BBM 505

MANAGING
SOCIO-
CULTURAL
DIVERSITY
AT

WORKPLACE

SUBMITTED BY
ARCHISHA GARG
BBM (HONS.)
077505

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 INDEX

Introduction
1

Diversity Management
5

Why Does Cultural Diversity In The Workplace Matter?

9

Managing Cultural Diversity in the Workplace

11

Sources of Diversity in the Workplace

12

Managing Cultural Diversity in the Workplace –

Case Study 1
14

Case Study 2
16

Case Study 3
19

Cultural Multiplicity in the International Business

22

Guidelines for Diversity Management

24

References
25
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 INTRODUCTION
According to a recent survey conducted by the Families and Work
Institute, 52 percent of Americans prefer to work with people like
themselves while only 34 percent would rather be with colleagues
who are ethnically or culturally different.
For Telco’s with global ambitions, success in the next twenty years will stem
from successful joint ventures and alliances. But while it is a simple matter to
draw lines across the globe in the manner of the nineteenth century colonial
powers and to devise a Concert, an Atlas, or a Unisource, there is no
guarantee that such alliances will thrive - or even endure. Where once a
global company such as Coca-Cola simply sold its product or imposed a
taste, and multinationals geared the names or colors of identical products to
the results of market research, the survival of transnational Telcos will
depend on flexibility in managing cultural diversity.
Primarily, this entails the successful management of a multi-cultural
workforce in a global context. But it also means being able to vary services
across cultures: not simple marketing ploys imposed from outside, but an
understanding of how culture drives differences from within. A simple
example of this is the way in which different cultures use the phone: an
American walks into his appartment after a week away and switches on the
answerphone; an Italian rings his mother. One requires an add-on device; the
other needs single number dialling and favoured-number discounts. These
differences may appear trivial, but they are profoundly culture-driven.
The development of genuinely transnational business organizations therefore
requires managerial approaches and systems which allow for variations
deriving from such diversity. This might be "national" cultural diversity
between nations, races or ethnic groups (eg. in a two-nation joint-venture),
intra-national diversity involving the range of cultures within a single nation
(eg. in the USA), or internal cultural diversity where managers need to deal
with foreign-owned transnational companies in their own country (eg. a

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British Telco manager dealing with a Korean manufacturer in the UK). All this
is well known, and there is indeed a burgeoning literature on the
management of cultural diversity. But the problems go deeper than is often
appreciated: it is not simply a matter of minding manners or learning to deal
with varying attitudes to punctuality. These are the surface manifestations of
much deeper differences in mental structures.
A few examples will make this clear.
# Negotiating Alliances
In a world in which cross-cultural joint ventures and alliances are essential,
problems of ethics and trust will loom large. How is it possible to achieve a
balance between the necessary and the contingent in business ethics, or in
other words to allow for flexibility between a strong corporate ethic and the
need to adapt to difficult local conditions? And how can we learn to build a
lasting trust relationship with people from a different culture? How can
managers going to the negotiating table be prepared for the very different
styles they will face? It is not merely a question of setting bargaining ranges,
toning down confrontational styles, or following pre-established rules. That is
sufficient for making a deal, but not for setting up a permanent alliance. It is
essential to grasp the deep structures - religious, social, ethnic and ethical -
that influence the way the opposite party will reason, the way they will react
to different presentational styles, what they expect and how they listen.
This requires a level of genuine understanding which goes beyond rapidly-
acquired skills. Recent studies have shown how an inherent sense of cultural
superiority is often enough to undermine European joint-ventures in Third
World countries even when extensive training has been provided. Such
"superiority" emanates from non-verbal aspects of behavior like the tone of
voice and body language, which few people other than accomplished actors
are able to control. If, then, as this would suggest and has recently been
asserted in Telco documents on cultural diversity (eg. by BT and France
Telecom), humility is a key factor, how is it possible to inculcate this quality
in managers whose education has often prepared them for anything but
humility?
# Human Resources
The global operator obviously needs managers capable of working globally.
Some European Telcos are now recruiting "non-nationals" in order to resolve
their problems quickly, but how does a human resource specialist trained in
his own culture, who can make a rough assessment of a candidate's
capabilities in a brief interview, deal with the problems of recruiting staff in
other cultures? How valid is psychological testing when applied cross-
culturally? How much do most human resource managers know about other
school and university systems? Suppose a German manager needs to choose
between, say, a Finn, an Italian and a Portuguese. That would require an
awareness not only of the very different education systems in European
countries but the ways in which educational background influences patterns
of thought and managerial style: how, for example, education underlies the
way in which the same conflict might be addressed in France by seeking
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orders from a superior, in Britain by sending the people in conflict on a
management course, and in Germany by employing a consultant.
Assuming for a moment that these problems can be resolved, how might the
issue of dual allegiance be tackled? For the employment of local managers
necessitates the creation of loyalty on their part to a distant entity with
culturally diverse norms and assumptions. Even a long-term expatriate who
is nominally still of the same nationality but has in fact "gone native" might
respond to an order in this way: "I'm sure my local employees won't like this,
so I won't tell them and try to smooth over the issue in some other way." It
can be much more difficult for the locally employed manager, especially
under stress.
# Everyday Work
Then there is the nitty-gritty of everyday working together, the problem of
creating the rituals, the back-room humour and the "off-stage" relationships
which are so vital to harmonious corporate life. Company jokes and in-group
stories, for example, are notoriously difficult to translate into other cultures:
what sounds laudable to a Briton can seem risible to an Italian. Companies
which contrived to impose a global corporate culture, such as IBM, did not
face the insidious cultural problems of a transnational organization.
Language is another problem. Although it might appear that the use of
English as the common working language of the international Teleco
community favours native English-speakers, this can turn into a
disadvantage when one of them is unaware of the problems that a regional
accent or rapid speech might create, and how linguistic confidence can be
perceived as a manifestation of quasi-colonial arrogance. Non-conformity
with what might be termed the "industry pidgin" can also generate
unexpected tensions.
Worse still, behind the words on the surface lurk centuries of cultural and
ideological rivalry which has often exploded into war. At moments of strain,
when a minor conflict might have irreversible consequences, simmering
stereotypes and prejudices boil up. Studies of cross-cultural teams indicate
that often it is the most superficially similar cultures which in the end
experience the greatest traumas: while differences such as those between
the US and Japan are obvious, serious problems often occur where they are
least expected - say, between Britain and Denmark - and warning signals are
neither perceived nor acted upon. In a world as competitive as that of the
Telcos will be in coming decades, nothing may be taken for granted.

