The diverse workforce has become a reality today. The impact of cultural diversity varies with the type of environment and firm’s overall strategy. As more and more number of firms move from domestic, multidomestic, multinational strategies to operating as a truly global firm, the significance and impact of cultural diversity increase markedly. Management of cultural differences has become more important for creating advantages and getting competitive edge. Companies must also consider stakeholders as employees.
The viewpoints of stakeholders such as shareholders, suppliers, public agencies, and government regulators should be considered in shaping the culture of performance and approaching the diverse markets. In number of situations employees, customers and other stakeholders in the service environment interact to produce the ultimate service outcome. To solve the problem of unfair, inequitable treatment of diverse people, both as employees and customers, managers must recognize that such treatment is bound with bureaucratic structure, subjectivity and irrationality, inappropriate policies and practices, ineffective implementation of human.
Companies should completely reshape the working culture that make possible the integration of a broad range of viewpoints that leads to a redefinition of how work gets done and how diverse markets are approached and capitalized upon. All employees should be held accountable for their behaviors and human resources results. There are certain arguments for creating a diverse workforce, those are as follows: 1. As the number of women, minorities etc. in the workforce increase, so will their influence as consumers. Hiring women, minorities, disabled, etc. will help the organizations to tap these niche markets. . As all the segments of society have stake in the development and prosperity of the society as a whole, the creation of diverse workforce should be seen as a social and moral imperative. 3. Diversity enhances creativity and innovation and produces advantages. 4. Diversity helps organizations for entering the international arena. 5. Diverse teams make it possible to enhance flexibility and rapid response to change. Diversity also causes certain problems those are as follows: (i) Communication becomes more difficult. Employees from different cultures fail to understand one another.
Firms operating in different language areas find difficulty in communicating with the local employees as local employees speak different language. (ii) Diversity increases ambiguity, complexity and confusion. (iii) Diversity also causes problems when managers and employees over generalize organizational policies, strategies, practices and procedures. (iv) Cultural diversity creates difficulties for an organization when it wants to reach on a single agreement. (v) Cultural diversity increases the complexity and problems in developing overall organizational procedures.
A company with a diverse workforce can better serve and compete in diverse markets. Hiring a diverse workforce can be challenging but the greater challenge is to retain the diverse workforce. Exploring best HR practices helps in identifying the best tools for retaining a diverse workforce. These practices include establishing open communication, supporting ongoing training and mentoring programmes and linking pay to diversity goals.
Ultimately, the key to create, develop, and retain diverse workforce is to find a way to make workforce to feel connected to their company Cultural Diversity and Management The cultural impact on management is reflected by basic values, attitudes, beliefs and behavior of the people. Culture can affect technology transfer, managerial attitudes, managerial ideology and even government-business relationships. Moreover culture affects how people think and behave. In some societies important decisions are made by few top managers, while in others, these decisions are diffused throughout the enterprise. American society comes under the first case and Japanese comes under the latter case. American and other Western countries’ cultural norms require individual rewards that are not so in Japanese culture.
In some societies, risk-taking is encouraged which is not so in others. People identify themselves very strongly with their company as in Japan against America where people identify themselves with their occupational group. Some societies encourage cooperation between people. Others encourage competition between people. The managers and employees vary on four primary cultural dimensions: * Individualism/collectivism * Power distance. * Uncertainty avoidance. * Masculinity/femininity (Career success/quality of life). Managing Cultural Diversity The five cultural dimensions highlight the important cultural differences in organizations.
To manage effectively in a global or a domestic multicultural environment, we need to recognize the differences and learn to use them to our advantage, rather than either attempting to ignore differences or simply allowing differences to cause problems. Rather managers should be taught how to respect the differences at work and how to work with them to maximize the contribution of each employee. Strategies for managing cultural differences The extent to which managers and employees recognize cultural diversity and its potential advantages and disadvantages defines an organization’s approach (strategy) to manage cultural diversity.
Ignore Cultural Differences – managers do not recognize cultural differences (diversity) or its impact on the organization. This strategy is very popular in parochial type of organizations. * Minimize Cultural Differences – managers do recognize cultural diversity but only as a source of problems. In an ethnocentric organization, managers believe that “our way is the best way” to organize and manage. * Manage Cultural Differences – The organizations which adopt the strategy of managing differences are synergistic organizations.
These type of organizations recognize the impacts of cultural diversity that leads to both advantages and disadvantages. Synergistic Organizations Assume I. that groups within society differ across cultures and that each maintains its cultural distinctness. II. that the similarities and differences are of equal importance. III. that there are many culturally distinct ways to live, to work, and to reach a final goal. IV. that there are many different good ways to reach the final goal. The best way depends on the cultures of the people involved. Cross-cultural Training
Cross-cultural training stresses on training employees about other cultures and sensitizing them to the discrimination and biases diverse employees feel. Cross-cultural training aims at helping employees live and work comfortably in another culture. Organizations can use two approaches of training that can play a big role in managing diversity. (i) First approach offers training to diverse groups of employees. People from diverse groups can be trained for an entry-level skill. (ii) Second approach is to provide training to managers and other employees who work with diverse employees.
Many organizations impart practical, real-life training to teach employees how to handle situations those arise due to cultural differences. Environmental briefings: to provide information about history, geography, climate, schools, government, economy, etc. Orientation in culture: to familiarize the employees with value systems and culture of the host country. Cultural assimilator: is a programmed learning technique that is designed to expose employees of one culture to some of the attitudes, customs, etc. of another culture. Language training: to teach conversational language skills.