The impact of racial and gender diversity in management on financial performance: how participative strategy making features can unleash a diversity advantage |
| |
| Authors: | Orlando C Richard Susan L Kirby Ken Chadwick |
| |
| Institution: | 1. Jindal School of Management, Department of Organizations, Strategy, and International Management, University of Texas at Dallas, Richardson, TX, USAorlando.richard@utdallas.edu;3. McCoy College of Business Administration, Texas State University, San Marcos, TX, USA;4. Department of Management, Marketing, and Business Administration, Nichols State University, Thibodaux, LA, USA |
| |
| Abstract: | How does racial and gender diversity in the management ranks affect the bottom line? Our findings indicate that participative strategy making (PSM) positively moderates the relationship between both racial and gender diversity in management and firm performance measured as return on assets. Specifically, PSM strengthens the positive relationship that exists between racial diversity in management and firm performance. Although no main effect is observed for gender diversity in management, our results reveal that gender diversity in management is positively related to performance when PSM is high. However, we find that gender diversity in management is negatively related to performance when PSM is low, while gender homogeneous management experience superior performance. We offer implications for diversity research to embrace and consider the role of PSM and ‘inclusiveness’. |
| |
| Keywords: | gender diversity in management inclusiveness knowledge-based view participative management racial diversity racial diversity in management |
|
|
