Role of Leadership for Diversity Management and Organizational Performance: Moderation Model of Diversity and Functional Leadership Dimensions in Pakistan

Purpose: The most important objective of this study is to investigate the associations of diversity management practices (DMP) and organizational performance with moderating role of functional leadership dimensions in Pakistan. Methodology: DMPs have been assessed employing EPDMP scale and functional leadership dimensions were measured with scale developed by Santos et al., 2015 on a total sample size of 499 employees serving in HEI in Pakistan. The data was collected from employees of higher education sector institutions. The PLS-SEM technique was applied for effective data analysis.Findings: Results of the study reveal that greater diversity may not necessarily generate inclusive environment-certain diversity inclusive functional leadership dimensions and are essential to encourage diversity workplace environment where personnel think respected and valued. Results also indicate that diversity-inclusive functional leadership dimensions regulate the association among workforce diversity management and the organizational performance. Conclusions: The Study concluded that the diversity management has significant direct and positive impact on the organizational performance. Therefore, leaders who creates plans, ideas and make policies especially those who carried out a business and governments institutions need to formulate such HR statutes, regulations, rules, policies, and practices that promote heterogeneous personnel in organizations and bid equal opportunities to all personnel unrestricted by their individual employee’s characteristics such as race, gender, ethnicity, religion, etc, Practical implications: The results are very supportive for HR directors for the effective workforce diversity management to boost the organizational performance. Originality/value: The study describes the relationship of the diversity management and organizational performance with the moderating role of diversity inclusive functional leadership dimensions.