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The Impact of Inter- and Intra-functional Diversity on Project Teams

By: Dr. Sujin K Horwitz

A project team is generally defined as a group of individuals with diverse knowledge, expertise and experience to collaborate on a project which may be temporary or long-standing (Edmondson & Nembhard, 2009). From the definition, one significant element of project teams is the relevance of functional diversity, the extent to which team member attributes reflect knowledge, experience, and perspectives pertinent to accomplishing tasks. Additionally, it can be inferred that the impact of functional diversity on project team performance is likely to be affected by members’ abilities to combine their unique expertise to contribute to project success. Note that numerous other diversity attributes can influence project teams in other ways than those comprising functional diversity examined the current team literature. Indeed, research endeavors to ascertain the effects of team diversity on teamwork have garnered prolific outcomes on the topic, and many studies have highlighted a positive relationship between task-related diversity (i.e., expertise, experience and knowledge germane to a team task/project) and team performance. Particularly, functional diversity has been suggested to benefit teams that perform novel and complex tasks across a variety of team contexts, as demonstrated in several meta-analyses. Because project teams are generally formed to undertake unique and complex tasks and their membership tends to be more functionally heterogeneous than that of other types of teams, functional diversity is assumed to hold the most significant impact on the complex dynamics of project team performance and thus is especially important to understand. In this blog, I examine the multifaceted dimensions of functional diversity in the project team context.

Dimensions of Functional Diversity in Project Teams

Most of existing work on the diversity literature conceptualizes functional diversity as the distributional differences among individuals on a team with respect to varying functional areas and amounts of job-related expertise (please see works by Bunderson & Sutcliffe, 2002; Harrison & Kline, 2007; Dawson, 2011). Functional diversity has thus become generally operationalized as a multidimensional construct embracing a variety of differences in individual functional expertise, experience, and knowledge. Functionally diverse teams are often equated with teams consisting of members who possess in-depth knowledge in their respective functional areas; however, it can also be examined on an individual basis by measuring the breadth of functional experience that an individual possesses. This within-individual functional diversity is assessed by measuring whether an individual on a team is a narrow functional specialist with experience in a limited range of functions, or a broad generalist whose work experience spans a range of functional areas. Less work has investigated on how the varying dimensions of functional diversity affect project team performance, despite the prolific research on teams in the literature.

Existing Frameworks Through the New Lens: Dichotomy of Functional Diversity

Clearly delineating functional diversity and its dimensions is critical to a discussion of how different dimensions of functional diversity affect project team performance. The current team literature reveals several existing frameworks to explain multiple facets of functional diversity. First, Bunderson and Sutcliffe (2002) classified functional diversity into four categories: (1) dominant function diversity, described as different functional areas within which team members have spent most of their careers; (2) functional background diversity, defined as differences in the complete functional backgrounds of team members; (3) functional assignment diversity, conceptualized as differences in functional assignments of team member; and (4) intrapersonal diversity, denoted as differences in functional backgrounds of individual team members (pp. 878–-880). In contrast, Harrison and Klein (2007) offered three components of diversity in analyzing their effects on team process: (1) separation, denoted as compositional differences among individuals in their lateral position with respect to values, beliefs, and attitudes; (2) variety, referred to as compositional differences among individuals with respect to some relevant categories which that contribute to team diversity; and (3) disparity, conceptualized as vertical differences in proportion of valued assets or desirable resources, hence creating inequality or relative concentration within a team. Finally, Dawson (2011) expanded the Harrison and Klein’s typology by refining the construct of variety into two sub-dimensions: (1) range in variety, defined as the range of levels of a variable is represented within a group (p. 88); and (2) spread in variety, defined as the degree to which all possible levels of a variable are equally or evenly represented within a group.

Reflecting on existing frameworks on project team functional diversity, I dichotomized such diversity into the following parsimonious dimensions: interpersonal functional diversity and intrapersonal functional diversity. Interpersonal functional diversity is defined as between-member differences in functional domains across team members, thereby including varying functional backgrounds, expertise, and knowledge at the group-level. Intrapersonal functional diversity is conceptualized as within-person differences in functional domains in order to reflect the breath of functional diversity that individual team members possess. Intrapersonal functional diversity, while frequently used as a group-level measure, also affects team performance, given the extent to which members’ prior experiences are individually heterogeneous or homogeneous. Intrapersonal functional diversity thus embraces the notion of spread in functional varieties in teams by capturing both the range of functional experience within the individual, as well as the common representation of functional experiences among team members at the group-level. For example, finding a high level of intrapersonal functional diversity in a team indicates that individual team members have a broad functional experience that overlaps with each other’s experience, thereby indicating a commonality in functional experience among the members at the group-level. In contrast, a high level of interpersonal functional diversity in a team suggests that the team has a diverse knowledge base and expertise, with a large number of functional domains represented across team members.

