A Brief Note on Organizational Diversity

1.      Introduction

We often hear the term “diversity” bandied about in our everyday usage. Usually, when we come across the term, it is in the context of having a mix of gender, race, ethnic, sexual orientation etc in a setting wherein there is no discrimination based on these traits.

In an organizational context, diversity refers to equality of opportunity and employment without any bias because of these traits. Indeed, it has become fashionable in the present scenario to have a diverse mix of employees drawn from all classes and proclivities so that the aura of correctness and humanitarianism can be actualized. However, this does not mean that organizational diversity has succeeded or it has become the norm in organizations. Rather, there are many barriers to diversity even after strenuous efforts by activists and experts and these relate to societal mindsets and personal psychological discomfort with having people drawn from diverse backgrounds working alongside.

Diversity is not practiced in society and let alone organizations which make a feeble attempt to enforce the rules. The reason for this is the prevailing cultural attitudes against certain sections of society, which makes it impossible for corporates to embrace diversity since they risk the wrath of the dominant cultural and societal groups. The point here is that when the entire society discriminates against say, homosexuals or lesbians, it is indeed difficult for even the best meaning of corporate leaders to buck this trend. Hence, it needs to be remembered that organizational diversity is not only about a certain organization’s policies but also reflects the broader societal consensus on this issue.

Of course, this is not to say since society discriminates against ethnic minorities, corporates can do so likewise. On the other hand, there is more responsibility on corporates to follow their heart and heed their conscience and ensure that their organizations reflect diversity. The point here is that there is a symbiotic relationship between organizations and their environment and hence both must work in tandem to resolve cultural conflicts and biases. When either is unwilling for whatever reasons, leaders must step in and ensure that diversity is encouraged for humanity’s sake. This is the way shown by several business leaders like NR Narayana Murthy of Infosys and the late legendary Steve Jobs of Apple who put their personal reputations at stake to promote diversity.

2.      Why Care About Diversity?

Not only is diversity in organisations important because the government has brought in so many legislations, but it is also important because organisations can use it to their advantage.

If you operate in an equal way, or manage your diversity well, then you will be able to get a competitive advantage, which not only will make your product/service better, but it could also lead to getting better staff as people will feel better about working for that organisation.

Obviously most organisations worry about diversity because they don’t want legal action taken against them because of the laws in place, but if we look at it in a different light, then it can prove to be a very important aspect of a business.

2.1 Racism

One of the major aspects of this topic is Racism, as it is one of the biggest parts which makes up diversity in our culture.

2.2 Racism Definition:

The systemic institutionalised mistreatment of one group by another, based upon skin colour or ethnicity. So that Racism is taken seriously training needs to be done, allowing people to understand different people, different attitudes, content and identity. As well as this people need to see beyond how people look, instead seeing what their connections are in other areas.

3.   The Areas of  Diversity:

ü  Makes it easier to recruit scarce labour

ü  Improves customer service

ü  Increases sales to minority groups

ü  Promotes team creativity and innovation

ü  Improves problem solving

ü  Enhances organisational flexibility

ü  Improves corporate image

ü  Improves quality

ü  Improves intergroup relations

ü  Opens people’s minds to different perspectives and thereby increasing resilience, flexibility, inquisitiveness

 

4.      What is Organisational diversity?

Diversity in the workplace means that there is an array of differences among employees such as race, ethnicity, gender, age, religion and education. Over the past few decades, increasing diversity within various business industries has become more common. Diversity affects how organizations understand that employing people who hold multiple perspectives increases the need to mitigate conflict between workers from different identity groups, enhances creativity and problem solving in teams, and serves as a resource to create a competitive advantage for the organization. Diversity in the workplace increases the organization's morale and creates efficiency and effectiveness. Workers from cultural backgrounds bring their skills to the table. This helps you critically examine a problem or task at many diverse levels. It enables you to understand the customer base from diverse backgrounds.

The global is a constantly changing marketplace, and the best way to gain a competitive advantage is through diversifying the workforce in companies and organisations. Diversity in the workplace matters not only because it brings benefits in business spheres as brand management, client engagement and CSR but because it creates additional value for the organisation by attracting diverse professionals that drive innovation.

