Towards a Theory of Diversity Mindset:

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Towards a Theory of Diversity Mindset:

Unraveling the effects and sources of Diversity Beliefs

Research Master Thesis

SOM Research and Graduate School, University of Groningen Faculty of Economics and Business

University of Groningen

OLGA PASCENCO Student number: 1832573 E-mail: opascenco@gmail.com

Phone: +31 (0) 6 14342219

Under the supervision of

Dr. FLOOR RINK

Acknowledgment: I would like to thank my supervisor, Floor Rink, for encouraging my research

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ABSTRACT

The goal of the present study is twofold.

First, it aims at uncovering the positive effects of individuals‟ Diversity Beliefs during Mergers & Acqusitions (M&A). It is widely accepted that M&A are a source of threat, stress and alienation among employees, accompanied by high resistance to accept new organizational culture and colleagues. I conducted an experimental scenario study, involving respondents (N=254) from various cultural, educational and functional backgrounds and showed that one of the keys to successful post-merger integration represents employees‟ Diversity Beliefs. Interestingly though, this relationship is mediated by employees‟ perception of the merger, their ability to cope with change-related requirements and willingness to elaborate and share knowledge.

Second, given the theoretical and practical relevance of individual Diversity Beliefs, I developed a holistic conceptual framework of Diversity Beliefs antecedents on the individual level, which could serve as a foundation for a broader and comprehensive theory of the Diversity Mindset sources. A detailed discussion and suggestions for further development of the theory are outlined.

Keywords: Mergers & Acquisitions, Diversity, Diversity Beliefs, Identification, Group Performance,

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INTRODUCTION

Mergers and Acquisitions remain a highly popular form of organizational development and corporate diversification. Only in 2004, 30 000 mergers were completed globally, which translates into one transaction every 18 minutes (Cartwright& Schoenberg, 2006). In spite of thirty years of relevant research in the field of M&A, we know surprisingly little about how to deal with M&A. However, we do know one truth about mergers, which could be summed up to the following statement: M&A rarely work. Projected synergies are not achieved in 70-80% of all M&A (Coffey, Garrow& Holbeche, 2002) and according to a Deloitte& Touche study (2001) only one third of employees in 540 companies surveyed about M&A viewed their merger as successful. What we also came to realize is that most of the M&A failures can be attributed to the human factor. Recall the Daimler-Chrysler merger: differences in management styles and organizational cultures lead to continuous tensions among employees from both companies. Or think of Cap Gemini acquiring the MAC Group. This merger ended up in an exodus of talents at MAC. Finally, when AT&T acquired the computer manufacturer NCR the financial and operational forecast predicted a fruitful merger. However, in the end this merger never worked, because of a poor integration of people and their relations. Often, failure to consider the role of people and their beliefs, capabilities and attitudes in the merger process result in significant loss of key employees, and a feeling of confusion over the existing differences between the merging companies and insecurity among those who remain. Harding& Rouse (2007) therefore refer to the importance of conducting human due diligence as a determinant of a successful merger.

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4 Moreover, given the strategic importance of individuals‟ diversity beliefs, in the present study I attempted to explore the sources such diversity beliefs. Although some of the positive effects of the pro-diversity attitudes and beliefs are known, the sources that generate such beliefs represent a black box. Several researchers have urged for the development of a theory with regard to the antecedents of diversity related attitudes (Mitchell, Nicholas, & Boyle, 2009; van Dick et al., 2008; Homan et al., 2007; van Knippenberg, Platow, & Haslam, 2007; Hobman, Bortia, & Gallois, 2004). I believe that such theory would have significant practical implications, especially for the diversity management in organizations. From a theoretical standpoint, it would bring further insights into the nature of diversity related attitudes and the mechanism through which they impact the group and organizational functioning. In the present paper I make a first attempt to develop the theory with

regard to the antecedents of the pro-diversity mindset.

The concept of diversity mindset (van Knippenberg & Schippers, 2007) will be employed for the development of the theory, thus bringing together various labels that have been applied to diversity attitudes and beliefs previously. By diversity mindset I refer to individuals‟ understanding about differences in a broader sense (e.g. not tied to a specific diversity dimension), attitudes and beliefs, and set of behaviors that shows support or resistance to diversity. Thus, the diversity mindset term represents a holistic concept, which describes individuals‟ cognitive, affective and behavioral responses to diversity.

The thesis is divided in two parts. The first part deals with the effects of Diversity Beliefs during organizational changes, such as M&A. Thus, the reader will be introduced to the relevant literature with regard to M&A and Diversity Beliefs, followed by the conceptual model. Next, the methodology of the study and the results are presented. Finally, a detailed discussion, outlining the practical and theoretical contributions of the findings will be elaborated.

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FIRST PART OF THE STORY:

Theoretical Review and Conceptual Model

MERGERS& ACQUISITIONS

BACKGROUND

Globalization and recent developments in corporate world have forced companies to undergo a complex process of mergers and acquisitions, in order to achieve corporate diversity and growth (Nahavandhi& Malekzadeh, 1988). M&A rose in the ‟80 and, as a trend occurring in waves, shifted from purely financial to more strategic and operational in its nature (Coffey, Garrow, & Holbeche, 2002).

Some clarifying remarks are needed on the concept of Mergers & Acquisitions. An acquisition implies that one or more companies are taken over by the acquiring company, while in a merger the assets of all the merging companies are transferred into a newly created company (Ullrich, Wieseke, & van Dick, 2005). Although mergers and acquisitions have different legal meanings, in the corporate world, these two words are used to describe slightly the same phenomenon. Indeed, in practice, most mergers are to a certain degree takeovers, making a clear distinction between the acquiring and the acquired company (Cartwright& Cooper, 1990). One partner is generally more influential and viable than the other ((i.e. more on organizational dominance, see van Knippenberg, van Knippenberg, Monden, & de Lima, 2002), with a clear competitive advantage over the company which is acquired.

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“You can run all your discounted cash flows and have the numbers come out perfectly, but it’s the human resources side of the M&A that spells failure or success… When the deal is inked and the financial wizards go home, that’s when the trouble starts. You’ve got the numbers. Now, what are you going to do about the people?”

There is no doubt that the human factor is an important aspect to be considered during organizational mergers (Cartwright & Cooper, 1993b, 1996). Mergers entail more than simply reallocating office locations or changing a brand name. The true challenge lies in merging cultures, people and their beliefs and management styles (Daniel, 1999). “Employee problems” still account for one third to one half of all M&A failures (Dackert, Jackson, Brenner, & Johansson, 2003). Most organizational mergers can traumatize and alienate people, inducing high levels of uncertainty, threat, turnover, low morale, job dissatisfaction and declining performance at all organizational levels (Buono& Bowditch, 1989; Cartwright& Cooper, 1993a; Amiot, Terry, Jimmieson, & Callan, 2006). Due to the cultural shock, that mergers often induce, employees tend to focus more on personal security rather on organizational goals (Grotenhuis, 2001). Thus, the main challenge that top management should realize and focus on during a merger process is to integrate people and their different cultures (Larsson& Lubatkin, 2001; Pepper& Larson, 2006).

