The Importance of Managing Diversity and Organisational Culture - Literature review Example

Diversity and organisational culture Name Institution Course Instructor Date Introduction Diversity has emerged as one of the most common management terminologies and a key principle in framing business activities in the recent past. The terminology has gained prominence both in management theory and practice in the wake of an ever changing global environment. Previously, diversity was seen by organisations as a legal obligation that had little significance in the core capabilities and potentials of an organisation. However, this has changed as most organisations and managers are aware of the fact that diversity is a key ingredient for success. For this reasons, firms are aware that they need to increase the diversity of their workforce in terms of religion, culture, race, ethnicity, gender, age, lifestyle, language, nationality, education etc. organisation have thus strategically positioned themselves in the labour market as destinations for all these varieties of workers. To accommodate and benefit from the diversity of the workforce, firms have adopted an organisational culture that respects and exploits diversity to increase organisational performance. This paper thus borrows from relevant scholarly material to show that workplace diversity is the new frontier in organisation management which when supported by a competent organisational culture enhances organisational performance and competitiveness. Diversity for today’s managers is critical for organisation success To pursue diversity and achieves its benefits, managers must develop diversity policies that are incorporated as a business process on various levels. There are different approaches to diversity. One of them is the assimilation approach. This approach denies differences and seeks to transform employees, regardless of their differences into one homogenous unit (Pless & Maak, 2004). The organisational usually has a predetermined mind-set or picture of what an employee working for that organisations should be. Therefore, this approach ignores differences such as social and cultural backgrounds among others. New employees, expatriates and foreigners have to abandon their unique identities and seek to conform to the standard expectations and bled in. Consequently, this kind of approach is likely to meet resistance from new employees as they seek to retain their identities. Other issues such as generational differences must be managed and cannot be wished away (Rajput et al., 2013). Therefore any management approach that does not acknowledge the differences between individuals is not only unrealistic but also hinders individuals from working at their highest potential (Pless & Maak, 2004). Furthermore, poor diversity management policies create avenues for discrimination. All forms of discrimination are prohibited by law through various statutory declarations and acts in various countries. For instance the U.S. Civil Rights Act of 1964, the Employment Equality directive of the European Union, the United Kingdom’s Sex Discrimination Act of 1975, and Australia’s Racial Discrimination Act of 1975 among others. All these laws bind organisations to diversity. Organisation have thus to define ways to embrace divert not only as a legal requirement but as a diversity. Diversity management procedures provides a framework and policy through which gender, religious, cultural, social and other forms of differences can be observed and respected (O’Leary & Weathington 2006). All these differences are fundamental in enabling innovation and creativity in the workforce (ibid). Diversity is also important in fighting groupthink in that it allows the organisation to have different perspectives and views on a given issue which gives it a competitive edge. Furthermore, diversity is here to stay. Labor mobility and globalization expose organisations to diversity by default. Initially, the handling of employees with different capabilities, age and cultural background presented challenges. In the US for instance, a larger population has been increasingly absorbed into the country’s labour force. Furthermore, some American and Australian firms have expanded their operations to new countries thus have embraced employees from different cultures and background. Towards the end of the 20th century, organisations acknowledged diversity but very few had initiated plans to manage it (Stoner & Russell-Chaplin, 1997). However, more and more organisations in the 21st century recognize the importance of proper management of diversity. Hoobler and colleagues (2007) through a web survey in 2006 noted that organisations in the finance industry were quite serious about diversity. This clearly shows that modern day firms recognize the important roles played by proper management of diversity as opposed to some years back. However, not all of them embrace diversity. Day (2007) claims that there are two main approaches to diversity which give opposing views. He writes that the defensive approach by organisations views cultural and racial differences as hazards while the developmental approach views potentially different values, assumptions, expectations and behaviour which people bring to business as a result of their differing collective experiences.” The latter approach seeks to manage and benefit from these differences. Under the developmental approach, there lies various strategies used to manage diversity. Inclusion is one of the most popular strategies practiced by organisations. This involves organisations hiring from various cultural and ethnic groups, minority groups, disabled persons, healthy mixture of different religions, disabled persons and even employees of different age groups (O’Leary & Weathington 2006). This kind of approach not only helps in enabling the organisation to adapt to the best aspects that these group of people have to offer such as innovation and a different approach to solving problems. Furthermore, it clearly demonstrates to the labour market, employees and the public that the organisation is accommodating. Allen et al (2006) conducted a study involving 391 managers from 130 organisations in south eastern part of the US and observed that employees were positively influence and motivated by an organisation’s perceived diversity. Diversity can harm of benefit organisations depending how it is managed. It is for this reason that Milliken and Martins (1996, p. 403) stated that “diversity appears to be a double-edged sword, increasing the opportunity for creativity as well as the likelihood that group members will be dissatisfied and fail to identify with the group” (cited in O’Leary & Weathington, 2006). One of the issues that is raised by diversity in the workplace is high incidences of conflict and longer time and resources spent and resolving conflict in the workplace. With such highlights on the implication of diversity on organisations, several studies have been carried out by experts. Majority of the studies have addressed the composition of