5.      Why diversity is important in an organisations?

§  Diversity in the workplace promotes the individuality within an organisation, acknowledging that every person can contribute with different, creative and new ideas and solutions. Employees with different backgrounds and experiences can bring together a variety of perspectives on matters and thus increase the productivity and deliver better results. Diversity brings in diverse different talents together working towards a common goal using different sets of skills that increases their retention and productivity.

§  Diversity within a company helps in building a stronger brand and makes the company more interesting  and desirable employer. With a diversified workforce an organisation gains even good reputation and image because it is seen as having fair employment practices.

§  Workplace diversity increases creativity and problem solving. Having a variety of different people from various backgrounds together is essential for finding and implementing creative solutions to business problems. With diverse mindset coming together many more solutions will arise as every individual brings in their way of thinking, operating and solving problems and decision making.

§  A diversified organisation encourages personal growth and development. Having expats or persons with international background  working for the company can help employees learn new ideas, perspectives and connect professionally with different people. That enriches the employees and gives them another point of view on how the market and the business work.

§  Interacting with diversified staff improves their ability to work in a diverse environment, with different styles, cultures and personalities.

§  Diversity in a workforce can optimize an organisation’s ability to meet the needs of each different market. Representatives of specific country or demographics can be paired with clients of the similar backgrounds, helping clients feel more comfortable and in a way to create customer loyalty to the company. For example having an employee who is actually part of a specific culture or a region where a given business is conducted is a great advantage for the organization.

§  A diversified company can attract and retain talents, young and as well experienced professionals and thus add a competitive edge to the organization. Possessing different set of skills and having a good command of different and/or exotic languages and being appreciated for that increases the feeling of belonging. This enables the company to compete in the international market or to increase its diverse customer base and market share.

6.      Benefits of Organizational Diversity

Organizational diversity brings together individuals of varied experiences, educational qualifications, age groups and backgrounds at a common place in your organization. The first and the foremost benefit of organizational diversity is individuals get to learn lots of things from each other. You get to know about each other’s religion, community and also get an opportunity to gain from each other’s expertise. You might not know everything which probably someone associated with the organization for quite some time would know. It is foolish to underestimate anyone.

§  Organization A had individuals who were more than forty years of age and were in the system say for last ten years. The management did not like the idea of recruiting fresh talent and relied only on experienced ones. In due course of time, the experienced lot could not cope up with the changing technologies and failed to survive the challenging times. Organization A eventually suffered great losses and had to be shut down.

§  Organization B on the other hand believed in the concept of organizational diversity and had individuals of all age groups, work experiences, qualifications striving for a common goal. Young talents are generally little keener on upgrading their knowledge as compared to older employees who are on the verge of retirement. During tough times, Organization B gained not only from the experiences of the older people but also from the young lot who faced challenges with a smile and encouraged others to stay calm and patient.

An organization needs to have all types of people around. Everyone is talented and everyone if mentored and guided well can actually make a difference. So what if the other person is a fresher? If he/she has the right knowledge, he/she can actually prove to be an asset for your organization. Organizational diversity ensures equal opportunities for all.

Organizational diversity goes a long way in exposing individuals to varied cultures and traditions. It gives you a chance to know about other festivals and how they are being celebrated by other religions. Believe me, during festival seasons, everyone loves to bring delicacies from home and it is like a big party at workplace. Organizational diversity not only brings employees closer to each other but also strengthens the bond among them. Employees feel happy and motivated when they celebrate different festivals together. This certainly also reflects in their work when they readily help each other and seldom indulge in unnecessary conflicts and solve issues among themselves. Individuals from different backgrounds and experiences can also sit together, brainstorm ideas and reach to better solutions benefitting the organization.

 

7.      Role of Management in Managing Organizational Diversity

Organizational diversity enables individuals from diverse backgrounds, religions, communities, age groups, experiences, educational qualifications and so on to work on a common platform, striving hard towards achieving the goals and objectives of the organization within the shortest possible time frame.

7.1 Management plays an essential role in managing organizational diversity:

All individuals need to be treated equally. If you have recruited someone, he/she is your employee and thus indispensable resource of the organization. Do not misbehave once he/she joins. You have no rights to ill-treat the other individual just because he is a peon. Management should not forget that even the office boy is an employee of the organization and ought to be treated with utmost respect and care, the same way you treat your other employees. Make them feel important. Do not make separate policies for them. Remember, even they have the right to enjoy company’s benefits, the way others do.

