HR-Faculty of Business Environment and Society - Essay Example

Diversity Leadership in IHRM (Paper Introduction The modern age is the age of globalization. The wave of globalization has marked its imprint on all spheres of today’s life- political, social, economic, legal and corporate. Today’s business world is beyond doubt a global village. This term refers to the fact that businesses in the current times are being operated all around the world. The countries and businesses all across the globe are competing fiercely in order to increase their share in the world market. Today, the business world has dissolved geographical boundaries and goes beyond national and regional considerations to evolve into a global phenomenon. The multinational corporations operate from their branches and headquarters spread all over the world to expand and enlarge their reach worldwide. And all these initiatives by the business firms have been supported and encouraged by the gifts of modern technology. This global presence of companies is essentially accompanied by the global presence of their human resource or rather the presence of a workforce that comprises people from different parts of the world. The functions of human resource management become more varied and complex when employees are located around the world. Apart from the factors such as technology, economic systems, legal frameworks and industrial relations, the cultural factors also assume great importance in the managing of a global workforce. And the most prominent manifestation of the cultural challenge is the diversity of modern workforce. The US workforce, for instance, has been increasing day by day in terms of its diversity. More and more women are joining the workforce. The majority of the existing workforce is gradually nearing old age. The number of immigrants has increased manifold over the past few years. People from different racial and religious background have come to form a part of the ever-increasing workforce of the USA, thus adding to its ethnic diversity. Thus the human resource in all transnational business endeavors has become increasingly diverse in terms of age, gender, ethnicity, culture, political views, physical abilities and psychological orientation. This paper aims to explore the different styles of managing and leading such a diverse workforce in the light of international human resource management. 2. Workforce diversity- a pool of opportunities The term diversity used with respect to a workforce simply implies that the working population at the workplace is a heterogeneous mix of people in terms of age, gender, race, religion, culture, education, physical abilities and psychological make-up. The term diversity refers to the similarities and differences between the employees in terms of these parameters. Not only this, the difference may lie even in the ways of perception that is, how the people perceive themselves and the people and situations around them. In today’s business world, diversity has become all the more important because of the recent realisation of firms that to effectively operate a business in today’s multicultural world, the amalgamation of different perspectives on every issue is highly essential. Moreover, there is also the legal obligation of complying with the anti-discrimination laws so as to stay clean in the books of law. Companies that do not conform to the equal opportunity employment policy are penalised by the government. The presence of a diverse workforce has a wide range of benefits and opportunities for any business firm. Today’s global economy is a service-driven economy and in such a scenario the interactions between people is the key to expanding the customer base. Moreover, the existence of similar states of mind and opinions between people helps a great deal to facilitate this process in a market where the customer base is getting more and more diverse with the passage time. The series of mergers and acquisitions in the business world has led to vital changes in the modern labour market. This has helped in globalisation of business by enabling business to be carried out with people across the world. A diverse workforce can act as a reservoir of resource by providing a diverse body of talent and a pool of fresh ideas, views and perspectives on work which is essential to bring about long-term success of any business. It also helps the firm to build up its overall capacity by virtue of the gamut of aptitude, experience, information, acumen and imagination of its diverse workforce. With a view to today’s increasingly international business landscape, engaging the services of people belonging to diverse national, ethnic and cultural backgrounds helps in understanding and attending to the needs of diverse markets. Lastly, employing diversity practices enables a company to fulfil its social responsibility as the section of society that reaps the most benefits by this act is the disadvantaged and minority communities. Thus, if judiciously managed, the inherent diversities in the workforce can be utilised as a source of innovation, high performance and competitive advantage in the business world. This will not only fortify the cultural values within the organisation, but also enhance the public image and goodwill of the organisation. 3. Challenges associated with Workforce Diversity In the current wave of ever-rising population, effectively managing workforce diversity is a major challenge. As rightly stated by Nancy R. Lockwood, “with the changing marketplace and an increasingly diverse labour pool, HR leaders are dealing with a myriad of factors regarding diversity management. Broadly speaking, workplace diversity challenges can be considered within three interrelated categories: attracting and retaining talent, greater diversity among employees and training.” (Lockwood, 2005, p. 6) The volume of population has surpassed the number of jobs available. Sourcing out and recruiting able and qualified employees in such a scenario is a tough task. Observing fairness in the treatment of the employees is another challenge. The concept of fairness has now gone beyond the mere ‘equal opportunity for all’ and evolved out to embrace the new concept of diversity at workplace. Thirdly, obtaining synergy in the team efforts of a diverse workforce is not an easy thing to achieve. While working in a group, the employees can enter into conflicts, owing to their inherent differences. But this conflict can be either positive or negative. While positive conflict would foster healthy competition, innovative strategies and creative thinking, negative conflict can hamper group work by affecting communication channels and disrupting the group activities. So it is highly imperative for the group leader to ensure that the diversity of inputs can be maximised while minimising the occurrence of negative conflict. The challenge today is to make organizations more accommodating to diverse