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Workforce Diversity: Changing the Way You Do Business By: Rob McInnes, Diversity World As we enter the 21st

century, workforce diversity has become an essential business concern. In the so-called information age, the greatest assets of most companies are now on two feet (or a set of wheels). Undeniably, there is a talent war raging. No company can afford to unnecessarily restrict its ability to attract and retain the very best employees available. Generally speaking, the term Workforce Diversity refers to policies and practices that seek to include people within a workforce who are considered to be, in some way, different from those in the prevailing constituency. In this context, here is a quick overview of seven predominant factors that motivate companies, large and small, to diversify their workforces: As a Social Responsibility Because many of the beneficiaries of good diversity practices are from groups of people that are disadvantaged in our communities, there is certainly good reason to consider workforce diversity as an exercise in good corporate responsibility. By diversifying our workforces, we can give individuals the break they need to earn a living and achieve their dreams. As an Economic Payback Many groups of people who have been excluded from workplaces are consequently reliant on tax-supported social service programs. Diversifying the workforce, particularly through initiatives like welfareto-work, can effectively turn tax users into tax payers.

As a Resource Imperative The changing demographics in the workforce, that were heralded a decade ago, are now upon us. Todays labor pool is dramatically different than in the past. No longer dominated by a homogenous group of white males, available talent is now overwhelmingly represented by people from a vast array of backgrounds and life experiences. Competitive companies cannot allow discriminatory preferences and practices to impede them from attracting the best available talent within that pool. As a Legal Requirement Many companies are under legislative mandates to be nondiscriminatory in their employment practices. Non-compliance with Equal Employment Opportunity or Affirmative Action legislation can result in fines and/or loss of contracts with government agencies. In the context of such legislation, it makes good business sense to utilize a diverse workforce. As a Marketing Strategy Buying power, particularly in todays global economy, is represented by people from all walks of life (ethnicities, races, ages, abilities, genders, sexual orientations, etc.) To ensure that their products and services are designed to appeal to this diverse customer base, smart companies, are hiring people, from those walks of life - for their specialized insights and knowledge. Similarly, companies who interact directly with the public are finding increasingly important to have the makeup of their workforces reflect the makeup of their customer base. As a Business Communications Strategy All companies are seeing a growing diversity in the workforces around them - their vendors, partners and customers. Companies that choose to

retain homogenous workforces will likely find themselves increasingly ineffective in their external interactions and communications. As a Capacity-building Strategy Tumultuous change is the norm in the business climate of the 21 st century. Companies that prosper have the capacity to effectively solve problems, rapidly adapt to new situations, readily identify new opportunities and quickly capitalize on them. This capacity can be measured by the range of talent, experience, knowledge, insight, and imagination available in their workforces. In recruiting employees, successful companies recognize conformity to the status quo as a distinct disadvantage. In addition to their job-specific abilities, employees are increasingly valued for the unique qualities and perspectives that they can also bring to the table. According to Dr. Santiago Rodriguez, Director of Diversity for Microsoft, true diversity is exemplified by companies that hire people who are different knowing and valuing that they will change the way you do business. For whichever of these reasons that motivates them, it is clear that companies that diversify their workforces will have a distinct competitive advantage over those that dont. Further, it is clear that the greatest benefits of workforce diversity will be experienced, not by the companies that that have learned to employ people in spite of their differences, but by the companies that have learned to employ people because of them.

The "business case for diversity" theorizes that, in a global marketplace, a company that employs a diverse workforce (both men and women, people of many generations, people from ethnically and racially diverse backgrounds etc.) is better able to understand the demographics of the marketplace it serves and is thus better equipped to thrive in that marketplace than a company that has a more limited range of employee demographics. An additional corollary suggests that a company that supports the diversity of its workforce can also improve employee satisfaction, productivity, and retention. This portion of the business case, often referred to as inclusion, relates to how an organization utilizes its various relevant diversities. If a workforce is diverse, but the employer takes little or no advantage of that breadth of that experience, then it cannot monetize whatever benefits background diversity might offer. In most cases, US employers are prohibited by federal and state laws from giving race or ethnicity any consideration in hiring or assigning employee. However, the US Supreme Court has upheld the use of limited preferences based on race, ethnicity, and sex, when there is a manifest imbalance in a traditionally segregated job category.

Workplace diversity Cultural diversity includes the range of ways in which people experience a unique group identity, which includes gender, gender identity, sexual orientation, race, ethnicity and age. An organizations culture tends to determine the extent to which it is culturally diverse. While diversity in the workplace brings about many benefits to an organization, it can also lead to many challenges. It is the responsibility of managers within organizations to use diversity as an influential resource in order to enhance organizational effectiveness. In the Journal of Applied Behavioral Science, C.L. Walck defines managing diversity in the workplace as "Negotiating interaction across culturally diverse groups, and contriving to get along in an environment characterized by cultural diversity". In a journal article entitled The multicultural organization by Taylor Cox, Jr., Cox talks about three organization types which focus on the development on cultural diversity. The three organization types are: the monolithic organization, the plural organization, and the multicultural organization. In the monolithic organization, the amount of structural integration (the presence of persons from different cultural groups in a single organization) is very minimal. "In the United States, this organization usually represents white male majorities in the overall employee population with few women and minority men in management jobs". "The plural organization has a more heterogeneous membership than the monolithic organization and takes steps to be more inclusive of persons from cultural backgrounds that differ from the dominant group". The multicultural organization not only contains many different cultural groups, but it values this diversity. Benefits Diversity is beneficial to both the organization and the members. Diversity brings substantial potential benefits such as better decision making and improved problem solving, greater creativity and