Every employee is important irrespective of designation; amount of time spent in the organization or educational qualification and contributes in his/her own way. Organization B had all types of employees, some who recently joined and some who were there in the system for quite some time. Joe was never called for team meetings because he joined the organization just one month back. This certainly is a wrong practice. Management and superiors need to ensure that every individual is called for team meetings and also has the liberty to contribute in formulating team strategies and organization policies. Remember, an organization does not always need experienced people but also young and dynamic individuals who have the passion for innovation and accepting challenges. Do not neglect someone just because he is new to the industry. You never know when he comes up with a wonderful idea which would benefit not only the team but the entire organization.

Appraisals and incentive plans need to be similar for everyone. If you have decided for twenty percent hike, make sure it is same for everyone, be it the general manager, manager, executive or the office boy. Even the office boy has the right to ask for his appointment letter. It is his right. Appraisals should be strictly done based on individual’s performance over a period of year and nothing else.

Encourage effective communication at the workplace. No employee should be left out of important discussions. Management needs to ensure transparency at all levels of hierarchy. This is in fact the best way to effectively manage organizational diversity.

It is the responsibility of the management to encourage individuals to celebrate and enjoy all festivals irrespective of their religion and community. We may be Hindu, Muslim, Sikh or Christian, but above all we are Indians. Do not be happy because 25th December is a holiday and you will have another day to watch your favourite movie or spend some time with your family. Do celebrate all festivals and enjoy them to the fullest. Do not ignore someone just because he/she does not belong to your religion. Believe me, individuals who do so have no rights to be a part of the system.

8.      Organizational Diversity: Ideal vs Practice

Diversity also means that the employees from different orientations are treated equally with other employees and inclusivity is practiced. Often, it is the case that employees from different backgrounds are hired and then treated shabbily because their coworkers have different views about diversity than the management. The reason for elucidating the point so deeply is that unless mindsets change, diversity would remain a concept on paper only. Hence, the only way out for companies to embrace diversity would be to educate their employees and enforce strict codes of conduct across the organization. Only then would the employees from different orientations would feel comfortable working in the company. In this endeavor, the government has to do its bit by passing and enforcing laws that take care of the rights of the differently abled and differently oriented employees.

As with any idealistic notion, organizational diversity is usually done more in theory than in practice if the experiences of organizations in the United States and Asia are taken into reckoning. This is because the concept is good in theory where all organizations commit themselves to employing people of all genders, classes, ethnicities and sexual orientation.

However, due to prevailing mindsets, organizations do not actually practice this ideal and often the result is that organizations pay lip service to the ideal of diversity without practicing it. This results in the organizations proclaiming their commitment but in a hypocritical manner, abandoning it for the sake of convenience.

In India, Infosys was one of the first companies to have introduced the IWIN (Infosys Women’s Inclusivity Network) initiative where the management proclaimed their support for diversity. However, with the passage of time, the initiative was suitably toned down to meet business goals where the need to encourage diversity was given up at the altar of convenience. Though the initiative had the blessings of the founders including NR Narayana Murthy, other executives at different levels did not see the need to follow these principles because of mindset issues. The point here is that mindsets are hard to change and hence, diversity is often sacrificed for organizational cohesion. The usual excuse given is that there are not enough employable candidates from different backgrounds and hence, it is not possible to practice diversity. However, a careful consideration of the facts shows that this is not true given the available labor pool that is very rich in diversity.

The inescapable conclusion is that unless there is a wholesome embrace of diversity by walking the talk instead of talking the talk, diversity would only remain compliant with the letter of the law and not the spirit of the law. This is the overriding message that emerges after surveying the experiences of organizations worldwide and in Asia.

9.      Diversity and Inclusivity as a Value Based Imperative

Diversity and inclusivity in organizations have to be practiced instead of being preached. This is because they are concepts that lend credence to value based management and management that is humanistic in nature. Many organizations claim to have diversity programs only to have a few women in positions of power or differently abled employees just for the sake of satisfying the principle of diversity in the letter of the law rather than the spirit of the law. This is the case with many top-notch companies where regressive attitudes exist to prevent women and other minorities from being significant. However, this is neither the ideal situation nor even the acceptable situation, as management has to be driven by values instead of being driven by profit alone. Hence, there is a need to practice value-based management and incorporate diversity as a guiding principle for recruitment and promotions.