M&A THROUGH SOCIAL IDENTITY PERSPECTIVE

I argue that the social identity approach will give a better understanding of the processes underlying individual and group adjustment to a merger (Mottola, Gaertner, Bachman, & Dovidio

,

1997; Terry, Carey, & Callan, 2001). Social identity theory (Tajfel, 1978) is a psychological theory of groups and inter-group relations, which explains that individuals perceive the world in terms of social categories. The central focus of the theory is one‟s self concept that results from individuals‟ membership in groups (social identity). Because people are motivated to achieve and maintain a positive self concept or self view, they prefer to belong to groups that can be favorably distinguished from other groups. Furthermore, they tend to differentiate between in-group and out-group members and give preference to in-group self alike members (Terry& O‟Brien, 2001).

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7 merger (van Knippenberg et al., 2002). Importantly though, for the success of a merger, organizations need to maintain committed personnel, which shows pro-organizational behavior (Boen, Vanbeselaere, Brebels, Huybens, & Millet, 2007).

The common in-group identity model (Dovidio, Gaertner, & Validzic, 1998) predicts that the more employees indeed see the merged organization as one new entity, the less inter-group bias and stereotypes they generate. As widely accepted, stereotypes represent one‟s category-based cognitive response to another person or group. Besides prejudice and discrimination, stereotypes often also refer to people‟s beliefs about a person, based on his/her group membership (Fiske, 1993). The model discussed above will create a context facilitating a smooth transition from thinking in terms of

“us versus them” to thinking in terms of “we”, resulting in high identification with the newly

composed teams and organization. According to the common in-group identity model, this is most likely to occur when employees have the opportunity to engage in informal interactions with the merger partners and start perceiving them as individuals rather than out-group members (Seo& Hill, 2005). The explanation is straightforward: only by fostering teamwork, common goals and intense cooperation between employees of the merged organization, people will be able to get to know each other better and start perceiving each other as team colleagues rather than individuals on the opposing side. Thus, in time, stereotypes about each other will be replaced by more realistic opinions, based on team work interaction for example, rather than pure belonging to a certain group.

DIVERSITY IN GROUPS

The term workgroup diversity gains more and more attention from practitioners and researchers. Nowadays, companies rely heavily on teams, to coordinate work and tasks within the organization (Milliken& Martins, 1996). Yet globalization and internationalization at the same time increase the instances that these team members have to work with others who differ from them in terms of functional backgrounds and opinions or values.

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8 Over the years, the results regarding the impact of diversity on group functioning are ambiguous and contradicting. From a Social Identity Perspective, diversity in groups lead to relational conflict (Jehn et al., 1999; Mannix& Neale, 2005), lower group cohesion and turnover (Milliken& Martins, 1996, Homan, 2006), deviant behavior and dissatisfaction on the individual level (Jackson, Joshi, & Erhardt, 2003). Again, this can be explained by the fact that people prefer to maintain and protect their self concept, or self esteem by associating only with those who are self-alike, and tend to evaluate others who are different than the self relatively negatively (Tajfel, 1978). Indeed, as stated by the Similarity-Attraction theory, similarities on different attributes like values, opinions, visible traits will ease interpersonal attraction and liking, while differences will give rise to disliking and avoidance (Mannix& Neale, 2005).

However, taking the information processing approach, diverse groups should also have access to a wider pool of information, knowledge and expertise. Through debates and unique information exchange, these groups should in principle be more creative, more efficient in problem-solving and higher in performance than homogeneous groups (Jehn et al., 1999; Jackson et al., 2003; Mannix& Neale, 2005; van der Vegt& Bunderson, 2005; Harrison& Klein, 2007; van Knippenberg & Schippers, 2007).

DIVERSITY BELIEFS

In an attempt to integrate the two main approaches on diversity, van Knippenberg, De Dreu & Homan (2004) proposed the Categorization-Elaboration Model (CEM), which main idea is that both visible and underlying diversity attributes can have a positive or negative impact on group performance, depending on the salience of the social categories that these attributes elicit. They further show that whether or not individuals will tend to sub-categorize on the basis of diversity attributes depends more on their beliefs about the value of diversity, rather than on the diversity attributes per se (Homan, 2006; Homan, van Knippenberg, van Kleef, & De Dreu, 2007; van Knippenberg, Haslam, & Platow, 2007; van Dick, van Knippenberg, Hagele, Guillaume, & Brodbeck, 2008). As defined by van Dick et al. (2008) diversity beliefs represent the beliefs that individuals hold about how diversity impacts upon the functioning of their group and the extent to which individuals think that diversity within their group can be beneficial or detrimental for its performance.

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9 whose members shared the beliefs that diversity is important for the group functioning (pro-diversity beliefs) performed better than those groups, whose members shared pro-similarity beliefs, regardless of whether the subgroups were salient or not. In two different studies, van Knippenberg et al. (2007) showed that there can be a strong positive relationship between diversity and group identification, when group members believe in the value of diversity.

The research in the field of diversity beliefs is crucial for understanding the phenomenon of workgroup diversity and reconciles the two main approaches on diversity so far. Contrary to the social categorization perspective on diversity, the previous studies promote the idea that diversity in groups does not necessarily have to lead to a lack of psychological attachment with the group and relational conflict, as long as people believe in the value of their group diversity. For these reasons I decided to focus on the role of diversity beliefs in the extent to which people are willing to accept a merger, and identify with their newly formed post-merger work team.

Importantly, I will deliberately not make a distinction between beliefs about visible or underlying diversity, because these two types of diversity often go hand in hand within workgroups (Homan, 2006). Imagine for example a consultancy team, working on a change project within a multinational. It is most probably that this team will be highly international (ethnic diversity), including professionals in various fields (functional diversity), since major strategic change projects require knowledge and expertise in soft as well as hard organizational issues.

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10 sensitivity – that is the ability to value the cultural differences - and its positive impact on trust dynamics between the merging companies.