The Way Forward

Cultural training is essential to avoid potential conflict, and to improve the
disastrous failure rate of joint-ventures in the recent past. In fact, most
Telcos with global ambitions now provide cross-cultural training in order to
create genuinely international managers. This sometimes involves in-house
training, and is also provided by consultants and business schools. Yet much
of this training deals with the traditional, superficial problems without
seeking to explore the deep causes of underlying cultural differences.
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Another problem is that much of the research and background material is
rapidly out-dated as the pace of change accelerates.
An innovative approach has been taken by the collaborative venture known
as "Euroteam". This was started in 1991 by the five main European
operators (BT, Deutsche Telekom, France Telecom, STET and Telefónica de
España) with the aim of contributing by means of the organization of regular
workshops and exchanges to the internationalization of Telco operators.
Euroteam was later expanded to include all European operators who were
members of ETNO (the organization of European Telecoms Network
Operators), and at present has about eleven members ranging from Finland,
Norway and Denmark to Portugal. It runs a series of international workshops
- hosted alternately by the members - whose focus is on Europe and
Telecommunications. There is a regular program called "Working Across
Cultures", and there has been a successful pilot version of a more theoretical
workshop called "Understanding Cultural Diversity" which may be run again
in the future. Other programs also include at least one session on cultural
diversity. These workshops allow managers from member companies to
learn and work together, and thus facilitate cross-cultural personal
networking even within the ambit of fierce competition.
The problem of devising some form of training within the industry has also
been recognized at the inter-governmental level, where "Cross-Cultural
Training and Education" has been included among the Global Information
Society projects of G-7.
No comprehensive solution to the problems of cultural diversity in the
context of the telecommunications industry has yet been conceived. Indeed,
there has been little specific research. Yet it is clear that preparation for the
successful management of such diversity in all its ramifications will be a vital
component of long-term success in the global market.
For while business is already global, management remains culture-bound.

A diverse workforce is a reflection of a changing world and marketplace.

Diverse work teams bring high value to organizations. Respecting individual
differences will benefit the workplace by creating a competitive edge and
increasing work productivity. Diversity management benefits associates by
creating a fair and safe environment where everyone has access to
opportunities and challenges. Management tools in a diverse workforce
should be used to educate everyone about diversity and its issues, including
laws and regulations. Most workplaces are made up of diverse cultures, so
organizations need to learn how to adapt to be successful practices.

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Diversity refers to any perceived difference among people: age, race,
religion, functional specially, profession, sexual orientation, geographic
origin, and lifestyle, tenure with the organization or position and any other
perceived difference. Diversity is more than equal employment and
affirmative action.

Diversity management is ensuring that factors are in place to provide for and
encourage the continued development of a diverse workforce by melding
these actual and perceived differences among workers to achieve maximum
productivity. Diversity management involves creating a supportive culture
where all employees can be effective. In creating this culture it is important
that top management strongly support workplace diversity as a company
goal and include diversity initiatives in their companies' business strategies.
It has grown out of the need for organization to recognize the changing
workforce and other social pressures that often result. Diversity is more than
being politically correct; it is about fostering a culture that values individuals
and their wide array of needs and contributions.

