that the goal is
to tap diverse markets more effectively. Also, an integration-
and-learning perspective is present when people believe that
The Role of Context and Moderators in Diversity Effects
cultural differences drive diverse knowledge and insight, and
The role of diversity on behavior and performance depends on this third perspective is associated with the greatest degree of
a variety of contextual factors. Meta-analytic data have showed effectiveness (Ely and Thomas, 2001). In other words, a diverse
that the main or direct effect of diversity attributes on team organization is likely to perform better when its members
performance is very small, but that this relationship is much believe that cultural differences drive diverse knowledge and
stronger when the role of contextual factors is incorporated insight than when members assume that diversity is only
(Joshi and Roh, 2009). Such contextual factors and moderators valuable to gain niche markets or to avoid blatant discrimi-
include industry setting, team interdependence, team longevity, nation and lawsuits. The notions of diversity climate and
leadership, task complexity, regulatory pressure, and market perspective are similar to diversity culture (Cox and Blake,
competition, among others. For instance, diversity is likely to 1991) and mind-set (van Knippenberg and Schippers, 2007).
lead to better outcomes when transformational leadership is The effects of organizational racial and gender diversity on
high, and when teams are interdependent. Also, empirical financial performance also depend on environmental factors.
evidence, particularly from laboratory studies, suggests that Consistent with the social categorization perspective and
diverse groups tend to perform better than homogeneous ones requisite variety arguments, racial and gender diversity-
in complex and creative tasks, while homogeneous groups performance effects tend to be stronger in the service than in
perform faster and better in routine tasks. manufacturing. One reason may be that diverse firms are better
The degree of diversity itself is a contextual factor that able to best serve a diverse stakeholder and customer base.
shapes its outcomes. Diversity can present curvilinear effects on Studies addressing the role of diversity in organizational
attitudes and performance that are U-shaped, or even J-shaped. financial performance (Richard et al., 2004) also report
In other words, adverse outcomes may be present at moderate a stronger positive relationship between racial diversity in firms
levels of diversity, but moderate diversity may not present such that have an innovation strategy, have a narrow span of control,
outcomes or even have positive effects at very high levels. For are in their early life cycle stages, and operate in munificent
example, managerial racial diversity has a curvilinear, U-shaped environments. Studies that have considered community
association with organizational financial performance (Richard demographics as context and explored the match between
et al., 2004). Similarly, a study of cultural heterogeneity in organizations and community demographics have reported
multicultural teams found that moderate levels of diversity both positive and negative effects on attitudes and performance
were associated with lower team performance, while highly (Joshi and Roh, 2009).
homogeneous and highly heterogeneous teams presented
lower social categorization problems. These effects were further
Complex Conceptualizations of Diversity
contingent on team longevity (Earley and Mosakowski, 2000),
suggesting that, given time, highly diverse teams tend to de- Complex conceptualizations of diversity include the combi-
emphasize their demographic differences and form a hybrid nation or alignment of various attributes or types. This includes
team culture or common in-group identity. diversity faultlines, a correlation of multiple individual attri-
Diversity in one type of attribute can also influence or butes that provide a clear basis for subgroup differentiation
moderate the effect of another attribute or type. For instance, (Lau and Murnighan, 1998). For example, a group comprised
diversity in deep-level attributes, such as values, personality, or of young, African-American men and older, White women
time urgency can increase the effects of demographic diversity shows the combination of three different attributes into
on attitudes, conflict, and performance (e.g., Jehn et al., 1999). subgroups. Diversity faultlines are related to heightened
Also, a collective culture – an aggregation of shared values that conflict, less communication, lower learning, and disrupted
emphasize cooperation – can reduce demographic diversity group functioning.
effects on conflict (Chatman et al., 1998). Diversity typically refers to the variety or dispersion or variety
An organization’s diversity climate also moderates diversity in terms of a specific individual attribute. However, it may also
effects. Diversity climate refers to the shared organizational refer to separation or disparity (Harrison and Klein, 2007).
International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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598 Diversity in organizations
Separation refers to differences in position or opinions, such as have been passed in many other countries. For example, Can-
in values, beliefs, or attitudes. A group that is fragmented due to ada’s Employment Equity Act covers ‘visible minorities’
different values or polarizing opinions would be an example. (language and religion – relevant to Canada’s English and
Disparity refers to vertical differences in the proportion of French heritage – are invisible attributes), women, people with
valuable assets and resources held by unit members, which disabilities, and Aboriginal peoples. Also, Malaysia’s New
acknowledges the important role of power and status differ- Economic Policy protects the majority Malay population,
ences. An example would be a group with inequitable pay or who traditionally has had lower access to business and income
network access. Combinations of these three types are possible. opportunities than the Malaysian Chinese minority.
