Does TMT cultural diversity contribute to firm performance and do socialisation and tenure matter? A test of two competing perspectives

2019 ◽  
Vol 49 (1) ◽  
pp. 324-348 ◽  
Author(s):  
Fang-Yi Lo ◽  
Yue Wang ◽  
Wu Zhan
Keyword(s):  
Firm Performance ◽  
Cultural Diversity ◽  
Transaction Cost Economics ◽  
Positive Impact ◽  
Diversity Management ◽  
Business Case ◽  
Negative Effects ◽  
Content Type ◽  
Cost And Benefit ◽  
Positive Effects

Purpose The purpose of this paper is to establish the effect of top management team (TMT) cultural diversity on firm performance with a framework that considers such an effect from both cost and benefit perspectives. The paper also examines whether and how diversity management mechanisms such as socialisation and tenure may moderate the effect of TMT diversity on firm performance. Design/methodology/approach Drawing upon two competing perspectives of resource-based view (RBV) and transaction cost economics (TCE), this paper theorises and tests the potential positive and negative effects of TMT cultural diversity on firm performance with 442 publicly listed IT companies in the USA. Findings The results supported the RBV prediction that TMT cultural diversity enhances firm performance and socialisation strengthens the positive effects of a culturally diverse TMT on firm performance. However, tenure was not found to be important in promoting diversity gains or mitigating diversity costs. By showing clear support for the RBV prediction of the positive impact of TMT cultural diversity and refuting the TCE prediction of the potentially negative effects, this research strengthens the business case for embracing cultural diversity in TMTs. Originality/value This paper contributes to the current literature by developing a more balanced framework to deepen our knowledge of how TMT cultural diversity may impact firm performance, and how the use of socialisation and tenure may moderate the TMT cultural diversity–firm performance relationship from both cost and benefit perspectives.

Diversity and firm performance: role of corporate ethics

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Yves-Rose Porcena ◽  
K. Praveen Parboteeah ◽  
Neal P. Mero
Keyword(s):  
Firm Performance ◽  
Diversity Management ◽  
Business Case ◽  
Workplace Diversity ◽  
Corporate Ethics ◽  
Content Type ◽  
Corporate Websites ◽  
Ethics Research ◽  
Repeated Calls ◽  
The Relationship

PurposeEmpirical evidence concerning the relationship between diversity and firm performance continues to produce mixed results that are context-dependent (Guillaume et al., 2017). Additionally, little is known about the relationship between workplace diversity management and corporate ethics and whether diversity management is a contextual factor to consider in ethics research. This study assesses whether diversity management's contributions to firm performance are maximized through its effects on the firm's ethical processes. This paper examines three manifestations of diversity management (diversity recruitment, diversity staffing, and valuing diversity) and their relationship with firm performance as mediated by internal and external ethics.Design/methodology/approachThe study used a sample from the Fortune 500 list of companies. The variables were constructed using several relevant indicators and applied to archival data collected from corporations' websites. The hypotheses on the relationship among diversity management, corporate ethics, and firm performance were tested using regression from the data gathered on 109 firms.FindingsThe analysis indicated that diversity management relates to both aspects of corporate ethics (internal and external ethics) but that only external ethics relate to firm performance. Results also found that external ethics partially mediate the relationship between diversity management and firm performance.Research limitations/implicationsThere are limitations to using corporate websites as sources of data. Furthermore, the research design assumed that diversity is an antecedent of ethics. Nevertheless, the findings convincingly demonstrate that diversity management has a strong positive relationship with both aspects of corporate ethics. Recommendations for further research are offered.Practical implicationsThe paper shows the value of diversity management and its impact on corporate ethics. Knowing that diversity management efforts contribute positively beyond their intended purpose may encourage managers to continue or implement such efforts, which could lead to more diverse and ethical workplaces and increased firm performance.Originality/valueThe paper addresses critical gaps in research and responds to repeated calls for studies integrating the business case for workplace diversity with its moral imperative (Alder and Gilbert, 2006; van Dijk et al., 2012; Yang and Konrad, 2011). The paper also provides evidence of a link from diversity management to firm performance through external ethics.

