A LITERATURE REVIEW OF DIVERSITY MANAGEMENT RESEARCH &THEORIES

A Research paper Submitted to the Faculty of Graduate Studies and Research In Partial Fulfillment of the Requirements for the Degree of Master of Business Administration University of Regina By Sameema Tahir Haque Regina, Saskatchewan. March, 2008

Copyright 2008: S.T.Haque

Literature Review Workplace Diversity

TABLE OF CONTENTS
1.0 2.0 3.0 ABSTRACT INTRODUCTION TYPES OF WORK FORCE DIVERSITY 3.1 3.2 4.0 5.0
Role Diversity Inherent Diversity

OVERVIEW OFEMPIRICAL RESEARCH THEORIES ON DIVERSITY 5.1 5.2 5.3

Information and Decision-Making Theory Social identification and Categorization Theory Similarity and Attraction Theory

6.0 7.0 8.0 9.0

UNION PERSPECTIVE DIVERSITY IN CANADA CONCLUSION REFERENCES

Literature Review Workplace Diversity

1.0 Abstract: In the hyper competitive global business market of today there are
no certainties. Past successes and failures though important hold no sway on the future of an organization in a business environment that is in a constant state of flux. To help deal with uncertainty, an organization needs access to diverse perspectives and assumptions about how to manage and do business. Diversity provides this adaptive capacity by giving a business access to a broader scope of perspectives to help understand and clarify uncertainty. Also diversity helps companies by combining perspectives in innovative ways. Demographic diversity in a workplace is a reality in terms of both composition and sheer numbers and this trend seems to grow with each day. On one hand research indicates that diversity is properly managed can lead to cost savings, a talented workforce and overall business success and prosperity but on the other hand it is suggested that the path to accomplish this is fraught with difficulties. Diversity in work place brings many challenges and constraints related to political correctness. This in turn redefines the traditional understanding of support, empathy and mutual understanding in all business transactions. Effective management of diversity entails not only the acquisition of diverse workforce but also the ability to develop and share understanding of how to use the talents such individuals bring. Therefore it is prudent for us to look towards the scholars in the field of business and human psychology to develop an understanding of what work force diversity means and how to best utilize this asset. To this end in this paper I have sketched out the evolution of ideas, and practice with regard to diversity management.

Literature Review Workplace Diversity

2.0 Introduction: The importance of recognizing how our differences are

different has become even more important these days because despite our unprecedented closeness as a result of globalization, we appear to be even further apart with an evergrowing sense of insecurity that is underpinned by a politics of fear and suspicion for those who are not like us. With an increased level of movement across the globe the face of the work force is in a state of constant flux. For example research indicates that in USA ethic minorities will comprise 28 percent of the population in 2005 and 2050 this number is expected to increase up to 50 percent ([1] Boone and Kutz, 1999; [2] Wright and Noe, 1996; [3] Fluery, 1999). Similarly in Canada visible minorities make up 10 percent of the population according to 1995 figures and this diversity within the population is expected to double in number by the year 2015 ( [4] Demer, 2002:2/4). In order to develop a synergistic relationship within the constituents of a diverse work force, efforts need to be focused on the development of best practices for effective diversity management.

3.0 Work force Diversity: The word diversity can be defined as a mixture
of people with different group identities within the same social system ( [3]Fleury,1999)The unlimited potential sources of diversity in mankind can be divided into two categories from a work force perspective. 3.1 Role Diversity: This includes diversity within the scope of the position that a

member has within the organization. The sources of diversity include specialized training and knowledge, practicing licenses and specific job related competencies. Diversity within these dimensions is clearly defined in its scope and well accepted ( [5] Maznevski, 1994). This type of diversity within an organization is deliberate and necessary in order to
4

Literature Review Workplace Diversity do business for e.g. a hospital would employee a diverse workforce for all the clinical services it provides which includes physicians, nurses, technologists, cooks and house keeping etc. 3.2 Inherent Diversity: This includes diversity within the scope of characteristics that

are inherent to a human being and cannot be altered. The sources of this diversity include age, gender, nationality, religious affiliation, sexual orientation etc. Diversity within these dimensions is often neither obvious nor well understood or accepted ([5] Maznevski, 1994). Such diversity if not appropriately incorporated into the work place could lead to discriminatory practices and if not managed well a cause of great conflict. It is the effective management of this type of diversity that has gained immense importance in the field of human resource management in the recent years. The need to avoid any discriminatory practices towards the various elements of such diversity has led to businesses establishing checks and balances that monitor human resource practices on an ongoing basis. Legislative pressures have further ensured compliance to such human resource standards and provided protection of rights for the diverse work force.

