Cultural Diversity In The Workplace

Touro University International

Unknown Author

MGT 501

Module 1

Dr. Debra Louis

There is no doubt that the business world is changing rapidly and that many factors are also simultaneously interacting. Perhaps these factors are created by cultural diversity.

The online dictionary source, http://en.wiktionary.org defines diversity in the social context as a business strategy encouraging differences in order to compete in a marketplace with a heterogeneous customer base. Diversity in the general population, the work force and the market place give many benefits for organizations. Global managers gain more knowledge on internal diversity in order to maximize the efficiency of their workforce and increase profit margins for their companies.

Diversification of the American workforce has changed the way managers interact with their employees. This diversification is due, in part to tighter labor markets, increased immigration, and women entering the workforce. Cultural factors, not present before, have caused managers to develop new methods of tasking, motivating, and educating these diverse employees. Essentially these new methods have been a change in interpersonal behavior, or the way a manager acts and re-acts to employees. This change in behavior was necessary to increase productivity and maintain a competitive edge in the marketplace.

Culture is an organized system of learned behavior patterns, always made manifest in a group, making that group distinctive from other groups. This definition has the key element of what culture is; a system of behavior distinctive to a particular group of people. These behaviors range from cultural norms to religious beliefs.

In business, the effectiveness of an organization rests on the ability of the management to interact with its employees and to motivate the workforce to accomplish the goals of the company. This ability to effectively interact between the manager and the employee depends on the managers understanding of the various cultural differences seen in the modern workforce. An organization is affected by cultural factors on many levels. The top management forms the basic foundation of an organization when they set the primary goals for that organization, the reason the organization is in business. An example might be an American car company with the goal of producing vehicles for the public and bringing in large profits for the shareholders. This goal is derived in the root cultural tenant of capitalism. The United States was founded with capitalist ideas and so American managers will have capitalist ideas. Now the same type of company in the Soviet Union, before the end of the cold war, may have had the goal of producing efficient military vehicles, not being concerned about the profit margin rather the purpose of the product. This goal would have been derived from the socialist belief of “all things are for the good of the state.”

As the influence of culture affects the direction of the company, it also affects the interaction between the managers and the employees. In the example of the American auto plant, the interaction between manager and employee was one based on western ideas of supervision and motivation. Today these ideas are changing. As people of other races and other ethnic groups continue to emigrate, they will bring even more diversity and lifestyle changes to the United States.

Three factors have contributed to the diversity of the American workforce: tight labor markets, immigration, and an increase in women entering the workforce. A tight labor market has been created by the decline in the overall labor force growth. In the 1990’s, the labor force growth fell 1.3 percent annually, down from 2.3 percent between 1962 and 1979. Annual labor force growth is expected to fall even further in the years to come, to less than 1 percent between 1998 and 2007. Immigration has contributed significantly to growing workforce diversity. According to the Bureau of Labor Statistics, immigrants account for half of the workforce growth in the 1990’s. Additionally, the foreign born population now makes up almost 10 percent of the total population, the highest since 1930.

Another force contributing to increased workforce diversity is the increase of women entering the workforce. The Bureau of Labor Statistics reported that 61 percent of the new labor force entrants between 1994 and 2005 were women and that by 2020 women will make up over 50 percent of the labor force in America.

The change in workforce diversity presents