Moral Obligation of Affirmative Action to Business Imperative - Essay Example

Diversity Hiring "The diversity debate has shifted from the moral obligation of affirmative action to a business imperative. CEOs, faced with intensecompetition in global markets, record numbers of mergers and acquisitions, and the global war for talent, are focusing on how to leverage diversity as their competitive differentiator. The challenge for many CEOs is to directly infuse their diversity belief systems into the organization. The test for diversity practitioners in many organizations is to overcome diversity resistors and to leverage the power of the CEO's vision to make diversity happen. " --Dr. Vanessa Weaver Introduction It is irrefutable that current business operations have evolved over time, confounding managers with new issues. The evolution of new business strategies is in response to the changes in the external environment of business organizations. It should be noted that the developments in the market mentioned were beyond the effects of neither the current economic turmoil nor the technological revolution which radically altered the way business is done. The present mode of business is strongly influenced by the emergence of hypercompetitive markets that resulted from the rapid integration of markets brought about by globalization. As businesses are faced with new challenges and opportunities, it is imperative that they also employ a new approach in doing business. They do this by strengthening their core competencies by aligning their respective resources to their various objectives. It is irrefutable that human resource is the indispensable, if not the most important, asset in a business institution. The contribution of human resource in the success and mere survival of a company cannot be overstated. As such, companies are seen to align their workforce in order to fully reap the opportunities present in the market. Diversity hiring is the new trend in choosing the employees to work for an organization. As more and more companies are embracing this new system, more reports and empirical evidences are also reported which support direct hiring. This report will look at direct hiring as an ethical issue in business organizations. The first part will briefly look at the scope of direct hiring in the United States. Discussions on its advantages and ethical considerations will also be set forth. The paper will conclude with the key points tackled. Scope of Diversity Hiring The first step toward creating a more diversified workforce was taken by the President John F. Kennedy with the establishment of The President's Committee on Equal Employment Opportunity. This effort gave way in the formation of workforce which is comprised of people with different nationality. It should be noted that during this period there is a lack of appreciation of the value of diverse teams. In contrast, the program was enacted to create equal opportunity for prospective employees regardless of their ethnicity. However, the present day situation is now different. The importance of having a diverse team working for a business organization is not only done in order to comply with this requirement but due to the perceived value of inclusivity. In fact, a leading proponent of diversity recognized the importance of hiring employees with diverse backgrounds in order to boost the performance of a business organization. Gloria Johnson Goins, the vice president of diversity and inclusiveness for the Home Depot asserted American businesses should willing embrace this new trend in order for them to adapt to the nation's business demographics. According to ASME, workplace diversity is "the variety among people related to such factors as age, culture, education, employee status, family status, function, gender, national origin, physical appearance, race, regional origin, religion, sexual orientation, and thinking style." Thus, diversity embraces the differences among individuals and utilizes them for the utmost benefit of the business organization. As companies come to recognize the contribution of workplace diversity, it is widely observed that players are closely monitoring the extent of diversity in its human resource. Accordingly, there has been a constant updating on the quantitative and qualitative aspects of diversity hiring. For instance, managers focus on the number of female, number of Hispanics, number of African-Americans, number of married, and number of single employees. Keeping an eye on these essential factors considered in creating a highly diversified group. Also, fervent effort to reach minorities in order to attain the prescribed quota for the organization is also prevalent. Advantages of Diversity Hiring The rationale in favoring a human resource with different origins, backgrounds, interests, and status is fairly simple: diversity will is able to pool together various talents, ideas, skills, and knowledge which serves the highly diversified market served by a business institutions. As stated above, the emergence of diversity in the workplace is due to the changes in business environment brought about by globalization. The rise in the proportion filled in by women and minorities in the American human resource is directly attributed to this. Multinationals are continuously locating overseas, capturing profitable niches which were not previously served. Also, as economies like India, China and others are undergoing rapid growth and development, large corporations sees the opportunity to expand and market their products abroad. Diversification and market development strategies are often faced with the need of acquiring valuable knowledge in the new market being considered. This necessitates an in-depth research on the targeted industry, market, and preferences which will be eased by employing someone who has a first hand in the particular country. This is acknowledged by Dibble: "In an increasing global marketplace, cultural sensitivity that comes from the awareness of cultural distinctions can make or break a company's success in a given market." This point is further illustrated by Chevrolet's "disastrous roll-out" of the Nova in Latin America. The car manufacturer incurred losses because of its inability to relate and understand its target market. It should be noted that in Latin America, "no va" means "doesn't go" which is in direct contrast with what a car should do. In order to avoid this disaster, companies are now very eager to hire employees who thoroughly understand the culture of the foreign market. This point is fully captured by Hymowitz: "If companies are going to sell products and services globally, they will need a rich mix of employees with varied perspectives and experiences. They will need top executives who understand different countries and cultures. They will need executives around the world who intuitively understand the markets they are trying to penetrate." One of the most significant features of the evolving hypercompetitive countries is the more intense competition among companies and the higher power of consumers. It is also irrefutable that as companies operate globally, the international and domestic consumer base is altered. The emergence of customer centered and market-oriented approaches in doing business is also pushing businesses to focus on adding value to the customers by understanding their culture and preferences. A good definition of a global business is "one that sees value in cultural uniqueness and a variety of global markets, not one that attempts