Last updated: February 27, 2019
Topic: BusinessMarketing
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One of the important paradigm shifts that happened at the beginning of the new millennium was inspired and spawned by the knowledge-based paradigms. These new beliefs took the globe by a sizeable energy fueled by technological advancements in communication. The rest of the age old business concepts followed suit and leveled up including diversity. It is important therefore to look closer at diversity in this new stage and how it is affecting the boom or bane of activities in the realm of business in the global age.

Diversity

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Diversity is a concept commonly understood in the realm of science where Darwin’s concepts of diversity continue to support his theories of evolution and how species cohabit the Earth’s planet. Diversity has long since begun its adaptation and evolution towards other fields. In business, diversity has seen action in the managing of human resource as essential capital in fostering businesses at a global scale. Diversity is also seen as a concept where differences can be a powerful resource. In Darwinian discussions, diversity in species helps the species protect themselves from diseases. In business, differences in cultures are recognized as strength to bring in profits for the company.

“Diversity is based on the concept of recognition of differences: recognising that everyone is different, and respecting and encouraging those differences for business benefit. People with different backgrounds and attitudes bring fresh ideas and perceptions, and a diverse organisation can draw upon the widest range of experiences so it can listen to, and meet, the needs of its employees, customers and the community it serves.” (Warwick, 2006)

Limits to diversity are also evident and socially imposed. Diversity between individuals has set characteristics unique to themselves. Diversity in the organization also has particularities that managers need to be keen to. The essential concept of diversity is that it has limits rather than looking at diversity as a limitless concept that can spell destruction to an organization in the long run.

Diversity Approach and Equal Opportunities Approach

Table 1. Summary of differences of Equal Opportunities Approach and Diversity Approach

 

Equal Opportunities approach
Diversity approach
Externally driven and reactive to legal requirements, seen as a cost
Internally driven and proactive, rests on business case, seen as an investment
Difference to be neutralised
Difference to be respected
Concerned with operational process
Concerned with strategic outcomes
Focus on group discrimination
Focus on development for all individuals
Responsibility of few
Responsibility of all
Warwick: equal opportunities or diversity?

http://www2.warwick.ac.uk/services/equalops/policies/diversity/

 

Table  1. shows the differences between these two approach. Insights from the table will lead to how the equal opportunities approach has evolved into the diversity approach. Where EOA can be fully driven by external factors and therefore predominantly reactive, DA is proactive in the light that techniques are seen as investments and prioritize business care and governance.

Respect is much more articulated in the diversity approach as compared in the neutralizing goals that are evident in the equal opportunity approach. Although process is important for the EOA, the diversity approach takes the process one more step as it races expectations of outcomes with strategic concern.

A big difference between the two concepts lies in their prioritization of advocacy. The EOA focuses on the ills of discrimination and center activities to fight against discrimination. This is all positive however, the diversity approach looks at discrimination by addressing concerns of all individuals in the workforce. With the development of all individuals, the focus on cultural differences skips the intent to focus on discrimination.

THE VALID BUSINESS CASE

 

There is a valid business case for diversity. It is the growing business paradigm of the new millennium. As people move into the new global village, managers continue to be challenged by the evergrowing existence of a multicultural work setting. In the publishing industry, the business case has seen profits. “It has become increasingly apparent that focusing on diversity and looking for more ways to be a truly inclusive industry – one that makes full use of the contributions of all employees – and appropriately managing a diverse workforce is crucial for the relevancy and economic vitality of the magazine publishing industry.  Diversity yields greater productivity, competitive advantage and market share.” (….)

With diversity as a valid business case, companies cannot help address the issues of diversity in their organization or in their growing markets. They cannot help but embrace diversity and put it in their corporate values.  “Embracing diversity isn’t just the right thing to do; there’s a strong business case for it. The globalization and proliferation of new retail markets in an Internet-driven world are presenting unprecedented new business opportunities. Via the Web, a company can target its products to virtually any market: African Americans, Hispanics, baby boomers, gays, lesbians, older people, soccer moms. All of those groups have identifiable and increasing buying power, say marketing experts. Companies recognize the importance of creating workplaces that look like their marketplaces and that don’t discriminate based on race, age, gender, ethnic background, religion, or sexual orientation.” (Koonce, 2001)

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Advantages of a diversity approach claimed for organizations

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Among the many advantages of diversity approach claimed for organizations, two items stand out from the manager’s point of view. Diversity in the workplace increases survival of the organization. Another advantage of diversity is found in the heightened creativity that organizations experience as cultural collaboration is profited from the diversity approach.