innovation, which leads to enhanced product development, and more successful marketing to different types of customers. Simply recognizing diversity in a corporation helps link the variety of talents within the organization. The act of recognizing diversity also allows for those employees with these talents to feel needed and have a sense of belonging, which in turn increases their commitment to the company and allows each of them to contribute in a unique way. Diversity also provides organizations with the ability to compete in global markets. Diverse organizations will be successful as long as there is a sufficient amount of communication within them. Because people from different cultures perceive messages in different ways, communication is vital to the performance of an organization. Miscommunication within a diverse workplace will lead to a great deal of challenges. Diversity is not only about preventing unfair discrimination and improving equality, but also about valuing differences and inclusion, spanning such areas as ethnicity, age, race, culture, sexual orientation, physical disability, and religious belief. Scott Pages (2007) mathematical modeling research of team work reflects this view. His models demonstrated that heterogeneous teams consistently out-performed homogeneous teams on a variety of tasks. Page points out that diversity in teamwork is not so simple. Challenges There are challenges to managing a diverse work population. Managing diversity is more than simply acknowledging differences in people. Many organizational theorists have suggested reasons that work-teams highly diverse in work-relevant characteristics can be difficult to motivate and manage. There are many challenges which face culturally diverse workplaces, and a major challenge is miscommunication within an organization. In her article entitled Developing Receiver-Centered Communication in Diverse Organizations, Judi Brownell explains that meanings of messages can never be completely shared because no two individuals experience events in exactly the same way. Even when

native and non-native speakers are exposed to the same messages, they may interpret the information differently. It is necessary for employees who are less familiar with the primary language spoken within the organization to receive special attention in meeting their communication requirements. "In high context cultures, communicators share an experiential base that can be used to assign meanings to messages. Low context cultures, on the other hand, provide little information on which to base common understandings and so communicators must be explicit".[10] Because of this fact, it is better to view all diverse organizational environments as low-context cultures. Cultural bias is an additional factor which challenges culturally diverse work environments. Cultural bias includes both prejudice and discrimination. "Prejudice refers to negative attitudes toward an organization member based on his/her culture group identity, and discrimination refers to observable adverse behavior for the same reason". Another challenge faced by culturally diverse organizational environments is assimilation. According to the journal articleCultural Diversity in the Workplace: The State of the Field, Marlene G. Fine explains that "Assimilation into the dominant organizational culture is a strategy that has had serious negative consequences for individuals in organizations and the organizations themselves. Those who assimilate are denied the ability to express their genuine selves in the workplace; they are forced to repress significant parts of their lives within a social context that frames a large part of their daily encounters with other people." Fine goes on to mention that "People who spend significant amounts of energy coping with an alien environment have less energy left to do their jobs. Assimilation does not just create a situation in which people who are different are likely to fail, it also decreases the productivity of organizations".[7] Creating the multicultural organization Main articles: Racial quota and Equality of outcome

"The key to managing a diverse workforce is increasing individual awareness of and sensitivity to differences of race, gender, social class, sexual orientation, physical ability, and age". There are several ways to go about creating the multicultural organization that performs extremely well. In her article, Judi Brownell identifies three skills which help to develop effective communication in diverse organizational environments. These skills include self-monitoring, empathy, and strategic decision-making. Self-monitoring refers to a communicator's awareness of how his or her behavior affects another person, and his or her willingness to modify this behavior based on knowledge of its impact. Empathy enables the receiver to go beyond the literal meaning of a message and consider the communicator's feelings, values, assumptions, and needs. Strategic decision-making implies that the communication sources and channels used to reach organization members, as well as the substance of the messages conveyed, are mindfully selected. An example of a company involved with creating diversity in the workplace is MentorNet, a non-profit online mentoring organization that focuses on women and underrepresented minorities in the STEM (Science, Technology, Engineering and Mathematics) fields. MentorNet has used an algorithm to match over 30,000 mentor relationships since 1997. The organization is unique because gives students, especially women and underrepresented minorities, the chance to seek mentors to discuss how to overcome diversity obstacles in their fields and eventually their workplace. Managing diversity tools Managing diversity goes far beyond the limits of equal employment opportunity and affirmative action. High performing diversity managers recognize that specialized skills are necessary for creating a productive, diverse workforce. They seek out continuous learning opportunities and some go as far as acquiring certification. Managers must be willing to work towards changing the organization in order to create a culture of

