Transforming Research on Diversity and Firm Performance: A Dynamic Capabilities Perspective

Abstract

Despite a growing body of literature on diversity and firm performance, our review of research across fields, theoretical traditions, and levels of analysis suggests that the relationship is not a simple one. However, we attempt to integrate theory and research from macro and micro research domains into one perspective on the firm-level performance effects of diversity. We review the results of research on diversity and firm performance based on the level of analysis at which diversity was examined, highlighting what we know and do not know about this relationship, and why a new approach to research in this area is needed. To set a future research agenda, we introduce a dynamic capabilities framework for studying diversity and firm performance, identifying a subset of capabilities through which we would expect firms to extract benefit (or loss) from diversity and articulate the underlying mechanisms through which such effects are likely to occur. By putting forth this framework, our goal is to offer an integrative, process-based perspective for understanding value creation and capture as it pertains to diversity, and encouraging a more systemic approach to the study of diversity and firm performance.

Inclusion climate: A multilevel investigation of its antecedents and consequences

“…However, a diverse workforce is not sufficient for value creation. Roberson, Holmes and Perry () recommend an alternative framework that focuses on how organizations configure and deploy their diversity resources to shape dynamic capabilities that can influence firm performance. In line with this process‐based perspective, our research demonstrates that organizations can leverage identity‐conscious programs to generate positive consequences from a diverse workforce.…”

Inclusion and commitment as key pathways between leadership and nonprofit performance

“…Given the projected growth of workforce diversity and the need for nonprofit leaders to channel organizational diversity into positive workplace outcomes (Mor Barak et al, ; Roberson et al, ), this study examined whether group and department level TFL were associated with perceptions of work group performance through their influence on climate for inclusion and affective commitment. Results found multiple pathways by which nonprofit leaders can influence perceived performance.…”

“…Given the projected growth of workforce diversity and the need for nonprofit leaders to channel organizational diversity into positive workplace outcomes (Mor Barak et al, 2016;Roberson et al, 2017), this study examined whether group and department level TFL were associated with perceptions of work group performance through their influence on climate for inclusion and affective Similar to top department leaders, results found that immediate work group supervisors can positively influence perceived performance by creating work groups wherein members feel valued and appreciated, which then fosters an emotional attachment and commitment to the work group. However, unlike top department leaders, immediate work group supervisors have the ability to directly influence perceived nonprofit performance by being more transformational.…”

“…Population projections indicate that by 2030, one in five Americans will be 65 or older; by 2044, more than half of all Americans will be members of a racial and ethnic minority group; and by 2060, nearly 20% of the nation's population is projected to be foreign born (Colby & Ortman, 2014). Although workforce diversity can lead to beneficial workplace outcomes, such as increased commitment and performance (Mor Barak et al, 2016;Roberson, Holmes, & Perry, 2017), organizational diversity has also been found to lead to detrimental outcomes, such as increased employee conflict and turnover (Mor Barak et al, 2016;Nishii, 2013). Finding ways to ensure positive workplace outcomes is especially critical for nonprofit organizations that strive to increase employee commitment and performance (Erdurmazli, 2019;Vecina, Chacon, Marzana, & Marta, 2013).…”

Dynamic Technological Diversification and Its Impact on Firms’ Performance: An Empirical Analysis of Korean IT Firms

“…However, in contrast to RBV and OI that analyze the impacts of technological diversification on the acquisition and exploitation of internal or external resources, DCT seeks to integrate and reconfigure existing resources [26]. DCT differs from the above two innovation frameworks by employing a process view for technological diversification [19,27]. The research on technological diversification, in this end, needs to be analyzed in details, varying from internal resources of a firm based on RBV to external resources with OI.…”