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Evaluate how diversity management could have more impact within organisations?
Diversity management is one of the most sensitive issues that an organisation has to go through. However, it can be rewarding if it is managed successfully. Diversity can cover many issues such as educational background, lifestyle, ethnicity, age, disability and gender. The purpose of this essay is to evaluate how diversity management could have more of an impact within organisations.
Redman and Wilkinson (2001), implies that “'managing diversity' refers to the systematic and planned commitment on the part of organisation to recruit and retain employees from diverse demographic backgrounds.” The definition by Redman and Wilkinson suggests by planning, organisations will be able to create a good working environment for their employees from different backgrounds.
In order to structure my essay I will begin by writing about the legislations that are involved in both diversity management and equal opportunity.
Following up by writing about both equal opportunities and diversity management and why should different organisation adopts this approach
Both diversity management and equal opportunity began as a result of various incidents. Discrimination was a common theme within organisations.
The Sex Discrimination Act (1975) has had a huge impact in the reduction of discrimination amongst males and females. This legislation improved equality within the organisation especially for women. According to Torrington, et al. (2005) the participation of females in the workplace has increased from 56.8 per cent to 72 per cent (between 1971 to 2001). The legislation has also benefited males, allowing males to pursue “female jobs” i.e. midwife.
Age discrimination can also be common in the work place especially during the later stage of the individual's career. Employees get forced to retire so other young workers can take their place. Young workers are also being discriminated against. A lot of employers believe younger workers are not as loyal as older workers. The Age Discrimination Act helps to minimise any prejudice.
The Disability Act has also had a large impact within organisations. Torrington, et al. (2005) explains that disabled workers are less likely to be hired compared to their able-bodied counterpart. Disability discrimination is often overlooked by organisations. Some organisations believe it is not as important as other discrimination laws.
Employment Equality (Religion or Belief) Regulations (2003) have also been put in place to help diminish discrimination against ethnic minority. This encourages equality in regards to recruitment.
These legislations have allowed organisation to be more aware of discrimination. This was one of the key reasons for the increase in globalisation.
Globalisation is the cause of diversity trends, this is clearly monitored by the increase in the “number of women and members of ethnic minority groups…….., Additionally, the age profile of the working population is changing,” (Redman and Wilkinson (2001)). This suggests that the age of employees working is on the increase. The quotation also suggests that organisations are opening up to women and members of ethnic minority. This indicates two points.
The First point illustrates organisations are hiring male/ female, older/ young workers, disabled workers, and people from ethnic backgrounds due to the positive contribution that they can make into the organisation.
The second point is organisations only hire male/ female, older/ young workers, disabled workers, and people from ethnic backgrounds due to the legislations. There are various legislations which influence organisations see appendix 1 for the legislations. Northumbria-police-authority (2009)
Point one indicates the organisation believes in managing diversity. Diversity management is very important to businesses, managing it right or wrong could either lead to the success or failure of that business. Hence it has a major impact on the organisation. According to Armstrong (2006) “managing diversity is about ensuring all people maximize their potential and their contribution to the organization.” This suggests that by valuing diversity there will be a positive effect on the organisation as employees will bring their diverse knowledge into the organisation i.e. experience or fresh ideas.
Redman and Wilkinson (2001) stated in their book ‘Contemporary Human Resource Management' the general principles of managing diversity, that one of the principles (TO WHAT??) was “given current shortage of labour effective use of diverse skills make good business sense”. This point was perfectly demonstrated during world war two when the men were out at war. Business had to hire female workers to take their place, in order for them to survive. This is a perfect example of diversity management in practice. WW2 is a prime example of how important it is to have a diverse workforce. Having a diverse work force is still important to this very day. It is important from a legal requirement as well as an objective (because it allows the business to move forward). There are various other reasons, why organisation incorporate diversity into the organisation as mentioned later.
