PurposePrevious research has provided substantial attention to how individual-level challenging experiences lead to individual- and organization-related outcomes. This paper aims to expand existing challenging experiences theory and research by proposing a theoretical framework that addresses how challenging experiences differentiation relates to work unit effectiveness.Design/methodology/approachThe authors integrate the literature on challenging experiences with that of work unit identification and citizenship behavior to shed light on the intervening mechanisms through which challenging experiences differentiation relates to work unit effectiveness.FindingsThe authors’ theoretical framework proposes that challenging experiences differentiation diminishes work unit effectiveness through the mediating roles of variation in work unit identification and variation in citizenship behavior among unit members.Originality/valueBy linking challenging experiences differentiation and work unit effectiveness, the authors’ framework highlights the importance of studying challenging experiences at the unit level of analysis.