More than the average: Examining variability in employee perceptions of diversity climate

Abstract

Guided by general climate models of organizational effectiveness and drawing from affective events theory and situational strength theory, we develop a comprehensive organizational-level model of the implications of diversity climate for company performance. In our model, we highlight the role of idiosyncrasies in diversity climate perceptions among members of organizations by considering diversity climate strength (i.e., agreement in employees' climate perceptions) as a moderator of diversity climate effects. Moreover, we introduce collective positive affect as an underlying mechanism linking diversity climate to organizational performance. Hypotheses were tested with a multisource dataset compromising 84 German small to medium-sized companies with a total of 15,310 surveyed employees. In line with theoretical expectations, empirical findings yield a conditional indirect relationship where diversity climate is only positively related to organizational performance (via collective positive affect) when there is high agreement in diversity climate perceptions among employees (i.e., high diversity climate strength).