Having diversity of thought among the leadership team is usually regarded as a positive, Houston researchers found that conflict can cause more harm than good. Photo via Getty Images

For the past 40 years, management researchers have assumed that diversity of opinion about company strategy, even when it causes conflict among senior managers, leads to higher-quality strategic decisions and improved firm performance.

It turns out there isn’t evidence to support that belief.

Rice Business Professor Daan Van Knippenberg has spent his career studying topics related to team performance, decision making, diversity and conflict. When a research team led by Codou Samba, an assistant professor at the University of Tennessee, Knoxville, approached him with an offer to test longstanding assumptions about conflict related to company strategy in senior management teams, he jumped at the opportunity.

In his experience, the business case for diversity is strong, but it comes with caveats. “Diversity of perspectives can lead to better solutions to complex problems, but only when team members are open-minded enough to listen carefully to each other and really integrate another point of view into their decision-making process,” he says. This does not seem to apply to differences in opinion about what company strategy should be.

When managers dig in their heels and refuse to consider and integrate other perspectives, that two-way door of communication slams shut and conflict ensues. “The popular idea that conflict is actually good for firms went against all my knowledge,” says Van Knippenberg. “It’s annoying that this idea has floated around in my field for so long when the evidence really points the other way.”

The team led by Samba, which also included C. Chet Miller, a professor at the University of Houston, conducted a quantitative summary and integration of 78 papers that provide data about strategic dissent — a term used to describe diverging opinions about strategic goals and objectives on senior management teams — and its influence on strategic decision making and firm performance.

Every paper that made a prediction about strategic dissent (only a few did not) posited that strategic dissent leads to better outcomes for firms.

In their paper, “The impact of strategic dissent on organizational outcomes: A meta-analytic integration,” the research team used a deep well of empirical data to demonstrate that the opposite is true. Turning common wisdom on its head, they found that strategic dissent among senior managers actually leads to lower-quality decisions and impaired firm performance.

The authors identify two major reasons for the negative impact of strategic dissent on firm outcomes.

First, strategic dissent causes relational breakdown among senior managers. “If managers walk away from a team meeting thinking they just had a conflict instead of a productive discussion, the outcome is rarely positive,” says Van Knippenberg. The two sides retreat into their respective corners, believing the other side to be wrong and closing their minds to further information.

Second, strategic dissent leads to less relevant information being exchanged among managers. Inevitably, this blockage impairs the decision-making process. If a marketing director and an operations director are at odds, for example, they are less likely to share the marketing- or operations-specific information that is needed to make an optimal team decision.

Teams can benefit from diversity of thought, but it is not always clear what conditions need to be in place for that to happen on senior management teams that disagree about the firm’s strategic direction. CEOs — the leaders of senior management teams — would do well to realize that it takes an effortful investment to foster open-minded discussions of diverging views on the organization’s strategy, to create an environment that encourages members to express dissenting perspectives while absorbing the perspectives of others, and to prevent vested interest and power dynamics from determining the outcomes of such discussions.

------

This article originally ran on Rice Business Wisdom and was based on research from Daan Van Knippenberg, the Houston Endowed Professor of Management at the Jones Graduate School of Business at Rice University, C. Chet Miller, the C.T. Bauer Professor of Organizational Studies at C. T. Bauer College of Business at the University of Houston, and Codou Samba, an assistant professor at Haslam College of Business at the University of Tennessee, Knoxville.

Ad Placement 300x100
Ad Placement 300x600

CultureMap Emails are Awesome

Houston Nobel Prize nominee earns latest award for public health research

Prized Research

Houston vaccine scientist Dr. Peter Hotez can add one more prize to his shelf.

Hotez — dean of the National School of Tropical Medicine and professor of Pediatrics and Molecular Virology & Microbiology at Baylor College of Medicine, co-director of the Texas Children’s Center for Vaccine Development (CVD) and Texas Children’s Hospital Endowed Chair of Tropical Pediatrics — is no stranger to impressive laurels. In 2022, he was even nominated for a Nobel Peace Prize for his low-cost COVID vaccine.

His first big win of 2025 is this year’s Hill Prize, awarded by the Texas Academy of Medicine, Engineering, Science and Technology (TAMEST).

Hotez and his team were selected to receive $500,000 from Lyda Hill Philanthropies to help fund The Texas Virosphere Project. The endeavor was born to help create a predictive disease atlas relating to climate disasters. Because the climate crisis has ushered in changes to the distribution of diseases, including dengue, chikungunya, Zika, Chagas disease, typhus and tick-borne relapsing fever, it’s important to predict outbreaks before they become a menace.

Rice University researchers are collaborating with Hotez and his team on a project that combines climate science and metagenomics to access 3,000 insect genomes. The goal is to aid health departments in controlling disease and informing policy.