to render culture differences insignificant or trivial." Thus, the overall ability of companies to respect and respond to differences may prove to be a competitive advantage over slower, single-solution companies. This feat can be accomplished by a more diverse workforce. Mauricio Velasquez of The Diversity Training Group states that corporate diversity efforts are all about money, business, and the bottom line. He further added that diversity is being employed by its clients in order to generate more profits and meet customers' expectations. This paper will further elucidate this by real world example. The most notable examples of improved sales abound. One is the Petro-Canada site in Vancouver's Chinese community which has been benefited by employing a diversified workforce comprised in part by employees who can speak and write Chinese. An effort to increase the company's presence in the locality as well as boost sales is posting advertisements both in English and Mandarin. The result was 15% growth in kiosk sales, and gasoline sales were 3.1 million liters in 1994, up from the 2.7 million liters recorded in 1991 (Benefits of Diversity 3). PepsiCo is another company which modified its workforce structure and largely reaped the gains of workforce diversity. It should be noted that the beverage and snack food giant has been transformed from a "mostly white male fraternity" to a more diverse human resource. PepsiCo expressed its satisfaction with the new system, attributing the 1% in the overall 8% revenue growth to the diversity efforts. Products which are inspired by workforce diversity are: guacamole-flavored Doritos chips and Gatorade Xtreme, aimed at Hispanics; Mountain Dew Code Red, which appeals to African-Americans; and a newly launched wasabi-flavored snack aimed at Asians (Hymowitz 8-10). The examples of Petro-Canada and PepsiCo are only few of the numerous companies who are pursuing to generate sales, increase market share, and profit through the modification of their resources. Another pay-off of a company's diversity effort is the improved retention, recruitment, and promotion of employees. Fast food giant McDonalds is known for going beyond the trend of recruiting younger employees. The company actively seeks older workers for its management and employs thousands of older employees in its restaurant. McDonald noted that older workers are generally more disciplined, well motivated, and with better work habits than their younger counterparts (Benefits of Diversity 7-9). It is often overlooked but workplace diversity also facilitates the eliminations of complaints and litigation. Accordingly, "the cost of an unhappy employee can go far beyond low productivity, high turnover or absenteeism" but "increasingly, they may include a lengthy public court battle." In 1996, Texaco was sued for racial discrimination forcing it to shell-out $35 million in order to establish a Task Force to implement the changes in their human resource programs. The new plan include recruitment and hiring procedures to reflect diversity in the workforce, concentrating on much-needed career development and retention of current employees, and increasing the number of women-and minority-owned business partners (Benefits of Diversity 10-11). Other benefits of diversification will be, "an ability to move into emerging markets, improved employee morale, and improved communication between employees and working units (Benefits of Diversity 12)." Ethical Issues in Workplace Diversity While a lot of corporate players recognize the role of workplace diversity, this trend also raises ethical concerns among organizations. Diversity hiring has been met with skepticism by critics, who perceive it as an opposition to equality, to hiring who is best, and reluctant to have women and minority in the workplace. In the real corporate world, the effects of diversity hiring in the workplace is amazing. Though it is often regarded with the benefits that it generates, the other side of the coin should also be revealed. Take for example, an HR manager who considers candidates for promotion. While a typical manager would choose the "best" candidate for the position based on the performance and accomplishments of the candidates, an HR manager who is a strong adherent of diversity will look at other factors. First, she will take into account the group that the candidate will be joining assessing if he/she satisfies the "requisite diversity factors." Thus, this practice often leads to choosing the "diverse" instead of the best candidate. To critics this can be labeled as inequality. Roscelli argued that the hiring goal should be equality and not diversity adding further that "candidates should be judged on their skills, not on immutable characteristics." Diversity hiring is regarded as an inefficient method of selecting prospective employees as it is focused on the creation of a diverse workforce instead of pooling individuals which are best in their fields. Another concern in diversity hiring is the reaction of other employees especially subordinates who have women or minority as immediate superiors. This somehow raises reluctance in them in functioning efficiently as the situation is seen as "degrading." This leads to a workforce who is not motivated to excel in their respective positions resulting to lower productivity and job satisfaction. Conclusion The emergence of diversity in the workplace has been brought about by the rapid changes and development in the domestic and global market. This current workforce strategy is seen as business organization's response in coming with the demands of the new business environment. This is their way of aligning their resources to take advantage of the present opportunities, generate revenues, increase market share, and squeeze more profits from their sales. Diversity in the workforce had also increased retention, recruitment, and promotion of employees as well as decreased litigation and complaints. However, the other side of the story tells of the ethical concerns raised by diversity hiring. According to critics, this new trend reflects inequality and higher lower quality employees. Another destructive effect of workplace diversity hiring is subordinates' reluctance to be under the supervision of women or minority resulting to low employee morale. As with other business strategies, diversity in the workplace generates benefits to the company and incurs costs. A business organization planning to create a more diversified human resource should be ready to face the challenges posted by this new system. A thorough cost and benefit analysis should be employed to ascertain the true value and effectiveness of diversity. However, it will be complicated as benefits such inequality cannot be quantified. What seems to be the best approach is come up with other means to eliminate or minimize the perceived costs brought about by diversity. Works Cited "Benefits of Diversity." Professional Practice Curriculum. 24 May 2006 Dibble, David. "Diversity 101: The Changing Face of Business." Texas Magazine, Fall/Winter 2001 "History." Professional Practice Curriculum. 24 May 2006 Hymowitz, Carol. "Diversity in a Global Economy-Ways Some Firm Get it Right." The Wall Street Journal Online. 16 November 2005. 24 May 2006 Roscelli, Paul. "Is Hiring Goal Diversity or Equality." San Francisco Chronicle. 28 August 2000. 24 May 2006 "Speaker says inclusiveness is the answer." Idohostateman.com. 24 May 2006 "What is Workplace Diversity." Professional Practice Curriculum. 24 May 2006 . Read More