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Challenges of cultural diversity in organisations

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Challenges of cultural diversity in organisations
The increasing competitive and globalised world economy has changed the face of organisations by introducing workforce and cultural diversity. Diversity in the workplace has different meanings to different people. As per one of the definitions, it refers to matching the composition of the workforce to the composition of clients for reasons of efficiency and effectiveness.
by Stephen Migiro, Professor of Finance, UNISA anaging diversity seeks to build on equal opportunities and initiatives undertaken by governments across the world, composition of the populations of countries, corporate background and customer diversity.

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Challenges of diversity
Workforce and cultural diversity have presented special dilemmas in organisations as the implementation of the diversity agenda is often received with questions. One of the biggest challenges that organisations face is understanding what exactly diversity means. The issues of cultural diversity in organisations generate highly charged emotions. For example, as the pressure for workforce diversity increases in organisations, a concern that minorities might displace the majorities, and vice versa, becomes an important reason to resist diversity. Cultural diversity poses challenges in organisations due to variations in individual perceptions and orientations. Understanding and managing diversity has thus become crucial as managers need to understand the dynamics in diverse teams of employees. Nonetheless, if challenges of diversity are properly considered, organisational productivity will increase, and employees will be more motivated and committed to their organisations. This notwithstanding, studies on management of cultural diversity in organisations have shown that diverse work groups compared to homogeneous groups suffer more from poor cohesion and social integration, conflict, turnover, low trust, low job satisfaction, stress, and communication difficulties . Furthermore, people different from their co-workers in terms of race, gender, and other

Benefits of diversity
The benefits of workforce and cultural diversity in organisations include, Improved Organisational Performance. Research into the link between cultural diversity and organisational performance indicates that, within the proper context, cultural diversity does in fact add value to the organisation. However, the relationship between employee diversity and organisational performance is moderated by business strategy. When organisations pursue a growth strategy, higher employee diversity is positively related to productivity and market performance. Employee diversity provides organisations with diverse experience and knowledge, and enables them to build stronger links with customers and the wider community; aspects beneficial to organisations with an orientation towards growth. Hence, recognition of such benefits creates the need for managers to develop “practices, policies and procedures that are responsive to a diverse community.” 01
ceo vol 5 no 5 2006

Stephen Migiro

characteristics have been found to suffer from feelings of discomfort and less organisational commitment. The Social Identity Theory explains the challenges of cultural diversity in organisations. The theory postulates that group members establish a positive social identity and confirm affiliation by showing favouritism to members of their own social category. Social category membership provides naturally occurring lines along which conflicts can be drawn. Thus, categorising individuals into different groups can provoke hostility or animosity within the work group.

ers should take strong personal stands on the need for change, role model the behaviours required for change and assist with the work of moving the organisation forward. Past research has identified characteristics of leaders which are also important in managing diversity. These characteristics include personal openness, approachability, emotional intelligence, empathy, strategic thinking, strong internal locus of control, capacity to trust, being prepared to challenge, and inspiring others. Diversity should form part of corporate strategy .Human resource practices such as recruitment, training, performance management and compensation should be adapted to respond to diversity related issues. The organisation’s policy is an important determinant of success when implementing diversity initiatives. Top management support should be manifested through the inclusion of diversity in corporate strategy. If there is a mismatch between formal and informal organisation practices and values, target individuals may become cynical about formal diversity initiatives. Little behaviour and attitude change is likely to occur when the organisation’s diversity goals are not perceived as serious. Lastly, diversity-related challenges in the strategic business units of corporate bodies may be addressed through the establishment of common rooms in organisations to serve as ice–breaking venues; establishment of clear communication channels, participatory decision making, team building exercises away from work, and involvement of employees in motivational, leadership and behavioural workshops, as part of diversity training and development.

Understanding crucial
Hence, the understanding and managing of diversity have thus become crucial to the viability of contemporary organisations. So what can managers do to respond to these challenges? Of a number of strategies that can be adopted by managers seeking to benefit from diversity, the most prevalent are Leadership and Organisational Policy, Organisational Research on Diversity; and Training and Development on diversity. Envisioning change in a culturally diverse organisation and driving its implementation is the primary responsibility of managers in organisations. Managceo vol 5 no 5 2006

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