Diversity in the workplace

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Keyword(s):  
Organizational Performance ◽  
Diversity Management ◽  
Negative Effects ◽  
Content Type ◽  
Management Level ◽  
Positive Effects ◽  
Pertinent Information ◽  
Negative Impacts ◽  
Context Specific ◽  
Diversity In The Workplace

Purpose This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings Increased globalization has led to increased diversity. This can have positive effects for the workplace in terms of increased variety of knowledge, skills and experience. However, there can also be negative impacts of diversity in terms of reduced social cohesion, poor communication and increased conflict. Diversity management can help to reduce the negative effects and capitalize on the positive effects of diversity, in order to enhance organizational performance. Diversity needs to be context-specific, taking into account a wider range of individual attributes, and needs to be supported by diversity at the top management level in order to maximize organizational effectiveness. Originality The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

scholarly journals A contextual analysis of the impact of strategic sourcing and E-procurement on performance

2015 ◽  
Vol 30 (1) ◽  
pp. 1-16 ◽  
Author(s):  
Minkyun Kim ◽  
Nallan C Suresh ◽  
Canan Kocabasoglu-Hillmer
Keyword(s):  
Firm Performance ◽  
Product Life Cycle ◽  
Structural Equation ◽  
Positive Impact ◽  
Equation Modeling ◽  
Content Type ◽  
Strategic Sourcing ◽  
Research Results ◽  
Positive Effects ◽  
The Impact

Purpose – The aim of this study is to investigate the relationships among strategic sourcing, e-procurement and firm performance, along with the moderating effects of business characteristics and environmental factors on these relationships. Design/methodology/approach – This empirical investigation relies on structured survey responses from 137 managers of US manufacturing firms. The partial least squares-based structural equation modeling approach is used for data analysis. Findings – The research results confirm that both strategic sourcing and e-procurement have a positive effect on firm performance. In addition, e-procurement is also found to have a positive impact on strategic sourcing. In addition, the research results suggest that business characteristics and the environment, especially the degree of competition, market turbulence, firm size and stage in product life cycle moderate these relationships significantly. The positive effects of strategic sourcing and e-procurement on firm performance are particularly enhanced under the right conditions. Originality/value – This research is the first, to the best of our knowledge, to provide insights into the joint effects of strategic sourcing and e-procurement, and how business characteristics and the environment affect their roles on firm performance. In addition, firm performance is evaluated as a multi-dimensional construct involving financial, operational and supply chain aspects, with the measurements consisting of several second-order constructs. The study makes both theoretical and practical contributions.

scholarly journals The impact of the gender composition of company boards on firm performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Teodora-Maria Soare ◽  
Céline Detilleux ◽  
Nick Deschacht
Keyword(s):  
Firm Performance ◽  
Organizational Performance ◽  
Policy Reform ◽  
Causal Effect ◽  
Business Case ◽  
Gender Composition ◽  
Negative Effects ◽  
Content Type ◽  
Gender Quota ◽  
The Impact

PurposeThe authors estimate the effect of the gender composition of company boards on firm performance by exploiting variation in the percentage of women after the implementation of a 2011 Belgian policy reform, which introduced a gender quota for listed companies.Design/methodology/approachThe authors analyze the evolution of firm performance between companies that were subjected to the quota law and compare it with the performance of similar firms that were not subjected to the law. This difference-in-difference (DiD) approach allows the authors to avoid the potential bias resulting from unobserved firm characteristics.FindingsThe authors find that the quota policy resulted in the replacement of about one male director by a female one in the average firm between 2010 and 2017. However, this increase in diversity appears to have negatively affected some firm performance indicators. The authors find statistically significant negative effects for 10 out of the 23 financial indicators included in this study, while the other 13 indicators showed no significant effect.Originality/valueThe originality of this research lies in both the methodology and the findings. The policy reform that the authors study can be regarded as a natural experiment so that the DiD method provides estimates of the causal effect of the gender composition of company boards on firm performance. To the best of the authors’ knowledge, this is the first study that presents causal evidence of negative effects of gender quota on organizational performance. These results cast doubts on the business case argument for gender quota and show that results from correlational studies are likely to be biased upward.

