IJBPAS, January, 2016, 5(1), Special Issue: 18-33

ISSN: 2277–4998

EFFECT OF DIVERSITY ON HUMAN RESOURCE MANAGEMENT AND ORGANIZATIONAL PERFORMANCE ALIREZA MOOGHALI1, ZOHREH SAEIAN2 1

Professor. Public Administration, University of Payam-noor, Iran E mail: [email protected]

2

Graduate student, public administration, University of Payam-noor Iran ABSTRACT

This paper critically reviews the literature on managing diversity through human resource management (HRM). We discuss the major issues and objectives of managing diversity and examine the state of human resource diversity management practices in organizations. Human resource management (HRM) Organizational performance Age diversity Professional tenure diversity Expertise diversity Fashion styling industry Extant research on strategic human resource management (HRM) primarily focuses on manufacturing and large scale service organizations. However, given the significant economic contribution of, and the employment opportunities provided by, Taiwan's fashion styling industry, the effectiveness of the organizations in this industry is a topic worth examining. By employing a resource-based view and taking an information/decision-making perspective, this study investigates (1) the relationship between a firm's HRM system and its performance and (2) the interaction effect of age diversity, professional tenure diversity, and expertise diversity in the fashion styling industry. The study collects data from both managers and front-end professional service employees in the fashion styling industry and uses multiple regression analysis to test the proposed hypotheses. The paper also discusses implications for theory and practice. Keywords: Human resource management (HRM), Organizational performance, Age diversity, Professional tenure diversity, Expertise diversity, Fashion styling industry

18 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

INTRODUCTION Workforce diversity acknowledges the reality

resource management (HRM). We also

that people differ in many ways, visible or

develop a conceptual framework which will

invisible, mainly age, gender, marital status,

help organizations develop HRM strategies

social status, disability, sexual orientation,

and policies to manage diversity effectively.

religion, personality, ethnicity and culture

Our framework will also help researchers

(Kossek, Lobel and Brown 2005). However,

identify key areas for future research and

the predominant diversity issues in each

guide

country

gender

implement diversity appropriately. A diverse

inequality is the oldest and most common

workforce comprises a multitude of beliefs,

diversity issue worldwide, religion and

understandings, values, ways of viewing the

ethnicity separate people in India and Middle

world,

East

(hukou)

internationalization and globalization has

from

enhanced the significance of workforce

urbanites in China. Chinese rural migrants

diversity. A cross-cultural and multicultural

are routinely looked down on by urbanites

workforce is a common thread not only in

and mistreated at the workplace and in

organizations in western economies but also

society. Multiculturalism has always been the

in corporations globally The service industry

most important dimension of diversity in

provides more than 70% of the employment

Western countries, including the EU nations,

in most industrialized economies (OECD,

Australia and New Zealand, where there are

2005). Although technology advancements

a large number of international migrants with

have facilitated a shift from manufacturing to

diverse cultural backgrounds. Racial equality

services, the service industry has a much

appears to be the predominant issue in both

higher turnover rate and requires greater

USA and South Africa where there has been

human capital. To succeed in a competitive

a long history of systematic discrimination

environmentwith high employee turnover,

against blacks and other ethnic minorities.

organizations seek to implement an effective

Although researchers have examined several

human resource management (HRM) system.

aspects of diversity, no comprehensive model

Moreover, managements are now leaning

exists. In this paper we review the literature

toward the implementation of a distinctive

on diversity practices in the area of human

set of HRM practices that emphasize the

are

and

differentiates

different.

household off-farm

While

status migrants

practitioners

and

unique

to

formulate

information.

and

Rapid

19 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

human side of people management and

Scholars have called for considering HRM

induce the desired behavior to achieve

from a service perspective (McClean&

organizational

objectives;

this

aspect

Collins,

investigation.

Extant

examines a set of HRMpractices aligned with

effective

the expectations of the organizations and

implementation of an HRM system may be a

their employees, in small-scale professional

key impetus for individual and organizational

services organizations. Second, in addition to

performance

&

the strategic contingencies that may moderate

Harden, 2006; Subramony, 2009). Most

this relationship (Arthur, 1994; Delery&

empirical research on the HRM–performance

Doty, 1996), this study examines internal

relationship

contingencies associatedwith collective-level

warrants

further

research

indicates

that

(Lepak,

the

Liao,

focuses

on

Chung,

explaining

the

2011).

