MGR - Module 2: Diverse Workforce Matters and Diversity Management

Arnold Donald, CEO of Carnival Corporation

"... a highly talented team, with a process to work together, that is diverse will out-innovate a homogeneous team 99.9% of the time. Is it the right social justice thing to do? Of course, it is. But it is also actually the right thing to do in terms of just flat-out generating return for shareholders and keeping a business sustainably successful."

Three types of arguments in favor of diversity management, each with its own slogan:

"Diversity is a reality that is here to stay." "Diversity is the right thing to do." "Diversity makes good business sense."

Four criticisms about Diversity Management program implementation

- Lack of knowledge of diversity management process and effects. Diversity management results in surface-level changes and does not alter more deeply rotted discriminatory and exclusionary structure and activities in the organizations -Diversity management may not be sustainable -Specific RIO attributable by these programs is difficult to measure

The Multicultural Organization (MO) paradigm

- Monolithic Organization: is an organization that is demographically and culturally homogenous -Plural Organization: has a heterogenous workforce -Multicultural Organization: characterized by culture that fosters and values cultural difference

The Human Resource (HR) paradigm

-Diversity Enlargement -Diversity Sensitivity -Cultural Audit -Strategy for Achieving Organizational Outcomes

Though these key components of diversity management represent strength in the current business context, they can potentially bring the demise of the concept in the long run.

-First, the voluntary nature of diversity management means that it may not survive during difficult economic times. -Second, the broad definitions of diversity mean that the most vulnerable groups in society (e.g., racial minority groups, people with disabilities, and women) may not receive the protection they deserve because resources will be spread across many groups. -Finally, the emphasis on the practical benefits suggests that once diversity management is no longer perceived as beneficial to companies, it will disappear given a lack of moral or ethical commitment to diversity.

Two prominent paradigms have offered for diversity management:

-the Human Resouce (HR) paradigm -the Multicultural Organization(MO) paradigm

Diversity management has three key components:

-It is voluntary. Diversity management is initiated by the companies themselves. -It uses a broad definition of diversity. Companies that implement diversity management use broad and open definitions of diversity, often to make diversity programs inclusive and reduce potential objection from members of the majority group. -It strives to provide tangible benefits to the company. Diversity management is seen as a business strategy aimed at tapping into the full potential of all employees in the company in order to give the company a competitive advantage.

In order for businesses to thrive they must:

-Promote a team conscience that is inclusive and reflective of the markets they serve -Foster diverse thought and an inclusive work environment that enables each coworker to excel -Provide customers with the best talent to understand and meet their unique needs -Leverage a diverse supplier network that adds value and innovation to the business

House mode

acts as a useful tool for organizations who want to implement GDM. This model, depicted in the shape of a house, whereby each layer represents considerations that build upon each other as the organization design its GDM strategy.

Process model

describes GDM as a sequence of inputs, activities, and outputs over time. Key inputs for successful GDM include leadership support and features of the organizational culture.

The Human Resource (HR) Paradigm in Diversity Management

Conventional HR practices tend to produce and perpetuate homogeneity in the workforce as a result of the A-S-A (attraction-selection-attrition) cycle. Typically, individuals are attracted to organizations that appear to have members with values similar to their own. In turn, organizations select new members that are similar to their existing members because their hiring continues to make everyone feel comfortable. As a result, employees who do not fit in well with the dominant organization cultural eventually leave or are fired—creating a selective attrition process that supports and maintains a workforce that is homogeneous. In the long run, this trend is unhealthy for organizations because it limits their talent pool, their long-term growth and renewal, and their ability to adapt to environmental changes and tap into new markets. In recent decades, human resource managers have recognized the need to adopt effective diversity management practices in order to overcome barriers for diversity and reap the rewards of a diverse workforce.

Advantages of diversity management

Diversity management can advance an organization's competitive advantage in areas such as recruitment, retention, marketing, problem-solving, resource acquisition, and financial performance.