The underlying mechanism of corporate governance in China

2019 ◽  
Vol 13 (2) ◽  
pp. 447-467
Author(s):  
Caiyu Yan ◽  
Hongqu He ◽  
Juan Li ◽  
Shuang Cheng ◽  
Yanjun Zhang
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Threshold Model ◽  
Governance Mechanisms ◽  
Negative Effects ◽  
Content Type ◽  
Listed Firms ◽  
Positive Effects ◽  
Management Ownership ◽  
Equity Incentives

Purpose This paper aims to propose a strategy to analyze management governance in China. Design/methodology/approach This paper incorporates data on 989 Chinese listed firms over 2006 to 2016. A fixed effects model with panel data and an F-test are applied to exploit the relationship between management ownership and firm performance. A threshold model is introduced to explore the impacts of other governance mechanisms on management governance. Findings This paper finds an inverted U-shaped relationship between management ownership and firm performance. Furthermore, the threshold model demonstrates that large shareholders strengthen the positive effects of management governance and attenuate its negative effects; board size strengthens the positive effects of management governance but cannot attenuate its negative effects; and independent directors attenuate the negative effects of management governance. Practical implications This paper indicates that increasing management ownership could motivate managers to ameliorate the agent’s moral hazard problem which link the firm value premium when management ownership is less than 20.286 per cent. However, equity incentives are very rare in China. Thus, the authors expect that equity incentives will be a common phenomenon in Chinese listed firms. Originality/value This paper contributes to corporate governance literature by shedding some light on management ownership to explore the effects of management ownership. Specifically, this paper explores the effects of management ownership on firm performance and the impacts of other governance mechanisms on management governance to shape the management governance in China.

Rationales of gender diversity management policies and practices in India: an exploratory empirical study in the Indian IT/ITeS industry

2020 ◽  
Vol 39 (6) ◽  
pp. 667-688
Author(s):  
Shreyashi Chakraborty ◽  
Leena Chatterjee
Keyword(s):  
Survey Methodology ◽  
Economic Value ◽  
Gender Diversity ◽  
Diversity Management ◽  
Business Case ◽  
Full Time ◽  
Content Type ◽  
Indian Context ◽  
Management Policies ◽  
Policies And Practices

PurposeThe Indian context is marked with weak anti-discrimination laws and patchy implementation of protection of civil rights of women at workplaces. The purpose of this paper is to unearth the rationales of the adoption of gender diversity management policies and practices in India, in the absence of laws and regulations.Design/methodology/approachInspiration is drawn from previous studies on diversity management in other national contexts, and a survey methodology was adopted. The lead researcher administered the questionnaires personally to all respondents to ensure that the understanding of the questions is uniform across respondents as gender diversity management is a relatively new concept in India.FindingsSize of the organisation (number of full-time employees), the influence of external organisations and perceived enhanced organisational flexibility were found to explain the adoption of gender diversity management policies and practices in the Indian IT/ITeS industry. Findings also indicate that Indian subsidiaries of foreign multinationals tend to adopt more gender diversity management policies and practices as compared to Indian-owned organisations.Research implicationsThis study provides evidence that organisations do not always enact structures or behaviours in the pursuit of normative rationality and also consider the economic value of them, establishing an organisational agency in adopting legitimated norms or practices. The study also shows that gender diversity management policies and practices are not only dependent on the enactment of laws but also are adopted because of the economic benefit perceived.Originality/valueDiversity management policies and practices have been mostly studied in national contexts with anti-discrimination laws or affirmative action programs and have been claimed to be a successor of equal employment opportunity (EEO) policies. In the absence of stringent laws to reduce or eliminate discrimination against women employees in Indian workplaces, this study contributes to the literature by determining whether the business case for gender diversity drives the adoption of gender diversity management in the Indian context.