Therefore,

organizational

systems enhance organizational performance

professional tenure diversity and expertise

(Huselid, 1995; Zacharatos, Barling, &

diversity.

Iverson, 2005). Few studies examine the

contrasts with previous research that centered

contingencies in this relationship. A review

on

of the period between 1994 and 2003

organizational performance at the managerial

indicates that only a fraction of the studies

level (Auh&Menguc, 2006; Dwyer, Richard,

focus on the boundary conditions that may

& Chadwick, 2003). According to van

strengthen/weaken the HRM–performance

Knippenberg and Schippers (2007, p. 516),

relationship (Boselie, Dietz, & Boon, 2005).

diversity is “a characteristic of social

To improve understanding, this study seeks

grouping that reflects the degree to which

to advance the existing literature on strategic

objective or subjective differences exist

HRM in the following ways. First, extant

between

group

research

literature

often

on

the

HRM–performance

Therefore,

interaction

the

such

study

intermediate mechanisms of how HRM

the

characteristics

this

current

relationship

members.” examines

as

paper

with

Diversity performance

relationship often focuses on workers in

differences among groups or organizations.

manufacturing

This study examines how compositional

or

large-scale

service

organizations (Zacharatos et al., 2005). These

diversity

two

attenuate/strengthen the HRM–performance

sectors

have

quite

distinct

within

organizations

characteristics; a prominent difference is the

relationship.

degree

investigates various aspects of diversity

of

employee–customer

contact.

Additionally,

the

may

paper

19 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

related to an organization's composition,

diversity

including age, professional tenure, and

relationship.

expertise, and seeks to understand how they

Major issues and objectives of HR

moderate

diversity management

the

HRM–

performance

in

the

HRM–performance

relationship. Therefore, this study aims to

Effective

expand strategic HRMand diversity research

historically been used to provide a legally

from a service perspective. This study

defensible

employs the resourcebased view (RBV) and

discrimination. A firm with a diverse

information/decision-making perspective to

workforce could argue in legal proceedings

justify howage diversity, professional tenure

that they were not guilty of discrimination

diversity,

since

and

strengthen

the

relationship. industry

expertise

is

diversity

may

HRM–performance

Taiwan's

fashion

flourishing,

styling

with

high

diversity

position

their

management

against

workforce

has

charges

of

demographics

represented the local community. However, there has been considerable debate on the areas

of

difference

between

equal

employment demand; however, little research

opportunities and managing diversity in

is devoted to this industry. Empirically

literature. Equal Employment Opportunity

testing the research framework for this

(EEO) and Affirmative Action (AA) are to a

industry

to

large extent, a product of the civil rights

understand the nuances of professional

movement of the 1960s and the liberal

service firms from the HRM– performance

political philosophy (Webb 1997). Diversity

relationship perspective. Managing diversity

Management is ‘a movement away from or

is

an alternative model to traditional EEO

one

provides

of

themain

HRMinmodern (2001)

an

opportunity

challenges

organizations.

Benschop

and

practices

or

the

second

generation of EEO’ (Thompson 1997, p.

HRM(SHRM) models implicitly assumed

195). In contrast to the negative perspective

workforces as generic and homogeneous,

of discrimination against staff in EEO the

without

emphasis of diversity management is on a

considering employees.

thatmost

policies

strategic

between

noted

for

internal

differences

Therefore,

it

is

positive perspective of differences among all

necessary to incorporate diversity in SHRM

individuals (Maxwell et al. 2001). Diversity

debates (Curtis & Dreachslin, 2008). This

management does not only recognize but also

study intends to incorporate the impact of

values and harnesses workforce differences, 20

IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan such

as

Research Article

individual

characteristics,

valuing and taking advantage of individual

orientations

and

religious

differences, mainly cultural pluralism, in

beliefs, so that individual talents are being

order for all people to maximize their

fully utilized and organizational goals are

potential, which is beyond legal compliance-

met. While EEO is primarily driven by

oriented equal employment opportunity.