Why Diversity Management?

Employees of organizations are becoming increasingly heterogeneous. With

the passing of days, diversity is going to be an important issue for the HR
manager for the following reasons:
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* A large number of women are joining the work-force.

* Work-force mobility is increasing.

* Young workers in the work-force are increasing.

* Ethnic minorities' proportion constantly in the total work-force is

increasing.

* International careers and expatriates are becoming common.

* Necessity of international experience is felt for career progression to many

top-level managerial positions.

Benefits of Diversity Management

More specially, diversity when built into organization at different levels,

offers the following benefits:

* Easy entrance to a changing market situation.

* Large scale business transformation.

* High quality customer service.

* Total quality

* Alliances with suppliers and customers.

* Uninterrupted learning process.

Workplace diversity
• Workplace diversity refers to the variety of differences between people
in an organization.

• That sounds simple, but diversity encompasses race, gender, ethnic

group, age, personality, cognitive style, tenure, organizational
function, education, background and more

Benefits of Workplace Diversity

• Increased adaptability

• Broader service range

• Variety of viewpoints

• More effective execution

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Challenges of Diversity in the Workplace
• Communication

• Resistance to change

Successful Management of Diversity in the Workplace

Recommended steps that have been proven successful in world-class
organizations are:

1. Assessment of diversity in the workplace

2. Development of diversity in the workplace plan.

3. Promote diversity in leadership positions.

4. Implementation of diversity in the workplace plan .

As a Belgian national living in Ireland, Hilde De Block is acutely aware of the

increasing number of people coming from overseas to live and work here.

‘‘As more and more nationalities arrive in Ireland, more and more are
working in a cross-section of Irish businesses,” said De Block, managing
director of Bradan an Eolais - the Irish for ‘‘salmon of knowledge’’. After
extensive research, she set up the company to design and deliver
specialised courses for trainers, managers and employees on how to deal
with multicultural and multilingual working environments.

‘‘The share of the Irish workforce made up by foreign nationals is higher now
than ever before, and the trend shows no sign of decreasing,” said De Block.
‘‘Research published by the Irish Management Institute last year showed that
non-Irish nationals comprised 10 per cent of the population, up from 5.8 per
cent in 2002.”

She said managers of Irish businesses had ‘‘been hit fast and hard’’ by the
need to deal with the challenges of cultural diversity.

‘‘Employers and employees at all levels are tested on a daily basis - the
language barriers, the different styles of working and the different models of
authority found in different cultures,” she said.
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‘‘Some of the effects experienced include time being lost by unnecessary
discussions to clarify messages and attitudes, and managers having
difficulties describing the results they want, in turn leading to lower
productivity and work quality.”

De Block, 37, grew up in Menen, a small town on the Belgian border with
France. From an early age, she was used to dealing with cultural differences
between the Flemish and the Walloons.

She studied clinical psychology at the University Hospital in Ghent in Belgium

and is also a graduate of languages. She started her career working in
multinational companies and worked in senior management roles, as well as
training and staff development. She moved to Ireland ten years ago and now
lives in Donabate, Co Dublin. The clients of Bradan an Eolais include fast-
food companies and construction firms.

‘‘A well-managed team of different nationalities can help to attract and

retain staff,” said De Block.

‘‘Salary is important, but as most of us spend at least eight hours a day

working with our colleagues, a good working environment is of crucial
importance.”

‘‘If Irish businesses create multicultural unity at work, rather than live with
unproductive diversity, it can make a difference to both business and
society,” she said.

A more realistic and appropriate "ideal" is one of multi-culturalism (cultural

diversity). Multi-culturalism is based on the idea that cultural identities
should not be discarded or ignored, but instead, should be maintained and
valued.
The importance of cultural diversity in the workplace has been, for the most
part, accepted in American business. This is illustrated by the increased
presence of women and minorities in the business world.Diversity has gone
from being a moral and /or legal issue into a business necessity.
As we move further along in the 21st century, it will be necessary for
business owners to compete in a more global arena.
A study by the Hudson Institute for the U.S. Department of Labor found that
85% of the new entrants into the workforce in the next decade will be
women, minorities, and immigrants. If you want your business to be
successful and competitive in the future, you will have to utilize these human
resources and participate in these diversity trends.

