Diverse Groups Do Perform Better … Sort Of

While it’s hard to find positive links between diversity and performance for firms, the link between high performance and diversity is clearer with groups or teams. In a survey of team diversity research published in the leading academic journals between 1985 and 2006, one powerful finding stands out: diversity related to work tasks—diversity of functions, expertise, or tenure—leads to better team outcomes.

Teams that include this kind of diversity generate more innovative decisions, consider a wider variety of relevant factors, and engender more thorough debate than groups without it. But it is not all about quality of output. Teams with task-related diversity also generate superior measurable outcomes. For example, a link has been shown between functional diversity and faster time to market for new products in the computer industry. In both quality and quantity of performance, there is undeniable value in having task-related diversity on a team.

But when it comes to diversity of race, gender, and age, the gains in team performance disappear. The same survey of team diversity studies revealed no discernible relationship between these kinds of diversity and team rapport or productivity. Having these demographic diversities may not hurt, but it doesn’t make the team function more effectively. In other words, the benefits of demographic diversity commonly suggested in the team performance literature have probably been overstated. Simply increasing the degree of demographic diversity isn’t an effective approach for building better teams. Focusing on cultivating task-related diversity is probably the better strategy. The bottom line is that not all diversity is helpful when it comes to making teams more effective.