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Management Of Diversity In Organization

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Autor:  anton  27 December 2010
Tags:  Management,  Diversity,  Organization
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Management of Diversity in Organization


Organizations have been becoming increasingly diverse in terms of gender, race, ethnicity, and nationality. This diversity brings substantial potential benefits such as better decision making, greater creativity and innovation, and more successful marketing to different types of customers. But, increasing cultural differences within a workforce also bring potential costs in higher turnovers, interpersonal conflicts, and communicational breakdowns. The utilities of diversity training and the essential managerial skills required for effectively managing diversity will also be discussed.

Diversity Management vs. Organizational Performance

Diversity of skills among individual members will increase the combined skills of the team. It is assumed that a team of people collectively having a diversity of skills will perform better than a team of people all having similar skills, Brakefield (1999).

In an empirical study of military tank crews, Tziner and Eden (1985) observed that crews consisting of all high-ability individuals performed more than additively better than expected, and that those consisting of all low-ability individuals performed even worse than expected.

The possible benefits which could be brought to organizational performance through diversity management can be related to six catalogues including cost, resource acquisition, marketing, creativity, problems solving and system flexibility. Here are some discussions for every catalogue.

1. Cost: As organizations become more diverse, the cost of a poor job in integrating workers will increase especially for those labor intensive jobs. Those who handle this well will thus create cost advantages over those who don't.

2. Resource Acquisition: Companies develop reputations on favorability as prospective employers for women and ethnic minorities. Those with the best reputations for managing diversity will win the competition for the best personnel. As the labor pool shrinks and changes composition, this will become increasingly important.

3. Marketing: For multi-national organizations, the insight and cultural sensitivity that members with roots in other countries bring to the marketing effort should improve these efforts in important ways. The same rationale applies to marketing to subpopulations within domestic operations.

4. Creativity: Diversity of perspectives and less emphasis on conformity to norms of the past should be able to improve the level of creativity.

5. Problem-Solving: Heterogeneity in decision and problem solving groups could potentially produce better decisions through a wider range of perspectives and more thorough critical analysis of issues.

6. System Flexibility: An implication of the multicultural model for managing diversity is that the system will become less determinant, less standardized, and therefore more fluid. The increased fluidity should create greater flexibility to react to environmental changes, for example, with greater speed and less cost.

But the impact of diversity management practices on company performance could go either ways. Because diversity does not come into organizations and businesses in a single dimension, employees bring several types of diversity with them into an organization simultaneously. It may not be only one or even two dimensions that make a difference; it may be the sum of the whole. One thing for certain is that diversity is not a substitute for ability. To get the highest possible performance from a team, all the best individuals should be gathered together.

Relationship between Diversity and Creativity

From Susan (1989), attitudes, cognitive functioning and beliefs are not randomly distributed in the population but tend to vary systematically with demographic variables such as age, race, and gender. When one manages a diverse combination of population in the organization will increase cultural diversity in organizations by the presence of different perspectives for problem solving, decision making and creative tasks.

Advocates of the value in diversity hypothesis suggest that work team heterogeneity promotes creativity and innovation. Research tends to support this relationship. Kanter's study of innovation in organizations revealed that the most innovative companies deliberately establish heterogeneous teams to "create a marketplace of ideas, recognizing that a multiplicity of points of view needs to be brought to bear on a problem". Kanter also specifically noted that companies high on innovation had done a better job than most on eradicating racism, sexism, and classism, in addition, tended to employ more women and racioethnic minorities than less innovative companies.

Research by Charlene J. Nemeth found that minority views can stimulate consideration of non-obvious alternatives in task groups. Nemeth found that the "minority" groups adopted multiple strategies and identified more solutions than the "majority" groups. She concluded that the groups exposed to minority views were more creative than the more homogeneous, majority groups. She further concluded that persistent exposure to minority viewpoints stimulates creative thought processes. Another experiment compared the creativity of teams that were homogeneous on a series of attitude measures against teams with heterogeneous attitudes. Problem solution creativity was judged on originality and practicality. Results indicated that as long as the team members had similar ability levels, the heterogeneous teams were more creative than the homogeneous ones. If people from different gender, nationality, and racioethnic groups hold different attitudes and perspectives on issues, then cultural diversity should increase team creativity and innovation.

Specific steps must be taken, however, to realize this benefit. The research shows that in order to obtain the performance benefits, it is necessary for heterogeneous team members to have awareness of the attitudinal differences of other members. Similarly, diversity needs to be managed in part, by informing work-group members of their cultural differences. In recognition of this, cultural awareness training has become a standard element of organization change projects focusing on managing diversity.

Demographic Diversity vs. Group Functioning Effectiveness

Although grouping people on the basis of ability can have synergistic effects on team performance, it is quite interesting that the overall effect could be unclear. Among a given group of individuals, diversity is fixed. How individuals are assigned to teams cannot affect the total amount of diversity in the group as a whole. Staffing teams according to similarity in ability has the effect of reducing diversity within teams and increasing diversity between teams. It is a tradeoff. A manager must decide which arrangement best suits the goals of the organization.

Almost inevitably, manager will take team cohesiveness into consideration. Diverse teams generally take longer to become cohesive and may require training and incentives to improve cohesiveness as Thompson & Gooler (1996) suggested. However, long-standing research on group cohesiveness by Griffin (2000) shows a positive relationship between group cohesiveness and inter-group conflict. Inter-group conflict refers to levels of culture-group-based tension and interpersonal friction. Research on demographic heterogeneity among group members suggests that communication and cohesiveness may decline as members of groups become dissimilar. The emergence of rivalry with other groups may then have either a positive or a negative effect on team performance and may have a positive or negative effect on total performance across teams.