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 Why Does Cultural Diversity In The
Workplace Matter?
Cultural Diversity matters to every single one of us, both professionally and
personally. When a group or segment of our population is excluded or
oppressed, all of us are denied.
For our businesses and communities to not only survive, but to thrive, each
of us needs to be aware and sensitive to ALL the members of the community.
Our communities are rich with human resources.
When all segments are respected and utilized, it benefits everyone involved.
A great many of us live on the "margins" of society. To be in a margin means
that you are not a part of the mainstream, popular culture.
In this nation, our popular culture, or ideal for business success, is white,
young, heterosexual, Christian, and male. In regards to cultural diversity in
the workplace, you are on the margins if you are:

➢ a woman
➢ have ANY ethnic background that is non-white
➢ are not a heterosexual
➢ are not a Christian
➢ are not between the ages of 21-50
If you can answer "yes" to any one of these criteria, you live in the margins.
This means that there are obstacles, prejudices, and stereotypes about YOU
as an individual.
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You can not automatically assume that society's view of you is unobstructed
or based solely on your individual character, qualifications, or
accomplishments. Unfortunately, you may be put in the situation to "second
guess" or question one's motives in their interactions and responses to you.
Another fact this criteria illustrates is that more of us live IN the margins than
do not. More of us DO NOT fit the societal prescription of what is normal and
acceptable. While this all may be true, we all must do our best to function as
productive, happy individuals.
So what are we to do? We can all strive for change. We can all be proactive
in our decisions and lifestyles rather than reactive to ignorance and
intolerance.
When a white woman snubs an ethnic woman, for instance, she is harming
herself as well. The white woman lives in the same margin as the ethnic
woman, and she is only perpetuating and cementing her place there.
America is the most diverse nation in the world. Cultural diversity in
the workplace is becoming more and more desired. Our ethnicity,
religion, life experience, etc., makes each of us unique. Ideas our
nation once embraced about assimilation are now inappropriate and
outdated.
For someone who lives on the margins to assimilate into a single
idea of acceptance to fit into society is a gross violation of their
individual identity and rights.
This means that we all need to learn to accept what is different from us and
respect it.

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 Managing Cultural Diversity in the
Workplace
The management of cultural diversity in the workplace can be considered a
response to the need to recognize, respect and capitalize on the different
backgrounds in our society in terms of race, ethnicity, and gender.
Different cultural groups have different values, styles, and personalities,
each of which may have a substantial effect on the way they do business.
Rather than punishing or stifling these different management styles because
they do not conform to the traditional white management methods,
employers should recognize these differences as benefits.
Not only can diverse management styles achieve the same results as
traditional methods, but cultural diversity in the workplace can also help
improve the company's competitive position in the marketplace.
Diversity, or sensitivity, training is now common place in the corporate world.
However, small businesses need to be aware of these issues as well.
As a small business owner, your awareness and respect of cultural diversity
in the workplace truly matters to your employees and your client base.
You must create a balance of respect and understanding in the workplace to
have happy and optimally productive workers. In addition, it is important that
you AND your employees are aware of the importance of respecting diversity
when dealing with your clients.
When you work effectively with your community, both you and the
community benefit.

What is EEO?
Equal Employment Opportunities (EEO) means eliminating barriers to ensure
that all employees are considered for the employment of their choice and
have the chance to perform to their maximum potential. EEO practices
include:

• A management system which incorporates the differences found in a

multicultural workforce in a manner which results in the highest level
of productivity for both the organization and the individual.

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 • fairness at work,

• hiring based on merit and

• promotion based on talent.

It concerns all aspects of employment including recruitment, pay and other

rewards, career development and work conditions

Sources of Diversity in the Workplace

Workforce Diversity: Gender

Women in the Work Place

• Women’s earnings are less than two-thirds of the earnings of men.

• Women hold only 12% of corporate officer positions

Workforce Diversity: Race and Ethnicity

• 1998 to 2008 Growth Rates for the U.S. Working Population

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 Workforce Diversity: Religion
• India: multi cultural country.

• Accommodation for Religious Beliefs

• Providing flexible time off for holidays

• Posting holidays for different religions on the company calendar

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 Cultural Diversity in the Workplace
CASE STUDY 1:

Bonita Community Family Center

Background:
Bonita Community Family Center (BCFC) is a community-based organization
dedicated to provide a variety of services to families living in Bonita City. The
Latino population has increased considerably the last 10 years and the BCFC
has been integrating bilingual bicultural personnel into the organization.

Mercedes Guzman has been working for the center for three year. She is one
of the case managers providing family services to the Bonita Community.
Part of her duties is to provide services to Spanish speaking families.

Jennifer Wilson is the Director of Bonita Community Family center. Jennifer

has been working for the organization for 15 years and has been involved in
the organization’s initiatives to expand services to the Spanish speaking
families.

At the cubicles:
Mrs. Wilson: “Mercedes, I need to talk with you in my office. Please come
with me”.
Ms. Guzman: “Yes, sure. Just let me inform the front desk person in case my
next appointment shows up”.

