How Can Diversity Work for Organizations - Essay Example

? Topic: Lecturer: Presentation: Introduction In today’s global environment organizations need to keep up withthe changing trends and to embrace diversity in the workplace as a source of competitive advantage and organizational effectiveness. Diversity manifests in different ways; it may be in terms of products or portfolios or workforce or it may mean many other things. However, we shall discuss diversity in the workplace. This is a term that has gained importance and attention over the years in all parts of the world but what do we mean by diversity? In simple terms, diversity can be viewed as difference. In the workplace, diversity is defined by Bell (2007) as attracting, recruiting and retaining persons from a wide talent base regardless of their religious affiliation, race, class, gender, national or ethnic origin, sexual orientation, age, disability, marital status and any other groupings. This ensures the organizations recruits individuals with a wide range of skills and from different economic, social and cultural backgrounds. There are often group conflicts in organizations that hinder a good working relationship and attainment of company objectives yet diversity is highly valued in organizations. The big question is, “how can diversity work for organizations?” To answer this question, this paper will compare and contrast various views from different authors regarding diversity in the workplace. The trends that have necessitated diversity will also be discussed. It will also evaluate the diversity in practice in two organizations: HSBC and Wells Fargo. It will discuss the importance of diversity in the two companies. Some companies develop a diverse workforce to comply with laws but for other organizations, diversity is much more than just a policy as it is the key to success. Besides compliance, companies that have an inclusive workplace environment enjoy a lot of benefits which will be discussed later. The challenges facing implementation are also worth noting. Global Trends Various global demographic, economic and legislative trends have over the years necessitated the development of diversity in workplaces. According to Mor Barak (2011) there has been a workforce decline in various countries thus the need to engage immigrant workers to fill the employment gap. Italy workforce for example, is expected to decline from 60 million to 56 million by 2050 while that of Germany is expected to decline from 82 million to 69 million (P. 4). These are countries which have been known not to entertain immigrant workers but the demographic trend forces them to. On the other hand, developing countries are faced with the problem of the youth who comprise more than half of the population (Kirton & Green, 2004). Since these economies are growing at a slow pace they cannot accommodate all those youths hence they look for jobs outside borders. Another trend is the growing number of women in the workforce and individualized migration to look for better opportunities without relying on their husbands or family (Bibard, 2011). This has changed the workforce dynamics to a great extent prompting the need to embrace diversity. Various legislations have also been emerging that press the companies to become diverse workplaces. These range from the universal declaration of human rights to the legislations on equal employment opportunity. Inclusive workplace programs have therefore, been instituted in many organizations to tap the benefits of a diverse workforce (Findler, Wind & Mor Barak, 2007). Companies which do not know how to manage diversity in the workplace risk losing business due to high turnover, absenteeism, and low earnings. Managing diversity is not a simple task. On one hand companies need to appreciate the importance of diversity for organization success and on the other hand, diversity brings about group conflicts which can lead to disharmony and even violence in the workplace (Powell, 2004). Service companies rely so much on diverse customers thus needs to embrace diversity. Wells Fargo is one of the leading financial services company providing banking, insurance, investments, and mortgage. It has more than 9,000 stores and more than 12, 000 ATMs across North America and internationally (Wells Fargo, 2012). HSBC is also a financial services company operating across a wide range of cultures (HSBC, 2012). Both companies have been actively developing a more diverse workforce and have gained a lot from it. At HSBC diversity is not just a policy but a key driver to success and is used to achieve managing for growth goals. It is an inclusive workplace that values diversity by employing best qualified candidates, nurture individual growth regardless of age, color, race or any other groupings, and emphasizes on Equal Employment Opportunity (EEO) laws in hiring, promotions, transfers, and training (HSBC, 2012). It also believes in supplier diversity. As a result it has gained a lot of reputation and rewards such as among the top 50 companies for diversity in 2008. Wells Fargo considers diversity as an integral part of its success. Its diversity is embedded in the company values and culture. Diversity and inclusion are promoted in every aspect of the business through the diverse segment outreach, diversity councils, supplier diversity and team member networks (Wells Fargo, 2012). As result, both companies have gained a lot of benefits. Wells Fargo has been able to earn more business from women, people with disabilities and other communities and also providing outstanding service. Both companies have built up their reputation as best diversity companies and best place to work besides being able to respond quickly and effectively to customer needs at home and across the globe. Service companies need to engage with all groups to get more customers and increase earnings. Embracing diversity also enhances creativity and innovation. People of diverse backgrounds have different views and ideas which they can share with others (Mor Barak, 2011). However, D’Almeida (2007) argues that having a multiplicicty of individuals and their differences is not enough. For creativity and innovation to occur, an inclusive work environment must be present. These individuals need to feel that their work and opinions are valued and appreciated and also be given room to experiment their ideas without fear of reprisal. Bibard (2011) agrees with this view and further emphasizes on the need to have good leadership and effective communication for this to be successful. The challenge he says is integrating groups of diverse backgrounds into workforce and believes the responsibility of integration should be shared between management and those who want to be integrated (P. 7). If a person does not feel like a member of a group, then he/she cannot contribute to its effectiveness. Wells Fargo believes in integration with locals in every area of its operations by utilizing the principle “local first, then national” (Wells Fargo, 2012). As such, diverse groups do not feel excluded from the workplace thus increased motivation, commitment and productivity. Diversity enables companies to understand the needs of customers and satisfy them effectively (Bell, 2007). A company like HSBC or Wells Fargo operates globally in different geographical regions. Each country has its own culture and the surrounding communities also have different values and beliefs. It would therefore, be difficult for any company especially a service company to operate in such an area if it does not embrace diversity. Its customers have different needs depending on the region and the company needs to appreciate and understand these differences to be able to serve the market better (Findler et al. 2007; Kirton & Green, 2004). The banks need to understand who their customers so as to serve them better. However, some communities are opposed to companies employing people from outside the community thus hindering diversity efforts in the workplace. Governments have put various legislations in place to protect the marginalized groups from discrimination at the workplace, for instance, the EEO. If embracing diversity and inclusion is very beneficial for companies, why then do laws have to be enforced to that effect? Mor Barak (2011 p. 6) argues that social exchange and reward allocation is determined by culture. Some cultures do value women and as such women are relegated to the role of care takers but not important roles in organizations. They are therefore, denied access to information networks which are essential for progressing in their career and also excluded from powerful positions. Even though a company would like to be inclusive, its efforts are hindered by culture of the surrounding communities. Bibard (2011) on the other hand disagrees with this view. He believes that it is the organizational culture which hinders integration of diversity groups into the organization. Since diversity “opposes the notion of repeat job routines and is a challenge to organization performance norms as well as advocating for changes, it is seen as a threat by stakeholders” (p. 10). They would like to keep the status quo and not change practices that have resulted in high performance in the past. They thus prefer routinized tasks and practices. Some organizations have a diversity policy to comply with the law rather than to put into practice. Another controversy is the issue of human rights and diversity. Human beings are equal thus have equal rights which are inalienable such as right to liberty and equality. They are also granted rights and freedoms by universal human rights and the constitution. There should be no discrimination based on color, race, ethinicity, religion, sexual orientation, transgender. However, as Findler et al (2007) puts it there is a tension between multiculturalism and human rights. For example, the issue of wearing hijab by Muslim women. While women have the freedom of religion hence can wear hijabs, for equality purposes women are banned from wearing them at the workplace. These two approaches are right but conflicting to the companies trying to manage diversity. Managing diversity is therefore, a heavy task but done properly it has a lot of benefits. Having an inclusive workplace is key to success. Conclusion Managing diversity is identifying and appreciating the differences between people and utilizing such differences for organizational success. A diverse and inclusive workplace such as HSBC and Wells Fargo is able to tap and retain the best talent from a wide talent base. It is also able to enhance creativity and innovation leading to productivity and improved earnings. It also leads to motivation and morale hence job satisfaction, reduction in turnover and absenteeism and improved performance. However, it requires collaboration from all those involved, good leadership and effective communication. There are some controversial issues regarding diversity in creating harmony and at the same time inducing conflict but results show that embracing diversity is the key to success. References Bell, M (2007) Diversity in Organizations. Mason, OH: Thomson South-Western. Bibard, L (2011) Integrating Diversity: Identities Replayed, In S. Groschl. Diversity in the Workplace: Multi-Discipline and International Perspectives. England: Gower D’Almeida, C.M (2007) The Effects of Cultural Diversity in the Workplace. Ann Arbor, MI: ProQuest Information and Learning Company. Findler, L., Wind, L and Mor Barak, M (2007) The Challenge of Workforce Management in Global Society: Modeling the Relationship between Diversity, Organization Culture, Employee Well-Being, Job Satisfaction and Organizational Commitment. Administration in Social Work, 31(3), 63-94. HSBC. 2012. www.hsbcusa.com/diversity. Kirton, G and Green, A.M (2004) The Dynamics of Managing Diversity. Oxford: Butterworth-Heinemann Mor Barak, M.C (2011) Managing Diversity: Towards a Globally Inclusive Workplace. 2nd ed. Thousand Oaks, CA: Sage. Powell, G (2004) Managing a Diverse Workforce. Thousand Oaks, CA: Sage Wells Fargo. 2012. www.wellsfargo.com Read More