There are a range of advantages for diversity management. It enables good decision making within an organisation. Seba cultuurmanagement (2004) shares a similar view believing that “studies of diversity in organizations have shown that an exposure to diverse colleagues helps managers make better decisions”. IKEA can relate to this statement, IKEA is based all around the world, meaning the ideas which revolves in the organisation is the combination of different cultures. MJ, Browaeys and R, Price (2008) backs the statement of Seba, in which they mention a diverse organisation “as being more flexible and open to new ideas” by being more open to suggestions this will reflect on to the customers not only will they come up with new ideas but they will meet (Browaeys and R, Price (2008)) “customers needs” this will result in (Seba cultuurmanagement (2004)) “increase market share” due to “an increasingly diverse customer base.” The BBC is good at increasing a diverse customer base due to their diversity policy. Their scheme includes taking care of all types of workers i.e. disable workers, male/female, older/ young workers, disable worker, and a person from an ethnic background. All of this is achieved thanks to their diversity management. Out of all of the diversities, Disability is the most undermined diversity by organisations. However, the BBC are the opposite because the encourage and employee disabled workers. They also have TV programmes underlining the importance of disability. They have several experts in sign language, who assist (by helping people hard of hearing), on different programs such as the news. They also clearly layout their diversity message on the BBC website for all to see (BBC 2009).
A journal article by C. W. Von Bergen et al, indicates another advantage of having diversity, within the article it declares that “researchers who have studied top management team diversity have found that they experienced more positive financial returns than more homogeneous teams”. This links to the advantage above. As the increase in the customer base increase so will the financial rewards. Further down the article C. W. Von Bergen et al also mentions “For tune's 1999 list of America's 50 Best Companies for Asians, Blacks and Hispanics out per formed the S&P 500 over three- and five-year periods” this clearly indicates how important diversity is to any organisation.
Another important advantage of diversity management in organisations is attracting new talent as well as retaining current staff. One Workplace Equal Rights (2009) also agrees with diversity management “recruiting and retaining people from a wide "talent" base.” The wide talent base indicates the future consists of applicants from different ethnic backgrounds as well as disabled people. This is what diversity management is all about giving everyone a fair chance.
The advantages clearly demonstrate why managing diversity is beneficial to any organisation. So applying managing diversity is crucial and there are various ways of managing diversity but the MOSAIC model is one of the most essential models. According to Redman, T and Wilkinson, A (2006), “Kandola and Fullerton (1994) suggested managing diversity must pervade the entire organisation if it is to be successful.” For this they came up with “MOSAIC vision”. CIPD (2009) gave a definition of MOSAIC in which they write about the meaning of MOSAIC and what each letter stands for See appendix 2. Firstly they illustrated that mosaic is a strategic tool to “map your own organisation against this vision and to identify priority areas for your diversity strategy.” They also mention ‘vision', suggesting a picture of a diverse organisation this statement is suggesting MOSAIC helps to look at the current strategy in diversity and helps it improve by constructing a new policy.
The other effective way of applying diversity is through training. Yawen Lai and Brian H. Kleiner (2001) defined “Diversity training is the process by which a work force is educated about cultural, socio-economic, racial and religious differences among employees and taught how to embrace those differences”. Tthis is similar to Kandola and Fullerton's views on diversity management. The most important phrase on the statement is “process”.
This is because employees are required to learn about diversity so diversity becomes one of the top priorities within the organisation. Diversity Training Group (2004) mentions “Top 10 Reasons Diversity Training Programs Succeed” . It is written by Mauricio Velásquez, and gives 10 principles on effective diversity training. See appendix 3.
Diversity management has a good impact on businesses, but it is in no use if the organisations don't conduct diversity in the right way. An example of this is if HR is not involved. In terms of business cases, it is very important that diversity management gets integrated with HR policies and practices. Many, if not all the advantages of diversity management will be successful if they get the backing of HR and the Senior Management. Redman and Wilkinson (2006) indicates “HR professionals have a wide range of tools available to them for changing the attitudes and the behaviour of their organisation's employees.” Form this statement it clearly indicates that HR are influential in the running of the organisation. With the tools HR can attract and retain staff.
This example specifically determines how important it is to have HR involved in thriving towards the success of diversity management. A prime example is IKEA. IKEA is a very successful organisation and diversity has played a vital role. IKEA they implemented diversity management during the opening of their first store in Belfast. They demonstrated it by (Business communities 2009) “the fact that it provides translation for non-UK applicants, both at the recruitment stage and during the induction process”. These polices also helped future employees to reach full potential. Due to HR the policies were successful as HR were involved during the recruitment process. Furthermore IKEA (Business communities 2009) “continuously promotes cultural diversity through culture and development days.” This process consists of the staff being made aware of the company's diversities ethos during induction. For managers and supervisors there are (Business communities 2009) “mandatory workshops”. This leads to the staff rating the fairness of their managers, and these ratings are included in the salary review. This process shows IKEA's intentions on diversity management. The Belfast IKEA store was a success it attracted (Business communities 2009) “3,000 applications were received for 400 jobs”. The diversity work had also dropped the turnover to a low “9%.” Also, “external bodies such as Disability Action, Princes Trust and local employability groups” recognised there polices. IKEA also did an advertising campaign on diversity (advertolog 2009) which they called “long live Diversity”. The number of applicants indicates that if diversity management is done in a right way the organisations reputation will increase resulting in attracting new employees, retaining staff and finally bringing in new customers.
