Managing the Diverse Workforce Chapter 11 McGraw-Hill/Irwin Copyright © 2011 by the McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives LO 1 Describe how changes in the U.S. workforce make diversity a critical organizational and managerial issue LO 2 Distinguish between affirmative action and managing diversity LO 3 Explain how diversity, if well managed, can give organizations a competitive edge LO 4 Identify challenges associated with managing a diverse workforce LO 5 Define monolithic, pluralistic, and multicultural organizations LO 6 List steps managers and their organizations can take to cultivate diversity

Managing Diversity Managing diversity Managing a culturally diverse workforce by recognizing the characteristics common to specific groups of employees while dealing with such employees as individuals and supporting, nurturing, and utilizing their differences to the organization’s advantage.

Diversity: A Brief History Most immigrants to the U.S. from late 1800s to early 1900s were non-English speaking from Italy, Poland, Ireland, and Russia It was considered poor business practice for white Protestant-dominated insurance companies to hire Irish, Italians, Catholics, or Jews It was not until the 1960s that the struggle for acceptance by various ethnic and religious groups had on the whole succeeded

Diversity: A Brief History When the Women’s Rights Movement was launched in Seneca Falls in 1848, most occupations, colleges, and professional schools were off limits to women Women could not vote and lost all property rights once they were married Until the Civil Rights Act of 1964, women: Were excluded from certain jobs Needed a male cosigner for a bank loan Were not issued credit cards if they were married

Diversity: A Brief History The most difficult struggle faced America’s nonwhite minorities Racial segregation remained for 100 years after the end of the civil war Blacks suffered voting right suppression and discrimination in education, employment, and housing Brown v. Board of Education (1954) declared segregation unconstitutional setting the stage for the Civil Rights Act of 1964

Components of a Diversified Workforce Figure 11.1

Diversity Today Diversity Differences that include religious affiliation, age, disability status, military experience, sexual orientation, economic class, educational level, lifestyle, gender, race, ethnicity, and nationality

Diversity Today Managing diversity means not just tolerating or accommodating all sorts of differences, but supporting, nurturing, and utilizing these differences to the organization’s advantage

Expansion of Diversity Programs in U.S. Companies Figure 11.2

The Size of the Workforce Lower birthrates are resulting in a smaller labor force As the baby boom generation retires the labor force will become even smaller Employers are likely to outsource to developing nations where birthrates are high Still, U.S. companies will have to compete for the best candidates from a smaller labor pool

Gender Issues Women make up about 47 percent of the workforce. The overall labor force participation rate of women rose throughout the 1970s Almost 60 percent of marriages are dual-earner marriages. One of every four married women in two-income households earns more than her husband does

Question A (n) ___________ is an invisible barrier making it difficult for women and minorities to move beyond a certain level in the corporate hierarchy. Organization chart Glass ceiling Glass limit Personnel limit The correct answer is b – glass ceiling. See next slide. 11-13

Gender Issues Glass ceiling an invisible barrier making it difficult for women and minorities to move beyond a certain level in the corporate hierarchy

The A-List: Top Women Executives Table 11.1

Gender Issues Sexual harassment Conduct of a sexual nature that has negative consequences for employment.

Sexual Harassment Quid pro quo harassment Hostile environment Submission to or rejection of sexual conduct is used as a basis for employment decisions Hostile environment Occurs when unwelcome sexual conduct has the effect of unreasonably interfering with job performance or creating an intimidating or hostile, working environment

Top 30 Companies for Executive Women Table 11.2

Basic Components of an Effective Sexual Harassment Policy Table 11.3

Minorities and Immigrants Black, Asian, and Hispanic workers hold more than one of every four jobs Asian and Hispanic workforces are growing the fastest, followed by the African-American workforce Three in 10 college enrollees are people of color. By 2020, most of California’s entry-level workers will be Hispanic

Minorities and Immigrants English has become the second language for much of the population in California, Texas, and Florida Foreign-born workers make up more than 15 percent of the U.S. civilian labor force One in 40 people in the United States identifies himself or herself as multiracial

Executives of Color: Selected Examples Table 11.4

Mentally and Physically Disabled People The largest unemployed minority in the U.S. The share of the population with a disability is growing Assistive technologies make it easier for companies to comply with the Americans with Disabilities Act

The Age of the Workforce The median age of workers is rising substantially while the number of young workers is growing only slightly The Bureau of Labor Statistics projects that entry-level workers will be in short supply in the future 70% of workers between 45-70 intend to work in retirement To prevent an exodus of talent, employers need strategies to help retain and attract skilled older workers Employers must also compete for talented young workers

Utilizing Older Employees Table 11.6

Managing Diversity versus Affirmative Action Special efforts to recruit and hire qualified members of groups that have been discriminated against in the past.