Although diversity beliefs represent an important factor on the organizational level, it still remains an abstract measure on the company-wide level. Diversity beliefs concern individuals in the first place and mainly what they think and how they perceive the differences. Since a merger‟s success fully depends on individuals who are directly involved in the merger process and their ability and willingness to cope with the merger, it is crucial to examine what processes might facilitate or obstruct the post-merger integration mainly on the individual or group level. The present research being conducted via a scenario study, offers insights on how individuals cope with the merger, depending on their diversity beliefs in a broader sense. Therefore, my first hypothesis will be:

Hypothesis 1: People who believe in the value of diversity and think that diversity is

beneficial for their group functioning (pro-diversity beliefs) will identify stronger and will

perform better within the newly created organization after the merger. Therefore, Diversity

Beliefs will be positively related to post-merger group identification and post-merger group

performance.

Importantly though, my interest is to take this research a step forward and to discover the exact processes that diversity beliefs generate in case of a merger, and how these processes can positively influence the merger success. Considering the rapid development and especially the fact that nowadays organizational changes are much more frequent, less controllable and on a much larger scale than ever before (Burnes, 2004), researchers need to conduct in-depth studies, inquiring more on the mediating processes, offering multiple tailored solutions, instead of solely focusing on some general outcomes.

MODEL AND HYPOTHESIS DEVELOPMENT

Figure 1: Theoretical Model

+ + + Diversity Beliefs

Mediators:

Merger perception

Self-efficacy

Information Elaboration

Outcomes:

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DIVERSITY BELIEFS AND MERGER AS THREAT VERSUS OPPORTUNITY

The first important process to look at is the perceptions of threat vs. opportunity that people develop when confronted with a merger. The way that employees perceive a merger generally has a strong effect on the post-merger functioning of a team and the merger integration process. There have been several studies in the field of organizational mergers, showing the impact of the “merger as threat” perception at the group level (see Terry& Callan, 1998; van Leeuwen, 2001; Terry& O‟Brien, 2001; Terry et al., 2001; van Knippenberg et al., 2002; Ellemers, 2003; van Leeuwen & van Knippenberg, 2003; Terry, 2003; Boen, Vanbeselaere, & Cool, 2006; Giessner, Viki, Otten, Terry, & Tauber, 2006; Amiot et al., 2007; Boen et al., 2007). This means that the extent to which employees perceive the merger as a threat or opportunity has consequences for how they eventually identify with their new team, and the eventual success of this team. Indeed, threat and opportunity are two basic categories through which people tend to label and evaluate different events. Threat implies a negative situation, in which the individual has little control over it and the personal loss is very likely. At the other end of continuum there is opportunity, a category involving a positive situation, offering personal gain and a fair amount of control over the situation (Dutton & Jackson, 1987). An extension of this reasoning is the Threat-Rigidity Theory (Staw, Sandelands, & Dutton, 1981), stating that threat situations often lead to mal-adaptive reactions to changes, both on organizational, group and individual level, by narrowing the extent to which people are able to process information or ability to “see the bigger picture”. According to the authors, the change attempt as threat leads to a certain degree of rigidity in people‟s thinking and action, which is not appropriate, since changes always ask for diverse and innovative responses.

The threat-opportunity concept has mainly been applied to investigate behavior on the individual level. For instance, in a computer training study, Martocchio (1992) showed that labeling the context as an opportunity rather than threat resulted in lower anxiety, higher computer efficacy and learning. A study by Larsson& Kempe (1988) showed that appraisal of the situation in terms of challenge and opportunity led to higher self-performance among police officers. Perceptions of a merger as an opportunity induced higher levels of perceived creativity and innovative decision-making than perceptions of Mergers as a threat (Zhou, Shin, & Cannella, 2008).

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12 inter-group bias, or the well known “us versus them” paradigm, lower post-merger identification and adjustment to the merger (Terry& Callan, 1998; Terry& O‟Brien, 2001; Boen et al., 2006). Yet, members of the acquiring group can perceive the merger as an opportunity, leading to positive outcomes, personal gains and a feeling of control of the situation. Another factor determining group members‟ predispositions to categorize the merger as threat represents the perceived permeability of boundaries - that is the extent to which members of both groups can freely move from one group to another, and have access to all the information, knowledge and competitive advantage of both groups (Terry, Carey, & Callan, 2001; Terry, 2003). From the employee viewpoint a merger which lacks a sense of equity and fairness also induces higher degrees of threat (Terry& O‟Brien, 2001; Giessner et al., 2006; Amiot et al., 2007; Gleibs, Mummendey, & Noack, 2008). Factors like organizational unity and support, as well as inter-group contact conditions can also guide the employees to perceive the merger in terms of opportunity or threat (Mottola, Gaertner, & Dovidio, 1997). On the organizational level, communication and social control mechanisms deployed by the top management transmits threatening or positive signals to employees (Larsson & Lubatkin, 2001). Mergers can induce higher levels of threat, particularly for the dominated groups, but not solely, if they disrupt the sense of continuity in employees‟ identity (van Leeuwen, 2001; van Knippenberg et al., 2002; van Leeuwen et al., 2003; Ullrich, Wieseke, & van Dick, 2005).

All the above mentioned factors influence the degree to which employees‟ are inclined to perceive the merger as a threat or opportunity, which has a direct effect on post-merger identification and group functioning (Mottola et al., 1997; Boen et al., 2007). A recent study by Kovoor-Misra (2009) on organizational identification through the threat/opportunity framework proved that, during organizational changes, high levels of threat induce “who we are” thinking instead of “who we could be”. In other words, threat forces people to resist the shift in their identity, while opportunity motivates them to look beyond the existing boundaries, be open to change, learn from it and internalize it in their attitudes and values.

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13 that are different (Mannix & Neale, 2005). However, whether people categorize based on diversity criteria or are threatened by the different ones depends on their beliefs about diversity (Homan, 2006). Therefore, applying the same logic, it can be assumed that people who hold strong pro-diversity beliefs are more inclined to see the merger as an opportunity rather than risk or threat. The merger should not represent a danger for those individuals who value the differences and believe that working with people with different educational, functional, cultural, cognitive backgrounds is beneficial and interesting.

Hypothesis 2: I argue that merger perception of threat vs. opportunity will mediate the

relationship between Diversity Beliefs and post-merger group identification and Diversity

Beliefs and post-merger group performance.

DIVERSITY BELIEFS AND SELF-EFFICACY IN THE CONTEXT OF ORGANIZATIONAL MERGERS

Second important mechanism that can potentially explain why diversity beliefs have a positive effect on successful post merger integration is the concept of self-efficacy. As argued before, mergers represent a form of organizational change, affecting state of mind and causing frustration, uncertainty and anxiety (Buono & Bowditch, 1989; Amiot et al., 2006). In the previous section the importance of merger perception as threat vs. opportunity was discussed and it was argued that the way individuals evaluate the merger, in terms of threat or opportunity, have direct impact on the merger success.