At Mrs. Wilson’s office:

Mrs. Wilson’s (Looking at Mercedes at her eyes): “Mercedes, the reason why I
wanted to talk with you is because I have had complaints about you and the
other Spanish speaking coworkers speaking Spanish in the halls and in the
break room”.
Ms. Guzman (Avoiding looking at Mrs. Wilson’s eyes): “Excuse me Mrs.
Wilson but I do not see why there is a problem with us speaking Spanish, we
feel more comfortable speaking in our native language”.

Mrs. Wilson: “Well, some of your coworkers feel uncomfortable. They think
that this is

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America and that you need to speak English”.

Ms. Guzman (Avoiding looking at Mrs. Wilson): I do not know why they feel
uncomfortable. We are not talking about them and they never have talked
with us about how they feel. Besides, we have been hired because we are
bilingual and we speak Spanish. I have even felt sometimes that this is the
only skill that you see in us.

Mrs. Wilson: “I do not understand what you mean by this”

Ms. Guzman: “When there are opportunities to get ahead in the Center we
are not considered because you need our Spanish speaking skills in the lower
level positions or because you do not see other skills that we have.”
Mrs. Wilson: “Mercedes, I did not know that you were interested in those
positions”.

Ms. Guzman: “Well, I feel that you did not consider me because nobody
asked me if I was interested.”

Mrs. Wilson: “Lets talk about these issues later.”

Ms. Guzman: “Ok, lets talk later.”

Unraveling the Situation:

Desired Outcome:
1. To respect each person.
2. To create a workplace environment that is safe, comfortable, and honors
each person’s gifts and talents.

Remember:
• We each have a cultural lens, which shapes the way we make sense of
our experience.
• We all have talents to share.
• We all want the best for our organization.

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CASE STUDY 2:

Diversity and Talent Management Practices at

IBM
The case examines the diversity and talent management practices of the US-
based IBM, the leading IT Company in the world. IBM figured in the Fortune
magazine's list of "America's Most Admired Companies" in the year 2004. It
was appreciated for recruiting and retaining the best talent across the world.
IBM actively encouraged recruiting people from various social and
cultural backgrounds irrespective of their age, sex or physical status. In the
same year, IBM had developed a talent marketplace to effectively manage
its workforce. The marketplace supported employees to find the most
suitable job across different organizational units within the company.
Experts felt that the talent management initiatives of IBM would help it to
gain competitive advantage in the long run as talent is the key differentiator
in the IT industry.

Introduction
In the year 2004, IBM was listed among the top 10 companies on Fortune
magazine's list of "America's Most Admired Companies." The ranking was
based on eight variables like employee talent, innovation, use of corporate
assets, social responsibility, quality of management, financial soundness,
long-term investment value, and quality of products/services5.

Fortune was appreciative of IBM for recruiting and retaining the best talent
across the world. Analysts attributed IBM's success to its skilled diverse
workforce that included people from almost all the countries in the world.
The history of diversity at IBM dates back to 1953 when the then Chairman
and CEO, Thomas J. Watson Jr. (Watson Jr.), issued a letter to the
management team in which he stressed equal opportunity of employment. In
the late 1950s, that letter was used as a foundation of company policy in
negotiations to establish IBM subsidiaries in Southern US.
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In 1964, Equal Employment Opportunity (EEO) became a legal obligation as
per the Civil Rights Act, passed by the US government. During the 1970s,
IBM actively recruited women and minorities in the company. It formed a
well-structured career development plan for them.

Later, in the 1970s and 1980s, as IBM started operating in other countries
outside the US, it actively promoted diversity. The company developed a
well-structured diversity policy and implemented it within the organization.
During the 1990s, diversity council and network groups were formed to
promote diversity
In the early 2000s, a skilled workforce was one of the key differentiators for a
successful IT company. IBM gave importance to not only recruiting and
retaining the best talent but also to managing them in such a way that
wastage of skills was reduced. In 2004, IBM developed Human Capital
Management Services software to implement a talent management model
within the organization. According to analysts, IBM's focus on talent
management enabled the company to utilize its workforce properly and also
to assess its future talent needs. They felt that the best practices in talent
management could be further used to formulate and implement succession
planning and leadership development strategies.

Background Note

The history of IBM dates back to the early 1900s. In 1911, the Computing-
Tabulating-Recording Company (CTR) was founded in New York, US, by
merging the International Time Recording Company6, Computing Scale
Company7, and the Tabulating Machine Company8. In 1914, Thomas J.
Watson Sr. (Watson Sr.), who had earlier operated an agency for selling cash
registers, joined CTR as a general manager
In 1924, CTR was renamed as International Business Machines Corporation
(IBM) and Watson Sr. took over control of the company as its President. Since
its inception, the top management of IBM had been giving importance to
employee-friendly practices. Watson Sr. concentrated on developing ‘self-
respect' and ‘self-confidence' among IBM's sales force. He said, "I want the
IBM salesmen to be looked up to. Admired. I want their wives and children to
be proud of them."9 To promote teamwork, Watson Sr. formed sports teams
among its employees. He tried to inculcate a sense of pride and loyalty in
them toward the company. He valued his employees as he believed that the
people were the biggest assets of the company.