legislation, diversity management is driven

Through the strategic deployment of a

by the business case (Kandola and Fullerton

diverse workforce, organizations seek to

1994).

achieve

backgrounds,

Diversity

management

takes

competitive

advantage

(Storey

advantage of the growing cultural pluralism

1995). There are a range of objectives

that results from the internationalization of

organizations

business, development of world markets,

effective HR diversity management. At the

growing

top is compliance with legal EEO and AA

workforce

mobility,

increasing

awareness

differences

(Lawler

of

and

the

individual

1996).

Equal

requirements. mainly

wish

to

Other

creativity,

achieve

objectives flexibility,

through

include employee

employment opportunity starts externally and

attraction, employee retention and better

is enforced through legislation, whereas

marketing capabilities. Through effective

diversity

internally,

diversity management, diverse teams aim at

through the efforts to create an atmosphere of

achieving greater innovation and creativity,

equality and a fully inclusive organizational

enabling them to outperform homogenous

culture at work (Gordon 1995). These

teams (Cox and Blake 1991; Richard 2000).

discussions lead to a conclusion that while

While there is evidence that short-term

diversity

progress

management

management

starts

includes

a

is

affected

by

conflict

and

commitment to EEO and AA, the actual

communication problems, by bringing a

scope of diversity management is a lot

wider range of perspectives to problem

broader (Kossek et al. 2005). First, diversity

solving, diverse teams foster speed and

management seeks to overcome labour

innovation and produce substantially higher

market

addressing

quality solutions over whole development

inequalities based on individual differences,

cycles. Moreover, by bringing equality to

such as race, gender and class (Horwitz,

employment relations, organizations tend to

Bowmaker-Falconer

1996).

attract and retain an adequate and qualified

Second, diversity management emphasizes

workforce. Cox and Blake (1991) argued that

segregation

through

and

Searll

21 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan the

benefits

of

Research Article

effective

management

include

absenteeism

and

reducing

now covers the whole gamut of people

turnover,

management processes. There are different

best

views about the nature of HRM and there

candidates as the labour market shrinks. Past

exists an enormous variety of HR practices

research indicates that those individuals who

adopted by various organizations (Boselie,

belong to the ‘dominant’ group within an

Dietz and Boon 2005). Nevertheless, it is

organization

tend

widely recognized that the key practices of

satisfaction

and

experience

higher

superior

rewards,

attracting

diversity

to

have

the

higher job

commitment co-worker access

to

as

they

HRM include recruitment and selection,

support,

training

and

development,

performance

adequate

management and pay (Shen and Edwards

resources, and greater autonomy (Kossek et

2006).

al. 2005). For those outside the dominant

Recruitment and selection

group within an organization, job satisfaction

Empirical evidence suggests that many

can be lower, particularly where they do not

employees and managers regard diversity

have access to equal rewards or advancement

management as being equal to having an

opportunities. In addition, tendencies for

equal opportunity for any person to enter the

people to form in-groups and out-groups can

organization. Many world class organizations

affect job satisfaction, and impinge on

have been effective in hiring women and

supervisor,

co-worker

minorities to mirror the increasingly diverse

relations. Furthermore, by making use of

markets and win over new customers

workforce diversity, many organizations seek

(Perlman 1992). Managerial attention to

to improve marketing capabilities to reflect

increased work force diversity has been

and to be more responsive to customer

mandated in IBM, Xerox and J. C. Penney

demographic change (Cox and Blake 1991).