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14 2004). Gender mixed groups had higher group efficacy, which lead to more tight connections within the group and favorable second performance. In homogeneous groups however, members based their group efficacy on similarity-attraction, which could inflate the perceptions of their efficacy. Importantly though, I could not locate any research study, linking either diversity or diversity beliefs with change-related self-efficacy. And this is despite the fact that organizational changes have been a leading topic among practitioners and researchers in the last years. The nature of change has evolved and now it is highly rapid, complex and requiring maximum adaptation and flexibility on the organizational level and subsequently, self-efficacy on the individual level. Wanberg and Banas (2000) define self-efficacy as “an employee’s perceived ability to function well on the job, despite the demands

of a changing work environment”. Change has never been as uncontrollable as it is nowadays (Burnes,

2004), the fact which requires increased adaptation skills (Chan, 2000), as well as constant change awareness.

I argue that people holding strong pro-diversity beliefs will possess higher change-related self-efficacy, due to a more flexible and reconfigurable mindset and understanding of the context. Moreover, when individuals consider that diversity is beneficial and represents a competitive advantage for their group functioning, they will perceive the newly merged diverse group as able to better cope with change. Accordingly, being a member of a “strong due to diversity group”, individuals‟ own appraisal about his/her capabilities on how to deal with the changing environment increases as well. I mentioned “newly merged diverse group” on purpose, as mergers always bring about a certain degree of changes to groups and organizations, due to in-flow of personnel, knowledge and expertise. It is widely accepted that one of the core motives behind M&A is creating unique value (Salter& Weinhold, in Krishnan, Miller, & Judge, 1997), which can be created by differences in resources rather than similarities (Barney, 1986).

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15 mastery, pro-active behavior focusing on the management of the problem, rather on its avoidance. This type of attitude lead to psychological well-being, higher job satisfaction and post-merger identification with the newly created group (also see Terry& Jimmieson, 2003). Similar results were found in Jimmieson, Terry& Callan study (2004), stating that people with high self-efficacy will perceive the merger as an opportunity, rather than threat or uncertainty.

Based on the above mentioned, I believe that diversity beliefs represent an important and innovative source for enhancing self-efficacy in workgroup and merger context. Therefore, I argue that:

Hypothesis 3: Self-efficacy will also mediate the relationship between Diversity Beliefs and

post-merger group identification and Diversity Beliefs and post-merger group performance.

DIVERSITY BELIEFS AND INFORMATION ELABORATION IN THE CONTEXT OF ORGANIZATIONAL MERGERS

Finally, the third factor that can explain the positive relationship between diversity beliefs and post-merger identification and performance is the so called process of information elaboration. Analyzing the mediating process of information elaboration is two-fold: on one hand, as discussed later, it offers groups the possibility to avoid the negative impact of diversity in terms of sub-groups existence and categorization and, on the other hand, it is a process of crucial importance for a successful integration of a merger between companies.

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16 The first empirical evidence for the information elaboration process was found in the study by Homan, van Knippenberg, van Kleef, & De Dreu (2007). Not only did the authors find that informationally diverse groups elaborated more information in the process of group decision-making, but also that pro-diversity beliefs engendered more information elaboration. Additionally, Homan et al. (2007) showed the mediation role of information elaboration between diversity and group performance (for more information see also Homan, 2006).

Besides, information elaboration can stimulate group performance through team reflexivity (Schippers et al. in van Knippenberg& Schippers, 2007) and team learning (van der Vegt& Bunderson, 2005).

In a broader sense, information plays a key role in the success of M&A, reducing uncertainty and threat among employees, induced by organizational changes (Schweiger& Weber, 1989; McEntire& Bentley, 1996; Wanberg& Banas, 2000; Larsson& Lubatkin, 2001; Stahl et al., 2004). In times of organizational mergers, when employees undergo a process of sense-making they need information in order to understand the merger and overcome the resistance to change (Sutton& Kahn in Jimmieson, Terry, & Callan, 2004). Often it is not the quantity of information which is important, but rather the quality of the dialogue during the information exchange between employees‟ of the acquiring and acquired organizations. Researchers proposed several recommendations on the topic of communication and information in the time of mergers, especially being destined for the acquiring organizations. They refer to the use of social controls and coordination efforts such as informal communication, cooperation between group members and teamwork. The outcome of these efforts would be enhanced post merger identification, better adjustment to the merger in terms of psychological well-being, job satisfaction and performance (Larsson& Lubatkin, 2001, Jimmieson et al., 2004). Therefore, I argue that:

Hypothesis 4: Information Elaboration will mediate the relationship between Diversity

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METHODOLOGY:

PROCEDURE

As it has already been shown in previous research, scenario studies represent an efficient experimental design in the field of organizational mergers, and can provide valuable insights on people‟s perceptions and behavioral changes related to it (Mottola et al., 1997). For this reasons I have developed a scenario study, based on Rentsch and Schneider (in Mottola et al., 1997) and the methodological approach of Giessner and colleagues (2006). The scenario included a standard introduction, with a brief description of the imaginary company where the respondent “was working”, the announcement and the description of the upcoming merger and a conclusion. Responses were collected from 254 participants, from various geographical, cultural, functional and educational backgrounds. I have used Qualtrics – the online survey solutions software - to design a standard layout for all the questionnaires, which would be easy to fill in electronically. Subsequently, I used several communication channels to distribute the link to the survey and mainly:

1. Online social tools (e.g. Facebook, Yahoo Answers) 2. Personal networks

3. Researchers, PhD and fellow students from Dutch Universities. Full anonymity was guaranteed.

PARTICIPANTS

The average age of respondents was 27 (SD=6.93). Out of 254 participants, 137 were male (64%) and 117 female (46%). The split by the field of activity was the following: 139 respondents were students (55%) and 115 were working (45%) in private and public sectors.

Since the study was related to organizational mergers and group functioning one additional item was included to establish the presence of any professional experience at all. The results showed that among the total number of respondents, 216 already had at least some professional experience (85%) and only 38 did not have any (15%).

MEASURES

Diversity Beliefs (independent variable)

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18 The respondents had to score two statements on a 5 point-Likert scale (1 – totally not applicable and 5

– completely applicable). Since the present study focused on beliefs about both visible and underlying

diversity, the propositions were adapted to “Groups benefit from the involvement of people from different

ethnic, cultural, educational and functional backgrounds” and “A good mix of group members’ ethnic, cultural, educational and functional backgrounds helps doing the task well”. The Cronbach‟s alpha for this scale was

.65.

Measures for mediating variables

Perception of the merger – participants had to score 6 items on a 7 point-Likert scale (1 – Strongly

disagree and 7 – Strongly agree), measuring whether they see the upcoming merger as threat versus

opportunity or in positive versus negative terms. The perception of the merger measurement included an initial question “To what extent do you see the upcoming merger as…” and 6 possible options

“risky/good step for our team/uncertain/negative experience/safe/positive experience”. Cronbach‟s alpha =

.74. The items were adapted from Ryan (2009).

