Managing Diversity in International Business Machines Australia - Case Study Example

Case Study (report) IBM Australia Name Course Tutor Date Case Study (report) IBM Australia Introduction The increasing globalization in the world necessitates more interaction amongst individuals from different cultures, backgrounds and beliefs than before (Aghazadeh, 2004, p.527). Individuals no longer work and live in a narrow market; they are currently part of the global economy with the competition increasing from almost all continents. Therefore, organizations require diversity to be creative. Maximizing and taking advantage of organizational diversity has turned out to be a significant issue for top management today (Kulik & Roberson, 2008, p.271). Today, IBM is one of the largest manufactures and seller of computers employing several employees across the world. Waddell, Cummings & Worley (2011) claim that in 2010, the Diversity Inc. ranked International Business Machines as the second largest US Company in terms of employees with up to 435,000 globally. Since it operates worldwide and has several staff, it is simple to understand the existence of workforce diversity in the firm and the complication of the managing diversity in the company. This report therefore analyses the importance of managing diversity in organizations. 1. Why managing diversity is important for organizations With globalization increasing in the world of business today, organizations have found themselves in an awkward situation that they have to scramble for foreign markets to maximize their profits (Fowler, 2006, p.401). Even though, every company hopes to market it right in the foreign target market, not every company becomes successful. Waddell, Cummings & Worley (2011) argue that for the fear of failure in the market, IBM Australia has formed two groups which help the firm to manage its workforce diversity. The two committees include the diversity council and Diversity Contact Officers (Waddell, Cummings & Worley, 2011). Just like any other organization, IBM manages its workforce diversity so that it can get opportunity of successfully competing in the global markets (Waddell, Cummings & Worley, 2011). In this perspective, the company created the two councils to help it compete in the Australian market. According to Waddell, Cummings & Worley (2011) managing diversity also help companies including IBM in attracting bilingual and multicultural skilled workers. When employees from different culture live and work together, they also learn unique and creative ways of doing things. Managing diversity is also important because it ensures employees work in harmony and create a feeling that they are part of the organization (Reynolds, Rahman & Bradetich, 2014, p.427). For IBM, its diversity program management is founded on three basic principles including creating advancement of the women, to create work balance and to integrate people with disability 2. Consequences of organizations not managing diversity issues In the current globalization, employees with different cultural background and orientation gather towards the organization common objectives (Barak, 2005). In return, the company pays or remunerate them for the services. Barak (2005) asserts that, it is not easy to drop unique personality and personal interest to pursue organization’s common goal. The company managers must have cultural intelligence or must have a plan to deal with cultural diversity. If this is not done, cultural prejudices and stereotypes will manifest themselves. Misunderstanding employee’s cultural background actually leads to feeling less inclusions in organizations (Fowler, 2006, p.407). In such a case, some people will feel unfair treatment. Employees feeling unfairly treated are likely to be less motivated and later resign. In a nutshell, companies which do not manage diversity issues experience less motivation and high number of employees’ turnover. Also, companies without proper diversity management find it hard to get into global markets (Aghazadeh, 2004, p.529). This is because every market has its challenges and risks. An organization in which cultural diversity is not managed struggles to adopt to change. 3. Whether the cost of planning and implementing organizational diversity program is justified given the benefits. Planning and adopting a workforce diversity program is strongly justified bearing the fact it helps companies to successfully enter the market (Madera, 2013, p.125). When the company management understands the culture of a foreign market, they are able to manufacture products which satisfy the market needs. Satisfied customers are always ready to pay for product that meets their needs. In that way, the organization will be able to maximize its profits. An organization such as IBM, which has an integrated diversity management program into their organization culture, improves employees’ motivation. Madera (2013, p.127) claims that motivated workforce will definitely improve organizational performance in terms of production and sales. Integrating diversity management programs ensure that organization do