Work Force Diversity at IBM

Diversity at the work place in the US originated from the concept of EEO in
the 1940s. At IBM, Watson Jr. issued the first equal opportunity policy letter
in 1953. Later, it came under government compliance under the Civil Rights
Act of the US in 1964.
With the onset of ‘globalization' in the 1980s, organizations initiated efforts

19
to broaden
their marketplace. In an attempt to sustain themselves amidst the
continuously increasing competition, they started doing business across the
world. This trend made it important for them to focus on diverse cultures
across borders in order to offer products and services that suited the specific
needs of different markets...

Recruiting People with Disabilities

IBM had a well-structured plan in place for recruiting and training people with
disabilities. The recruitment specialists and hiring managers were specially
trained for this purpose. In each business unit, IBM had ‘line champions' - the
managers experienced in hiring and working with people with disabilities - to
facilitate the recruitment process. The company also worked with various
educational institutions for campus recruitment of such candidates. Besides,
IBM had a diversity website where prospective candidates with disabilities
could submit their resumes directly.

Work/Life Balance
As one of its major employee retention strategies, IBM offered a
comprehensive work/life balance program based on the following seven
principles:

• Employees must take responsibility for their own work/life balance needs.
• Work/life balance should have a positive impact on all employees involved.
• Quality of output is more important than the amount of activity.
• Teams should be flexible when balancing working and personal needs.
• Employees must be treated as individuals.
• Ongoing performance and contribution are a prerequisite.
• Achieving work/life balance is hard work and ongoing...

Women in the Workforce

IBM started recruiting women professionals well before the Equal Pay Act,
1963. A letter issued by Watson Sr. in 1935 stated, "Men and women will do
the same kind of work for equal pay. They will have the same treatment, the
same responsibilities, and the same opportunities for advancement." IBM's
management made efforts to find out what the specific needs of its women
employees and provided women-friendly facilities accordingly. This helped
the women in increasing their productivity while maintaining a proper
balance between work and family life. The women networking groups in IBM
actively promoted female mentoring, assisted women to achieve a better
work/life balance, and also conducted programs to encourage girls to seek
careers in the IT industry (Refer to Table I for ‘Filling the Pipeline' programs).

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Talent Management
To achieve a balance between talent supply and demand, IBM often
redeployed its workforce. The internal redeployment process was designed
to minimize loss of productivity of skilled employees. Each of IBM's business
units had its own resource board that reviewed and approved external job
postings on a regular basis. In case the company had employees with skills
matching the criteria, they were redeployed on the new job instead of
recruitment being done externally.

IBM treated diversity as a part of its business strategy. Having employees

from different social and cultural strata helped the company understand and
serve its customers better.

It also helped the company expand its market by obtaining business from
small and medium sized enterprises owned by the women and minorities
(Asian, Black, Hispanic, etc.). In the early 2000s, the executive diversity task
forces were encouraged to develop business relationships with the leading
women and minority-owned businesses in the US.

CASE STUDY 3:

Promoting Diversity - The American Express

Way
American Express was well known in American corporate circles for its
commitment to diversity. The company not only made a conscious effort to
recruit a diverse workforce, but it also created a work culture
where diversity was valued and promoted. This case discusses
the diversity initiatives of AmEx. It talks about how the company partnered
with several profit and non profit organizations to ensure that it had access
to a diverse pool of candidates in its recruitment efforts. It also talks about
the culture and policies at AmEx that ensured that diversity was promoted in
all parts of the organization. The case concludes with a commentary on the
extent to which the diversity initiatives were successful at the company, in
the light of a law suit filed by some women employees against the
discrimination they faced.
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Introduction

In January 2006, the American Express Company (AmEx) was featured on

Fortune's 3 list of the '100 Best Companies to Work for' in America. AmEx
was ranked ninth among large companies, and 37th in the overall ranking of
the list of the best employers in the US. AmEx had been one of the regulars
on this list in the early 2000s, and the company stood ninth in the overall
ranking the previous year as well.
Fortune said AmEx's diversity initiatives, especially its policies related to
women employees and minorities, made the company one of the best places
to work for in the US. AmEx's commitment to minorities was also saluted by
Black Enterprise, a magazine committed to the business and consumer
issues of the African-American community, in July 2005.

The magazine included AmEx in its '30 Best Companies for Diversity' list. The
30 best companies were selected after the editors of the magazine
conducted a detailed survey of more than 1,000 publicly traded American
companies and 50 global companies with significant operations in the US.
Companies which showed a significant representation of African Americans
and other ethnic minorities in four key areas - corporate procurement,
corporate boards, senior management, and the total workforce - were
included in the list.