Self-efficacy – in order to assess the perceived level of efficacy, 4 items on change-related

self-efficacy were used and adapted to the merger situation (items developed by Asford in Wanberg& Banas, 2000). The items were scored on a 5 point-Likert scale, ranging from 1 – Strongly disagree to 5

– Strongly agree. Participants had to score statements like “Wherever the merger of the two teams takes me, I'm sure I can handle it”, “I have reason to believe I may not perform well in the new team following the merger” (reversed). Cronbach‟s alpha = .63

Information elaboration – 4 items measuring the level of information and knowledge elaboration and

exchange between members of the merging groups were used (in van Dick, van Knippenberg, Hagele, Guillaume& Brodbeck, 2008, see Appendix I). Items like “I would exchange task information

with the new members” and “I would think deeply about what the new members of my group say about task issues” were scored on a 5 point-Likert scale (1 – Strongly disagree to 5 – Strongly agree). The scale

proved a high reliability (Cronbach‟s alpha = .78). Measures for the outcomes

Post-merger group performance (first dependent variable)

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19 varied from 1 – “Strongly disagree” to 5 – “Strongly agree” on the items “The newly merged group will

perform well” and “The newly merged group will be effective”. The scale showed a very high reliability

(Cronbach‟s alpha = .85).

Post-merger group identification (second dependent variable)

Group identification measurement was based on 3 items from Terry& O‟Brien (2001) and adapted to the organizational merger situation. Respondents had to answer to three statements on a 7 point-Likert scale, ranging from 1 – Not very much to 7 – Very much. The statements were “How much would

you identify with the newly created team?”, “How much would you see yourself as belonging to the newly merged team?” and “How much would you feel strong ties with the members in the new team?”The reliability

of the scale was high (Cronbach‟s alpha = .83)

Control variables

Considering the existing research in the area of diversity, and mainly that focusing on the positive impact of diversity on workgroup functioning (Jehn et al., 1999, Jackson et al., 2003) I considered important to control for the group composition. The respondents were told in the scenario study that they were members either of a diverse or homogeneous team. Besides, the group status proved to be an important determinant in M&A (Terry et al., 2001; Terry& O‟Brien, 2001; Giessner et al., 2006; Boen et al., 2007), therefore I controlled for the group status as well. The respondents received the scenario, mentioning that they were members either of the acquiring or acquired organization.

ANALYSIS

I performed a multiple regression analysis (Field, 2005, Cohen& Cohen, 1983) for each dependent variable separately (post-merger group performance and post-merger group identification) to test the hypothesis. By means of multiple regression it is possible to test the relationship between several predictors and outcomes. The advantage of using this analysis is that we fit a predictive model to our data and, subsequently, it allows us to go beyond the data that we have.

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20 moderators which explain when certain effects occur, mediators provide insights on how and why certain effects happen (Baron& Kenny, 1986).

RESULTS

CONTROL VARIABLES

I performed ANOVA to test if there are any differences in both outcomes (post-merger group identification and performance) and mediators in diverse versus homogeneous groups. However, there was a non-significant main effect of the composition of the group (diverse versus homogeneous) on the post merger identification (F (1,252) = .220, ns) and post-merger group performance (F (1,252)= 3.34, ns) and on all three mediators. Additionally, there was no significant effect of group composition on diversity beliefs F (1,252) = 1.617, ns. A similar procedure was conducted to test the effect of the Group Status on the outcomes and mediators. ANOVA tests did not reveal any significant effect of the Group Status on post-merger identification (F(1,252)= 1.087, ns) and post-merger group performance (F(1,252)= .089, ns), as well as no significant effect on the perception of the merger (F (1,252)= .296, ns), information elaboration (F(1,252)= 3.507, ns) and diversity beliefs (F (1,252) = .784, ns). However, there was a significant main effect of the group status on self-efficacy, members of the high status group scoring significantly higher on self-efficacy (M=4.00, SD=.49) in comparison to members of low status group (M=3.83, SD=.49). However, the effect size is relatively small (partial eta squared = .03).

CORRELATION ANALYSIS

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21

Table 1: Means, Standard Deviations and Correlations of Variables

Mean SD 1 2 3 4 5 6 Diversity Beliefs (1) 4.06 .7 1 Merger perception (2) 4.13 .85 .251** ₁ Self-efficacy (3) 3.92 1.07 .119* .237** ₁ Information Elaboration (4) 4.19 .49 .299** _.193**_.340** ₁ Identification (5) 4.54 .56 .249** _.418**_.289**_.298** ₁ Performance (6) 3.60 .63 .193** _.403**_.283**_.309**_.332** ₁ **. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

The Pearson‟s Correlation coefficient can be used to test the relationship between the variables and serves as a pre-test measure for the hypothesis. The analysis shows that all of the variables are significantly correlated. As assumed in Hypothesis 1a and 1b, Diversity Beliefs are correlated with both outcomes and mainly post-merger group identification (r=.249, p<.01) and post-merger group performance (r=.193, p<.01).

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HYPOTHESIS TESTING

For testing the hypotheses I proceeded with a multiple mediation analysis instead of three simple mediation analyses, as suggested by Preacher& Hayes (2008), to determine the extent to which one mediator affects Diversity Beliefs – merger group identification and Diversity Beliefs – Post-merger group performance relationships in the presence of other Mediators. Another advantage of performing a multiple mediation analysis is to decrease the parameter bias, caused by the omitted variables.

First, the condition of prediction of the Mediators by the Independent variable was confirmed in a simple regression analysis. Thus, Diversity Beliefs proved to be a significant predictor of:

 Merger perception, β = .249, p<.001. Diversity Beliefs accounted for R² = 6.2% in the variance of Merger perception.

 Information elaboration, β = .299, p<.001. Diversity Beliefs accounted for R² = 9% in the variance of Information elaboration.

 efficacy, β = .119, p = .05. Diversity Beliefs accounted for R² = 1.4% in the variance of Self-efficacy.

Next, I have combined Step 2 and Step 3 in Hierarchical Regression, by entering Diversity Beliefs in Step 1 and Merger perception, Information Elaboration and Self-efficacy, but controlling for Diversity Beliefs in Step 2. Such analysis was performed separately for Post-merger identification and Post-merger group performance. The results of the analysis are shown in Table 2.

As predicted in Hypothesis 1 Diversity Beliefs are good predictors of post-merger group identification (β=.249, p<.005), accounting for 6.2% of its variability and of post-merger group performance (

β=.193, p<.005

), accounting for 3.7% of its variability.

