Purpose - The extant literature is replete with suggestions, findings, etc., about how best to manage or lead a culturally diverse workforce. However, very few studies have focussed explicitly on leading with values in a workplace that may be fraught with disparate cultural value systems. The purpose of this paper is to assess, conceptually, the relative effectiveness of values-based leadership (VBL) in culturally diverse workplaces and attempt to provide an answer to the questions: what factors determine the effectiveness of VBL in culturally diverse workplaces and what is the probability that VBL will be effective in a culturally diverse workplace? Design/methodology/approach - The authors explore VBL within the context of two models. The first model assesses the relative effectiveness of VBL in culturally diverse workplaces from a deterministic perspective. The second model assesses VBL effectiveness from a probabilistic perspective. At the core of the deterministic model is the notion that the relative effectiveness of VBL can be determined by the cultural recompositioning of a firm's workforce. At the core of the second model is the notion that the likelihood of VBL effectiveness can be derived when conditions are created by the interface of the ethnic identity salience of culturally diverse workers and the organizational culture of the firm. Findings - A conceptual finding from the deterministic model is that the relative effectiveness of VBL is determined by the historical level of cultural diversity in a firm's workforce and the rate at which cultural recompositioning takes place in its workforce. A question addressed by the probabilistic model is: what factors create conditions for assessing the likelihood of VBL effectiveness? A conceptual finding from the probabilistic model is that the strength of a firm's organizational culture and the ethnic identity salience of culturally diverse workers are two major factors that create these conditions. Research limitations/implications - One of the major theoretical implications/contributions is the deterministic and probabilistic models introduce new variables (i.e. historically level of cultural diversity in the workforce, rate of cultural recomposition, strength of workers' ethnic identity salience, and strength of organizational culture) that have the potential to enhance our understanding of VBL by adding to the list of possible determinants of its effectiveness as well as the conditions under which it is likely to be effective. One limitation is the conceptual nature of the models. Empirical validation of the models will be required to test the veracity of the propositions derived from them. Practical implications - A major implication for practice is the need for leaders to develop a values management strategy. Such a strategy entails developing or having a strong set of core values for the organization, clearly communicating those values, and having reward and management systems to reinforce those values. This strategy implies that once implemented the tendency for culturally distinct workers (incoming and existing) to identify with their own values will decrease and the tendency for them to identify with the values of the organization will increase. Social implications - Because of the growing gap between the world's supplies of labor and the demands for it, industrialized nations will have to rely on and compete for foreign-born workers. The result will be the creation of a global workforce composed of individuals from different cultures with different value systems. In terms of economic benefits, success in reconciling these differences will have positive implications for organizations, workers, and the societies in which they exist. Originality/value - Prior studies have not fully explored the conditions under which VBL is likely to be effective in culturally diverse workplaces. Since diversity in the workplace is considered one of the main challenges for human resource management, the models we discuss address a very timely issue and provide a framework that leaders in organizations around the globe might use to better understand and manage the relationships described in the models. This under-explored topic represents a major gap in the literature. Helping to narrow this gap is an important contribution that the conceptual study makes to the literature related to this topic.