Of course, we are not making the case for an affirmative action kind of scenario where disadvantaged groups are recruited and promoted irrespective of their abilities. Rather the point that is being made here is that there should not be implicit and explicit barriers to women and differently abled employees reaching senior positions.

The prevailing attitudes must change and leadership must set an example to the rest of the organization to follow when formulating and actualizing diversity management policies and procedures. In this scenario, women and differently abled people as well as disadvantaged groups are treated equally with the other employees and without showing them undue favours, barriers are not placed in their path. This should be the goal of diversity management if value based management is adopted as the guiding principle for organizations.

The point here is that the ongoing economic crisis has shown how lack of ethics and normative principles can wreak havoc with the corporate system. Hence, the only way out is for corporate leaders to practice value based management and this can be done only if the senior leadership walks the talk instead of just talking the talk. Moreover, a culture of tolerance and inclusivity has to be built into the organizational DNA since senior management alone cannot change the system on their own. What this means is that middle management and even the employees from the ground up have to be taught to respect diversity and welcome inclusivity.

There are many companies including Infosys where the senior management is committed to diversity and inclusivity but the situation in the shop floor is something different altogether. Indeed, there are many instances of employees showing scant respect for diversity and be exclusive in their dealings with women. This presents problems for the companies concerned, as not only does this attitude vitiate the organizational culture but is also detrimental for its reputation and adherence to corporate governance principles. As mentioned earlier, if there is one lesson from the recent events, it is that one can fool people for some time but not all the time. Hence, value based management that promotes diversity and inclusivity as a business principle should be the goal of corporate leaders.

10.  Fostering an Inclusive Environment

The question that is uppermost on business leaders’ mind is how to foster an inclusive environment as the current environment in the business world is about not tolerating harassment and discrimination. For instance, in recent years, there has been some high profile cases involving senior management figures in the US and in India in matters related to sexual harassment and discrimination. Though the defendants and the victims reached out of court settlements in some cases, the damage done to the reputations of individuals and the companies is immense. This makes the case for fostering an inclusive environment in the workplace and avoiding such incidents that much more important.

It needs to be remembered that having policies in place alone is not enough to prevent harassment. Rather, companies and business leaders must walk the talk and practice what they preach about having an inclusive environment in the workplace.

The first aspect here is the sensitization towards gender, ethnic, and alternative sexualities and orientations that must take place before any meaningful action on inclusivity happens. For this to be actualized, employees at all levels have to be made sensitive to the problems of women, racial minorities, and those who are of alternative sexual orientation.

In many multinationals, explicit training programs are conducted to sensitize the staff on these issues. This is a practice that other companies can follow to have an inclusive environment. Apart from this, there needs to be redressal mechanisms wherein victims can report the incident in a confidential and secure manner. This means that the identity of the victim is kept confidential until the incident is investigated and action taken.

The other aspect is that strict punishment must be meted out in case wrongdoing is proved. Instead of mildly reprimanding the perpetrator and allowing the person to get away with the misdemeanor, there needs to be concrete action so that such incidents are not allowed to recur again. The point here is that justice must be seen to be done as well as seen to be effective. In many organizations, there are no punitive actions taken against the perpetrators, which embolden them and others to repeat such acts. Hence, the only way out would be for the company to initiate as strict an action possible that would deter others and serve as an example.

Finally, change comes from within and there is no point in having rules and regulations as well as punishments if the underlying mindset is one of mediaevalist thinking. Hence, the best way to foster inclusive working environment would be to effect a change in the mindset that creates inclusivity rather than narrow mindedness. Therefore, it would be in the interests of business leaders if they inculcated some of the values like tolerance, respect, and diversity among the staff. Only when there is an attitudinal change can there is an inclusive working environment.

In conclusion, fostering an inclusive working environment takes time, patience, and courage which the business leaders’ and the other management figures need to have in abundance.

11.  Communicating Across Cultures

In these times when global corporations operate in many countries across the world, it is important for the employees in these organizations to know the nuances of intercultural communication. It is often the case that many Asian employees (especially the younger lot) say, “they passed out in a certain year from college”. This has different connotations in the West as it refers to the act of losing consciousness. The correct phrase would be that “we graduated”. To take another example, it is common for many Westerners to start talking about the weather as an icebreaker for the conversation. However, this is interpreted differently in Asian countries where many employees do not seem to understand why the weather is a topic for conversation. Finally, many Asian employees (especially Indians) usually use the term “freaked out” to mean that they have had a good time. However, this is interpreted differently in the US where it has entirely different connotations.