AmEx was also appreciated by other mainstream magazines as well as those

catering to minority groups and special interests such as Hispanic Business
and Working Mother, for its diversity related policies.
In the 1990s, diversity issues came to the fore in corporate America. Not only
had a large number of women and minorities entered the workforce, but
markets had also rapidly expanded beyond national boundaries, compelling
companies to adapt their operations to diverse cultures and societies. In light
of these developments, analysts suggested that for companies to continue
growing, they would have to take full advantage of all the human resources
and intellectual capital available to them.

Background
AmEx was originally set up in 1850 as an express company that forwarded
freight and valuables across the US.

In the mid 1800s, the US postal system was not very well developed; not
only was the service slow, but many far flung areas did not have any service
at all. Besides, it was extremely unreliable and very often documents were
lost en route.

Therefore, people were reluctant to send valuable papers and articles by

post. Henry Wells, William Fargo, and John Butterfield recognized that the
shortcomings of the US postal system provided a good business opportunity.
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When AmEx was started, it provided a service that was not only fast, but also
reliable.
Consequently, it earned a reputation as the best express company in the
country at that time. In 1882, AmEx launched a money order business to
compete against the money order service of the US Postal Department.
Around the same time the company also expanded into Europe with the
same product. In Europe, the concept of money orders was still new and
AmEx gained the first mover advantage. In 1891 the company created a new
product known as the 'American Express Travelers Cheque' as a substitute to
the traditional letters of credit people used when they traveled abroad.

The Travelers Cheque was launched in denominations of $10, $20, $50, and
$100, and soon became popular with international travelers.

The Travelers Cheque triggered off AmEx's international expansion in a big

way. In 1895, the company opened its first overseas office in Paris. This was
followed by a London office in 1896...
By the early 1990s, AmEx had offices across Europe including Denmark,
Italy, the Netherlands, Germany and Belgium. In the early 1900s,
immigration into the US was at a high. In 1905 the US Immigration
Department appointed AmEx to provide official currency exchange services
to these immigrants. The outbreak of the First World War in 1914 brought in
new business opportunities for AmEx.

Diversity at Amex
Diversity was an integral part of the culture at AmEx. AmEx believed that
focusing on diversity was one of the ways to gain competitive advantage in
the rapidly expanding global markets.
Having a diverse workforce allowed AmEx to obtain a better understanding
of the varied markets it operated in. Diversity has been defined in various
ways by experts. The narrow definition, the one pertaining to the Equal
Employment Opportunity Commission (EEOC) in the US, defined diversity in
terms of gender, race, ethnicity, nationality, age, religion, and disability.
However, over the years the concept of diversity widened to include
parameters like marital status, language, sexual orientation and tenure with
the organization. AmEx embraced and promoted diversity in the broad
sense, and its diversity initiatives covered a large number of groups
including women, minorities, senior employees, people with disabilities, and
homosexuals.

Diversity Eyewash?
Despite AmEx's commendable diversity initiatives and the testimony of
several satisfied employees, the company did not escape criticism. Over the
years, AmEx had become involved in a few controversies related to
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discrimination
One of the biggest controversies that the company faced was a class action
gender discrimination lawsuit in 1999. During the late 1990s, several female
advisors at AEFA complained to the EEOC that the unit's managers
discriminated against them on the basis of gender, and showed preferential
treatment to white males in terms of assignments, mentoring programs,
promotions and compensation. They also said that they faced a sexually
hostile environment at AEFA. Although the complainants were from different
locations, their complaints were similar. Shirley Krieger from AEFA's New
York office said that although she had worked at the unit for more than 13
years, her superiors had been trying to get her to resign saying that she was
'too old'...

Cultural Multiplicity in the

International Business
The issue of cultural multiplicity in the international business
scenario is continuously on the up rise owing to the factor of rapid
globalization. As the developed countries spread their wings across the
globe, the third world talent finds more employment opportunities in their
lap. Nevertheless, the businesses of underdeveloped nations have also made
giant strides since they are provided with better and more channels for
spreading out. The role of Internet has indeed played a major role in bring
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about this global revolution in the international business. Businesses
worldwide are endowed with unfathomable opportunities and access to
limitless societies and cultures, making business prospects and employment
available to all. Even the biggest giants of the world are now just a click
away. However, for the companies seeking to squeeze this planet, this
cultural amalgamation has set a number of problems along with the rosy
side of it. The last decade has proffered a number of challenges for the
companies who intend to go global with regard to the effective management
of cultural diversity.
Managing the differences of languages, cultures, religions and traditions
under one umbrella are some of the main obstacles faced by the
international businesses, and are more complex than they seems to be on
the out front. People coming from multiple backgrounds not only have
differences of social setup, in fact, the cultural impact influences the