(Ted 2005). Digital, Esso and Westpac all set

HR diversity management practices

EEO targets in their HR practices (Kramar

HRM is a set of distinctive activities,

1998). Alcoa recruits and retains high calibre

functions and processes that are aimed

people through harnessing the creative

attracting, directing and maintaining an

capacity of its employees. Alcoa creates a

organization’s human resources (Lado and

work environment and culture where this

Wilson 1994). The HR function has grown

creativity will flourish (DIMIA 2002). Allen,

substantially over the past few decades and

Dawson,

subordinate

and

Wheatley

and

White

(2004) 22

IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

conducted a survey of 396 employees from a

more supportive. Organizations need to

wide variety of companies in Australia to

ensure

examine 13 separate diversity practices.

practices

Ninety-three per cent of the companies

opportunities, career planning, reduction of

reported a zero-tolerance level of workplace

work–family conflict, and mentoring for

discrimination in recruitment. South Africa

disadvantaged

addresses

proposed

its

discrimination

past

segregation

policies

by

way

and of

that

employment

policies

provide

developmental

groups.

that

Morrison

managing

and

(1992)

diversity

The

International Journal of Human Resource

Affirmative Action programs demanding the

Management

appointment sometimes of a black person

affirmative

above a better qualified white candidate (Van

employment policies and practices to address

Jaarsveld

1979

the failure of organizations to promote

amendments to the Industrial Conciliation

women and racial and ethnic minorities into

Act (ICA), recruitment, employment level

higher levels of management. Bennington

and access to skilled positions were virtually

and Wein (2000) found that there is

controlled by established white trade unions

widespread discrimination in employment in

in South Africa. Over the past three decades,

Australia. Holly (1998) and the Equal

due to the wide adoption of tripartite

Opportunities Review (1995) presented the

negotiations, the percentage of blacks and

evidence of discrimination in recruitment and

other minorities in management has been

selection in the UK public sector. Walsh

considerably increased (Horwitz et al. 1996).

(1995)

However, despite several decades of equality

competitive environment makes it difficult

legislation and declared commitment to equal

for public sector managers to maintain the

opportunities, there still exists a systematic

levels of organizational commitment required

discrimination

for equal employment opportunity to be truly

2000).

in

Before

the

the

recruitment

and

239 action

argued

can

complement

strategies

that

the

new

increasingly

selection process. Morrison (1992) conducted

meaningful.

a survey of managers in 16 ‘model’ US

working-age women are in the workforce

organizations.

compared to 80% of men (Kossek et al.

He

found

that

most

Worldwide,

and

organizations introduced just one approach to

2005).

equality, instead of an array of measures

Training and development

only

54%

of

intended to make the organizational climate 23 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan There

is

diversity

Research Article

anecdotal

evidence

training

and

showing

Portuguese

public

administration

the

management

percentage of female managers is twice that

considerable

of Europe. J. C. Penney set a goal of 46%

attention from organizational management.

representation of women on its board of

According to Maxwell et al. (2001), people

directors.

in the UK public sector normally regard

corporations have not been successful in

diversity management as giving a fair chance

training, retaining and promoting women and

to get ahead for everyone. Horwitz et al.

minorities (Goodman et al. 2003). Managers

(1996) reported

the

in organizations where there is a lack of

monopolization of skilled labour by white

effective HR diversity polices are likely to

trade unions effectively denied access to

promote or rate highly subordinates who

apprenticeship training and skilled and

have

managerial positions for South African black

experience. In the US whites hold 88.4% of

employees. Since the late 1970s, black

managerial positions while comprising only

managers as a proportion of all managers

75% of the population (US Department of

have increased as a result of implementing

Labor 2003). The Executive Leadership

Affirmative Action programs. Many South

Council’s

African

instituted

Development and Research conducted the

multicultural value sharing workshops. By

2004 census of African Americans on

1995, only 7.3% of the managers in the

corporate boards. The survey revealed only

Breakwater Monitor sample involving 137

8.1% of the board members are African

leading South African organizations and

Americans in the 500 largest publicly traded

837,331 employees were black, coloured or

American corporations (Alleyne 2005). A

Asian.

a

similar study conducted by Fortune magazine

considerable growth of black, coloured,

reported that people of colour made up only

Asian and female mangers in South Africa

19% of corporate board rooms and 26% of

since then. Past studies, such as Cunha and

management in the Fortune 1000 plus the

Marques (1995), showed that nations with a

largest privately held companies (Hickman,

high femininity culture, such as Portugal and

Tkaczyk, Florian and Stemple 2003). Cited

the Scandinavian countries, have higher

in a CNN report (CNN 2007), Fortune

percentages

magazine revealed that, in 2006, only 2% of

development

are

receiving

that before

organizations

However,

of

there

female

have

has

1979

been

managers.