The point here is that intercultural communication depends on a variety of factors that include the specifics of language, style, and substance.

Further, one has to be sensitive to the fact that what is acceptable in one culture might be prohibited in another culture. Hence, it is common for Asian employees to enquire about the families of their coworkers, whereas, in the West, it is not common for the employees to talk openly about them.

Most important aspect in cultural communication is the gender aspect where the way in which employees address the issues of women in the workplace makes a lot of difference to how they are interpreted. In the West, employees are usually politically correct in their communication, which means that they do not overly make racist and gender based statements. This does not mean that such issues do not exist there. On the contrary, there are enough cases of sexual harassment at the workplace in the west. Rather, the point is that in the West, employees are usually guarded when talking about their female coworkers. However, many Asian employees are openly racist and gender biased in their comments.

The other aspect of cross-cultural communication is the issue of how cultural differences are handled. For instance, while it is common for Asians to know many details about the US and the Europe, many westerners have a rather sketchy knowledge of countries other than in the West. This ignorance can sometimes be annoying to the Indians as was evident in the recent issue involving the popular Talk Show Host, Oprah Winfrey. Her statement that “Indians still eat with their hands” kicked up a row with many Indians taking umbrage at this remark. Hence, one must be cognizant of cultural differences and not say or do anything that would be interpreted in a different manner. Finally, cross-cultural communication is all about sensitivity and having empathy with the person from the other culture. Hence, it goes beyond differences and depends largely on the individual who is communicating.

In conclusion, there is a need for training for employees who are being sent onsite or who have to deal with employees from other cultures. This would make the job of communicating across cultures easier and would reduce the chances for faux pas in the communication process.

   11.1 Intercultural Communication: The Hofstede Model

One of the most widely used frameworks for analyzing cultural differences is the model developed by the eminent cultural theorist, Geert Hofstede. In this model, the differences in culture between countries have been plotted along five dimensions, which can be used as the basis for predicting the cultural differences between different countries. The model was developed after extensive research into the cultural differences between different countries and after surveys of thousands of employees in the West and the East. The five dimensions along which the cultural differences are plotted are power distance, masculinity vs. femininity, long-term orientation vs. short-term thinking, individualism vs. collectivism, and uncertainty avoidance. The model is comprehensive and exhaustive in its treatment of cultural differences across cultures.

To take the first dimension, power distance measures the extent to which hierarchy dominates the work environment. In the US, the power distance is relatively small when compared to China where the power distance is more because of the hierarchical nature of Chinese society. Similarly, the Masculine traits predominate in India and China as compared to the US and UK as the cultures in the former tends towards patriarchy.

The third dimension of individualism vs. collectivism yields the result that employees in the West would be highly individualistic as compared to the employees in the East who subscribe to the group instead of to the individual. The fourth dimension of long-term thinking vs. short-term thinking is likewise different in the US and the UK where the emphasis is on getting the short-term results whereas in China and India, there is a tendency to look ahead into the future. Finally, the fifth dimension of uncertainty avoidance refers to the structured work environment, which in the West would be oriented towards specific and measurable goals and objectives whereas out of the box thinking is prevalent in the East.

The Hofstede model is useful for expatriate managers who when they work in the East find it easy to understand the cultural differences in the work environment. Using this model, the expatriate managers can be trained to adjust to the different cultures. To take an example, it is common in the East (China and India) to be hierarchical in the organizational structure where the position and the status of the employee matters a lot. Given the fact that in the West, these are important but not to the extent that they are in the East, expatriate managers can learn to negotiate cultural differences using this model. Another important aspect is that culturally China and India are male dominated, which is different from the US, and the UK where gender equality is prevalent. Hence, the expatriate managers can likewise adjust to the East when they work there using this model.

Finally, for expatriate managers to adjust to the local cultures, adopting a “Glocal” approach would be the ideal solution. This approach wherein a global outlook is combined with a local approach means that multinationals can adapt themselves to the local cultures and at the same time do not lose focus of their global vision. This is the most important learning that the Hofstede model and the other models of culture provide to the expatriate managers. In conclusion, cultural differences can make or mar the chances of multinationals in the globalized world economy of the present. Hence, it is important to realize and understand that culture plays a prominent part in shaping the work environment.