4 Steps to Effectively Manage Diversity

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Do you find the phrase “workplace diversity” daunting? Does your organizational culture have a need to successfully managing diversity or to increase diversity? Let’s explore the different components and practical applications on what workplace researchers have been finding effective over the last couple of decades.

Diversity in the workplace refers to the state of having a workplace population made up with individuals with differing characteristics/traits, such as age, gender, race-ethnicity, educational background, political beliefs, lifestyle, weight, and more. These may be salient and easily detectable, such as race-ethnicity, or less so, such as their attitude towards a certain type of music. Diversity in America is generally viewed as increasing, as noted by predicted increase to 25% of the workforce belonging to a minority group in 2050, changing generations, and visible policy and social changes to be more accepting of gender diversity. Therefore, organizations and management should also adapt to understand and better manage diversity.

The effect of diversity on performance researchers have found is varied. Some argue that since it brings together a greater range of skill sets, abilities, perspectives, thought processes, and experiences, it should diversify choices in the overall pool of ideas and novel answers to problems, increasing overall performance.1 Enhanced creativity and problem solving abilities allows for greater innovation and competitive market advantage.2 Another perspective states that increase of diversity encourages formation of different groups based on their similarities. These groups can use characteristics to compare and discriminate each other, creating biases, reducing organization cohesion and performance.3

However, there may not be a choice left when it comes to harnessing diversity to maintain competitive edge and spur innovation. Diversity can make groups more likely to consider different ideas and perspectives just by its presence because a homogenous group is more likely to assume that they already agree with each other and have shared perspectives. A study of top 1500 firms and effect of gender revealed that representation of women in top management was correlated to $42 million higher in firm value.4 So what can organizations do to effectively manage diversity? Here are a couple of suggestions:

  1. Effective leadership: Leaders must understand the benefits and challenges of diversity and its management. They should also be able to build personal relationships with each individual member, view each team member’s contributions and place within the whole picture, and encourage acceptance and understanding between team members.
  1. Ongoing training: One-time or one workshop once a year is not an effective way to change behavior. Organizations committed to diversity must develop ongoing training offered to all levels within the organization and encourage a collaborative and understanding culture that embraces diversity as catalyst to innovation and competitive edge.
  1. Exposure: Heterogeneous groups as a whole may be prone to conflict if members of different groups are creating distance and differentiation. However, this can be moderated by increasing exposure of each group to another. Although it may not be possible to avoid group formation, but it is possible to expose each member to members of other groups to maximize understanding and pave a path for collaboration.
  1. Open dialogue and communication: A multi-way dialogue between different affinity groups can open up the communication channel for not just between employees and leadership but also between each group to understand the needs and different wants of each group. Competent moderation of this dialogue is extremely important. Although their ground-level interests may differ, targeting the overall good of the organization can remind each group that they are working towards the same goal.

References:

  1. Williams, K., & O’Reilly III, C. (1998). A review of 40 years of research. Research of Organizational Behavior20, 77-140.
  2. Bassett‐Jones, N. (2005). The paradox of diversity management, creativity and innovation. Creativity and innovation management14(2), 169-175.
  3. Turner, J., & Tajfel, H. (1986). The social identity theory of intergroup behavior. Psychology of intergroup relations, 7-24.
  4. Dezsö, C. L., & Ross, D. G. (2012). Does female representation in top management improve firm performance? A panel data investigation. Strategic Management Journal33(9), 1072-1089.
  5. Christian, J., Porter, L., & Moffitt, G. (2006). Workplace diversity and group relations: An overview. Group Processes & Intergroup Relations9(4), 459-466.

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