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The importance of leaders as diversity managers is widely acknowledged. However, a dynamic and comprehensive theory on the interplay between team diversity and team leadership is missing. We provide a review of the extant (scattered) research on the interplay between team diversity and team leadership, which reveals critical shortcomings in the current scholarly understanding. This calls for an integrative theoretical account of functional diversity leadership in teams. Here we outline such an integrative theory. We propose that functional diversity leadership requires (a) knowledge of the favorable and unfavorable processes that can be instigated by diversity, (b) mastery of task- and person-focused leadership behaviors necessary to address associated team needs, and (c) competencies to predict and/or diagnose team needs and to apply corresponding leadership behaviors to address those needs. We integrate findings of existing studies on the interplay between leadership and team diversity with insights from separate literatures on team diversity and (team) leadership. The resulting Leading Diversity model (LeaD) posits that effective leadership of diverse teams requires proactive as well as reactive attention to teams' needs in terms of informational versus intergroup processes and adequate management of these processes through task- versus person-focused leadership. LeaD offers new insights into specific competencies and actions that allow leaders to shape the influence of team diversity on team outcomes and, thereby, harvest the potential value in diversity. Organizations can capitalize on this model to promote optimal processes and performance in diverse teams. (PsycInfo Database Record (c) 2020 APA, all rights reserved).
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