“Research has consistently shown that diverse teams produce better results, provided they are well led.” 

The ability to bring together people from different backgrounds, disciplines, cultures, and generations and leverage all they have to offer, therefore, is a must-have for leaders” (Ibarra and Hansen 2011: 71).

This blog explores the advantages and challenges of managing diverse team that contribute to an organisation. Several theories or models would be demonstrated so as to support the discussion in this blog.

Working with diverse people in a team might be frustrating and stressful, however it would also deliver better results in term of decision making process and overall performance of the team as a whole, at the same time.

Albion & Gagliardi (2007) stated that “It is somewhat a difficult task to handle people who are physically, psychologically, culturally and ethnically different from each other. Management of employees is largely dependent on the quality of leadership organizations have.”

Regarding to this discussion, first of all,  Tuckman’s team building model would be demonstrated.

Stages of Group Formation
Tuckman’s Team Building Model (Sources: Shaw,1998)


As can be seen from the diagram above, each team will go through the five phases of team development stages, which are forming, storming, norming, performing, and adjourning. The team development processes would be started from forming stage up until to the last stage, which is adjourning. At the first stage, leader has an authoritative power to lead the team because the roles and responsibility of the team member are not clear yet at this point (Manktelow et al., 2017). Meanwhile, at the last stage, team member disbands from the team because the purpose of the teams has been fulfilled and every member can move to the new things (, 2017).

How does diversity matter in Financial industry?

According to Bushra, Usman and Naveed (2011), the success of an organization is dependent on the hard working, loyal and involved managers and employees.

Additionally, Mitchell et al (2015) said that the involvement of leader is aimed to encourage and value the different point of views of diverse members within team interactions, and has strong potential to cope obstacles to interprofessional team performance. Hence, I would say that it is important for the leader of an organization to possess the ability to manage a diverse team in the organization. It means that as a manager of an organization it is essential for the manager to be able to bring the diverse team member all together as one and work together towards to the organization’s goal.

Barbara Stewart (2016) mentioned

“We consistently find that more diversity leads to a BETTER ecosystem. More diversity creates a biological environment which is more responsive, adaptive, and handles shocks or changes better. Those are great things in a habitat like the desert . . . they are also great things in our workplaces!

The diversity that we each have as part of our background and experience lends different perspectives and experiences, and it is these differences that lead to more robust outcomes in business.”

From the quotation above, I would acknowledge that diversity does matter in the financial industry as it allows the organisation to increase its core business performance in terms of customer and employee satisfaction; and produce better decision making. Furthermore, recent studies also declared that there is a strong correlation between diversity and financial performance where more diverse companies are better to gain top expertise and improve their customer orientation, employee satisfaction, and decision making, causing to an upstanding cycle of returns (BBA, 2015).

What are the benefits of diverse team?

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As has mentioned before, Barbara Stewart (2016) mentioned that diverse group would allow the group or organization to be more responsive, adaptive, and handles disturbance or changes better which more likely to produce more advantageous result for the organization.

What are the challenges of diverse team?


The challenges of managing diverse team includes the high management costs, discrimination, communication issue, lack of freedom of speech, integration issue, and so on.

Besides, it is also important for the manager of an organization to be familiar with the cultural differences to capable managing the team successfully and deliver better result. This would be supported by Hofstede’s six dimensions of culture.

Screenshot 2017-03-12 14.26.39
The comparison of Hofstede’s cultural dimensions between Indonesia and UK (Sources: Hofstede, 2017)

As shown above, Indonesian has high power distance (78) while British has considerably low power distance (35). With a low power distance, British people has a like family relationship within an organisation, where power is allocated equally, whereas, Indonesian people with a high-power distance where deferential to figures of authority and normally accept an unequal distribution of power, and leaders give direction to the team members (Hofstede, 2017).

Moreover, Indonesian has low level of individualism while British has very high level of individualism. This dimension tells us that Indonesian people are collectivism. This means that individual belongs to the group, and they (Indonesian) tend to sacrifice their values and goals for the group’s. Meanwhile, British has a very high individualism; this means British are very individualistic and private person.


Leader of the team is necessary to be aware of the cultural differences through Hofstede’s model. Additionally, the team development would go through several stages, which starts from forming, storming, norming, performing, and adjourning. Diversity team delivers both advantages and disadvantages, hence the leader of the team needs to be smart enough to avoid the disadvantages and create more advantages to the team as a whole.





Barbara Stewart, C. (2016). Diversity in Finance: It Matters. [online] CFA Institute Enterprising Investor. Available at: [Accessed 12 Mar. 2017].

Bushra, F., Usman, A. and Naveed, A. (2011). Effect Of Transformational Leadership On Employees’ Job Satisfaction And Organizational Commitment In Banking Sector Of Lahore (Pakistan) – ProQuest. [online] Available at: [Accessed 12 Mar. 2017]. (2017). Clarion Learning | Team Learning. [online] Available at: [Accessed 10 Mar. 2017]. (2015). Diversity and inclusion in banking. (2015). [online] Available at: file:///Users/mitchelleshaw/Downloads/diversity-in-banking-low-res-Final%20(1).pdf  [Accessed 12 Mar. 2017].

Dike, P. (2013). Cite a Website – Cite This For Me. [online] Available at: [Accessed 12 Mar. 2017].

Elizabeth Yeh
Charlene SmithClaretha JenningsNancy Castro, (2006) “Team building: a 3‐dimensional teamwork model”, Team Performance Management: An International Journal, Vol. 12 Iss: 5/6, pp.192 – 197

Graves, S. (2017). Tips on Improving Team Performance – [online] Available at: [Accessed 10 Mar. 2017].

