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Diversity as a Business Strategy and Stakeholder Issues Part 4 A.

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Presentation on theme: "Diversity as a Business Strategy and Stakeholder Issues Part 4 A."— Presentation transcript:

1 Diversity as a Business Strategy and Stakeholder Issues Part 4 A

2 Objectives To examine the potential links between diversity and competitive advantage. To emphasize cost, resource acquisition, marketing, creativity, problem-solving and systems flexibility. To describe a developmental model for organizational diversity and strategy. To describe strategies for organizational change.

3 Is there a link between Diversity & Business Success ? Kuczynski, S. If Diversity, Then Higher Profits? HR Magazine. Dec 99.If Diversity, Then Higher Profits? Firms w/ Diverse Boards reap greater market returns Better performing firms attract the best diverse talent Firms w/ Diverse Boards are less risky for investors; make better decisions about workforce mgt. Better candidates shop for firms that offer career advancement Firms offering career advancement cast a wider recruiting net Hallmark of successful diversity programs is diverse company leadership.

4 Managing Cultural Diversity Can Provide Competitive Advantage (Cox & Blake 44-59) 1.Cost Reduction 2.Resource Acquisition (Hiring) 3.Marketing 4.Creativity 5.Problem-Solving 6.Systems Flexibility

5 1. COST Effective programs for managing diversity in the workforce may reduce the rates of Turnover & Absenteeism Create opportunities for career growth & improve job satisfaction. Improve work schedules (flextime) & benefits such as child care

6 2. Resource Acquisition Even in an economic downturn (especially in an economic downturn) firms want to recruit the the most talented employees. Companies noted for their excellent diversity programs appeal to the most able candidates.

7 3. Marketing Selling goods and services is made easier by a representational workforce. Global markets respond to cultural sensitivity. First generation Americans have strong ties to their root cultures. Many consumers want to do business with firms known to be “good corporate citizens”

8 4. Creativity innovative organizations deliberately establish heterogeneous teams to create a “marketplace of ideas, recognizing a multiplicity of view points. (Kanter) Minority views can stimulate consideration of non-obvious alternatives in task groups. (Nemeth)

9 5. Problem Solving Diverse groups have a broader, richer base of experience from which to approach a problem. Heterogeneity improves decision quality by undermining the likelihood of “groupthink” (the absence of critical thinking in the interests of maintaining group cohesiveness)

10 6. Systems Flexibility Firms have discovered that they need to become less standardized, more fluid and adaptable, more accepting of change. Women and racioethnic minorities tend to have especially flexible cognitive structures, thus promoting tolerance for ambiguity. Those who are Bi-lingual have higher levels of divergent thinking compared to mono-linguals.

11 Modes of Acculturation (Action – Proficiency Stage) Assimilation Dominant Culture becomes the standard of behavior for other cultures. Everyone conforms to Dominant norms/values. Separation Minority Culture unwilling/ unable to adapt to Dominant; Seeks cultural & physical autonomy. De-culturation Dominant & Minority Culture not highly valued by members Neither is influential in framing minority behavior. Pluralism Integration: a two-way process. Both Cultures change to some degree and reflect the norms and values of the other. Cox, Taylor, & Beale, R.L. Developing Competency to Manage Diversity. San Francisco, Berrett-Koehler, 1997, pp. 204-207.

12 Models for Organizational Diversity 5 5 4 4 3 3 2 2 1 1 Altruism & Access Business Reasons Transition Strategic Imperative Law & Order Institutionalize leadership from Diverse sources Mobilize & use networks to change business Talent pipeline Employee &Team Development Productivity gains Reduce system barriers Value-added; Competitive advantage Consumer appeal Shareholders Turnover, absenteeism, $$$ Lend a hand; open the door to disadvantaged Recruit scarce employees; public image. Avoid results of non-compliance w/ law - minimalist EEOC/Court $$$ People View Corporate View

13 Aren’t “Business Reasons” and “Strategic Imperatives” the same? Assumes a direct link between #s of employees who “look, act, & sound like” and consumers. Employees may be front- line “tools” or Ghettoized” in niche depts. Firms may have aggressive recruitment plans, but the infrastructure to support diverse employees is developing. Values a potential link to creativity, innovation & solving out-of the ordinary problems. Top mgt. & leaders direct cultural change; diversity permeates the mainstream Multifaceted Infrastructure driven by networks, task- forces that define agenda to support employee development and advancement Strategic ImperativesBusiness Reasons

14 Features of Multicultural Organizations Pluralism: reciprocal acculturation – all groups respect value, learn from each other. Structural integration of groups – well represented at all levels. Integration of minority group members in informal networks. Absence of prejudice & discrimination. Minority/Majority members identify equally with goals of the organization. Minimum of inter-group conflict based on identity.

15 Organizational Change for promoting multicultural organizations Leadership from top management. (Commitment & role models) Training (awareness and skill-building) Research (Equal opportunity profiles, attitude surveys, career experience tracking) Cultural and Management Systems Audits (uncover potential bias; identify inadvertent bias based on corporate culture)

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