The influence of the top management team diversity on sensing and sensemaking of the external environment

Abstract

Top management teams are responsible to ensure that their organisations are conversant with the prevailing circumstances in their operating environment. Through their understanding of the operating environment leads to sensemaking which is required to device strategies to sustain their business. For this reason, the study of the role of top management teams in sensing and sensemaking is important. A critical review of existing scholarship as conducted in this study acknowledges that top management team diversity is beneficial to companies but may also pose certain challenges. Stemming from this realisation, the study explored how TMT diversity influences the sensing and sensemaking of the external environment among medium to large organisations from various sectors that operate in South Africa. It achieved this goal through the use of a qualitative study that used a semi-structured interview guide to collect data from twelve purposively selected research participants. Through the use of inductive thematic analysis, the study discovered that diversity among Top Management Teams contributes to deeper problem-solving capabilities, enhanced team innovation, customer base alignment and augments broader perspectives in collective sensing and sensemaking. Concurrently, the findings also highlight that team diversity, conversely, contributes to delayed decision-making, is characterised by a need for effective leadership to manage conflicting views during the sensing and sensemaking processes. Thus, the findings confirmed results from prior studies, which also highlighted the balanced perspective on its contribution in this regard. While the study has achieved its goal, the report has also highlighted its limitations based on the methodology that was chosen. Consequently, it recommends that future studies should consider employing quantitative methods and a bigger sample to enhance reliability and results generalisation. Despite these limitations, the report posits that these findings may be beneficial to both business and academic knowledge. They may serve as an input to the content of management training programmes and may also influence organisational policy and strategy.