not lack qualified and unique talents during their hiring. Bringing unique talent into the organization is the foundation of creativity and annotation in the organization (Waddell, Cummings & Worley, 2011). Today, IBM is the second largest employer both in the US and other countries. It has attracted a large pool of employees all over the world to bring creativity and innovation in its computers. Waddell, Cummings & Worley (2011) contend that, IBM established two groups, diversity council and Diversity Contact Officers to run diversity management program. The program is also justified because it will increase cultural intelligence of not just the IBM managers but also of the employees. Challenges of working with a team from different cultural background When working within a culturally diverse group, without proper cultural intelligence and exposure, I am likely to face poor communication and understanding between us. This is because misunderstanding someone could result to poor interpretation of words or sentences. The delays decision making and even poor end result of a certain project. Working with culturally diverse people could lead to discrimination and stereotypes (Fiske & Lee, 2008, p.15). This is likely to lead to loss of morale towards work. Cultural diversity may have long-reaching impacts on my motivation satisfaction and performance. Another challenge that I will likely to face is the assimilation. In other words, if I am a foreigner working for IBM Australia, I will struggle to be accepted by the dominant group which could be the Australians. To deal with the problem of communication, mostly language, I would go for on-job-training on the language mostly spoken by employees or my team so as to be at par with them. To stop discrimination, I would openly discuss with the rest of the group about my culture. 4. Organizations that have successfully used diversity strategies Workforce diversity and management in a multicultural business environment is more and more becoming a critical issue for many businesses in this globalization era (Fiske & Lee, 2008, p.18). Apart from IBM, several companies also use diversity strategies to create an environment of inclusion in their organizations. Some of the companies which use diversity strategies include HP, Coca-Cola Company, Toyota and Dell (Shin & Park, 2013). HP and Dell introduced several internal diversity strategies. These strategies differ from workshops to online training programs which assist employees comprehend Dell’s diversity agenda (Shin & Park, 2013). The dedication to diversity is rooted to its business strategies in global markets. Similarly, Toyota business is anchored in two essential principles, which are continuous improvement and respect for people. To help achieve this principle, Coca-Cola has an elaborate communication channel where employees are allowed to express their views on how the company is run and what need to change. Shin & Park (2013) postulate that, in 2001, Toyota introduced a “21st Century Diversity Strategy” aimed at increasing dealership possessed by women and ethnic minorities. This strategy can be described as a culture of inclusion. 5. How a cultural awareness training program can be useful to managers Managing diversity is a very important issue for the current managers (Holladay & Quiñones, 2008, p.345). However, unless a manager himself has a good training in diversity, he is likely to fail. Training is important for managers especially at IBM where there are cultural teams. This is because it provides them with cultural intelligence with they can use to manage the emotions of employees. Diversity training helps IBM managers create and uphold a hospitable environment. Training in diversity management help managers to hire potential talents which can provide creativity in the workplace (Holladay & Quiñones, 2008, 349). Training on diversity also helps managers in getting into a new market and understand the culture and the need of the consumer in that market. 6. How cultural awareness training program can be useful to employees Individuals, who are “diverse” from one another with regards to their gender, socio-economic background, and physical ability among others, will probably have some stereotypes regarding each other (Fiske& Lee, 2008, p.21). With the impacts of globalization and stereotypical issues on the rise, training is in diversity management turning out to be a more pressing agenda for managers who are dealing with multicultural teams (Fowler, 2006, p.403). Diversity training to educates employees to embrace their differences, irrespective of the gender, race, sexual orientation, religion, social class or other associated dimensions. These trainings are provided in the on-the-job basis. Aghazadeh (2004, p.527) posits that, diversity training objective is to support people to accept and appreciate the cultural differences between them”. Employees gains and improve their personal development and interpersonal communication as a result of diversity training. Effective conflict resolution and fairness and equality promotion among the employees is normally resulting from thorough diversity training (Madera, 2013, p.127). 