Earlier I mentioned two points. The second point relates to Equal Opportunities. Kirton and Greene (2000) said “equal opportunity exists when all individuals are enabled freely and equally to compete for social category.” Further on Kirton and Greene 2000 mention that people should have the same treatment within the organisation regardless of the individuals social category i.e. gender, disability, age and etc. Equal opportunities can be seen as a free market where everyone is allowed to apply for any jobs and not be discriminated against. A prime example is Torrington, et al. 2005. They say that a selection procedure will not be influenced by stereotypical characteristics. They say “women will not be prepared to work away from home due to family commitments, that a person with disability will have more time off sick” these are not proven facts but due to these stereotypes many disable workers and women will be discriminated against.
This is the reason why equal opportunities legislations are in action. Appendix 1.Northumbria-police-authority (2009) these laws are there to provide a “level playing field” (Torrington, et al. 2005) for all workers. The legislation ensures that all workers are not at a disadvantage and gives importance to those workers in order for them to compete with other applicants, i.e. “British Rail has given members of minority groups extra coaching and practice in a selection test for train drivers, as testing taking was not part of their culture” (Torrington, et al. (2005). Equal opportunities will also apply during job advertisement. Organisation will need to be careful of what they write on the job advert, according to an article written by business wings (2009) also agrees with my statement for example “Avoid stating any requirements that are not directly related to the job such as the candidate's marital status or race”. It is very important for the organisation not to break the law as there could be hefty penalties as well as the decimation of their reputation.
There are various positive to equal opportunities in terms of business case. Redman, T and Wilkinson, A (2006) mentions “in 1995 the equal opportunities commission launched a campaign to highlight business case for equal opportunities”. This helps link the equal opportunity to organisational goals. One of the positives of equal opportunities is that it brings out the best of HR. It also brings in new business ideas with more diverse work force there would be more ideas generated within the organisation.
Kandola and Fullerton (1998) wrote in their book that equal opportunity has changed in recent years. They say “There is more concern for the business case”. The reason being, organisation look to enhance the profits and reputation, and equal opportunities is one of the important polices that would achieve this. Above is one of the various reasons why businesses integrate equal opportunity and only follow the minimum legal frame work.
The foundations of organisations follow the minimum legal frame work that is needed. This is due to the fact that organisations are not simply big enough and do not acquire the resource to carry out diversity management. HR department is one of the vital resources that small organisation lack, HR is a very important asset to an organisation but it is also very costly and the reason why small organisations do not have HR. Another reason why businesses only follow the minimum requirement is the lack the support from Senior Management. For example, a line manger may like to bring in diversity management into the organisation, but due to saving cost or other reasons the Senior Management will reject that proposal.
One of the key reasons why organisations follow the minimum obligation is due to the disadvantages of conducting diversity management. One of the disadvantages is means of communicating (CIPD 2009); with different cultures working together they all have different ways opinions, therefore creating conflict within the organisation.
It is also difficult when one of the workers has a disability i.e. difficult to speak, this will slow the work down which results in low morale in the workplace.
In conclusion, after writing about the diversity management I have realised that it is very important to peruse with diversity management as there are great rewards to be achieved both for the employee and the organisation. Core legal obligation is not the way forward. It is a short term answer to a long term issue. Even with disadvantages of diversity management in mind, the positive outweighs the negative. For example IBM started off by applying minimum obligation in their “Diversity 1.0” scheme they followed this up by “diversity 2.0” and now “Diversity 3.0” (IBM 2009). Then they realised that they could obtain creativity and harmony through diversity management. They believed that a diverse work force can be an advantage “for innovation”. They also mention “Our diversity is a competitive advantage and consciously building diverse teams helps us drive the best results for our clients.” (IBM 2009). IBM is one of many examples of organisations moving towards diversity management hence realising how diversity management impact on the organisation. It is therefore important for all organisations to adopt diversity in order to stay competitive