Chapter
Three
Managing Diversity
And
Individual Differences
Thomson South-Western
Wagner & Hollenbeck 5e
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Chapter Overview
 This chapter examines the following topics:
– Capitalizing on Diversity
• Selection
• Training
• Reengineering
– Diversity in Personality: Five Critical Factors
• The Big Five Framework
• Making Personality Tests More Effective
– Diversity in Cognitive Abilities: Four Critical Factors
• General and Specific Aspects of Cognitive Ability
• Validity of Cognitive Ability Tests
– Diversity in Physical Abilities: Three Critical Factors
– Diversity in Experience: Two Critical Factors
• Broadening Demographic Experience: Political Aspects
• Broadening Demographic Experience: Competitive Aspects
• Broadening Cultural Experience
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– Adaptability: Flexibility in the Face of Diversity
Introduction
 When it comes to building and
leading organizations,
inexperienced managers often
make one of two critical mistakes:
– Mirror image fallacy
– Prejudicial stereotypes
 Managers need to treat each
person as a unique configuration
of ten characteristics rather than
simply categorizing workers by
surface characteristics such as
race, sex, age, or culture
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Capitalizing on Diversity
 Even the most tolerant managers
might sometimes wish that
individual differences might go
away; however, such homogeneity
is highly unlikely to happen
 Successful organizations must try
to capitalize on differences in a
way that advances their
competitiveness
 Benefits can be derived from
individual differences in
organizational behavior through
three ways
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Selection, Training, and
Reengineering
 Selection and placement 
programs enable
managers to assess people
and jobs and then try to
match up the two in a way
that maximizes the fit
between the abilities and 
traits of the individual and
the abilities and traits
required for the job
 Effective selection is
critical for carrying out
certain business strategies
Training compensates for any
job-related deficiencies in
their current profile of traits
and abilities
– Training can also be directed
at changing people’s
personality styles
Reengineering is a different
approach to respond to a
mismatch between person
and job; it requires changing
the job or work processes
– Successful managers strive to
put each worker in a position
that best taps his or her own
talents
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Diversity in Personality: Five
Critical Factors
 Given the vast number of
personality characteristics,
some type of classification
scheme is needed before
understanding both the
characteristics and their
interrelationships
 Current personality
literature tends to focus on a
consensus group of five
dimensions of personality
known as the “Big Five”
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The Big Five Framework
 The Big Five personality characteristics home in on a person’s
social reputation in the sense that they describe what the person is
like when viewed by other people also the five characteristics can
be used to comprehensively capture what people are like
 The Big Five traits include:
– Extroversion
– Emotional stability
– Agreeableness
– Conscientiousness
– Openness to experience
 Many companies rely heavily on personality assessment programs
to evaluate and promote employees while many other firms use
such programs as screens for initial hiring
 Despite their widespread adoption by industry, the usefulness of
such personality measures in explaining and predicting human
behavior has been criticized on several counts with the most
significant criticism dealing with the validity of these measures for
actually predicting future job success
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Making Personality Tests More
Effective
 Although the validity of personality tests may never
exceed that of ability tests, organizations can
nevertheless take concrete steps to more successfully
capitalize on individual differences in personality
– First, the effects of some trait on performance are revealed
–
–
–
–
only when the person is also high in ability
Second, any one trait by itself may not be as important as
how the trait interacts with other traits
Third, the relationship between the trait and performance
could be a function of the specific demands of the job
Fourth, the relationship between the trait and performance
may be a function of whether the job is stable or unstable
Finally, obtaining information about the job applicant’s
personality is also an area where one can take steps to
improve the predictive validity of such tests
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Diversity in Cognitive Abilities:
Four Critical Factors
 Although mental
abilities are not onedimensional, we do
generally find positive
relationships between
people’s performances
on different kinds of
mental tests
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General and Specific Aspects of
Cognitive Ability
 Specialists tend to prefer the term general cognitive
ability to intelligence because the former term is more
precise and conjures up less controversy over issues
such as the role of genetic factors in mental ability
 Four facets of of cognitive or mental ability that stand
out in terms of their generality and their usefulness as
predictors of performance in the real world include:
– Verbal ability: reflects the degree to which a person can
understand and use written and spoken language
– Quantitative ability: reflects a person’s ability to perform all
kinds of arithmetic problems
– Reasoning ability: the ability to invent solutions to many
different types of problems
– Spatial ability: reflects a person’s ability to imagine how an
object would look if its position in space were changed
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Validity of Cognitive Ability Tests
 The usefulness of cognitive ability tests in
predicting task performance has been
investigated in both academic and
organizational contexts
 A great deal of evidence suggests that
general cognitive ability is also predictive of
success in the work world
 For certain jobs, tests of specific mental
ability can add significantly to the
predictive power of tests of general
intelligence
 General cognitive ability influences both
how quickly a person can learn a job and
how readily he or she can adapt to changing
circumstances when on the job
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Diversity in Physical Abilities:
Three Critical Factors
 A great deal of the early research in the area
of organizational behavior examined physical
abilities
– Edwin Fleishman
 Physical ability consists of three major
dimensions:
– Muscle strength: tension, power and endurance
– Endurance
– Movement quality: flexibility, balance, and
coordination
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Diversity in Experience: Two
Critical Factors
 Recent trends related to the labor supply have heightened
managers’ awareness of individual differences found
among workers
 Most of the awareness has focused less on differences in
physical abilities, cognitive abilities,and personality traits
and more on diversity related to demographic and cultural
characteristics
 The term demographic experience refers to the variability
between people in terms of how much exposure they have
had in working with people from different demographic
groups
 The term cultural experience describes the variability
between people in terms of how much exposure they have
had in working with people from different nations and
cultures
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Broadening Demographic
Experience: Political Aspects
 In the past, political forces drove
integration of the workforce
 These political forces are still alive
today , but have waned for several
reasons
– Many of the affirmative action
programs have achieved some
measure of success
– Existing affirmative action programs
no longer target groups who need the
most support
– Backlash against affirmative action
and other remedial programs aimed
at minorities
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Broadening Demographic
Experience: Competitive Aspects
 Hiring Issues:
– Rather than being motivated by a sense of
social injustice or fear of litigation,
affirmative action programs in the 21st
century are part of a larger strategy that
seeks to leverage diverse experience into
competitive advantage
 Successfully creating a diverse workforce can
enhance a firm’s bottom line and hence its
standing in financial markets
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Broadening Demographic
Experience: Competitive Aspects
 Retention Issues:
– Firms that value diversity also
need to ensure that they can
retain the services of members of
these groups
 To help with this problem,
companies can:
– Provide training programs
– Establish programs that promote
mentoring relationships
– Provide top managerial support
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Broadening Cultural Experience
 Creating a workforce with diverse international and
cultural experience can help firms move into global
product markets
 To broaden the cultural experience of employees,
organizations can:
– Teach employees of the intricacies of differing cultures
– Send employees on international assignments
– Import the type of talent needed to be competitive both
domestically and internationally
 The ability to overcome problems wrought by
individual differences is a critical skill for today’s
managers
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Adaptability: Flexibility in the
Face of Diversity
 Given the complex and dynamic nature of
the environment, perhaps the most critical
aspect of human variability in the 21st
century will be adaptability
 Highly adaptable people can handle
emergencies and deal effectively with
uncertain and unpredictable situations
 Research has shown that both general
cognitive ability and openness to experience
are related to adaptability
 Given the changing nature of both work
and the workforce, future managers will
need this trait perhaps more than any other
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