For example, members of an ethnically diverse group may hold Scholars and practitioners have discussed issues with
values that are similar within each ethnic group but distinct employee acceptance of affirmative action. Some argue that the
across ethnic groups, showing ethnic variety and value separa- legal coercive pressure of affirmative action may neutralize
tion. Such ethnically diverse group could also present no rather than enhance equality. This occurs because affirmative
differences in pay, which would mean having high variety but action promotes the idea that beneficiaries are hired due to
low disparity. preferential treatment rather than their qualifications. For this
reason, affirmative action can be associated with a stigma of
incompetence among beneficiaries and associated feelings of
Diversity Management unfairness on the part of the majority group. Other scholars
posit that different programs have different degrees of
The potential for positive, negative, and complex effects from perceived fairness and acceptance. In general, programs that
diversity warrants efforts to manage diversity. Diversity promote hiring gain greater acceptance than other programs,
management refers to the development and implementation of such as those involving promotions, compensation, and
practices, processes, and systems designed to enhance work- training. In addition, program beneficiaries (e.g., African-
place diversity, exploit its benefits, and minimize adverse Americans) typically report greater acceptance of affirmative
outcomes. Diversity management includes affirmative action action programs, particularly beneficiaries who report to have
policies, which aim to comply with the law, as well as experienced discrimination before (Kalev et al., 2006).
management-led diversity initiatives, which refer to formalized
human resource management practices designed to reduce bias
Management-Led Diversity Initiatives
and discrimination, promote and sustain organizational
diversity, and improve performance. Affirmative action Unlike affirmative action, management-led diversity initia-
predates the notion of diversity management, and many tives and other diversity management practices focus on
diversity scholars and consultants differentiate across them. reducing discrimination and improving the effectiveness of
The reason is that the focus of affirmative action is to comply diversity organizations by changing its practices, culture, and
with a legal mandate, while diversity management seeks to climate. Diversity initiatives may be inclusive of individual
increase organizational performance, fairness, equality, and attributes that are not covered by law. They are likely to
inclusion through management-led initiatives. Nonetheless, emphasize the inclusion and of all social groups, including
some scholars refer to management-led diversity initiatives the majority group. Many diversity initiatives are designed to
as ‘voluntary’ affirmative action programs. A source of increase competitive advantage (Cox and Blake, 1991). Also,
benchmarking on diversity management is the Web site they may be designed to underscore the importance of
and magazine DiversityInc, which publishes a list of the acknowledging the uniqueness of employees and social group
top companies who champion diversity (DiversityInc, www. members as individuals, rather than their assimilation into
DiversityInc.com). the dominant culture (Shore et al., 2011). Despite their
voluntary nature, management-led diversity initiatives may
also have a backlash. For instance, employees may become
Affirmative Action
distrustful or cynical and resist the implementation of
Affirmative action refers to activities taken to reduce discrimi- diversity programs if prior efforts have failed in the past
nation and provide employment and promotion opportunities (Kalev et al., 2006). Examples of management-led diversity
for disenfranchised groups. Affirmative Action was initially initiatives include targeted recruitment, retention, promotion,
enacted for US government contractors through executive mentoring, and diversity training.
orders by President Kennedy and Johnson in the 1960s, and Organizations use a variety of targeted recruitment strate-
was expanded by the Civil Rights Act of 1964. Title VII of the gies to attract women and minority job applicants to increase
civil rights act prohibited organizations with more than 50 diversity. For instance, organizations may adopt impression
employees from discriminating on the basis of race, color, management techniques, such as displaying pictorial diversity
religion, sex, or national origin. It also established the Equal and inclusive policy statements in their job marketing,
Employment Opportunity Commission (www.EEOC.gov) to recruiting from colleges with a large minority population, and
oversee the law. Related legislation has been expanded to cover employing female and minority recruiters (Avery and McKay,
age, disability, pregnancy, veteran status, genetic information, 2006). Research shows similarity-attraction race effects in job
and sexual orientation. The goal of affirmative action was to interviewer–applicant dyads, and that these effects influence
compensate for past discrimination, prevent ongoing discrim- interview quality, the interviewer’s evaluation of the applicant,
ination, and provide equal employment opportunities to and the applicant’s perceptions of the organization’s diversity-
covered demographic groups. Similar antidiscrimination laws related attributes. Gender effects are also present, but these tend
International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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Diversity in organizations 599
International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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600 Diversity in organizations
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Relevant Websites
44, 1–28.
Ragins, B.R., Cotton, J.L., 1999. Mentor functions and outcomes: a comparison of www.BLS.gov.
men and women in formal and informal mentoring relationships. Journal of Applied www.EEOC.gov.
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International Encyclopedia of the Social & Behavioral Sciences, Second Edition, 2015, 595–600
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