Multiple Diversity – Existential Challenges for Boards and TOP‐Teams

Erosion of Uberwelt

Erosion of the ›Uberwelt‹

A diverse top management team/​board, for example under the regime of the departmental principle, leads to the expectation that the members can explore the depth in their respective areas, but cannot gauge the breadth in the range of each other’s areas:

»Top management teams functional diversity reflects the range of specialists .… A functionally diverse top management team indicates that members possess depth in their respective areas but not breadth across a range of other areas. Diversity has been embraced with the expectation that it will bring about a richer cognitive pool of ideas, experience, and knowledge«. (Menguc & Auh 2005, p. 6).

Diversity and heterogeneity in teams thus create not only advantages, but also problems. At least when functional and cultural diversity is not integrated holistically. Then it can impair the effectiveness of communication, coordination, cohesion and cooperation in an almost destructive way. Then ›Mitwelt‹ and ›Eigenwelt‹ get out of balance. And this imbalance ultimately affects as negative ’spillovers‹ what we have called here the ›Uberwelt‹, and therefore the commonality in diversity that generates emergence.

So, while diversity in top management teams and boards appears to be an advantage on the one hand, a mechanism seems to be necessary that simultaneously enhances its benefits and ensures the need for overarching coordination on the other. The conscious learning and anchoring of inter‐​functional and intercultural coordination within executive teams and boards can be such a mechanism. That is, communication, coordination, cooperation and cohesion can be expected to improve if it is designed to consistently address and raise awareness of the routine interactive dysfunctionalities related to the four existential dimensions just outlined, and their collectively irrational outcomes, and from out there it is to establish a significantly different process logic within the team.

Existential coordination at the top level against the backdrop of the four existential dimensions is therefore characterised by learning (a) a common non‐​judgemental openness (phenomenological basic attitude) to improve and to utilise the perceptive capacity of the individual and the system as a whole, (b) as an open common reflection work and (c) establishing a culture of the boundary experiences of dialogue at eye level. In this process, the ›four aspects of organisational reality‹ form the fixed framework against the background (a) of what is actually required here and now, (b) the realisation of the common organisational concern, (c) the functional/​cultural self‐​image of the respective management areas (departments), (d) expectations of the departments towards each other.

The internal adaptability of an organisation linked to external functional and cultural pressures for change will only be effective then, if there is also a collaborative environment within the top management team and the board that enables the implementation of new ideas for the organisation as a whole. A very high degree of cultural diversity, coupled with internal (self‐​interested) competition and internal separation, however, results in severe limitations to open dialogue in implementation and a thus reduced ability to develop targeted processual innovations within the organisation. It is to be expected that such an organisational atmosphere is associated with low levels of creativity and effectiveness and – given the implicit ceasefires at the top level – staged proxy wars are the order of the day. Such an organisational state is (c.p.) regularly assumed to be associated with a low level of adaptability in the market.

A top level can and must detect such phenomena, ruthlessly expose dysfunctionalities and consequent inefficiencies against the backdrop of organisational concern and make them an issue within the top team itself.

Long‐​term results associated with an increase in diversity or complexity show that organisations that invest too little in a dialogue alignment of shared values will not cope well with the increase in complexity (›Umwelt‹). The internal, uncompensated increase in complexity consequently results in a significant increase in the level of competition (›Mitwelt‹) within the organisation, which takes on a conflictual and hostile tone (›Eigenwelt‹). Thus, the level of competitiveness tends to decrease and creativity and performance decline. Unresolved internal conflicts tie up considerable resources. In addition, the increase in intra‐​organisational tensions and conflicts is reflected in an erosion of the hitherto sustainable ›Uberwelt‹, and thus the (re-)segregation of groups within the organisation is to be expected. (cf. Ofori‐​Dankwa & Julian, 2014).

Such management systems experience an increasing and often for them incomprehensible and disturbing increase of responsibility diffusion at the top management level. – And, as a consequence, a sprawling CEO agenda! In practice, latent conflicts manifest themselves there in defensive communication, tabooing of mistakes and ignoring critical signals, among other things. If left unaddressed, they manifest themselves in uncontrolled sudden and seemingly unprovoked outbursts, leaving team members frustrated, irritated and sometimes at a loss. – And with them the entire organisation.

The complexity and multiple diversity brought or created into the system by growing external complexity causes an increasing individual emphasis on different backgrounds and perspectives. This can consequently cloud the awareness of the previously underlying construction of meaning, but now questionable commonalities. Consequently, the increase in complexity will be associated with a decrease in congruence and cohesion within the organisation. This can then lead to a further increase in conflicts in the dynamic fabric of the four existential dimensions and a drastic decline in creativity and effectiveness, exacerbating the initial negative situation and creating a whole‐​organisational experience of crippling existential meaninglessness. – An erosion of the organisational ›Uberwelt‹.