7. Problems that is likely to occur in organizations with diverse work in terms of age, sex, ethnicity and sexual orientation An organization that is lacking effective management program in the 21st century is likely to have difficult time trying to unite the culturally diverse employees (Madera, 2013, p.132). Reynolds, Rahman & Bradetich (2014, p.431) maintain that currently, there are several Y generation employees getting employed to replace the baby boomers. However, the organization cannot just phase out baby Boomer at once because of skills and experience they provide to Y Generation group. Looking closely, these are two different groups of employees. While the baby boomers worked hard with less technology involved, the Y Generation want it easy because most of their work is made easy through technology (Jayne & Dipboye, 2004, p.417). Therefore, the age difference between and their opinions could cause a rift in the organization. Similarly, people from different ethnicity usually have stereotypes and discrimination on each other. Some will argue that their ethnic culture is superior compared to other employees. This could lead to bad attitudes and non cooperation among the employees. According to Madera (2013, p.129), organization with no diversity management program could experience high employee’s turnover, hence extra cost of hiring new employees. 8. Characteristics of an effective diversity program The programs for managing diversity have mostly been a vehicle for encouraging culture of inclusion (Shin & Park, 2013). However, not all diversity programs are successful due lack of firm foundation. For a diversity program to be effective in an organization, it has to be a continuous process and have clear objectives (Shin & Park, 2013). Company like IBM is always in a process of targeting new markets so as to create brand awareness and maximize its sales. Every market has its unique culture which companies are bound to face. As such, IBM and other companies must create continuous diversity programs which focus on several markets. Madera (2013, p.131) argues that the continuity of the program will ensure that culturally diverse employees are deeply assimilated into the organizational culture. The program must also have a clear objectives on how deal with workforce diversity and key deliverables. It must be able to recognize and appreciate other people’s culture, accept it bringing different people together towards the common goal of the organization. Waddell, Cummings & Worley (2011) reports that at IBM, diversity program aims at women’s advancement, integration of individuals having disability, creating working life and work balance and cultural awareness and acceptance. Conclusion A diverse labor force is a manifestation of an ever changing business environment and the world in general. Diverse work group and training bring higher value to the organizations. Respecting personal differences will help benefit the organization by enabling a competitive advantage and improving work productivity. IBM has set pace for businesses which want to do well in the 21st century, hence managers mostly include diversity management as one of their top agenda which will enable them to understand the market and provide the needs of the consumers. References Aghazadeh, S.M. (2004). Managing workforce diversity as an essential resource for improving organizational performance. International Journal of Productivity and Performance Management, 6, 521-543. Barak, M. E. (2005). Managing Diversity Towards a Globally Inclusive Workplace. Sage Publications: London. Fiske, S. T. & Lee, T. L. (2008). Stereotypes and prejudice create workplace discrimination. In A. P. Brief (ed.), Diversity at Work. Cambridge University Press: Cambridge, pp. 13-52. Fowler, S.M. (2006). Training across cultures: what intercultural trainers bring to diversity training. International Journal of Intercultural Relations, 30, 401-411. Holladay, C.L., & Quiñones, M.A. (2008). The influence of training focus and trainer characteristics on diversity training effectiveness. Academy of Management Learning and Education, 7, 343-354. Jayne, M.E.A & Dipboye, R.L. (2004). Leveraging diversity to improve business performance: research findings and recommendations for organizations. Human Resource Management, 43, 409-424. Madera, M.J. (2013). Best practices in diversity management in customer service organizations: an investigation of top companies cited by Diversity Inc. Cornell Hospitality Quarterly, 2, 124-135. Reynolds, D., Rahman, I., & Bradetich, S. (2014). Hotel managers' perceptions of the value of diversity training: an empirical investigation. International Journal of Contemporary Hospitality Management, 26, 426–446. Shin, H.Y. & Park, H.J. (2013). What are the Key Factors in Managing Diversity and Inclusion Successfully in Large International Organizations? Cornell University. Waddell, D.M., Cummings, T.G. & Worley, C.G. (2011). Organisational Change: Development and Transformation, 4th ed. Sydney: Cengage Learning Australia Pty Limited. Read More