management and management strategies used to influence the outcome of management. Opstrup and Villadsen (2013) note that studies have observed that individual management strategies and styles can influence the outcome of diversity. The authors note such aspects are race, ethnicity, tenure and gender. These findings are similar to one presented by Allen et al. (2006) who observed that the perceived level of diversity in an organisation by employees was first assessed through the composition of managers and senior staff first rather than subordinate staff. This perception tends to imply that the key implementation method for diversity is through hiring. Diversity management is a continuous process that goes beyond just hiring a diverse workforce. Stoner and Russell-Chapin (1997) argue that policies and programs must be oriented towards hiring and attracting a diverse workforce and at the same time develop other policies geared towards achieving long terms of diversity which includes greater innovation and creativity in the workplace. Such additional programs suggested by the authors include motivation programs, and career development programs. For instance, organisations that have Japanese employees must be ready to offer motivational incentives synonymous with Japanese culture. Such concepts are bound to have more impact on Japanese employees that the contemporarily Australian incentives, which are largely financial, would do. Hicks-Clarke and Iles (2000) call for organisations to create a climate, which also comprises of organisational culture, that “employees perceive is created in their organisations by practices, procedures and rewards” (p. 325). Simply put, organisations must be ready and willing to meet the diverse needs of a diverse workforce. One major need that must be addressed is the feeling of acceptance at the workplace. As the paper has indicated in the earlier chapters, diversity is a relatively new issue in management. It is therefore viewed as part and parcel of organisational change. Changes in the workplace are subject to resistance as individuals and systems seek to maintain the status quo. This is because under the organismic system, organisations develop unique ways of doing this, identified as culture that is shared as tacit knowledge which can be best learned through experience. With change through a more diversified workforce, the incumbents are likely to resist the new processes and way of things. For instance, with an increasing number of disabled persons in the workplace, there might be a change in the use of communication methods to accommodate the disabled persons. Some employees might not be willing to change to new communication methods to accommodate change. Diversity management must thus step in to protect diversity and address the needs of the more diversified workforce at all time Protecting diversity means that individuals should celebrate their uniqueness and who they are. Allen et al. (2006) argue that workers should always celebrate who they are in a diverse organisation rather than seeking to assimilate. Five major options in managing diversity are; general philosophy, training, development, accountability and feedback (Hobbler et al., 2007). The general philosophy involves the common approach taken by the organisation such incorporation of the diversity in corporate goals. This is usually supported by three pillars namely direction, strategy and perseverance. The management on the other hand should work towards creating a perception of diversity amongst employees. Hobbler et al. (2007) note that it is possible for organisations to be diversified on paper but the same is not experienced or employees do not perceive it. Because perception of minorities or marginalized communities is subjective, employees may not share the perception of diversity unless adequate diversity management measures are put in place. Training diversity strategy largely comprises on induction training for new employees. They are introduced into organisational rules and behaviours which are reinforced through an employee’s tenure. Managers must however, convey a persistent message on culture by example. It goes without saying that firm that experience high employee turnover can hardly maintain a strong organisational culture. The strategy of using developing is based on developing individual employees through reward system, promotions and recognition. The accountability strategy calls for evaluation on performance of managers and leaders on attaining diversity. The feedback strategy relies on input from employees on their perception of diversity. This can take place through internal surveys or exit interviews (Hobbler et al., 2007). Celebration of individual cultures and backgrounds can create chaos in a diverse organisation. Communication can break down and conflict is likely to arisen leading to poor organisational performance. The common ground in a diverse organisation is achieved through a unique organisation culture. Many experts have indicated that diversity should be perceived as part and parcel of organisational change whole some view diversity as a threat to long established organisational cultures. Irrespective of the view, recent literature and studies on the topic have indicated that culture is the common ground or binding factor in most organisations. It enables organisations to manage the chaos and conflict that can arise out of a diversified organisation. Hicks-Clarke and Iles (2000) also notes that an enabling climate or culture must be maintained to enable diversity to flourish and the benefits such as creativity and innovation to be realized. So, what is the role organisational culture in inclusive organisation environment that? Organisation culture There are a number of definitions that explain the term organisation culture. One of is that it is the software of the mind. One of the simplest definitions is that Organisational culture an organisation’s ways of doing things exhibited in decision making, leadership style, level of consultations, communication methods and style, team work, dress code, employee-employer relations among other areas (Wilson, 2000). Hicks-Clarke and Iles (2000) say that culture is “a common set of shared meanings or understandings about the group/organisation and its problems, goals and practices.” Generally, organisational culture is shaped by the cultural backgrounds of individual employees and national culture at large. Good organisational culture is critical to the success of any given firm. However not all cultures are beneficial to the organisation. Whether a given organisational culture is beneficial to the firm is largely determined by the management’s attitudes and behaviours (Hicks-Clarke and Iles 2000). The management communicates more about organisational culture by setting examples than through organisational activities, rules and regulations, memos and meetings. Therefore, culture plays a distinct role in any given organisation. One of the key functions of organisational culture is shaping behaviour and channelling emotion. With