groups of people. Moreover, workforce diversity affects HRM by creating the need to attract and retain a diversified work force that is reflective of the diversity in the general population. It makes it essential for the organizations to adopt a stance of increased sensitivity to inter and intra-group differences. For the HR managers, it is really difficult task to deal with employees with different set of needs, expectations, interests and values. In such a case, understanding the cultural environment is of utmost importance for both the employees and their managers. The culture of different countries varies a great deal in terms of the basic value systems of their citizens and the forms in which those values are expressed in the social, political and occupational life of the people. Culture can be defined as “a characteristic way of behaving and believing that a group of people in a country or region (or firm) have evolved over time and share” (Briscoe and Schuler, 2012, p. 116) Workforce diversity carries certain cultural implications for HRM. Since none of the HRM theories and practices is universally applicable, the HR managers must understand varying cultural values. For instance, Intel helps its new employees to understand the US culture by handing over to them its booklet titled “Things You Need to Know about Working in the U.S.A”. The booklet contains topics that include sexual harassment, recognition of gay rights, and Intel’s expectations about behavior. (Dessler, 2011, p. 633) 4. The Concept of Diversity Management HRM functions become more complex and painstaking when the workforce is distributed all around the world. In the event of globalized working, the managers need to attend to the various needs and requirements of the employees in terms of relocation, orientation and foreign language training. In the event of relocation of employees, the organization has to consider not only the needs of employees but also of their families who accompany them overseas. It should facilitate the working of the employees in cultures that differ on parameters such as individualism, assertiveness, status differentiation, risk-orientation and societal uncertainty. HRM must ensure that the multicultural and multilingual groups can function together to yield effective results. It must also ensure that the communication flows smoothly between employees in the appropriate language and is easily comprehended by the multilingual workforce. An ideal diversity management strategy must include articulation of a defined diversity mission with preset objectives, followed by a globalized recruitment policy to employ the most diverse possible pool of competent candidates. This should be complemented by a mentor support system for the minorities and the disadvantaged sections of the workforce to help them come at par with their fellow workers. All this should be continuously monitored and supervised by the diversity councils to track the company’s progress towards the set goals. A very vital component of diversity management is diversity training which is meant to be imparted to managers as well as employees. The managers must be trained in how to recruit and select diverse employee and then train and develop them for integration into the organization. The employees much be trained to understand and accept the interpersonal differences that exist between them, the impact of these differences on their work environment and the methods of raising productivity by properly channelizing these differences. 5. Cross-cultural Leadership Styles In order to understand the concept of cross cultural leadership, it is essential to grasp the meanings and implications of two terms- leadership and culture. Both these terms are very frequently used in the sphere of HRM and both assume different meanings in different contexts. The term leadership has no single or universal definition. (Bass, 1997) But over the years, the evolution of the concept has outlined two major aspects of leadership. One is that a leader influences the behaviors of others in the team. And second, this influence on behavior is deliberate and aimed at achieving the preset shared goals of the team. By some, a leader is defined as “that group member whose influence on group attitudes, performance, or decision making greatly exceeds that of the average member of the group” (English, 2008, p. 16). According to an international research project of the Global Leadership and Organizational Behavior Effectiveness (GLOBE), effective organizational leadership is defined as “the ability of an individual to influence, motivate, and enable others to contribute toward the effectiveness and success of the organizations of which they are members” (House et al, 1999; Shriberg, 2011, p. 43). However the concept of global organizational leadership is a relatively new one and it is deemed by experts that “leadership involves people in business settings whose job or role is to influence the thoughts and actions of others to achieve some finite set of business goals…usually displayed in large, multicultural contexts; that is, not just from one nations perspective” (Goethals, 2004, p. 301) Just as leadership has no limiting definition, the concept of culture is also difficult to define in explicit terms. On a broad and generalized level, culture refers to the set of characteristics and features that defines a group and separates it from other groups. The famous social psychologist Florence Kluckholn has defined culture as “a patterned way of thinking, feeling, and reacting, acquired and transmitted mainly by symbols, and constituting the distinctive achievements of human groups, including their embodiments in artifacts.” (Goethals, 2004, p. 301) The expert organizational scholar Geert Hofstede has described culture as “the collective programming of the mind that distinguishes one human group from another” (Hofstede, 1984, p. 21). There is another definition of culture offered by anthropologist Clifford Geertz, who states that culture is a “historically transmitted pattern of meanings embodied in symbols, a system of inherited conceptions expressed in symbolic forms by means of which men communicate, perpetuate, and develop their knowledge about and attitudes toward life.” (Storr, 2013, p. 3) The common element that emerges from all these definitions is the fact that culture is a collection of shared beliefs, values and knowledge. And cross-culture leadership is the art of guiding and influencing the behavior of people who come from diverse cultural backgrounds, with an aim to fulfill the common organizational objectives. (Stogdill, 1974) 6. Application of Cross-cultural Human Relations to Diversity Management practice In managing diversity of workforce, the understanding of cross-cultural human relations is of utmost importance. In this respect, Geert Hofstede has put forward a very useful theory of cultural dimensions. Hofstede’s theory upholds the five