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23

Table 2: Standardized Coefficients from Hierarchical Regression with Diversity Beliefs as predictor of Post-merger Group Identification and Performance, mediated by Merger Perception, Information

Elaboration and Self-efficacy

Post-merger group identification

Post-merger group performance

β

Step 1

Diversity Beliefs

.249*

.193*

R²

.062

.037*

R² adjusted

.058

.033*

Step 2

Diversity Beliefs

.103*** (ns)

.038*** (ns)

Merger Perception

.328*

.325*

Information

elaboration

.153**

.189*

Self-efficacy

.147**

.138**

R²

.251*

.236*

R² adjusted

.239

.224

∆ R²

.189*

.199*

* p<.005, **p<.05, *** p>.05 (ns)

First, the direct effect of Diversity Beliefs on Post-merger Group identification (when entered alone in Step 1) was significant, β=.249, p<.005, R²=.062, as well as the direct effect of Diversity Beliefs on post-merger group performance (β=.193, R²=.037). Then, after entering in the model the three mediators, the direct effect of Diversity Beliefs on group identification (β=.103, ns) and group performance (β=.038, ns) was no longer significant, whereas all three mediators remained significant strong predictors of the post-merger group identification. Thus, in support for Hypothesis 2 perception of the merger in terms of opportunity vs. threat was a significant predictor of post-merger group identification (β=.328, p<.005) and post-merger group performance (β=.325, p<.005). Hypothesis 3 was confirmed, showing that self-efficacy was a significant predictor of group identification (β=.147, p<.05) and group performance (β= .138, p<.05). And finally, in support for Hypothesis 4, information elaboration significantly influenced post-merger group identification (β=.153, p<.05) and post-merger group performance (β=.189, p<.005).

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24 Additionally, the Sobel test indicated a significant full mediation effect of merger perception on both post-merger group identification (z=3.33, p<.005) and post-merger group performance (z=3.3, p<.005), and a significant full mediation effect of information elaboration on post-merger group identification (z=2.25, p<.05) and post-merger group performance (z=2.6, p<.005). However, the Sobel test indicated a non-significant mediation effect of self-efficacy on post-merger group identification (z=1.5, ns) and on post-merger group performance (z=1.4, ns).

DISCUSSION OF THE FINDINGS

The first goal of my study was to understand what drives employees‟ negative emotions and reluctant behavior during a merger and thus investigate on the positive effects of Diversity Beliefs – as a possible mechanism to improve human due diligence.

Considering the pessimistic results of mergers so far and the role that people play in post-merger integration the present study offers insights into the group processes and inter-group relations and proposes a model aimed at increasing post-merger employee identification and performance. To my knowledge, it is the first study examining the advantages of workgroup diversity in the context of organizational changes such as M&A and especially focusing on people‟s beliefs about the value of diversity.

While diversity emerged as a topic in corporate and academic contexts long ago, the present study is based on a new stream of research in the area of diversity, which promotes the idea that it is not the diversity per se which leads to contradictory results, but the way people think about the differences and the degree to which people value the differences determines further group and organizational functioning (van Knippenberg, Haslam& Platow, 2007, Homan, 2006, Homan et al., 2007). According to van Dick et al. (2008) diversity beliefs represent the beliefs that individuals hold about how diversity impacts upon the functioning of their group and the extent to which individuals think that diversity within their group can be beneficial or detrimental for its performance.

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25 environment is not yet an indicator for pro-diversity beliefs. This is also confirmed by the results of the study, as workgroup diversity did not affect the level of diversity beliefs.

In the present research I showed that pro-diversity beliefs can facilitate post-merger integration in terms of employee identification and performance. These processes are mediated by merger perception, self-efficacy and information elaboration. Therefore, those people who value diversity are more inclined to perceive the merger as an opportunity rather than threat or negative experience, as traditionally assumed. Individuals with pro-diversity beliefs are also more able to deal with the organizational changes and possess higher degrees of self-efficacy. And finally, they are more open for cooperation with individuals from the other merging company, in terms of information elaboration and knowledge sharing.

Interestingly though, the Group Status did not have any direct impact on post-merger integration and performance, and this may be explained by the fact that in previous studies its effect was mediated by the level of perceived threat (Terry et al., 2001, Terry& Callan, 1998), pre-merger identification (Boen et al., 2007), merger pattern (Giessner et al., 2006) or perceived legitimacy (Terry& O‟Brien, 2001). The implications of the study are important, because they show that diversity beliefs, and not the workgroup diversity per se, affect employees‟ cognitive, judgmental and behavioral processes, which eventually account for the successful implementation of the merger. Each of these dimensions is discussed below.

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26 Another finding of the study is the fact that diversity beliefs positively influence one‟s self-efficacy in a merger process, which in turn also leads to higher identification and performance. Self-efficacy is particularly important during organizational mergers (Idel et al., 2003, Jimmieson, Terry& Callan, 2004), as it reflects one‟s judgments and confidence in personal abilities to deal with the situation (Wanberg& Banas, 2000); Moreover, self-efficacy is essential for organizations, considering that more and more companies prefer flat organizational structures (Nordström& Ridderstråle, 2002) and the role of management is shifting from that of a leader or pioneer to more of a coach (Hemp, 2008). In these conditions, employees are not given instructions and have to rely heavily on personal capabilities and competencies. As a result, self-efficacy may be seen as one of the crucial driving forces of successful change efforts in organizations. The link between diversity beliefs and self-efficacy is a subtle one, and might not be self-evident. However, the current study demonstrates that people valuing diversity feel more confident in embracing uncertain and highly demanding situations such as M&A.

Besides, I have shown that Group Status have an impact on the level of self-efficacy, so that members of the high status group feel more able to cope with the merger in comparison to individuals from low status group. This may be explained by the fact that employees from the acquiring organization often feel less threatened during a merger (Giessner et al., 2006, Terry&O‟Brien, 2001) and that they are less exposed to identity discontinuity (van Knippenberg et al., 2002).

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PRACTICAL IMPLICATIONS

The findings of my study would be of interest for practitioners dealing with organizational changes and particularly with M&A. In contrast to numerous existing studies on diversity management, focusing mainly on the visible workgroup diversity (gender and ethnic), I argue that the tendency to differentiate between various types of diversity is misleading. Nowadays, with the increasing role of multi-functional teams, it is rather difficult to imagine a diverse team only in terms of race, gender or ethnicity. People also differ on many other dimensions such as education, functional background, tenure, values and beliefs. The advantage of this paper is that it considers diversity in a broader sense, which is more in accordance with corporate realities. As shown before, diversity beliefs have a positive impact on employee post-merger identification and performance.