Greenberg, J. (2004). Diversity in the Workplace: Benefits, Challenges and Solutions. [online] Available at: [Accessed 25 Feb. 2017].

Green, K., Lopez, M., Wysocki, A., Farnsworth, D. and Clark, J. (2002). Diversity in the Workplace: Benefits, Challenges, and the Required Managerial Tools1. [online] Available at: [Accessed 8 Mar. 2017].

Hofstede, G. (2011). Dimensionalizing cultures: The Hofstede model in context. Online Readings in Psychology and Culture, 2 (1). Retrieved from

Hofstede, G. (2017). Indonesia – Geert Hofstede. [online] Available at: [Accessed 12 Mar. 2017].

Johnson, R. (2017). Examples of Diversity Problems in the Workplace. [online] Available at: [Accessed 8 Mar. 2017].

Manktelow, J., Jakson, K., Edward, S., Cook, L., Khan, B. and Eyre, E. (2017). Forming, Storming, Norming, and Performing: Understanding the Stages of Team Formation. [online] Available at: [Accessed 26 Feb. 2017].

Manktelow, J., Jakson, K., Edward, S., Cook, L., Khan, B. and Eyre, E. (2017). Hofstede’s Cultural Dimensions: Understanding Different Countries. [online] Available at: [Accessed 5 Mar. 2017].

Mitchell, R, Boyle, B, Parker, V, Giles, M, Chiang, V, & Joyce, P 2015, ‘Managing Inclusiveness and Diversity in Teams: How Leader Inclusiveness Affects Performance through Status and Team Identity’, Human Resource Management, 54, 2, pp. 217-239, Business Source Complete, EBSCOhost, viewed 12 March 2017.


Owner, J. (2011). Tuckman’s Group Development Model – Neocrisis. [online] Available at: [Accessed 6 Mar. 2017].

Shaw, J. (1998). Effective Organizational Comunications. [online] Available at: [Accessed 11 Mar. 2017].


Zarndt, F. (2012). What did you say? interculture communication [HICSS 45 2012-01-04. [online] Available at: [Accessed 10 Mar. 2017].



23 thoughts on “The Challenge of Managing Diverse Teams

    1. In my opinion, the hardest thing to manage people from another cultures because of the cultural differences people can understand same things differently. Therefore, it is important for leader to understand the cultural differences in order to minimize the misunderstanding and be able to overcome this issue. To give you better understanding of the cultural differenes dimensions, please refer to my blog that explained about “Hofstede’s model”.


  1. I agree that some tasks would have a better result if we work in a team, but sometimes the company forget that each individu have a different skill and idea. I think it would be better if the company give a chance for an individu to develop their own skill and give an achievement to the one who have given their best effort in a team. In my opinion it would be fair enough both for each individu and for team.


  2. Very interesting topic, yet many companies still strugling with diversities within their organization. Especially when it comes to for example opening a branch or new head office outside their mother base. Lastly i think its a better idea you put more examples in your blogs.


    1. Yes, I do agree with you that many people actually are not aware of the cultural differences, and they might think that cultural differences are not a significant impact to their business; although it is in fact.
      Thank you for your advice. More example would be given in my next blogs.


  3. Hi Mitchelle, it is a very interesting topic and I really like how you explained about diversity and the role of a leader in this matter.
    I personally agree that a diverse team will allow the team to grow even better and have a wider point of view if they are being led well. But there are some leaders that tend to minimize the diversity by choosing their team based on the similarities and compatibility. It is allow the leader to work better with the team because they will have same idea and it will be easier to communicate.
    So, If you have the power to choose your own team, will you choose to have a diverse team that has more challenge but has wider point of view or will you just choose people who have more similarities and easier to work with?


  4. I agree to achieve fast and maximal goal, need diverse teams. But the issue is the diversity of the team itself. with a lot of diversity, there’s lack of freedom of speech from each individu, and the individu will be more difficult to show their maximum performance. How do you think about these issues?
    i think its better to give more explanation and example to solve the problem of diversity.


  5. Hi Mitchelle,
    It’s very nice blog and you really clear to explain about this issue.. To improve you blog I think u should give more example to each section. But u already did well! Good Luck ✨✨


  6. Hai Mitchelle, I really like the way you explain the topic. It is easy to understand. But i personally think it will be more challenging when you work in a successful organization and in those company the need for taking an immediate action is a must. Especially for financial industry, timing is a matter and I think working in a diverse team would be the barrier because you need more time to reach the consensus because of the wider point of view. So do you have any suggestion in handling this situation ?


    1. Hi Valen,
      yes, in order to minimize the issue, you need to learn to have a good communicaton skills especially when working in diverseteam, as people has different perspective and way of thinking from one to other due to cultural differences.


  7. Interesting thoughts on managing team diversity. Do you think that cultural differences play important roles in managing diversity? If yes, what do you think is the best way for managers to manage this? Thank you.


    1. Hi Nadia,, yes I would say that cultural differences play important role in managing diversity because it give huge impact to the productivity of the group as a whole. because each member would contribute their work to th group.


  8. I agree with your statement of “hence the leader of the team needs to be smart enough to avoid the disadvantages and create more advantages”, what are some of the methods you have in mind to achieve this?


  9. I am interested about the comparison of Hofstede’s cultural dimensions between Indonesia and UK.We can see that the culture is really different between Asian and European country. Do you think that differences will have an impact on each country’s team building model?


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