cultural dimensions of Power Distance, Uncertainty Avoidance, Individualism versus Collectivism, Masculinity versus Femininity and Long term versus short term orientation. Power distance reveals the distribution of power within an organisation. In a high power distance organisation, the juniors or subordinates cannot make interrogations on the decision of their senior or supervisor. A flat organisation, on the other hand, signifies a low power distance. Uncertainty avoidance represents the extent to which the members of a given culture are affected or threatened by unknown or uncertain situations. An instance of this can be seen in the case of certain companies which maintain strict adherence to rules and norms in order to minimize the uncertainties in the performance and behavior of their employees. Collectivism in an organisation refers to a situation wherein the employees are dependent on one another and on the organisation for the fulfilment of their shared goals. Individualism is characterized by the freedom or liberty to take work decisions independently and being accountable individually for the successes or failures. A workplace that is masculinity dominated gives preference to high income jobs, challenging job responsibilities and explicit recognition for achieved goals. On the other hand, a feminine environment at workplace lays more emphasis on cordial interpersonal relationships and on sharing a good working relationship with the subordinates and the superiors. In an environment that has a long term orientation, framing a good strategy and making proactive decisions is favoured which helps in creating a strong position and image in the competitive market . But business firms that have a short term orientation look for immediate results and hence put enormous pressure on their employees in order to earn more in a relatively short span of time. (Harzing and Ruysseveldt, 2004). 7. Analysis of Cross-cultural Leadership practices in the West and non-Western contemporary work situations Hofstede’s cultural dimensions can be studied in the context of different national cultures. A study of the cultures of different nations can yield enough information about the leadership styles followed in their respective corporate sectors. For the convenience of our study we may classify the countries into two categories, namely the Western and the Non-western nations. The work culture and leadership trends in these nations reflect the inherent societal and cultural values of the nations. (Ardichvili, 2001) An examination of the cultural dimensions in the light of Hofstede’s theory would provide a better understanding of the contemporary cross-cultural leadership practices in the West and non-Western work situations. Kohls (1981) presented the points of difference between the Western and non-Western cultures and the same can be used to assess the impact of leadership approaches on the cross-cultural diversity of international organisations. The Western countries nurture individualism which is reflected as the drive to excel and the achievement or result-oriented attitude in their work culture. The non-western nations, on the other hand, value collectivism and group coherence, a belief that is evident in their work culture in the form of modesty, harmony, respect, collaboration. (Wang, 2005; Gelfand, 1998) While western organisations lay emphasis on egalitarianism and equality, non-western firs have a high hierarchical structure and chain of authority. The traditional non-western culture, in nations like India, China and Africa, the people rely a lot on fate and have an external locus of control. So the employees in those nations prefer to cling on to their past heritage and tend to be more humanistic, loyal and relationship-oriented. But the western countries are future-oriented and open to change. They have a sense of control over their life and career. Thus the workers in the West are more systematic, mechanistic, task-oriented and focus on holistic rather than specific growth. (Kearsley, 1999; Elkin, 2006) Hence, the management practices that are prevalent and have been successful in the west need not necessarily yield similar results in the non-western nations. For instance, the western management models failed to bring about improvements in the African organizations as they “failed to recognize cultural inertia… have not provided the panacea for the overall development of the continent, and neither are the theories suitable for application in our Africa’s peculiar circumstances.” (Inyang, 2008, p. 130) 8. Conclusions and Recommendations For today’s global organizations, the key to success is a combination of workforce diversity, diversity management practices, effective communication networks and cross-cultural leadership. In the modern world of business, multicultural projects are increasingly becoming popular and common. To overcome the potential risks and effectively attain the organisational goals, the HR managers should be trained to be culturally sensitive and accommodating. (Javidan, 2001) Multinational organisations that use effective cross-cultural teams always remain a step ahead owing to their diverse pool of knowledge, experience and innovative thinking. The diversity of talents helps them to enhance their competitive position with respect to the other companies and also enables them to remove and overcome potential communication barriers. But the choice of management style is a challenge in itself. “The choice of strategy is important because of the differences in social and management cultures of different countries. Research has shown that the management culture and practices of a particular country cannot be generalized to other countries. This is especially true in case of developed and emerging countries.” (Nigam, 2011, p. 123) Thus workforce diversity, if tempered with effective and flexible leadership styles, can help a great deal to encourage creativity and induce motivation, and lead to improved organisational performance and image. References: Lockwood, N. (2005) ‘Workplace Diversity: Leveraging the Power of Difference for Competitive Advantage’ in SHRM Research Quarterly. Nigam, R. and Zhan, S. (2011) ‘Management in Emerging vs Developed Countries: A Comparative Study from an Indian Perspective’. In The Journal of Centrum Cathedra. Vol. 4 Issue 1. (pp. 121-133). Inyang, B. (2008) ‘The Challenges of Evolving & Developing Management Indigenous Theories & Practices in Africa’. In The International Journal of Business & Management Vol.3, No 12 (December) Wang, J. et al (2005) ‘Confucian Values and the Implications for International HRD’. In Human Resource Development International. Vol. 8. No.3. pp.311-326. 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Leadership styles and work-related values of managers and employees of manufacturing enterprises in post-communist countries. Human Resource Development Quarterly, 12(4), 363 – 383. Read More