Values and career behaviours of entrepreneurs and employees

2019 ◽  
Vol 26 (7) ◽  
pp. 1607-1625
Author(s):  
Anita Gaile ◽  
Ilona Baumane-Vitolina ◽  
Erika Sumilo ◽  
Daina Skiltere ◽  
Ricardo Martin Flores
Keyword(s):  
Career Success ◽  
Structural Equation ◽  
Positive Impact ◽  
Career Adaptability ◽  
Individual Values ◽  
Content Type ◽  
Positive Effects ◽  
Entrepreneurial Behaviour ◽  
Culture Development ◽  
Individual Value

Purpose The purpose of this paper is to determine the differences in the values and behaviours of employees and entrepreneurs and to develop guidelines for employers to foster entrepreneurial thinking in their organisations. Design/methodology/approach To determine individual behaviours, the authors used the career adaptability scale developed by Savickas and Porfelli (2012), complemented with the statements regarding relationships in the workplace and reward, designed by Gattiker and Larwood (1986). The individual values were evaluated by Schwartz’s individual value framework. The career success of individuals was defined by income level and job satisfaction. Data from a sample of 473 respondents were analysed using structural equation modelling. Findings This paper reveals that there are differences in the behaviours and the values of employees and entrepreneurs. Employees are more concerned with relationships at the workplace, rewards and confidence, whereas entrepreneurs focus solely on relationships. Self-direction value has a direct positive impact. Universalism, conformism, achievement, stimulation and safety have indirect positive effects on career success for employees. There is no specific individual value driving career success for entrepreneurs. Originality/value This paper follows the recent trends in organisational culture development whereby organisations seek to incorporate the entrepreneurial mindset at all levels of the organisation. Until now, there has been scarce empirical evidence on the differences between entrepreneurial and employee values. This research provides evidence that the value gap between these two distinct groups is considerable enough to question the ability of the average employee to adopt the entrepreneurial behaviour required by modern organisations.

Market orientation, innovation commercialization capability and firm performance relationships: the moderating role of supply chain influence

2017 ◽  
Vol 32 (7) ◽  
pp. 913-924 ◽  
Author(s):  
Jeen-Su Lim ◽  
William K. Darley ◽  
David Marion
Keyword(s):  
Supply Chain ◽  
Firm Performance ◽  
Market Orientation ◽  
Innovation Management ◽  
Strategy Formulation ◽  
Content Type ◽  
Positive Effects ◽  
The Impact ◽  
Moderating Role

Purpose The study aims to explore supply chain influence (SCI) on the linkages among market orientation, innovation capabilities and firm performance (FP), using the resource-based view as a theoretical backdrop. Design Survey data from 182 top managers who are involved in strategy formulation and innovative direction of their companies was collected and analyzed using moderated multiple regression analysis. Findings Results revealed a moderating role of the SCI in that the proactive market orientation (PMO) and FP relationship is stronger when SCI is high, and innovation commercialization capability (ICC) and FP relationship is stronger when SCI is low. Practical implications Firms pursuing high PMO strategy must collaborate with supply chain function to achieve the full effect of PMO. Additionally, as supply chain is critical to meeting customers’ needs, these firms should allow supply chain to exert greater influence to enjoy the positive effects of PMO in addition to ensuring full integration into marketing strategy implementation. Also, firms with high ICC need to limit SCI to maximize the benefit of ICC on FP, just as innovation management needs to be cognizant of other functional areas. Originality/value The study investigates the potential moderating role of SCI on the relationships among market orientation, ICC and FP. The study fills a gap in the understanding of the nature and role of supply chain in the marketing–supply chain interaction, and the impact on FP.