Considering the strategic implications of diversity beliefs in the merger context and the ubiquitous nature of the organizational culture, it is obvious that the former should be strongly embedded in the culture of an organization. Schein‟s (1997) considerations on corporate culture propose that it sets implicit values and standards within workgroups and generates shared mental models and common understandings among employees. Only by developing a pro-diversity culture, companies can create non-rigid environment which would promote tolerance for ambiguity and appreciation of differences. In the long-run it would make the employees more open to corporate changes such as M&A, due to their abilities to better cope with the change, understand and positively perceive the mergers and increased willingness to share knowledge.

So how do we build an organizational culture promoting pro-diversity beliefs? In my opinion, this is where

the role of the management lies. They should be the first to acknowledge the value of diversity, embrace the differences and unlearn the old practices, if needed. Rather than imposing diversity quota, the managers are advised to focus on ways to incorporate pro-diversity beliefs in organizational mission and philosophy. Taking into account that pro-diversity beliefs are an intangible attribute, managers should feel comfortable operating with metaphors and symbols (Nonaka, 1991) regarding the value of diversity. Additionally, mechanisms to keep managers accountable for promoting pro-diversity beliefs could be developed.

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28 rather than increase the awareness of stereotypes (cf. van Knippenberg, Haslam, & Platow, 2007, Homan et al., 2007).

In the long-run companies that have learnt to harvest the benefits of diversity through diversity beliefs will have a clear competitive advantage, especially in times of organizational changes of larger scale, such as M&A. These companies will be able to conduct M&A based on partnering and cooperation, rather than pure acquisition. Interestingly, this approach has been already successfully implemented in emerging economies (Kale, Singh& Raman, 2009). Partnering perspective on M&A can be compared to the “hand-off” technique, when merging companies carefully choose the fields which are to be integrated, but in the same time allowing both companies to maintain their identity. As a result, these M&A are less threatening and create an appropriate environment for human integration and knowledge sharing. The practice shows that only those companies that have an inclusive culture, high tolerance for ambiguity and value for new ideas and perspectives can conduct partnering M&A. Therefore, building on pro-diversity beliefs is clearly a first step towards conducting a new type of corporate mergers.

LIMITATIONS OF THE STUDY

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SECOND PART OF THE STORY:

Towards a Theory of the Sources of Diversity Beliefs

Given the findings of the present study and the strategic importance that Diversity Beliefs play in the organizational reality I believe it is crucial to explore the sources of individuals‟ Diversity Beliefs. Indeed, the concept of diversity beliefs seems to facilitate individuals‟ cognitive and behavioral processes during organizational changes, such as M&A. Interestingly, other researchers have also captured the benefits of positive diversity attitudes on the individual, group and organizational levels (see Cox & Blake, 1991; Thomas & Ely, 1996; Hartel & Fujimoto, 1999; Kossek & Zonia, 1993). These studies provided empirical proofs for the idea that beliefs, attitudes, climates and cultures valuing diversity are needed to harvest the benefits of diversity. To date, however, there is no comprehensive overview of these various concepts their impact on the affective, cognitive and behavioral outcomes. Thus, I will provide such a first integrated review, given the promising results of the diversity related attitudes and beliefs and their recent emergence in the scientific world.

Second, the sources that generate individuals‟ diversity beliefs still represent a balck box in the scientific community. Numerous researchers have urged for the development of a theory of diversity beliefs antecedents (Mitchell, Nicholas, & Boyle, 2009; van Dick et al., 2008; Homan et al., 2007; van Knippenberg, Platow, & Haslam, 2007; Hobman, Bortia, & Gallois, 2004). In the present paper I make a first attempt to develop the theory with regard to the antecedents of the pro-diversity mindset. The concept of diversity mindset (van Knippenberg & Schippers, 2007) will be employed for the development of the theory, thus bringing together various labels that have been applied to diversity attitudes and beliefs previously. By diversity mindset I capture not only individuals‟ understanding about differences in a broader sense (e.g. not tied to a specific diversity dimension), attitudes and beliefs, but also the set of behaviors that shows support or resistance to diversity. In my opinion, the diversity mindset term represents a holistic concept, which describes individuals‟ cognitive, affective and behavioral responses to diversity.

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30 group functioning. Finally, only after careful examination of the individual level sources of diversity mindset, one could potentially proceed with the expansion of the theory to the team and organizational levels.

In developing the theory with regard to the individual level origins of diversity mindset I will employ a holistic approach, thus incorporating both static and changeable variables. First, I propose that static individual level variables, such as personality traits, might serve as potential sources of diversity mindset. Moreover, I believe that the Authoritarian Personality Theory (Altmeyer, 1998a; 1998b) and the Social Dominance Theory (Pratto, Sidanius, Stallworth, & Malle, 1994; Sidanius, Liu, Shaw, & Pratto, 1994; Sidanius, Levin, Liu, & Pratto, 2000) might offer interesting insights with regard to how individuals‟ personality traits impact their mindsets. Finally, I will not limit to the individual personality traits and social attitudes solely, since individuals do not operate in vacuum and complete isolation from the external environment. Therefore, the impact of the external variables, which I define as situational, is also examined within the proposed theoretical framework. The outcome of the present paper is a comprehensive model, outlining the sources of individuals‟ pro-diversity mindset and advancing assumptions, which could be empirically investigated in future studies.

DIVERSITY MINDSETS: AN OVERVIEW

The idea that people may differ in their attitudes and preferences on a myriad of factors, including in how they feel about diversity, seems obvious. Surprisingly though, and despite the decades of research in the field of workgroup diversity, only recently researchers and practitioners turned their attention to individuals‟ ideas and understanding of diversity. Since people‟s beliefs or perceptions of diversity may impact the effects of workgroup diversity per se, I consider this factor of crucial importance to advance the research in the area of diversity. In recent years, researchers have employed various concepts to refer to individual, group or organizational attitudes towards diversity, while exploring how such attitudes influence the effects of actual levels of diversity on people‟s affective and behavioral responses. In the present chapter, I will present an integrated overview of the main labels given to diversity mindsets, and namely Learning and Effectiveness Paradigm, Diversity

Beliefs, Cultural Tolerance, Dissimilarity Openness and Universal Diverse Orientation, thus providing the

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Appendix B), providing a mind-map of the concepts discussed below. Additionally, it also includes

other more distal concepts related to diversity mindset, outlining the differences and convergences between these terms and their impact upon the cognitive, affective and behavioral outcomes.