The challenge of diversity research is to determine "what difference does difference make?" Despite considerable research relating demographic diversity to various organizational outcomes reviewed by Milliken & Martens (1996), there is no theoretical basis to predict that demographic diversity should directly affect team performance. Interactions between demographic diversity and task type, however, may very well affect team performance. Diversity among team members may affect the team's ability to compete or cooperate with other teams, or at least may affect the team's propensity to carry out instructions to either compete or cooperate with another team.

Utility of Diversity Training

Despite the popularity of diversity training in corporate America, a lack of systematic evaluation has left managers with little guidance on how to design effective diversity training programs.

Nancy J. Adler (1988) suggest that people exposed to even the most rudimentary form of training on cultural diversity are significantly more likely to recognize the impact of cultural diversity on work behavior and to identify the potential advantages of cultural heterogeneity in organizations. In addition, anecdotal evidence from managers of many companies indicates that valuing and managing diversity training represents a crucial first step for organization change efforts.

Managing diversity training is the most prevalent starting point for managing diversity. Two types of training are popular: awareness training and skill-building training. Awareness training focuses on creating an understanding of the need for, and meaning of managing and valuing diversity. It is also meant to increase participants' self awareness on diversity related issues such as stereotyping and cross-cultural insensitivity. Skill-building training educates employees on specific cultural differences and how to respond to differences in the workplace. Often the two types are combined. Such training promotes reciprocal learning and acceptance between groups by improving understanding of the cultural mix in the organization.

Most diversity programs begin with some form of awareness training for employees as Flynn (1998) described. Indeed, recognizing the importance of effective training programs to overall diversity initiatives, corporate spending on diversity training remains strong even in economic slowdowns as Leonard (2002) observed. These programs strive to sensitize workers to differing values, communication norms, and interaction patterns that could thwart coordination between people from different cultural backgrounds. More pragmatically, these programs also seek to develop employees' communicational skills to ensure that their interactions are free from prejudicial responses that pose potential legal liability for the organization. All those utilities from diversity training are all critical in promoting pluralism in an organization so as to create multicultural organization.

Essential Managerial Skills Required for Effective Diversity Management

The fact that gross under-utilization of human resources and failure to capitalize on the opportunities of workforce diversity, represent unaffordable economic costs. In order to avoid these kinds of failure, proper managerial skills are required.

An absolutely essential skill is to ensure that the organization's performance appraisal and reward systems reinforce the importance of effective diversity management. In order to capitalize on the benefits of diversity while minimizing the potential costs, leaders are being advised to oversee change processes toward creating "multicultural" organizations.

A summary of managerial skills to achieve multicultural organizations is provided by Taylor (1991).

1. One can use managing diversity training, provide new member orientation programs, provide language training, and maintaining diversity in key committees, explicit treatment of diversity in mission statements, advisory groups to senior management and create flexibility in norm systems to promote pluralism to create a two-way socialization process and ensure influence of minority-culture perspectives on core organization norms and values.

2. One can utilize education programs, affirmative action programs, targeted career development programs, changes in manager performance appraisal and reward systems and HR policy and benefit to ensure full structural integration so that there will be no correlation between culture-group identity and job status.

3. It is also important to build up mentoring programs and one may provide company sponsored social events to improve the integration in informal networks to eliminate barriers to entry and participation.

4. To address cultural bias to eliminate discrimination and prejudice, one can provide equal opportunity seminars in the company; utilize bias reduction training, research or bias reduction special task forces.

5. One should also address organizational identification and makes it less correlation between identity group and levels of organization identification to reduce the gap between majority and minority group.

6. One may conduct regular survey and feedback mechanism, offer conflict management training, provide training of diversity management, and build up focus groups to reduce inter-group conflict, minimize interpersonal conflict based on group-identity and backlash by dominant-group members.

By utilizing those tools and skills discussed, one should be able to acquire better chance on receiving benefit from diversity management.


Brakefield, J. T., White, C, & Howard, J. L. (1999). Managing workforce composition: What good is diversity? Emerging Issues in Business and Technology 1999, Conference Program and Proceedings, Myrtle Beach, SC, 79-83.

Charlan J. Nemeth. (1986). "Differential Contributions of Majority and Minority Influence," Psychological Review, 93: 23-32

Flynn, G. (1998). Experts explain the evolution of diversity programs. Workforce, 77(12). 32-33.

Griffin, R. W. (2000). Fundamentals of Management. Boston: Houghton Mifflin.

Leonard. N. (2002). Not all training programs have felt the squeeze of corporate belt-tightening. HRMagazine. 47 (7). 25.

Milliken, R J., & Martins, L. L. (1996). Searching for common thread: Understanding the multiple effects of diversity in organizational groups. Academy of Management Review, 21: 402 33.

Nancy J. Adler. (1988) International Dimensions of Organizational Behavior, Kent Publishing Co., P.77-83.

Rosabeth Moss-Kanter. (1983) The Change Masters. New York: Simon and Schuster.

Susan E. Jackson. (1989) Team Composition in Organizational Settings: Issues in Managing a Diverse Workforce. Group Process & Productivity, J. Simpson. S. Warchel and W, Wood (eds), Beverly Hills, CA; Sage Publications,.

Taylor Cox, Jr. (1991). The multicultural organization. Academy of Management Executive, Vol. 5 No. 2.

Thompson, D, E., & Gooter, L. E. (1996). Capitalizing on the benefits of diversity through work teams. Managing Diversity: Human Resource Strategies for Transforming the Workplace. Cambridge, MA: Blackwell.

Tziner, A., & Eden, D. (1985). Effects of Crew Composition on Crew Performance: Does the Whole Equal the Sum of Its Parts? Journal of Applied Psychology, Vol. 70 (1), p85-67

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