Exploring privacy and trust for employee monitoring

2015 ◽  
Vol 115 (1) ◽  
pp. 88-106 ◽  
Author(s):  
Shuchih Ernest Chang ◽  
Anne Yenching Liu ◽  
Sungmin Lin
Keyword(s):  
Organizational Culture ◽  
Employee Performance ◽  
Full Time ◽  
Negative Effects ◽  
Content Type ◽  
Positive Effects ◽  
Study Results ◽  
Employee Monitoring ◽  
Communication Privacy ◽  
The Relationship

Purpose – The purpose of this paper is to evaluate privacy boundaries and explores employees’ reactions in employee monitoring. Design/methodology/approach – The research used the metaphor of boundary turbulence in the Communication Privacy Management (CPM) theory to demonstrate the psychological effect on employees. The model comprised organizational culture, CPM, trust, and employee performance in employee monitoring to further investigated the influence exerted by organizational culture and how employees viewed their trust within the organization when implementing employee monitoring. Variables were measured empirically by administrating questionnaires to full-time employees in organizations that currently practice employee monitoring. Findings – The findings showed that a control-oriented organizational culture raised communication privacy turbulence in CPM. The communication privacy turbulence in CPM mostly had negative effects on trust in employee monitoring policy, but not on trust in employee monitoring members. Both trust in employee monitoring policy and trust in employee monitoring members had positive effects on employee commitment and compliance to employee monitoring. Research limitations/implications – This research applied the CPM theory in workplace privacy to explore the relationship between employees’ privacy and trust. The results provide insights of why employees feel psychological resistance when they are forced to accept the practice of employee monitoring. In addition, this study explored the relationship between CPM and trust, and offer support and verification to prior studies. Practical implications – For practitioners, the findings help organizations to improve the performance of their employees and to design a more effective environment for employee monitoring. Originality/value – A research model was proposed to study the impacts of CPM on employee monitoring, after a broad survey on related researches. The validated model and its corresponding study results can be referenced by organization managers and decision makers to make favorable tactics for achieving their goals of implementing employee monitoring.

Gender diversity and innovation in mining – a corpus-based discourse analysis

2017 ◽  
Vol 9 (4) ◽  
pp. 359-376 ◽  
Author(s):  
Ylva Fältholm ◽  
Cathrine Norberg
Keyword(s):  
Discourse Analysis ◽  
Gender Diversity ◽  
Mining Industry ◽  
Diversity Management ◽  
Business Case ◽  
Female Representation ◽  
Policy Makers ◽  
Content Type ◽  
Gender Patterns ◽  
Practical Implications

Purpose The purpose of this study is to gain increased knowledge about gender diversity and innovation in mining by analyzing how women are discursively represented in relation to these two concepts, and in doing so establish how diversity management is received and communicated in the industry. Design/methodology/approach The study is based on analysis of texts including references to gender diversity and innovation in mining found on the web. The tool used to retrieve the data has been WebCorpLive, a tool designed for linguistic analysis of web material. Findings Although increased female representation is communicated as a key component in the diversity management discourse, based on the idea that diversity increases innovation and creativity, closer analysis of texts on diversity and innovation in mining shows that what women are expected to contribute with has little explicit connection with innovation. Research limitations/implications The study contributes with increased knowledge about diversity management by providing an example of how it is received in a traditionally male-dominated industry. Practical implications The findings indicate that for diversity management to have a real effect in mining, it needs to be based on gender equality and social justice motives, rather than on a business case rationale – the principal motive today. To enable this change, stereotypical gender patterns, as shown in this study, need to be made visible and problematized among policy makers, practitioners and actors on all levels of the industry. Originality value The study contributes with new knowledge about gender in the mining industry previously not attended to by using a method which so far has been sparsely used in discourse analysis, although pointed out as promising.

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