Among the most known studies to recognize that organizations and teams differ in their attitudes and culture towards diversity were Cox (1994) and Thomas & Ely (1996). The latter advanced the “learning and effectiveness paradigm”, which introduces an organizational approach that builds on promoting equal opportunities and acknowledging differences, but also making people internalize these differences in such a way so that organizations can grow and learn from the differences among its employees. In a similar vein, Bellinger & Hillman (2000) showed that organizational openness and cultural tolerance may be of crucial help in making people accept diversity and deal with it effectively, particularly during large-scale transformations, such as mergers and acquisitions. The researchers argue that companies need to realize that differences do not necessarily pose threats, and may as well serve as opportunities for broadening its perspectives, gaining new knowledge and ultimately creating added value for all the stakeholders.

Another, relatively metaphorical construct of diversity mindsets is dissimilarity openness (Hartel & Fujimoto, 1999; Hartel, 2004; Fujimoto, Hartel, & Hartel, 2004). This concept refers to the way individuals, groups, organizations and societies deal with differences of all kinds. At one end of the dissimilarity openness continuum, differences are perceived positively and as an opportunity for learning and enriching perspectives, while at the other differences are met with resistance. As suggested by Hartel and Fujimoto (1999), dissimilarity openness occurs at three levels. First, at the individual level, people differ in the way they perceive and welcome different others. Next, on the team level, the group climate may either promote or inhibit differences. Finally, on the organizational level, philosophy, stories and symbols signal how the differences are viewed. The Perceived Dissimilarity Openness Moderator Model was confirmed in several field studies, carried out in Australia (Fujimoto, Hartel, & Hartel, 2004).

Besides, a relatively broad construct, namely Universal Diverse Orientation (UDO, Miville, Gelso, Panu, Liu, Touradji, Holloway, & Fuertes, 1999) was proposed to measure individuals‟ attitude toward a multitude of socio-cultural differences. UDO is conceived as “an attitude of awareness and

acceptance of both similarities and differences that exist among people” (p. 291). Miville and colleagues

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32 dimension revolves around the positive affective feeling engendered by the shared experience of being human. Finally, seeking interaction with different others characterizes the behavioral dimension of the UDO. These dimensions are labeled as realistic appreciation, comfort with difference and diversity of contact subsequently (Fuertes, Miville, Mohr, Sedlacek, & Gretchen, 2000).

In my opinion, the organizational ability to value the differences parallels the more narrow construct of Diversity Beliefs (Homan, Greer, Jehn, & Koning, 2010; van Dick, van Knippenberg, Hagel, Guillaume, & Brodbeck, 2008; van Knippenberg, Haslam, & Platow, 2007; Homan, van Knippenberg, van Kleef, & De Dreu, 2007; Homan, 2006; van Knippenberg & Haslam, 2003). The diversity beliefs are defined in terms of perceived value of diversity for the team functioning. More specifically, individuals may vary in their attitudes toward diversity, ranging from pro-similarity to pro-diversity beliefs, highly valuing the different perspectives that a diverse group can bring in the latter case. In brief, the above mentioned studies have shown that pro-diversity mindsets can moderate both social categorization and the information elaboration processes within a group. For instance, van Dick et al. (2008) found that group identification was higher among those participants who perceived their group as diverse and shared pro-diversity beliefs at the same time. This is a very important finding, since group identification is likely to suffer the most from the inter-group bias and social categorization, which might appear as a result of diversity (Ashfort & Mael, 1989). Similarly, in a laboratory experiment and a field study, van Knippenberg et al. (2007) also discovered that the relationship between ethnic diversity and group identification was positively moderated by group members‟ diversity beliefs. Later, Homan and colleagues (2010) shed light into

why diversity beliefs engender such beneficial effects. More specifically, the researchers showed that

the more group members valued diversity, the less likely they were to perceive diversity in terms of sub-groups and the more likely they were to see diversity as beneficial differences.

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33 To summarize, although called differently and measured on the organizational, group and individual level, all the concepts discussed earlier refer to the same phenomenon, and namely both the affective, cognitive and behavioral openness toward diversity and different others and the ability to value diversity. Drawing on the importance of this relatively new phenomenon, it becomes relevant to uncover the sources of pro-diversity mindset, and thus build the foundation for the theory of the diversity mindset antecedents.

CONCEPTUAL FRAMEWORK: ANTECEDENTS OF

DIVERSITY MINDSET

In the present chapter I aim at developing the theory of diversity mindsets antecedents, as urged by several researchers (Homan et al., 2010; van Dick et al., 2008; van Knippenberg et al., 2007). For this purpose and as argued in the introduction, I elaborated a conceptual framework (see Figure 2), focusing on the individual level factors influencing the way people think about diversity and the degree to which they value diversity in its broader sense. Since the group processes, and especially the group shared mental models, are shaped by its members‟ beliefs and attitudes (Mohammed & Dumville, 2001), the theory with regard to the diversity mindsets antecedents needs to start at the individual level. Given that the conceptual framework that follows is only a first step toward the development of such theory it remains largely flexible and can be adapted to various diversity related contexts. The framework outlines three sources influencing diversity mindsets: (1) Personality traits, (2) Social Attitudes/Values, and (3) Situational factors. Each of these sources will be explained in more details below.

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PERSONALITY TRAITS

One of the most largely employed taxonomies in the social and organizational psychology fields represents the Five Factor Model (also known as Big Five), which outlines the five personality dimensions on which people may differ (McCrae & Costa, 1987). The dimensions included in the Big Five are: Openness to Experience (e.g. broad-minded, tolerant, curious), Conscientiousness (e.g. organized, hard-working, responsible, reliable), Extraversion (e.g. talkative, assertive), Agreeableness (tolerant, flexible, pleasant, empathetic) and Neuroticism (e.g. anxious, insecure). The Big Five model has been largely applied to study team performance, leadership behavior and inter-group relations, or attitudes toward out-group members (Homan et al., 2008; Strauss, Connerley, & Ammermann, 2003; Silvestri & Richardson, 2001). Considering that diversity mainly represents an in-group vs. out-group situation, and a pro-diversity mindset basically engenders one‟s openness toward the out-group, it seems important to investigate the role of the Big Five personality traits on pro-diversity mindsets as well. In this regard, two out of five dimensions are particularly relevant and can be employed to explain attitudes toward diversity: Openness to Experience and Agreeableness (Strauss et al., 2003; Strauss & Connerley, 2003).

The last important remark has to be made with regard to the distinction between personality traits that are examined below and the pro-diversity mindset. Drawing on my conceptual framework, it becomes clear that both Openness to Experience and Agreeableness are conceptualized as static personality traits, while individuals‟ diversity mindset is shaped by these static traits and situational factors in the same time. It also means that in contrast to personality, diversity mindset may considerably change over time and is of a more complex nature.

OPENNESS TO EXPERIENCE

Towards a Theory of Diversity Mindset: