CHAPTER I

INTRODUCTION

Background of the Study

The emergence of an increasingly heterogeneous workforce has brought with it an increased

focus within the global corporate world on the issue workforce diversity. This report
discusses the workforce diversity management strategies deployed by leading organizations
in response to the changing nature of the workforce. Analysis of secondary data collected
through online resources available on the corporate websites of the top 20 Fortune 500
corporations of 2012 reveals that leading organizations are focused on, and deploy
multifaceted management practices and strategies to effectively manage, workforce diversity.
These findings may be of use to a range of organizations seeking to implement or improve
diversity-management practices and benchmark their diversity efforts against global best
practice.

Statement of the Problem

Diversity in the workforce and in the marketplace is a reality and an opportunity facing health
care organizations in the 1990s. A first step in implementing a successful diversity program is
to research other organizations that have successfully embraced diversity. Program designs
will vary for each organization according to such factors as organization size, customers
served, available financial and staff resources, community expectations, management styles
and company culture.

Objectives of the Study

General objectives

 Reflects the contributions and interests of diverse cultures in its mission, operations,
and instructional services;
Is committed to eradicating institutional racism and social oppression of all forms;
Includes members of diverse cultures in decisions that affect them;
Values diversity and views the differences between people as a strength;
Uses management practices and policies that emphasize participation and
empowerment of all people in the organization
Creates a working environment where all people are valued and
Follows through on broader external social responsibilities by educating employees
and students in multicultural perspectives.

Specific objectives
To identify areas of underrepresentation of people of colour and women and outline
the action steps necessary to increase their representation in those areas where they
are significantly underrepresented.
To employ women, people of colour, and people with disabilities throughout all levels
of the organization and throughout all job classifications and occupational categories.
To eliminate and prevent recurrence of systemic discriminatory practices relating to
employment, or access to promotion, within the district for women, men, people of
colour or people with disabilities.
To identify and define problem areas and barriers to achieving workforce diversity
and take affirmative actions where necessary.
To implement workforce diversity evaluation process in order to systematically gauge
the districts progress towards goals and the effectiveness of action plans.

Significance of the Study

Businesses have started to recognize diversity in the workplace as a business strategy that
maximizes productivity, creativity and loyalty of employees while meeting the needs of their
clients or customers. If a company is only as good as their employees, then it stands to reason
that a great deal of energy should be devoted to hiring the most talented individuals. By
branching out to a diverse workforce, employers have access to a greater pool of candidates
thereby improving the odds of hiring the best person. In a competitive marketplace, an
organization that puts people first - regardless of their race, religion, gender, age, sexual
preference, or physical disability has an advantage over the other players.

Limitations of the Study

Limitation

Although employing a diverse workforce has many advantages, it comes with some
disadvantages as well. A company that recruits and employs a diverse workforce must create
a culture that promotes dignity and respect to avoid tension between employees. In addition,
communication may be adversely affected if employees' first language is not English.
Existing employees may leave the organization if their personal prejudices prevent them from
working with colleagues from a different background. As another disadvantage, the
investigation of employee complaints regarding negative attitudes and harassment can take
up a considerable amount of management time, whether or not they are upheld.

CHAPTER II
REVIEW OF RELATED LITERATURE

Changes that have taken place in the global market in recent years have altered the way
people perceive organizations and interact within them. Globalization has presented curious
juxtapositions: for example, an Indian employee could work in the Emirates for an American
company and interact with a Kenyan colleague (Novinger, 2001). An "organization" does not
merely represent a workplace; rather, organizations can be considered "mini-societies that
have their own distinctive patterns of culture and subculture" (Morgan, 2001, p.129).
Organizations consist of employees who work, interact, and share each others life for a
specific time (Myron & Koester, 1998; Lauring, 2011).

Diversity refers to a team of diverse group and that teamwork needs facilitation and provision
of authorities which results in positive employee attitude and increased job involvement (job
involvement, 2008).Organizations have realized the need of being flexible and responsive to
market instabilities and therefore recognized the need of managing a diverse workforce in
order to cope up with this situation (Farrer, 2004). In this regard, effective diversity
management leads a company to better organizational performance and give a competitive
advantage (Allen et al., 2004). Therefore, it is an intense need to manage a diverse workforce
by organizations. Management should utilize properly the benefits of workforce diversity in
order to enhance group performance (Ely &Thomas, 2001) for this purpose employee
involvement in managing diversity is a very crucial tool.

Diversity refers to "a set of characteristics of groups of two or more people and typically
refers to demographic differences of one sort or another among group members" (McGrath,
Berdahl, &Arrow, 1995). In addition, diversity refers to workers working in an organization
belonging to different socio cultures (Kundu, 2003). "The broader definition of diversity may
include age, national origin, religion, disability, sexual orientation, values, ethnic culture,
education, language, lifestyle, beliefs, physical appearance, and economic status" (Wentling
et al., 2000). No doubt, diversity promotes organizational performance (Torres et al, 1992)
but, it appears as a double-edged sword i.e. enhances opportunities on one side while
becomes the basis of employee dissatisfaction (Milliken &Martins, 1996). In this way, he
fails to identify himself with the group, ultimately leading to lower group performance.
Studies have provided evidence that diversity negatively influence group performance
(Ancona &Caldwell, 1992; Steiner, 1992).

Likewise, employees in diverse workplaces are often challenged to adapt their own cultural
bias (Novinger, 2001) and moral measurements to be tolerant of differences. Within a given

culture, values can maintain order and sustain a society. However, sometimes the explanatory
function of such values, which once served a purpose, might need to be drastically modified
as a result of increasing knowledge or practical requirements. This dimension often requires
going beyond understandings of national, racial, and religious boundaries (Shaules, 2007).

The attention being given by employers to issues of workplace diversity, for example,
through the creation of diversity mission statements and the development of systematic
diversity plans, is well established (Jackson et al., 1992). Employers can leverage diversity to
create culturally-specific rules that can improve relations between employees.

CHAPTER III
THEORETICAL/CONCEPTUAL/OPERATIONAL
FRAMEWORK

Workforce Diversity

Similarities and differences among employee in terms of age, cultural background,

physical abilities and disabilities, race, religion, sex, and sexual orientation.
Workforce diversity goes beyond a company's legal obligations to comply with equal
opportunities and non-discrimination legislation. Companies that employ diverse workforces
encourage different perspectives and promote learning from alternative perspectives. A
diverse workforce should reflect the society in which the company operates in terms of race,
gender, physical and mental ability, ethnicity, age, class, spiritual practice and sexual
orientation. Employing a diverse workforce requires a company to create a culture that
respects conflicting opinions and promotes the dignity of each member of the workforce.

Basic principles
Whatever the program design, organizations that have implemented diversity initiatives agree
that the following basic principles apply to any program: Have business reasons--not social or
political reasons--for advancing a position of diversity within your organization. Ensure that
the program has the full support of executive management. At Security Pacific, there is a
policy directive outlining senior management's commitment to workforce diversity. This
commitment requires not only support in policy but in program funding, and it holds
management accountable for meeting program objectives. Make a long term commitment.
The transition to "Workforce 2000" is truly a transformation. Programs will not necessarily
show immediate, short-term results but will tend to make the difference over time. Be patient,
but expect results. Outline behavioral expectations for managers and employees that demand
growth, and reward progress toward meeting these expectations. Put the organization--not the
human resources department--in charge of the program. Human resources should be a ready

and able provider of guidance and assistance, but line management must be given the
expectation for implementation of diversity programs.

Stages of commitment
Expect varying levels of organizational commitment to diversity:
1. Awareness of differences. This most basic level of response is one that most human beings
will have simply by virtue of interacting with other people.
2. Sensitivity to differences. Organizations can foster this level of response by creating an
environment that recognizes differences in customers and co-workers as an opportunity to
create a new and effective response to a need.
3. Acceptance of differences. Organizations can foster this level of response by creating an
environment that invites employees to be introspective and to challenge their established
attitudes, thoughts, and beliefs.
4. Maximizing differences for the good of the organization. Organizations can achieve this
level of commitment by outlining expectations, giving employees the skills and tools to meet
the expectations, measuring performance against the goals, and rewarding progress. While
levels of commitment and program designs will vary, all healthcare organizations--if they are
to remain viable, vital, and competitive--must face the fact that diversity is a business strategy
worth embracing and worth implementing.

Construct Domain of Diversity

Generally, diversity may be defined as the presence of differences among members of a

social group or unit (Jackson, May and Whitney, 1995). In another perspective, Cox (1993)
defines diversity as "... the representation, in one social system, of people with distinctly
different group affiliations of cultural significance" Deresky ( 1994) highlighted that the
differences between the group members may be illustrated in terms of the dimensions such as
national origin, language, religious belief, culture, age, physical ability, socio-economic
status, marital status, sexual orientation, race, family situation, and gender. Ferdman (1995)
emphasized the fact that membership in social groups distinguish one person from another
not only in name but also in their viewpoints of the world, in their construction of meanings,
and in their behavioral and attitudinal preferences, and other patterns of values, beliefs,
norms. Harris and Moran (1999) further expounded on the dimensions of diversity and
included other characteristics not identified by Deresky (1994). The factors include physical
appearance, cultural heritage, personal background, functional experience, mental and
7

physical challenges, family responsibilities, military experience, educational background,

style preferences, thinking patterns, political backgrounds, city, state or region of residence,
IQ level, smoking preference, weight, height, non-traditional jobs, and white and blue collar.
Although researchers and institutions in the fields of international business, applied
sociology, and anthropology have investigated the subject of diversity and have proposed
some common denotations of diversity, they have not organized the identifiable
characteristics or variables of diversity into a systematic, universal structure, which can be
used for empirical analysis and contextual comparisons across and within societies. In other
words, cataloguing the details of diversity is not enough, since each complex society is more
than just consisting of 'presumably unrelated' societal features. This paper introduces a
construct domain of diversity, which classifies employee differences in terms of three
distinctive categories.

Organizational diversity, and Socio-cognitive diversity

The first category is demographic diversity such as age, gender, ethnicity, and nationality
(Cox, 1991 ; Cox and Blake, 1991 ; Jackson and Ruderman, 1995) whereby Jackson et al
(1995) have commented that these are considered readily detectable attributes that can be
easily characterized in particular individuals. The second category is organizational diversity.
It is important to note that workforce diversity is not limited to the physical or social
attributes of the organizational members. It also involves the organizational context that adds
to the diverse perspective of the group dynamism. Organizational diversity may include the
1) occupation, functional or job portfolios of the employees such as marketing, finance,
accountancy, manufacturing, production, etc; 2) staff job tenure or seniority in the firm; 3)
hierarchical ranking within the organization (for example, senior management, middle
management, and lower management); and 4) work or professional experience (Jackson and
Ruderman, 1995). The last category is socio-cognitive diversity, which includes cultural and
religious values, beliefs, knowledge level, and personality characteristics (Jackson and
Ruderman, 1995). It constitutes the underlying attributes of personal characteristics that are
not so easily identifiable (Jackson et al, 1995).
By establishing and organizing the staff according to their unique attributes, it will enable
business managers to have a more objective understanding and appreciation of their diverse
staff's behaviors, attitudes and values, given the implications for interpersonal and
organizational processes and outcomes when staff members work together. Essentially, as
people's values and beliefs vary distinctively as a consequence of their different sociocultural predispositions, this will affect organizational processes and configurations, for
example, supervisor subordinate relationships, leadership and decision-making styles, crosscultural communication, international team management, staff motivation, staff recruitment,
selection and development, staff expatriation and repatriation, and other managerial
functions. Figure1presents an illustration of the construct domain of diversity.

Workforce Diversity and Strategic International Human

Resource Management
Undoubtedly, MNCs would benefit from the wealth of available business knowledge,
differing experiences, and global perspectives that staff from diverse backgrounds can
contribute. Porter ( 1990) contended that differences in character and culture may prove to be
integral to global success, as diversity is considered important towards enhancing innovation
and competition in an environment of multiculturalism in organizations. Thus, this signals a
need for greater cultural sensitivity and empathetic orientations in the workplace, whereby
there ought to be an emphasis on cultural acceptance rather than cultural tolerance. Policies
and practices in diversity management should ensure that there is continuous learning and
adaptation in organizations. As such, strategic international human resource management
(SIHRM) and the related issues in workforce diversity in MNCs would become challenging
areas of research and managerial practices for academics, management consultants and
business managers, respectively. The ability to effectively manage diverse workforces in
organizations is crucial in the wake of the increasing proliferation of transnational strategic
alliances, international joint ventures and HQ-subsidiaries establishments.
Figure 1 Construct domain of diversity

Organizations interested in planning and implementing their own

diversity programs:

1. Find out what all the people think.

At many companies, what human resources people think is needed may not be what others-even the majority of the workforce--think is needed. At UPS, we conducted surveys and
collected data on peoples' attitudes about valuing diversity at different levels of the
organization.

2. Determine your organization's readiness to value diversity.

Most managers are not prepared to meet the new challenges that an increasingly diverse
workforce represents. Often, managers and employees go through a predictable set of stages
in examining this issue. Denial, confusion, and anger tend to be the first responses, followed
by partial or total commitment (depending on how well people have been trained to
understand the importance of valuing diversity.)
To evaluate you organization's potential openness to valuing diversity, ask yourself questions
like these:

How do we handle conflict between men and women here?

Are women supported when harassed by men?
How do we handle conflict between ethnic groups?
Do we encourage white males in our workforce to understand the competitive
advantage of valuing diversity?
Is there a consensus of employees who are aware of the challenges associated with
diversity?
What are the organizational stereotypes we need to change in order to be successful
at valuing diversity?
How do the changes in our workforce parallel changes in the marketplace?

Numerous meetings and strategizing with the "stakeholders of power" (i.e., senior
management and constituent representative councils) at UPS helped prepare and build
support for the diversity program. This kind of preplanning effort paid off substantially as the
program was rolled out.

3. Involve people in the planning process so that they share ownership.

This is an organizational learning venture that goes deep into the soul of the company. The
planning process needs to be collaborative and is itself a training program. The effectiveness
of the UPS program came from everyone feeling as though he or she had some input in the
process.

4. Be culture-specific.
10

Every organization has a unique culture that it brings to issues of diversity. The diversity
program at UPS has been effective in large part because it is based on the values, attitudes,
and specific culture of the organization.

5. Mesh the corporate mission with diversity goals.

What is the relationship between valuing diversity, corporate mission, and the strategic plan?
Finding the fit between the corporate mission and valuing diversity can be challenging.
Often, as was the case at UPS, the mission statement was nonspecific about people policies.
Finding parallel goals--such as cutting costs or increasing customer service--that can fit
synergistically with valuing diversity, is critical to the viability and creditability of the
program.

6. Establish the facts, but focus on practicalities.

At UPS, we found that too much data turned people off and made them insensitive to the
subject. Always ask yourself: What can people take away from training and put to use so that
they might be effective at valuing diversity?

7. Raise awareness of personal stereotypes.

What are the personal stereotypes people need to change in order to be successful at valuing
diversity? Create a nonthreatening way for people to own their own stereotypes. At UPS, we
started by indicating that everyone has stereotypes about people different from themselves.
"Stereotype" is a polite substitute for racism and sexism--part of the unconscious social
conditioning we all have. We focus on having people monitor their own decision making
process and how it relates to stereotypes.

8. Build awareness and skills.

An effective diversity program provides both awareness and skills; one without the other
creates a dysfunctional program. At UPS, awareness goals were reached when participants
became responsible for changing the game. Skills such as communication, conflict
management, decision making, and teambuilding were tied directly to valuing diversity.

9. Pilot test the program, listen to feedback, and do it again.

Be prepared for surprises in your evaluation phase. Pilot test and evaluate throughout the
process. Eight months of planning did not prepare us at UPS for the reactions of people at the
first pilot. After two pilot programs we were still changing breakout sessions and slides. Be
open to participants' evaluations. Listening to the feedback might determine success or
failure--it did at UPS.

10.Tie valuing diversity into management development.

11

If valuing diversity is seen by managers as a separate program unrelated to management

development, efforts to impact the organization will fail. Managers must realize that valuing
diversity is a managerial competency and responsibility--not a choice.

12

CHAPTER IV
RESEARCH METHODOLOGY

RESEARCH

Research is a thorough, orderly, organized, efficient and logical investigation of an area of

knowledge or of a problem. In the broadest sense of the word, the definition of research
includes any gathering of data, information and facts for the advancement of knowledge.
Main components of a research are:
Curiosity:
Science is knowledge of the physical or material world gained through observation
and experiment. Research begins with a broad question that needs an answer.
Theory (Hypothesis)
Researcher creates an assumption to be proved or disproved with the help of data.
Experiment
Researchers design an experiment with steps to test and evaluate the theory
(hypothesis) and generate analyzable data. Experiments have controls and a large enough
sample group to provide statistically valid results.
Observation
Observing and recording the results of the experiment generated raw data to prove or
disprove the theory.
Analysis
Statistical analysis on the data and organizing it so that it is understandable generates
answers to the initial question. Data may show trends that allow for the broadening of the
research.
Conclusions
Research following the scientific method will either prove or disprove the theory
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TYPES OF RESEARCH

Descriptive Research

Descriptive research or statistical research provides data about the population or

universe being studied. But it can only describe the "who, what, when, where and
how" of a situation, not what caused it. Therefore, descriptive research is used when
the objective is to provide a systematic description that is as factual and accurate as
possible. It provides the number of times something occurs, or frequency, lends itself
to statistical calculations such as determining the average number of occurrences or
central tendencies.
One of its major limitations is that it cannot help determine what causes a specific
behavior, motivation or occurrence. In other words, it cannot establish a causal
research relationship between variables.
The two most commonly types of descriptive research designs are:
Observation
Surveys

ANALYTICAL RESEARCH
In analytical research the researcher has to use facts or information already available
and analyze these to make a critical evaluation of the material.

EXPLAORATORY RESEARCH
Exploratory research is conducted into a research problem or issue when there are
very few or no earlier studies to which we can refer for information about the issue or
problem. The aim of this type of study is to look for patterns, ideas or hypotheses,
rather than testing or conrming a hypothesis.
Exploratory research often relies on secondary data.

14

APPLIED RESEARCH

Applied research is also known as an action research.

Applied research aims at finding a solution for an immediate problem facing a society
or any business organization. Marketing research is a part of applied research.

QUANTITATIVE RESEARCH

Quantitative research is based on the measurement of quantity or amount. It is

applicable to the phenomenon that can be expressed in terms of quantity.

15

Research framework
This study is for workforce diversity in organization. Research said that a diverse workforce
should reflect the society in which the company operates in terms of race, gender, physical
and mental ability, ethnicity, age, class, spiritual practice and sexual orientation.

Types of data which helped to prepare this report:

The secondary data which was already prepared so these data was only used to reach the aims
and objectives of this project. These data has been collected from various journals related to
work force diversity.

How the data was collected:

The sources of collecting the primary data was through interviews, observation and
questionnaire, however the secondary one was collected from various journals related to
work force diversity.

Printed Sources:
The secondary data I collected was through the study of the workforce diversity already existed in
the firms in form of printed files or digital files reserved in the company for further references. I
had chosen these files because of the reliability and suitability of these information which I was
also sure about the accuracy of them.

16

CHAPTER V
SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS

Summary

Diversity in the workforce and in the marketplace is a reality and an opportunity facing
organizations . A first step in implementing a successful diversity program is to research
other organizations that have successfully embraced diversity. One example is Security
Pacific Bancorporation Northwest. Program designs will vary for each organization
according to such factors as organization size, customers served, available financial and staff
resources, community expectations, management styles and company culture. Whatever the
program design, organizations that have implemented diversity initiatives agree that the
following basic principles apply to any program: 1. Have business reasons for advancing a
program of diversity within the organization. 2. Ensure that the program has the full support
of executive management. 3.Make a long-term commitment. 4. Place the organization in
charge of the program.

Conclusions

The results of this study led to the following conclusions:

The major barriers that have inhibited the employment, development, retention, and
promotion of diverse groups in the workplace can be categorized into two types. The
first type of barrier is organizational in nature and comes from the workplace
environment. The second type of barrier is individual and comes from the employees
themselves.
The six organizational barriers which are most likely to inhibit the advancement of
diverse groups in the workplace are (1) negative attitudes and discomfort toward
people who are different, (2) discrimination, (3) prejudice, (4) stereotyping, (5)
racism, and (6) bias.

17

 The six individual barriers that are most likely to inhibit the advancement of diverse
groups in the workplace are (1) poor career planning, (2) inadequate skill preparation,
(3) lack of organizational political savvy, (4) lack of proper education, (5) low selfesteem, and (6) poor self-image.
Diversity should be defined in the broadest sense in order to include all the different
characteristics that make one individual different from another. Also, another reason
for making the definition all-inclusive is that it recognizes everyone as part of the
diversity that should be valued.
The six factors most likely to influence diversity in the workplace are (1)
demographic changes, (2) global marketplace, (3) economics, (4) comfort with being
different, (5) a diverse customer base, and (6) Equal Employment Opportunity and
Affirmative Action programs.
The four major reasons that organizations manage diversity are (1) to improve
productivity and remain competitive, (2) to form better work relationships among
employees, (3) to enhance social responsibility, and (4) to address legal concerns.
The six best strategies for managing diversity are (1) training and education programs,
(2) organizational policies that mandate fairness and equity for all employees, (3)
mentoring programs, (4) performance appraisal systems that are nondiscriminatory,
(5) outreach programs, and (6) career development programs.
Other important recommendations for managing diversity are to obtain top
management support, to integrate diversity into all company functions, to use a
combination of strategies, and to create a corporate culture that supports diversity.
The major goals of diversity training are to increase organizational effectiveness and
personal effectiveness.
The ten components of an effective diversity training program are (1) commitment
and support from top management, (2) inclusion as part of the organizational strategic
plan, (3) meeting the specific needs of the organization, (4) utilizing qualified trainers,
(5) combining with other diversity initiatives, (6) mandatory attendance, (7) creating
inclusive programs, (8) providing trust and confidentiality, (9) requiring
accountability, and (10) conducting evaluation.

Recommendations

Diversity training needs to begin with increasing awareness of what the concept of diversity
is and why it is important. The skill training, then, should provide the specific information
needed to create behavior changes that are required to effectively manage and work within a
diverse workforce. Then, application strategies and support needs to be provided so that
diversity awareness and skills can be applied to improving work performance.
18

The future trends related to diversity include the following: Society will become more diverse
and, therefore, the workforce and the marketplace will become more diverse; there will be
more globalization of corporations, which will lead to a more global workforce, marketplace,
and economy; diverse work teams will be a reality in organizations; diversity will become
more of a business concern than a social concern and be more closely linked to competitive
strategies; diverse populations will make more money and spend more money and this
increase in wealth will empower diversity; senior managers will become more involved in
diversity issues because they will realize that the diverse workforce needs to be better utilized
in order to remain competitive; more managers will face the challenge of dealing with
backlash; and diversity training will be integrated more with other types of training.

19

References

Journals

1.

Bishop, J. W., Scott, K. D., &Burroughs, S. M. (2000). Support,

commitment, and employee outcomes in a team environment. Journal of
Management, 26.

2. Cohen, S., &Bailey, D. (1997). What makes teams work: group effectiveness
research from the shop floor to the executive suit?. Journal of Management,
23.
3. Farrer, J. (2004). A practical approach to diversity. Industrial and
Commercial Training, 36(4).
4. Aslam, Muhammad Salman; Ayub, Arslan; Razzaq, Adeel (2013). Enhancing
Group Performance through Employee Involvement: A Conceptual
Framework on Workforce Diversity, 419-426.
5. Choy, William K W (2007). Globalization and Workforce Diversity: HRM
Implications for Multinational Corporations in Singapore, 1-19.
6. Shea, Sue; Okada, Ruby K (Jan-Feb 1992). Benefiting from Workforce
Diversity, 23.
7. Dahanayake, Pradeepa; Rajendran, Diana (Feb 2013). Global Leadership
in Managing Workforce Diversity.

Websites

1.
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http://smallbusiness.chron.com
www.businessdictionary.com
www.ukm.my
www.4j.lane.edu
ncrve.berkeley.edu/abstracts

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