In

However,

similar

many

leading

cultural backgrounds

Institute

for

and

Leadership

24 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

CEOs in the Fortune 1000 were women.

openly

Elsewhere, Allen et al. (2004) argued that the

Furthermore, the context of some diversity

minority representation in middle and senior

training may be different enough from the

management

positions

Australian

ongoing work context so as to make it

organizations

is

There

is

difficult for trainees to exhibit behaviours

evidence that training programmes present

similar to those learned in training (Ford and

lower rates of female participation, becoming

Fisher 1996).

an obstacle to women’s career advancement

Performance appraisal

and

positions

Many organizations, such as Digital, Esso

worldwide (Powell and Butterfield 1994).

and Westpac, take account of AA and EEO

Women are also widely excluded from

in their performance appraisal systems

informal networks and experience difficulties

(Kramar 1998). Australian companies largely

in

mentoring

draft and implement objective criteria and are

relationships. These factors prevent them

fair in the performance appraisal process

from reaching top positions, a phenomenon

(Dagher, D’Netto and Sohal 1998). However,

known as ‘the glass ceiling effect’ (Ragins

appraisal

and

most

practices and techniques are often inherently

reinforce

gendered and against women (Rubery 1995).

norms, values and perspectives of the

Tsui and Gutek (1999) reported that there is

dominant organizational culture (Tung 1993).

consistent evidence showing that higher

Rabobank, a Dutch bank, has employed a

demographic similarity between supervisors

relatively

ethnic

and subordinates on age, race or gender

minorities than other organizations in the

correlates with HR outcomes, such as higher

community in order to attract ethnic minority

ratings

customers.

in

citizenship, and lower role ambiguity and

Rabobank with immigrant backgrounds are

conflict. Other mechanisms of discrimination

mostly recruited only for lower positions and

are pointed out in the performance appraisal

promotion for these employees is very

processes, in which women seemprone to get

difficulty, if not impossible. Also, ethnic

lower

minority employees are not allowed to

McCauley

express their culture and religions in the bank

usually do not involve culturally diverse

access

the

inadequate.

to

managerial

establishment

Scandura

in

1994).

diversity training

higher

of

Moreover,

programmes

percentage

However,

of

employees

(Subeliani

and

on

and

performance-related

performance,

ratings

Tsogas

(Ohlott,

1994).

2005).

pay

organizational

Ruderman

Australian

and

companies

25 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

employees in performance appraisal panels

whereas this difference was 15% for people

(Dagher et al. 1998).

in the same situation in the late 1970s

Pay

(INSEE 2002). Gender wage inequality

Pay inequality is a main cause of job

ranged from 10% to 54% in urban industries

dissatisfaction

and

and from 20% to 45.7% in the rural sector in

a major HR diversity issue

the 1990s in China (Meng 1998; Gustaffson

(McLoughlin and Carr 1997; Van den Bos,

and Li 2000; Hughes and Maurer-Fazio

Lind, Vermunt and Wilke 1997). EEO and

2002). The size of gender wage differential

AA have been integrated with compensation

in China is similar to that ofRussia and other

practices by many organizations, again, like

developed

Digital, Esso and Westpac (Kramar 1998).

1994;Brainerd 2000).

Kramar has been supported by Dagher et al.

2. Literature review and hypotheses

(1998) who also reported that diversity

2.1. HRM system for service organizations

practices in remuneration are widely used by

According to Accounting and Statistics of the

Australian organizations. However, Dagher

Executive Yuan in Taiwan (2003), the

et al. (1998) attributed positive remuneration

average personnel cost and turnover rate for

practices to a ‘union effect’. These authors

the service industry are nearly double those

state that a relatively strong trade union

for

movement in Australia has prevented the

competitive environment, organizations must

occurrence of wage discrimination among

implement a distinctive set of HRM practices

unionized

that

therefore

and

demotivation,

employees.