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Examples of such advantage is expounded by the experience of Bill Carner when he recalled his experience in Bank of America in East Los Angeles where the rise of minorities and women in the business world led to the increase in Italian, Hispanic, Chinese, Korean, and Japanese workers in the workplace. “In an increasingly global marketplace, cultural sensitivity that comes from an awareness of cultural distinctions can make or break a company’s success in a given market. “Those people who were bilingual were much more effective in conducting day-to-day business,” said Carner. “As the only employee who didn’t speak another language, I often just had to get out of the way.” (…)

When businesses try to reach global markets, it is important that they embrace diversity because with diversity, they can realize their global aims. How could one reach Spanish customers if the company does not employ a Spanish agent that will be truly palatable to the Spanish markets? How could a global business prosper without understanding intricacies of cultural specifics that may sound obnoxious to the other workers. Increasing diversity of markets means the proportional increase of understanding and respect of cultural differences.

Especially where communication has been hastened by technology, there is no time for businesses to train their people to learn a second language. Multi-lingual employees are assets to the companies that are aiming for global business. The company that is able to respond faster to unique needs and wants of their clients will spell success over corporations that are slow to respond due to communication barriers.

“Companies, then, are eager to hire employees who are able to negotiate the many varieties of the wider world of cultural difference. “Verizon’s large and diverse customer base demands that we also employ individuals who interact effectively with people of different backgrounds,” says Lou Laste, Director of Community Relations for Verizon Information Services. More specifically, he notes, “We have needs for employees who can speak more than one language, who understand and can be sensitive to differences in societies and customers, who are able to manage a diverse workforce, and who can work collaboratively in multicultural teams.” (Utopia, 2006)

Verizon along with other companies continue to commit to diversity. They support diversity because it helps their hiring, training, education and management skills. Valuing diversity add value in turn. Besides understanding a wider social structure, businesses are able to practice color blind which saves American companies from being isolated by time, distance and cultural understandings. Outsourcing has been a formidable venue to show this skill.

“Corporate evolution depends on diversity, and offshore development introduces great potential in that regard. What companies really want is to find the creative edge before someone else does. Building on success is less expensive than starting from scratch. Why do you think so many companies hire the best and brightest graduates each year, and then add those workers to successful teams? Before people can contribute new ideas to a team or to a project, they need to understand what you already know. The cost of new-hire training and experience can be significant.” (Fullmer, 2003)

Table 2. below ranks 2001’s list of best companies for minorities that are grossing millions in revenues.

Table 2. The Best Companies for Minorities

2001 Rank
Company
Revenues ?($ Millions)
1
Advantica
1,526
2
Fannie Mae
44,088
3
McDonald’s
14,243
4
Southern California Edison
11,635
5
Sempra Energy
7,143
6
Xerox
18,632
7
Silicon Graphics
2,331
8
SBC Communications
51,476
9
Lucent TEchnologies
41,420
10
BellSouth
26,151
11
Dole Food
4,763
12
Hilton Hotels
3,451
13
PepsiCo
20,438
14
Applied Materials
9,564
15
Levi Strauss ; Co.
4,646
16
Union Bank of California
4,148
17
Freddie Mac
30,000
18
U.S. Postal Service
64,540
19
Hyatt
3,950
20
Public Serve Co. of New Mexico
1,611
*SOURCE—The Center for Responsibility in Business bases company rankings on the number of minorities on the board of directors, the percentage of minorities among the top paid, the percent of minorities who are officials and managers, and the percentage of minorities among new hires.
THE FAILURE OF MANAGING DIVERSITY IN SOME ORGANITIONS

Managing diversity does not always succeed in all organizations. Some attempts to use the method or approach ended up in failures. These failures can be seen from many reasons. First, diversity in some organizations is deeply rooted to culture that practices become more of a tradition that cannot be easily erased. Second, the human will to be at the top blocks a person to cooperate and in turn, makes him compete to co- workers. The third reason is the strong conception of people that one culture or race is dominant than the other.

“The relationship between managing workforce diversity and the development of international business capabilities is not well understood. As Australian business ventures overseas, it is faced with the challenges of doing business with people from different backgrounds. These diverse backgrounds include an array of ideologies and institutions, such as different languages, customs, belief systems, social hierarchies and business practices.” (AGI, 2006)

Some differences are deeply rooted to culture that it is hard to eradicate. This problem is evident in the European countries and Japan conduct business. Japan is known for its deep commitment to cultural practices. People are more likely to make organizations adapt their culture rather than them adapting to organizations. The problem of differences had proven to be big. In an organization that European and Japanese employees are working, the problems due to cultural differences persist.

Europeans are more liberal and honors human freedom. Japanese are more on the practice of conformity. The two poles have a hard time making the good out their difference because of the grasp of Japanese people to their culture is strong. Japanese workers instead of giving ideas for the betterment of the whole organization settle to conformity to Europeans’ ideas. This strong hold of Japanese people to their culture blocks the growth and success of an organization because instead of giving ideas to help attain success, they always settle to the ideas of other employees. They always conform to others as a sign of their known way of respect. Instead of arriving to a better judgment because more than one brain exchanges ideas, in a Japanese way of respect, only one brain is being used in the company’s attainment of goals. The strong hold of employees to culture as a part of their known way of life hinders the success of managing diversity.