Although these two types of diversity fall under the same rubric of functional diversity, they tap into fundamentally different facets of functional bases, as interpersonal functional diversity pertains to the breadth of functional diversity at the group-level, whereas intrapersonal functional diversity examines the breadth of functional diversity at the individual team member level. In particular, the concept of intrapersonal functional diversity allows for a more specific analysis, hence elucidating the complex impact of functional diversity on project team dynamics. However, a significantly sparse amount of research on the effects of intrapersonal diversity on project teams has been conducted and the ramifications are important since this is an area in need of further examinations. Although the construct of intrapersonal diversity has been increasingly addressed in team research, the current literature still severely lacks empirical studies investigating the moderating role of intrapersonal functional diversity on project team interactions and outcomes. Therefore, the significance of intrapersonal functional diversity for project team outcomes is currently understudied, hence calling for greater stream of research on this area.

Implications for Project Management

Unlike innate and immutable surface-level, demographic diversity at the individual-level, functional diversity is more malleable at both the individual and team levels in team composition. For example, employees can transfer from one functional unit to another to broaden their functional experience, and in practice, an increasing number of companies utilize cross-training to obtain organizational flexibility, broaden employee skills, and thus increase the value of their employees’ human capital. Similar to cross-training, another managerial strategy that counteracts the potential negative impact of functional diversity on project team collaboration is cross-cut role assignments, in which individuals are simultaneously members of more than one task group or team for a fixed duration of time. For example, Anthro, an Oregon-based furniture manufacturer, has been successfully utilizing a cross-cut role assignment program called, “Shadow Program,” to improve internal relations and cooperation among teams and departments. In Anthro’s Shadow Program, employees shadow other employees to understand different functional roles and develop interdepartmental relationships to improve their teamwork. As the primary goal of cross-training and cross-cut role assignments is to enhance knowledge of interpersonal activities by introducing team members to the roles and responsibilities of their teammates, such training can improve team interaction, communication, and coordination among diverse team members and thus help organizations capitalize on the cross-functionality of project teams.

Additionally, organizations can build shared knowledge by making information on individual skills and expertise easily available and accessible to employees. For example, an organization can promote knowledge sharing by cataloging information on employee expertise and making such information available across the origination. An employee can then access the database of employee expertise to search and consult others with relevant expertise when needed. Indeed, with the expansion of information technology, organizations are increasingly utilizing HR information databases to identify, store, and retrieve knowledge, skills, and abilities of employees. Such employee skills databases greatly enhance the organization’s capability to track and integrate employee talent for creating project teams with optimal complementary skills.

Finally, caution should be exercised when promoting member diversity in project teams. Simply increasing the amount of functional diversity in teams is not sufficient to improve project team performance. Instead, the characteristics of the specific project must be taken explicitly into account to maximize the benefits of functional diversity. In doing so, a right combination of interpersonal and intrapersonal functional diversity makes it more likely that members will utilize their different perspectives with their teams to optimize their project performance.

Final Thought

In this blog, I challenge readers to rethink how functional diversity can impact project team performance by refining the existing concept into interpersonal and intrapersonal functional diversity. The refinement of the construct in particular was captured by the notion of intrapersonal functional diversity, defined as variation in functional domains within individual members, which is different from the traditional construct of functional diversity discussed in the project team literature. The inclusion of intrapersonal functional diversity in the functional diversity–-team process–-team outcomes relationship allows for a more consistent analysis and accurate identification of the impact of functional diversity on project team outcomes. For those who support that functionally diverse members benefit project performance, a myopic, single-lens approach to understanding the complex nature of such diversity may miss the mark, as the effects of functional diversity are not uniformly positive, while engendering some contradictory findings. It is no doubt that as functional diversity increases in a project team, so does the breadth of knowledge, expertise, and experience that the team can collectively utilize to enhance the quality and quantity of projects. However, it has been also found that functional diversity, often combined with complex tasks and temporal structures in project teams, reduces member familiarity and shared understanding, leading to the potential for communication difficulties, coordination challenges, and suboptimal knowledge integration. I contend that teams with high levels of intrapersonal functional diversity have a broader repertoire of experience to draw upon, share a larger proportion of their functional background, and thus have a better understanding of different functions and how they are related to accomplish team goals.

Notes

Bunderson, J. S., & Sutcliffe, K. M. (2002). Comparing alternative conceptualizations of functional diversity in management teams: Process and performance effects. Academy of Management Journal. 45(5), 875–893.

Dawson, J. F. (2011). Measurement of work group diversity. (Unpublished doctoral dissertation). Aston University, Birmingham, England.

Edmondson, A. C., & Nembhard, I. M. (2009). Product development and learning in project teams: The challenges are the benefits. Journal of Product Innovation Management, 26(2), 123–138.

Harrison, D. A., & Klein, K. J. (2007) What’s the difference? Diversity constructs as separation, variety, or disparity in organizations. Academy of Management Review, 32(4), 1199–1228.

About the Author — Sujin Horwitz

Sujin HorwitzAssociate Professor of Management & Marketing

Dr. Sujin Horwitz’s research interests encompass team diversity and outcomes, cross-cultural HR issues, and teamwork in multidisciplinary setting. She can speak on topics related to teamwork and diversity in organizations.

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