The authors report the results of an investigation on how demographic heterogeneity in work teams influences team empowerment and team effectiveness. Using data collected from 111 intact work teams in four organizations, it was found that team race heterogeneity was negatively related to team empowerment and to multiple indicators of team effectiveness. Teams were also less effective when their team leaders had longer, rather than shorter, organizational tenure. Team empowerment fully mediated the relationships that race heterogeneity had with team leader ratings of team effectiveness and partially mediated the relationships with team member ratings. In addition, demographic dissimilarity between team leaders and their teams on race was negatively related to empowerment and team leader ratings of team effectiveness; and team members reported less empowerment when led by older team leaders. The authors discuss both theoretical and managerial implications of these findings.
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