The urge and desire of employees to be on the top of an organization makes it hard for managing diversity to be successful. People’s desire most of the time are so strong that they do away from the spirit of teamwork for the betterment of an organization. The temptation of success is very hard to combat in reality. This urge is so strong that people makes this as the ultimate goal of their employment. People become selfish and blinded with such urge. This reality is one reason why diversity approach is unsuccessful. Most people only care about their personal advancement.

The strong conception of people that one culture or race is dominant than the also blocks the success of managing diversity. It is of great reality that racial discrimination is still evident in organizations despite the efforts to mange diversity and to convert diversity for the success of organizations. In team working, an organization cannot utilize much of diversity because of the fact that some employees tend to look at other employees as of lower societal rank than them. This is evident still in the organizational relationship of whites and blacks in the US. The conception of white supremacy is also evident in their relation to ASIAN people in a work place. Such conception makes white people not respect opinions from other people of different race. Instead of exchanging ideas for the success of the organization, they never listen to other races. People of dominant race settle in their own judgment. They do not trust people of other races or cultures because they think that they have the brightest ideas on the organization. The strong conception of a dominant culture of race causes the management of diversity in some organizations to fail.

Therefore, managing diversity fails because of three reasons. First, diversity in some organizations is deeply rooted to culture that practices become more of a tradition that cannot be easily erased. Second, the human will to be at the top blocks a person to cooperate and in turn, makes him compete to co- workers. The third reason is the strong conception of people that one culture or race is dominant than the other.

DIFFERENCE IN EMPHASIS BETWEEN INDIVIDUAL DIFFERENCE AND SOCIAL GROUP DIFFERENCE

The difference in emphasis in diversity practice on individual difference and social group is in itself evident. The emphasis on individual differences is on the micro level background of the person while the emphasis on social differences is on the macro level background of people in an organization.

The focus on individual differences would mean that approach is on the uniqueness of different people in terms of their emotions and personality. The individual emotions and personalities are being looked upon by managing people in order to best know the contributions that the organization can get in the uniqueness of its people. In individual differences, the practice of diversity is seen in the efforts of organizations in dealing with differences in the attempt to make everyone travel the path towards the common good for the organizations.

The emphasis of managing diversity in individual differences is really on the individual’s self-concept, personality and emotions. The emphasis is on understanding the person in his belief of his own capacity to succeed. This is very important in an organization because the person’s view of his capacity is vital to organizations’ success. An organization must look at the self- esteem of people inside itself. The managing diversity in individual differences is a way in which to understand people’s personality inside an organization and a way to find ways how to maximize the status of people. The personal view in himself of an employee affects the efficacy of his performance in an organization.

The emphasis on of managing diversity in social differences is different from the emphasis on individual differences. The emphasis on social differences is on the cultural background of a person. It is indeed true that different people from different social contexts work in an organization. A lot of different cultural practices are seen in different employees. In social differences, the focus of management is on the beliefs and values an employee banners. These beliefs and values are of course products of culture. Culture dictates how an individual lives his life.

In managing diversity in social differences, they try to understand the cultural backgrounds of employees. In understanding the cultural background of employees, they will be able to device plans and means on how to utilize each social uniqueness. The focus is on how to incorporate different social beliefs and values of employees for the benefit of the organization. Each employee in his beliefs and values must be utilized for the success of the whole organization.

We can see the utility of organizations on social differences of their employees in different situations. For instance, if a car company has a Chinese employee, in the event of having a Chinese costumer, the Chinese employee will be used to entertain the Chinese costumer. Another instance is in planning to market in different places around the world. An organization can arrive to a better judgment on how to market their products with the help of their international employee. These are some of the things that managing diversity in social differences are getting ready for. Managing diversity is always looking at means on how to utilize differences in an organization.

Therefore, managing diversity in individual differences and social differences differ in their emphasis. The managing diversity in individual differences focuses on the self- concept, personality and emotions of employees while managing diversity in social differences focuses on the cultural practices and beliefs of employees.

BIBLIOGRAPHY

Rahn, G.. Cultural Differences and Doing Business in Europe and Japan. Retrieved December 15, 2006 from.

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http://www.kclc.or.jp/english/sympo/EUDialogue/rahn.htm

http://www.ou.edu/russell/4363/OB.doc

Fullmer, Steve. Oct 3, 2003. Why To Support Global Outsourcing

http://www.phptr.com/articles/article.asp?p=101364=5=1

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AGI, 2006. The Business Case for Diversity Management

http://www.diversityaustralia.gov.au/benefits/business_case_intro_06.htm

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Warwick. 2006. Diversity. http://www2.warwick.ac.uk/services/equalops/policies/diversity/

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Utopia. 2006. Diversity 101. University of Texas at Austin.

(http://utopia.utexas.edu/articles/texas/diversity.html?sec=business;sub=management)

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