While

the

counties

manufacturing.

emphasize

the

(BlauandKahn

To

succeed

human

in

side

a

of

implementation of equal pay has significantly

management and the need to induce the

reduced earnings differences between men

desired service-oriented behavior to achieve

and women, gender income inequality still

organizational objectives. The manufacturing

remains a global problem (Blau and Kahn

and service sectors have quite distinct work

1994; Katz and Autor 1999; Brainerd 2000).

characteristics, especially in the degree of

Globally, women earn 20% to 30% less than

contact between employees and customers.

men (Kossek et al. 2005). In France, the gap

Schlesinger and Heskett (1992) state that

between men’s and women’s pay stands at

front-end workers are crucial in the service

around 22% for those entering the labour

industry

market for the first time in the early 1990s,

organizational performance through their

as

they

directly

influence

26 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

relationships with customers. This also

advantage (Barney, 1991). A set of carefully

applies to the fashion styling industry.

aligned HRM practices, often called a high

Existing service industries research includes

performance work system (HPWS) or high-

medical

(McClean&

commitment work system, may lead to

Collins, 2011), fast food restaurants (Leidner,

competitive advantage from two standpoints.

1993), and banks (Wallace, Chernatony,

The behavioral perspective suggests that an

&Buil, 2013); these studies highlight various

effective HRM systemwill acquire, develop,

HRM practices as predictors to enhance

and

performance. Chebat (2002) suggests that

enhance

employees' perception of workplace equality

additionally, the system should be consistent

is a key predictor of their behavior. Jago and

with the organization's competitive strategy

Deery

(Wright & McMahan, 1992). The RBV

and

(2002)

training,

legal

offices

indicate

selective

that

staffing,

innovative and

team

motivate

desirable

behaviors

organizational

highlights

the

that

performance;

attributes

required

capabilities

to

for

environment favorably influence employees,

organizational

thereby inducing improved customer service.

competitive advantage. Empirical studies

Previous empirical studies suggest various

also

HRM practices that foster organizational

influences

performance. This study presents a set of six

(Delery&

HRM practices suitable for the service

Strategic HRM research shows that such a

industry, pertaining to staffing, training,

system

involvement/participation,

performance

performance (Lepak et al., 2006; Subramony,

appraisal, compensation/ rewards, and caring.

2009). HPWS is a set of HRM practices

Further, this study verifies whether this set of

comprising a series of actual programs,

HRM practices affects performance. 2.2.

processes, and techniques that are established

HRM system and organizational performance

and

Extant research on strategy mainly focuses

organization's

on

firms'

system enhances employees' knowledge,

RBV,

skills,

howHRMcontributes

competitiveness.

According

to to

confirm

that

HPWS

significantly

organizational Doty,

may

and

in

a

key

impetus

accordance

strategic

abilities to

performance

1996; Huselid, 1995).

be

enforced

yield

with

objectives.

(KSA),

contribute,

for

the The

empowers

organizations equipped with valuable, rare,

employees

and

boosts

non-imitable, and non-substitutable resources

employee motivation and efforts (Delery &

may possess a sustainable competitive

Shaw, 2001; Lepak et al., 2006), leading to 27

IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

favorable organizational outcomes. When

members of workgroups or organizations

employees

organizations'

directly affect the group process and

HRM practices as conscientious, diligent,

performance. The main effect approach

and fair, they reciprocate with positive

yields mixed empirical results regarding the

attitudes, resulting in superior performance.

influence of diversity on various performance

This

following

indicators (Jackson, Joshi, & Erhardt, 2003;

hypothesis: Hypothesis 1. HPWS positively

Kochan et al., 2003). To better describe their

affects organizational performance.

interaction effects on the performance or

2.3. Age diversity, professional tenure

work outcomes, researchers propose a joint

diversity,

analysis

perceive

study

and

their

proposes

expertise

the

diversity

as

of

diversity,

different

task

moderators

characteristics, and organizational practices

Diversity refers to differences in individuals'

or situations (Van der Vegt, Bunderson, &

characteristics or attributes that result in the

Oosterhof,

perception that others are different from one

Schippers, 2007). This study investigates the

self (van Knippenberg & Schippers, 2007).