Differences? Similarities? (Between cross-national diversity management and intra-national diversity management)

Each presents different challenges and dilemmas and each requires a different set of policies and programs. The central difference is rooted in the legislation and cultural norms within which diversity management is practiced within each type

Revenue Loss

Paula Deen lost an estimated 12.5 million in earnings over the N-word controversy. The celebrity chef lost 7.5 millions in endorsements and another 5 million from her cancelled television and restaurant deals in the wake of her admission that she used the N-word. She ruined relationships with: • Food Network • Sears and Kmart • Wal-Mart • Walgreens •Target • QVC • J.C Penney • Home Depot • Caesars Entertainment and others

The consumer buying power has long been dominated by White males,

Per the 2010 Multicultural Economy Report, as of 2010, the total buying power of consumers in the United States was estimated to be $11.1 trillion. For diverse populations, this equated to: -Blacks occupying 8.6% of the nation's buying power -Latinos occupying 9.0% of the nation's buying power -Asian Americans occupying 4.9% of the nation's buying power -The LGBT community occupying approximately 7.5 % of the nation's buying power

In the US

The term Diversity Management originated in North America but has slowly taken hold in other regions and countries in the world. In the United States, the term diversity management originated and gradually progressed over the years from Title VII of the 1964 Civil Rights Act, culminating in diversity management policies and programs developed in the 1990s and the 2000s.

Six Models of Global Diversity Management (GMD)

There are six models of global diversity management (GDM) based on 10 years of field studies. The model types include: -Strategic Model -Process Model -Contextual Model -Intervention Model -House Model -Communication Model

The challenge of diversity management is to break the harmful cycle that equates cultural difference with social/economic disadvantages.

Therefore, while the emphasis on the business advantage of diversity management is probably a good motivator for companies to enact diversity programs, it does not mean that moral and ethical missions should be neglected or overlooked. To overcome these potential limitations, diversity management has to focus on both enhancing productivity and fostering social justice.

our domestic work place is changing

Women are beginning to hold more positions of power, minorities are graduating with college degrees at a growing rate, and while the majority of STEM positions are occupied by White males, that number is slowly declining

Communication models

address the issue of how an organization talks about diversity and inclusion compared to actual action, commitment, and organizational change. Four scenarios illustrate how communication models might conceptualize GDM: (10 "walk the talk"; (2) "empty rhetoric"; (3) "just do it"; and (4) "low priority."

Diversity management policies and programs

are designed to create a welcoming organizational environment to those groups that, in the past and through the present, have not had access to employment in general and to more lucrative jobs in particular.

equal rights legislation and affirmative/positive action policies

are prerequisites for the development of diversity management because they create the social, legal, and organizational environment on which diversity management initiatives can be based. In some countries, the development was sequential and took decades, whereas in others, the development was rapid.

In the European Union

as a whole, developed a strong commitment to equality and positive action policies. Different countries within the union, however, each implemented varying levels of protections and initiatives, and some have adopted affirmative or positive action programs while others have not

A-S-A

attraction-selection-attrition cycle: individuals are attracted to organizations that appear to have members with values similar to their own

"Diversity is a reality that is here to stay"

businesses have to adapt to the new realities of an increasingly diverse workforce

The latter two attempt to achieve equality of opportunities

by focusing on specific groups in order to right past wrongs.

"Diversity makes good business sense"

diversity management can provide businesses with a competitive advantage. Here the logic is that companies have a lot to gain, including cost reduction due to lower absenteeism and turnover; advantage in the competition for talent in the workforce; reducing the reasons for discrimination lawsuits; marketing more effectively to diverse customer pools; increasing creativity and innovations through diverse work teams; competing for government contracts; and improving corporate image and generating public good will. (See Table 10.2

The Plural Organization

has a heterogeneous workforce relative to the monolithic organization, and typically makes efforts to conform to laws and public policies that demand and expect workplace equality. It will take active steps to prevent discrimination in the workplace suchas audits of compensation systems that assure equality, and manager training on equal opportunity issues and sexual harassment. Although there is greater structural and formal integration in the plural organization, institutional bias is rather prevalent and intergroup conflict is significant.