culture defined as a way of doing things, it is clear to see that culture forms a set of written and unwritten rules, performance of rituals, and formation of beliefs and shared assumptions (Willcoxson & Millett, 2000). These shared aspects when repeated over a long time become synonymous with the group of people. For this reason, culture becomes unique though there are common aspects borrowed from other cultures. For instance, in the relating to diversity, some shared assumptions maybe embedded in the mind of the group of people such that it might be hard to replace them. For instance, Australians hold certain assumptions about themselves Asian people in the sense they are viewed to be hardworking people and better in sciences academically. Such assumptions keep changing with time and are influence by industry characteristics. These changes over time capture the generational differences among employees. Rajput et al. (2013) write that different generations have individual opinions and behaviour patterns informed by their generation’s experiences, fear and worries. These experiences formulate their beliefs, perception towards the world, morals and communication behaviour. Such differences are manifested in the workplace where employees of different generational background have to work in teams or in the same organisation. One of the most obvious differences that organisation that embrace diversity must grapple with s communication barrier. Younger employees are likely to use modern communication channels and platforms such as social media, instant messaging, email, and text messages. On the other hand, employees of an earlier generation might be stuck in the old paper communication and telephone. Diversified organisations must thus develop a culture that brings such different generations together by articulating formal communication channels. Organisation’s way of approaching cultural diversity in the workplace manifests the organisations cultural orientation. In this age of globalisation, organisations face increasingly new culture related challenges. While organisational cultures developed by various organisations are based on national cultures, multination organisations face a bigger task of developing an all-encompassing culture due to their cross border operations. However, various components of can be used in creating a defined organisational culture. They include, symbols, rituals, leadership, communication and language and knowledge management and sharing. According to Hofstede (1994), the perceptions towards leaders/leadership, power and authority vary from one nation to another. For firms with a diverse workforce, the senior management has to contend with a workforce operating on different ‘software of the mind’. Organisations with a diverse workforce should strive to use to language understood by all (Kleinbaum, Stuart and Tushman 2008). The communicator must also observe cultural underpinnings which influence the tone and reception of the message. The management should train its employees to embrace diversity in all areas including communication. The method or approach used in enabling employees embrace diversity differs widely and the strategy chosen repeatedly manifests itself as culture. For some large scale organisations such as the UN, employee exchange programmes in different countries. Organisational culture and leadership have a mutual relationship where one affects the other. The leadership style used by the top management can be used to portray an organisations corporate culture. Alvesson (2012) write that an organisation's culture develops largely from its leadership while at the same time, the culture of an organisation can affect the development of its leadership.” In essence, there is constant interplay between leadership and organisational culture. Leaders develop frameworks and structures that foster cultural development while the leaders also reinforce and norms and behaviours within the acceptable boundaries. “Organisational culture, Schein claims, is embedded in leaders and potentially strengthened by them. Good leaders create and shape their organisations’ cultures by embedding their assumptions in missions, goals, structures and work procedures” (Cheney et al. 2011, p. 87). Leadership in an organisation is pivotal in the realization of the organisational goals. There are various leadership connotations applied by managers and leaders in an organisation which are largely based on the history, culture and traditions of the given organisation. They entail autocratic, democratic, transformational, transactional, laissez faire, as well as servant leadership. Leadership style entails all kinds of approach and capability directed at realizing organisational goals and further influences all activities within the organisation. Leadership style is a form of a relationship that an individual applies his rights and methods to influence many people towards a common goal (Wang et al., 2010). Nevertheless, leadership styles may be effective or ineffective depending on the situation. Effective leadership is concerned on satisfying the needs of the employees, customers and stakeholders, which collectively steer performance. Wang et al. believe that, effective leadership is directly related to organisation success. Every organisation has a unique culture of its own though the company may not have tried to change, manipulate or manage it. Instead, it is changed, managed or probably manipulated by the top management. People who build and show the organisation the direction to follow would also change it. Corvette writes that “professional, and personal lives ….regularly… affect the attitudes and behaviour of others” (p.2) thus making all employees party to cultural influence. Strenuously, individuals attempt to change and manipulate the organisations that they are in to fit their own preferences. They do this by changing the market place conditions. This culture changes the process of decision-making, affects management styles and success as determined by everyone. Organisations that chose to ignore cultural issues in the 21st century choose failure. It is apparent from the above discussion that there are various ways in which organisational culture is manifested. Developing a healthy organisational culture sets a firm foundation for a successful organisation. The culture developed must always be responsive to the business environment and stakeholders and most specifically the employees. This is because organisational culture is all about the people and not the processes. The perception to change, leadership and perceptions to leadership, share assumptions and communication styles and strategies sued within an organisation are just some of major ways that organisational culture is manifested References Allen, R., Dawson, G., Wheatley, K & White, C. 2008 ‘Perceived diversity and organisational performance’ Employee Relations Vol. 30 No. 1, pp. 20-33 Alvesson, (2012). Understanding organisational culture. London: Sage. 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