moderating effects of the fashion styling

Given the extensive range of diversity types,

industry's employee diversity on the HRM–

it is essential to classify diversity for

performance

discussing how demographic differences can

service organizations are typically small-

influence team performance. Harrison and

scale and resemble a team structure. Team

Klein

as

diversity

separation, variety, and disparity; these

between

diversity types differ in their substance,

diversity attributes. Frequently, demographic

patterns, operationalization and, ultimately,

diversity

consequences (Bell, Villado, Lukasik, Belau,

cognitively accessible, and immutable; they

&

relate closely to the social categorization

(2007)

classified

Briggs, 2011).

diversity

Researchers propose

2006;

van

Knippenberg

relationship.

research

often

demographic

attributes

(van

and

&

Professional

distinguishes task-relevant

are

Knippenberg,

observable,

various typologies to classify diversity, for

processes

example, bio-demographic (age) and task-

&Homan, 2004). Age diversity can influence

related diversity (Horwitz&Horwitz, 2007),

team

and highly and less job-related diversity

potentially valuable variety in resources such

(Webber & Donahue, 2001). Diversity

as styles, insights, experiences, and social

literature examines how differences among

network ties. Thus, age diversity may

interdependence

and

DeDreu,

reflects

a

28 IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan moderate

the

relationship.

In

Research Article

HPWS–performance contrast,

task-related

diversity moderates the relationship between the

HRM

system

and

organizational

diversities are less noticeable and are

performance, such that the relationship is

associated with skill-based and informational

stronger under high age diversity and weaker

differences. Based on van Knippenberg and

under

Schippers (2007), this study considers both

Professional tenure diversity moderates the

demographic and functional diversity as

relationship between the HRM system and

important

organizational performance, such that the

boundary conditions

for

the

lowage

Hypothesis

relationship

diversity refers to differences in employees'

professional tenure diversity and weaker

educational

under low professional tenure diversity.

background,

professional

functional tenure,

and

stronger

under

3.

HPWS–performance relationship. Functional

background,

is

diversity.

high

Hypothesis 4. Expertise diversity moderates

expertise (Dahlin, Weingart, & Hinds, 2005;

the

Van der Vegt et al., 2006). An organization's

organizational performance, such that the

demographic composition may influence

relationship is stronger under high expertise

members' communication and cooperation

diversity and weaker under low expertise

(Chatman & Flynn, 2001). Further, gender

diversity.

diversity is positively associated with firm

CONCLUSION

performance (Dwyer et al., 2003). Functional

This study contributes to the HRM and

diversity attributes such as tenure and

diversity

expertise are related to workplace KSAs. By

perspective,

influencing the range of available task-

diversity positively moderates the HRM–

relevant resources and how well members

store performance relationship. This finding

communicate

one

implies that greater age diversity strengthens

significantly

the HPWS–performance relationship. HPWS

influences organization performance (Bell,

implementation fosters teamautonomy and,

2007). Scholars suggest that functional

consequently,

diversity

communication

another,

and

team

performance

cooperate

composition

positively and

with

affects

innovation

group (Auh

relationship

between

literature

from

showing

that

HPWS

a

different

demographic

cooperation among

and

team

and members.

&

Moreover, an organization with diverse age

Menguc, 2006). Hence, this study proposes

groups can attract diverse customer groups;

the following hypothesis: Hypothesis 2. Age

thus, age diversity enhances an organization's 29

IJBPAS, January, 2016, 5(1), Special Issue

Alireza Mooghali and Zohreh Saeyan

Research Article

attractiveness. However, the moderating

organizations should adjust policies for

effects of professional tenure diversity and

recruitment, training, compensation, and

expertise diversity are insignificant. These

motivation, to accommodate the diverse and

findings

heterogeneous

regarding

prominent

diversity

workforce.

According

to

factors in organizations warrant further

Kochan et al. (2003), if organizations wish to

investigation. Diversity can be a complicated

reap performance benefits from diversity,

issue in the organizational context; however,

managers' conceptualizations of the SHRM

it can be pivotal in strengthening the HPWS–

system would be crucial.

performance relationship. This study has

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