Organizations that diversify the skill levels of their top leadership benefit more than those that try too hard for similar diversity in personality, according to the Management Insights feature in the current issue of Management Science, the flagship journal of the Institute for Operations Research and the Management Sciences (INFORMS®).
Management Insights, a regular feature of the journal, is a digest of important research in business, management, operations research, and management science. It appears in every issue of the monthly journal.
"Top Management Team Diversity and Firm Performance " is by Christophe Boone of the Faculty of Applied Economics, University of Antwerpen, 2000 Antwerpen, Belgium and Walter Hendriks of the Faculty of Economics and Business Administration, Maastricht University, 6200 MD, Maastricht, The Netherlands.
An empirical analysis of 33 medium-sized Dutch and Belgian information technology (IT) firms reveals that teams with diverse expertise and work experience tend to be more effective in managing organizations, particularly when these managers cooperate and share accurate information and decision-making power.
On the other hand, analysis shows that diversity in the personalities of members of the management team hampers firm performance.
The authors found that one means of avoiding the disruptive consequences of these personality differences is to concentrate authority in the office of the CEO. But centralization of power comes at a price, because organizations must decentralize decision making to reap the full benefits of diverse expertise and experience.
In the sample examined by the authors, the mean return on sales (ROS) of IT firms with the ideal team configuration (diverse expertise and work experience, similar personalities, and decentralized decision making) was 10%, whereas the mean ROS of IT firms with the worst possible team configuration (similar expertise and work experience, diverse personalities, and decentralized decision making) was −7%.
Based on these findings, the authors suggest that management team recruiters use carefully designed personnel selection techniques screening personality and knowledge experience.
Barry List | EurekAlert!
Frugal Innovations: when less is more
19.04.2017 | Fraunhofer-Institut für Arbeitswirtschaft und Organisation IAO
Europe's microtechnology industry is attuned to growth
10.03.2017 | IVAM Fachverband für Mikrotechnik
More and more automobile companies are focusing on body parts made of carbon fiber reinforced plastics (CFRP). However, manufacturing and repair costs must be further reduced in order to make CFRP more economical in use. Together with the Volkswagen AG and five other partners in the project HolQueSt 3D, the Laser Zentrum Hannover e.V. (LZH) has developed laser processes for the automatic trimming, drilling and repair of three-dimensional components.
Automated manufacturing processes are the basis for ultimately establishing the series production of CFRP components. In the project HolQueSt 3D, the LZH has...
Reflecting the structure of composites found in nature and the ancient world, researchers at the University of Illinois at Urbana-Champaign have synthesized thin carbon nanotube (CNT) textiles that exhibit both high electrical conductivity and a level of toughness that is about fifty times higher than copper films, currently used in electronics.
"The structural robustness of thin metal films has significant importance for the reliable operation of smart skin and flexible electronics including...
The nearby, giant radio galaxy M87 hosts a supermassive black hole (BH) and is well-known for its bright jet dominating the spectrum over ten orders of magnitude in frequency. Due to its proximity, jet prominence, and the large black hole mass, M87 is the best laboratory for investigating the formation, acceleration, and collimation of relativistic jets. A research team led by Silke Britzen from the Max Planck Institute for Radio Astronomy in Bonn, Germany, has found strong indication for turbulent processes connecting the accretion disk and the jet of that galaxy providing insights into the longstanding problem of the origin of astrophysical jets.
Supermassive black holes form some of the most enigmatic phenomena in astrophysics. Their enormous energy output is supposed to be generated by the...
The probability to find a certain number of photons inside a laser pulse usually corresponds to a classical distribution of independent events, the so-called...
Microprocessors based on atomically thin materials hold the promise of the evolution of traditional processors as well as new applications in the field of flexible electronics. Now, a TU Wien research team led by Thomas Müller has made a breakthrough in this field as part of an ongoing research project.
Two-dimensional materials, or 2D materials for short, are extremely versatile, although – or often more precisely because – they are made up of just one or a...
20.04.2017 | Event News
18.04.2017 | Event News
03.04.2017 | Event News
24.04.2017 | Physics and Astronomy
24.04.2017 | Materials Sciences
24.04.2017 | Life Sciences