psychological side of the personality as well. The business

culture of a country is not very dissimilar to its social norms.
As for instance, the social and cultural values and norms in U.S, Europe and
Asia are completely in contrast with one another and so are the perspectives
of people. When these separate and distinctive cultures come closer, there
are high chances of a tug of war since groups fail to empathies with each
other and this is what mars the productivity and effectiveness of work
environment, disturbing the business consequently.
Moreover, the problem of general acceptability of other cultures and
religions has been an issue ever since. It is indeed a fact that human beings
feel more at ease with those of their own like and are not too enthusiastic to
work in diverse teams. Team members coming with mottled cultures exhibit
varying attitudes in work place and thus the situation for the management
becomes all the more exigent. Every individual exhibits his social and
cultural norms in business world. In this case, a lot depends on the role of
management as to how they view taking their businesses to diverse

countries and their insight into its pros and cons. Their
international business strategies must encompass all the socio-economical
aspects of the native countries and have practical policies for business
expansion in each culture. All these plans of actions need to be much
customized; what might be suitable in a certain culture may not work for
another. The constraint of English language as the sole mode of
communication in the western business world is also an imperative issue.
Although learning English has been given a lot of significance in Asia now,
yet people are not too comfortable with foreign language as a matter of fact.
This calls for interpreters sometimes, increasing the overheads for the firm.
However, being defensive and confining our horizons pertaining to these
obstacles would be child-like. Instead we need to be solution-oriented and
device methods and strategies to tackle ethnic multiplicity in the workplace.
More focus needs to be given to the positive sides of globalization, as the

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prospects of business success are much higher and beneficial around the

globe. The international business strategies should be realistic

and free of all bias based on religion, culture, race or ethnicity. With this
constructive and realistic approach, firms can hop into the international
market and extend their sphere. Various approaches can be adopted to
minimize this issue and make people feel ‘one’. Breeding regard and respect
for religions, ethnicities and races in training workshops, fair company
policies, standard setting by the senior management, social gatherings and
events where employees from varied ethnicities may get an opportunity to
intermingle informally are some of the solutions that can help minimize this

problem of multicultural diversity in the business world.

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 Guidelines for Diversity Management
The following are some important guidelines to manage diversity effectively:

➢ Consider female employee needs, such as child care and job sharing, to
prevent their turnover.
➢ Commitment from top management towards value diversity is a pre-
requisite.
➢ Arrange mentoring program by senior managers to identify promising
women and minority employees and play an important role in nurturing
their career progress.
➢ Arrange diversity training programs to bring diversity awareness and
educate employees on cultural and sex differences and how to respond
to these in the workplace
➢ There should be an apprenticeship program to trained promising
prospective employees properly before they are actually hired on a
permanent basis.
➢ Employer should set up a support group to provide a nurturing climate
for employees who would otherwise feel isolated or alienated.
➢ Conduct diversity audit to review the effectiveness of an organization's
diversity management programs.
➢ There should be a proper communication which includes speeches by
senior executives, inclusion of diversity in corporate vision statements,
the publication of diversity brochure and inclusion of diversity as a topic
in new employee orientation.
➢ Managers need to be sensitive to the needs of working parents.
➢ Ward off change resistance with inclusion.
➢ Foster an attitude of openness in your organization
➢ Learn the professional aspirations of all team members and support
their efforts to achieve them.
➢ Create opportunities for highly talented employees to be exposed to
leaders who may not otherwise interact with them.
➢ Create cross-functional teams
➢ Volunteer for community projects that teach tolerance, both directly
and indirectly
➢ Delegate fairly
➢ Communicate and support intolerance of inappropriate and
disrespectful behavior.
➢ Evaluate performance objectively
➢ Consider individual needs when enforcing company policies and
guidelines
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 ➢ Don’t make assumptions
➢ Communicate appropriately
➢ Search for common ground
➢ Be aware of formal versus informal work environments.

REFERENCES

1. Melissa Solomon, "Create Diversity in Culture, Ideas", Computerworld 36

(May 6, 2002):42-43.
2. Suzanne C. de .Janasz, Interpersonal Skills in organization, McGraw-Hill,
2002, p-146.
3. "Diversity: A 'new' Tool for Retention", HR Focus 77 (June), 14.
4. The Problems of Cultural Diversity in International Business -
Instablogs.htm
5. Leadership-tools.com. Cultural diversity in the workplace.htm
6. Managing%20cultural%20differences%20...%20%20Google
%20Books.htm#v=onepage&q=&f=false
7. Managing cultural differences 6th edition – Philip R. Harris, Robert T.
Moran, Sarah V. Moran.
8. http://www.leadership-tools.com/intellectual-rights.html
9. www.google.com
10. www.scribd.com
11. www.citemanhr.com

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