Competitive Advantage through Diversity and Inclusion Ability to Attract and Retain Motivated Employees Better Perspective on a Differentiated Market Ability to Leverage Creativity and Innovation in Problem Solving Enhancement of Organizational Flexibility

Challenges of Diversity and Inclusion Unexamined Assumptions Lower Cohesiveness Communication Problems Stereotyping Mistrust and Tension

Diversity Assumptions and Their Implications for Management Table 11.7

Multicultural Organizations Monolithic organization An organization that has a low degree of structural integration—employing few women, minorities, or other groups that differ from the majority—and thus has a highly homogeneous employee population.

Multicultural Organizations Pluralistic organization An organization that has a relatively diverse employee population and makes an effort to involve employees from different gender, racial, or cultural backgrounds.

Question A ___________ organization is an organization that values cultural diversity and seeks to utilize and encourage it. Multi-spatial Multidimensional Multicultural Multi-temporal The correct answer is c – multicultural. See next slide 11-32

Multicultural Organizations An organization that values cultural diversity and seeks to utilize and encourage it.

How Organizations Can Cultivate a Diverse Workforce Securing top management’s leadership and commitment Assessing the organization’s progress toward goals Attracting employees Training employees in diversity Retaining employees

Attracting Employees Recruitment Accommodating Work and Family Needs Alternative Work Arrangements

Guidelines for Diversity Training Table 11.8

Career Development and Promotions Retaining Employees Support Groups Mentoring Career Development and Promotions Accountability

Question ___________ are higher-level managers who help ensure that high-potential people socialized into the norms and values of the organization. Trainers Mentors HR specialists Employee coaches The correct answer is b - mentors. See next slide 11-38

Retaining Employees Mentors Higher-level managers who help ensure that high-potential people are introduced to top management and socialized into the norms and values of the organization.

Destination CEO: Darden Restaurants Give examples of minority CEOs in Fortune 500 companies. Where did Otis learn a great deal about working with diverse groups of people? From restaurant server to CEO. . . Growing up in the Watts ghetto of Los Angeles during the 60s as the son of a janitor, Clarence Otis’ parents set high expectations for him. Instead of getting involved in neighborhood gangs, Otis became a standout student who went on to graduate from college with Phi Beta Kappa honors; eventually earning a law degree from Stanford University.   A strong financial and legal background prepared Otis for his position of CEO of Darden Restaurants, the largest publicly traded casual dining chain in the world. Yet Otis learned the importance of getting along with all types of people early in his career while working as a server at a restaurant at the Los Angeles International Airport. Otis has guided Darden to healthy earnings as a result of his sound financial strategies, while also creating a shared vision for Darden that embraces diversity. Otis is one of less than a handful of African American chief executives of a Fortune 500 corporation. Darden Restaurants, Inc., (NYSE:DRI) is the parent company of over 1,400 eating establishments, among them Red Lobster and Olive Garden.   Multiple Choice Questions Which of the following positions did Otis hold before being named CEO of Darden Restaurants? CEO of McDonalds CFO of Darden Legal council for Darden President of Citicorp An important part of Otis’ background involves his childhood growing up in what city? New York Chicago Biloxi Los Angeles Otis learned a great deal about working with diverse groups of people from his first job, where he was employed as a: Server in a restaurant Law clerk in Washington, D.C. Janitor at the Los Angeles International Airport Carrier for a newspaper route Essay Questions What management skills are you developing in a job or in college that will aid you in your future career? Students’ responses will vary. Typical answers may include technical skills such as Otis’ finance and law background. Another response may include soft skills such as Otis’ ability to get along with a diverse group of people. Finally, students may identify conceptual skills such as Otis’ ability to create a vision of diversity for Darden. Provide examples of forces in the external environment that Otis must consider. Students’ responses will vary. As an example, the Food and Drug Administration could pass new laws regarding food safety. Economic conditions such as growth or recession affect availability and cost of capital. Laws regarding affirmative hiring may change. Conduct research on the number of minority CEOs in Fortune 500 companies. Report your findings with citations. Students’ responses will vary. As of 2007, only 10 of the 500 Fortune 500 CEOs were female. Fortune does not provide data on the number of minority CEOs, yet their number remains in single digits. More minority-owned businesses are being created in this country than ever before, leading to more minority CEOs which eventually may become Fortune 500 companies. Look especially for Hispanic CEOs to increase as the U.S. population continues to increase in the number of Hispanic entrepreneurs. 11-40