The Monolithic Organization

is an organization that is demographically and culturally homogeneous. This homogenous culture is perpetuated in the workforce's hiring and promotion practices. There is an expectation that members of diverse groups will assimilate into the culture of the majority with minimal structural and formal integration. Intergroup conflict is expected to be minimal since the composition of the workforce is basically homogeneous and is composed of one dominant cultural group.

The Multicultural Organization

is more of an ideal than an actual type since very rarely do companies achieve this level of integration. The multicultural organization is characterized by a culture that fosters and values cultural differences, truly and equally incorporates all members of the organization via pluralism as an acculturation process, rather than as an end resulting in assimilation. The Multicultural Organization has full integration both structurally and informally, is free of bias and favoritism towards one group as compared to others, and has only minimal intergroup conflict thanks to the above characteristics that result from effective management of diversity.

diversity management

is proactive and aimed at promoting a diverse and heterogeneous workforce

Strategic model

maps out three strategies that organizations can use when implementing GDM policies and practices.

affirmative action programs

mean that companies need to take positive steps to ensure equal opportunities

Equal Employment Opportunity (EEO) legislation

means that it is against the law to discriminate

Diversity Management focuses

on managing and handling the diverse workforce to give the company a competitive advantage.

intra-national diversity management

refers to managing a diverse workforce of citizens or immigrants within a single national organizational context.

cross-national diversity management

refers to managing a workforce composed of citizens and immigrants in different countries.

Diversity Management

refers to the voluntary organizational actions that are designed to create greater inclusions of employees from various backgrounds into the formal and informal organizational structures through deliberate policies and programs

In Brazil

similar to South Africa, both legislation and government measures to combat employment discrimination began recently.

In Australia

the same progression took place. Diversity management has been seen as the natural next step for effective management in the future competitive business environment.

Intervention models

these models describe three categories of GDM interventions. Informational interventions revolve around staff training and education, and might include diversity training or a formal company diversity statement. Structural interventions alter structures and processes within the organization. Finally, cultural interventions, dig deeper and "challenge the implicit cultural assumption of the organization with a view to making the organization more welcoming of difference and more inclusive."

Cultural Audit

this approach aims at identifying the obstacles that limit the progress of employees from diverse backgrounds, and that block collaboration among groups in the organization. The recommendations for change are based on the notion that the source of the problem is the dominant cultural group, and that the change must come from within that group.

Diversity Sensitivity

this approach attempts to overcome difficulties posed by bringing together those of different backgrounds through diversity training that is aimed at sensitizing employees to stereotyping and discrimination, while also promoting communication collaboration. The assumption embedded in this approach is that increased sensitivity to differences will improve performance.

Strategy for Achieving Organizational Outcomes

this approach focuses on diversity management as a mechanism to achieve desired organizational outcomes by integrating diversity management with Human Resource policies. Using this approach, managers have to design diversity goals and policies that can be linked to the organization's overall strategic choices

Diversity Enlargement

this approach focuses on increasing the representation of individuals of different ethnic and cultural backgrounds in the organization. The assumption is that the new employees will conform to existing practices and that no additional intervention is needed.

"Diversity management is the right thing to do"

this is the moral and ethical reasoning for diversity management. At the heart of this argument is the notion of equal opportunities regardless of individual characteristics such as gender, race, and sexual orientation. This includes providing all potential employees with equal access to jobs in the organization, and providing current employees with comparable pay for jobs of comparable worth as well as access to better jobs within the organization

Not fostering diversity and inclusion can have severe consequences

to business relationships and, thus, revenue.

Contextual model

uses a systems approach and acknowledges multiple layers of influence that can affect GDM activities. The model highlights individual, organizational, sectoral, national, and international levels of influence.

Australian wild animal analogy

uses giraffes and elephants to describe the difference between equal opportunity legislation and diversity management.

An organization's journey to become both diverse and inclusive begins with a critical but simple inquiry:

what actions is my organization taking to foster an inclusive work culture where uniqueness of beliefs, backgrounds, talents, capabilities, and ways of living are welcomed and leveraged for learning and informing better business decisions?

In South Africa

where a nonracial, democratic constitution came into effect in 1996, equal rights legislation was implemented at just about the same time as its affirmative action policies and many of its companies continue to try to design and implement diversity management programs