Perceived Faultlines and Decentralized Structures in Decision-Making Teams

Abstract

We advance the literature on faultlines by theorizing about how and why perceived faultlines (i.e., realized subgroupings as perceived by team members) not only influence team characteristics (e.g., decision-making structures), but also change in response to these team characteristics over time. Drawing on current team theories, we reason that strong perceived faultlines lead teams toward a decentralized decision-making structure (i.e., distributed decision-making responsibility), but a decentralized decision-making structure weakens future perceived faultline strength. We also build a theory suggesting a decentralized decision-making structure mitigates the dysfunctional effect of perceived faultlines on team performance. We find support for our theory in a sample of 230 undergraduate students in 48 teams, and we discuss implications for faultline and team research.