The Hill Prize, which is being awarded to six innovators for the first time, thanks to a $10 million commitment from the philanthropic organization, is intended to back ideas that are high-risk and high-reward. Each of the projects was chosen for its potential real-life impact on some of Texas's — and the world’s — most challenging situations. Hotez’s prize is the first Hill Prize to be given in the realm of public health. The additional winners are:

  • Hill Prize in Medicine: Kenneth M. Hargreaves, D.D.S., Ph.D., The University of Texas Health Science Center at San Antonio
  • Hill Prize in Engineering: Joan Frances Brennecke, Ph.D. (NAE), The University of Texas at Austin
  • Hill Prize in Biological Sciences: David J. Mangelsdorf, Ph.D. (NAM, NAS), UT Southwestern Medical Center
  • Hill Prize in Physical Sciences: James Chelikowsky, Ph.D., The University of Texas at Austin
  • Hill Prize in Technology: Robert De Lorenzo, M.D., EmergenceMed, LLC
Read about other Houston-area researchers recognized by TAMEST here.

How Houston's cost of living compares to other major Texas cities in 2025

Calculating Costs

A new cost-of-living index yields a result that many Houstonians will find surprising: Houston is not the most expensive place to live in Texas. Dallas and Austin are costlier.

Numbeo’s cost-of-living index for 2025 shows Dallas ranks first in Texas and 24th in North America, landing at 65.8. The cost-of-living index compares the cost of living in New York City (which sits at 100) with the cost of living in another city. Austin is at 61.7, Houston at 60.6, and San Antonio at 58.8.

Houston ranks 40th overall in North America, out of 52 cities in the index.

Numbeo’s cost-of-living index takes into account the cost of items like groceries, restaurant meals, transportation, and utilities. The index excludes rent.

When rent is added to the cost-of-living index, Houston is still third among Texas cities. Dallas grabs the No. 21 spot in North America (57.1), one notch above Austin (56.6). Houston ranks 35th (51.4), and San Antonio ranks 42nd (34.6).

Rent index
While Dallas holds the top Texas spot on Numbeo’s overall cost-of-living index, Austin faces the highest rent prices. Numbeo's rent index for Austin sits at 50.1, putting it in 12th place among major cities in North America and highest in Texas, above the indexes for Dallas, Houston, and San Antonio. Houston lands at 27th.

The rent index in New York City, which tops the list, is 100. As Numbeo explains, the rent index estimates the cost of renting an apartment in a city compared with New York City. If the rent index is 50, for example, this suggests the average rent in that city is 50 percent below the average rent in New York City.

Around Texas, the rent index is:

  • 46.2 in Dallas
  • 39.8 in Houston
  • 34.6 in San Antonio

Restaurant index
In contrast to its showing on the rent and cost-of-living indexes, Houston outranks Dallas, Austin, and San Antonio on Numbeo’s restaurant index. This index compares the prices of meals and drinks at restaurants and bars to those in New York City.

Houston sits at No. 25 on the restaurant index, at 68.9. Dallas comes in at No. 32 (67.1), Austin at No. 34 (66.6), and San Antonio at No. 36 (65.2).

The National Restaurant Association reported in December that menu prices in the U.S. had risen 3.6 percent in the past 12 months, outpacing gains in grocery prices and the federal government’s overall Consumer Price Index. Fortunately for diners, that was the smallest 12-month increase in menu prices since August 2020, according to the association.

Toast, which provides a cloud-based restaurant management system, says the higher menu prices reflect higher food prices.

“Food prices have been increasing due to inflation, labor expenses, fuel costs, and supply chain disruptions, all of which impact restaurant profitability, Toast says. “While raising menu prices is one option to combat rising food costs, some restaurants have introduced service charges and simplified menus to avoid passing all costs onto customers.”

---

This story originally appeared on our sister site, CultureMap.com.

Houston startup taps strategic partner to produce novel 'biobased leather'

cleaner products

A Houston-based next-gen material startup has revealed a new strategic partnership.

Rheom Materials, formerly known as Bucha Bio, has announced a strategic partnership with thermoplastic extrusion and lamination company Bixby International, which is part of Rheom Material’s goal for commercial-scale production of its novel biobased material, Shorai.

Shorai is a biobased leather alternative that meets criteria for many companies wanting to incorporate sustainable materials. Shorai performs like traditional leather, but offers scalable production at a competitive price point. Extruded as a continuous sheet and having more than 92 percent biobased content, Shorai achieves an 80 percent reduction in carbon footprint compared to synthetic leather, according to Rheom.

Rheom, which is backed by Houston-based New Climate Ventures, will be allowing Bixby International to take a minority ownership stake in Rheom Materials as part of the deal.

“Partnering with Bixby International enables us to harness their extensive expertise in the extrusion industry and its entire supply chain, facilitating the successful scale-up of Shorai production,” Carolina Amin Ferril, CTO at Rheom Materials, says in a news release. “Their highly competitive and adaptable capabilities will allow us to offer more solutions and exceed our customers’ expectations.”

In late 2024, Rheom Materials started its first pilot-scale trial at the Bixby International facilities with the goal of producing Shorai for prototype samples.

"The scope of what we were doing — both on what raw materials we were using and what we were creating just kept expanding and growing," founder Zimri Hinshaw previously told InnovationMap.

Listen to Hinshaw on the Houston Innovators Podcast episode recorded in October.