diversity and inclusion. Assessment skills and diversity education are key elements of culture change. However, the importance of leaderships support for the change cannot be understated. Increasingly, companies are concerned with corporate diversity management. Motivations for corporate diversity management are manifold and include legal pressures as well as increasing employer attractiveness, improving financial performance as well as realizing moral beliefs. Corporate Diversity Management can aim at achieving equal opportunities regarding gender, racial or ethnic origin, religion or belief, disability, age, or sexual orientation. Three approaches towards corporate diversity management can be distinguished: Liberal Change, Radical Change, and Transformational Change. Liberal change The liberal concept, deduced from Liberalism, sees equality of opportunity as given when all individuals are enabled freely and equally to compete for social rewards. The aim of the liberal change model is to have a fair labor market from which the best person is chosen for a job position just based on performance. The liberal concept is implemented by formal rules. Policy makers are responsible for ensuring that nobody suffers discrimination by the rules and that these rules are enforced on all. Positive action is used to guarantee maximum effectiveness. The biggest weakness of the liberal view is that the formal rules cannot cover every aspect of work life, as there is always a non-formal side to work. One way to achieve the liberal conception is by law. In this case, companies have little scoop for configuration. Title VII of the Civil Rights Act of 1964 protects employees and job applicants in the US from discrimination by employers. In Europe, the Treaties of Rome 1957 establish the right to equal pay for women and men. Recently, the European Parliament and the Council passed EU directives concerning equal opportunities at work. Directive 2000/78/EC establishes a framework for equal treatment in employment and occupation. Directive

2006/54/EC deals with the implementation of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation. For example, in Germany, equal treatment and anti-discrimination directives were implemented in the general equal treatment bill, also called the anti-discrimination law. It ensures equal treatment for job applicants and employers independent of their gender, race or ethnic origin, religion or belief, age, disability, or sexual orientation. Also, in other countries, there are anti-discrimination acts, which partly deal with anti-discrimination issues at worksites. Radical changes In contrast to the liberal approach, radical change seeks to intervene directly in the workplace practices in order to achieve balanced workforces (in regard to all diversity dimensions), as well as a fair distribution of rewards among employees. The radical approach is thus more outcome focused than focused on the forming the rules of the game.[15] One major tool of radical change is quotas which are set by companies or national institutions with the aim to regulate diversity of workforce and equal opportunities. Quota systems are critically discussed concerning their effectiveness. Arguments for and against gender quota systems in companies or public institutions are listed below: Cons

Quotas are against the principle of equal opportunity for all, since women are given preference over men. Quotas imply that employees are elected because of their gender, not because of their qualifications, and that more qualified candidates are pushed aside. Many women do not want to get employed just because they are women. Introducing quotas creates significant conflicts within organizations. Diversity initiatives in the university environment may have marginalized the potential gains in the business environment.

Introducing quotas may cause conflicts.


Quotas for women do not discriminate, but compensate for actual barriers that prevent women from their fair share of the managerial positions. Quotas imply that there are several women together in a work related meeting or committee, thus minimizing the stress often experienced by the token women. Women have the right to equal representation in companies and management positions. Women's experiences are needed in corporate life. Women are just as qualified as men, but women's qualifications are downgraded and minimized in a male-dominated economic system.

Swedens quota system for parliamentary positions is a positive case for radical change through quota setting.[18] A quota system was introduced at the Swedish parliament with the aim of ensuring that women constitute at least a critical minority of 30 or 40 percent of all parliament seats. Since the introduction of the system, women representation in parliament has risen dramatically even above the defined quota. Today, 47.3 percent of parliamentary representatives are women, a number which stands out compared to the global average of 19%. Transformational change Transformational change covers an equal opportunities agenda of shorter and greater length.[19] Therefore, it can be seen as a combination of the liberal and the radical approach. On short-term it implements new measures to minimize bias in procedures such as recruitment or promotion. The long-term is seen as a project of transformation for organizations. This approach acknowledges the existence of power systems and tackles them. In short-term the power concept is handled

with the above mentioned measures. In the long-term, the reproduction of the existing power is combated through implementing the equality values in the organization. An illustrative case for transformational change is ageing management. Youngsters are seen as more innovative and more flexible. Furthermore, older employees are associated with higher costs, e.g. through early retirement or higher rates of absenteeism. Therefore companies prefer young to elderly people. In short-term, you can set up legislation to prevent discrimination regarding age (e.g. Age Discrimination in Employment Act). In long-term, negative stereotypes should be abolished and the value of elderly people highlighted. In fact the working ability can increase with the age and a mixture of ages in workforce can increase a firms profitability. The latter is based on the idea that workers of different ages are complementary to some degree. Through the implementation of an ageing management in an organization, the perception of elderly employees and their working abilities can be improved. There are mainly two factors that should be considered to alter the working ability of elderly job holders: optimization of working conditions and the advancement of the employees on three levels (health, life-long learning, and adequate leadership. Implementation Diversity issues change over time, depending on local historical and dynamic conditions. Overt "diversity programs" are usually limited to large employers, government agencies, and businesses facing rapid demographic changes in their local labor pool, and they help people work and understand each other. The implementation of diversity is often limited to the Human resources department when there is also a good economic case for UK companies to use it as a tool to reach new market shares.