4.0 Overview of empirical research : Most researchers agree on the

inevitability as well as the importance of a diverse workforce in any business. It is a widely held belief in the human resources practitioners that in the 21st century , one of the most important human resource trends is that of an increasingly diverse workforce( [6]Lavaty and Kleiner,2001) .What gives effective diversity management even more importance is the increasingly believed view that valuing differences makes business sense ( [7]Iles,1995). Equally as important is the fact that companies are now serving a customer group just as diverse as their workforce , therefore workforce diversity also provides an opportunity to
5

Literature Review Workplace Diversity develop strategies to better understand and serve the needs of the customers ( [ 2]Wright and Noe, 1996). Diversity can have a positive or a negative affect on an organization, the nature of the impact depends largely on the type of climate within the organization rather then the phenomenon of diversity itself ( [8] Bhadury et al, 2000). Some researchers believe that diversity can increase ambiguity, cause confusion and complexity in group process leading to the downfall of an organizational team structure ( [9]Chevrier,2003). On the other hand some view that the two opposite i.e. diversity and unity existing within the frame work of an organization simultaneously lead to its strength on an individual and a collective level ([ 10]Haraung and Harung, 1995). At the same time the two terms are essentially polar in requirements i.e. with the increase in differentiation due to diversity, the level of efforts needed to achieve integration in the form of unity within the organization are much higher ( [11] Lawrence and Larsch, 1967). From a management perspective if there is an unwillingness to learn and change to meet the needs of a diverse workforce, a failure to motivate the workforce may be the end results, since the traditional managerial tools to award, motivate and direct the workforce may no longer be relevant. ( [12]Lee and Chon,2000;[13]Jackson and Bak,1998; [14]Diribarne,2002; [15]Uysal,1994). Some researchers also point to the fact that the globalization of technology and trade and thus the task-force are inevitable. These lead to a normative conflict due to the diversity of the workforce. Use of traditional methods of conflict resolution such as compromising, forcing, persuading and problem solving may not be adequate under these circumstances. No matter the view towards diversity almost all researcher are in agreement on the one thing- that is- Management must be ready and

Literature Review Workplace Diversity willing to use this diversity to their advantage and hone there skills rather then lamenting about it ( [16] Appelbaum et al, 1998).

5.0

Theories on the impact of diversity on working relationships : There are varied view son this aspect and each is

supported by its own set of arguments. The three most widely accepted theories on the subject are as follows: 5.1 Information and Decision-Making Theory: This theory is based on the concept that

the constituents of the decision-making groups affect how information is obtained and processed and ultimately the outcome in this form of a decision. This theory predicts a positive relationship between diversity and information and decision making. The heterogeneity of a working group leads to an increased level of creativity, multiple perspectives and ideas, larger resources of knowledge and expertise ([17]Tziner and Eden, 1995). As the scope of the information gathered increases, better and well informed decisions can be made. Even when group dynamics cause problems in highly diverse teams, the quality and quantity of information gathered is enough to offset these problems([18] Ancona and Calwell1992; [19] Jehn et al.1999; [20] Zenger and Lawrence, 1989). One important factor to consider is the nature of the task or activity at hand. For routine tasks the need for creativity is low and usually standard operating procedures are in place, therefore diversity can actually have a negative impact as it may extend the time required to reach a decision. For complex and new tasks, the need for creativity is high as brainstorming and problem solving activities need to take place to explore all possible options. For such scenarios, a highly diverse team, can often be more effective due to various aspects and view points being represented within the working group. The one drawback in this theory is
7

Literature Review Workplace Diversity that most of the research used to develop it is based on role and educational diversity rather then intrinsic diversity within a group. There is very limited research available on the positive impact of intrinsic sources of diversity on decision making process ( [18]Ancona and Calwell, 1992,; [21]Bantel and Jackson 1989; [22]Pelled 1997). 5.2 Social identification and Categorization Theory: Social identification starts with

the assumptions that each human being has a desire to increase their self-worth. In order to do that people engage in social comparison and thereby categorization of others, based on criteria such as age, gender, race , socio-economic status, education, religion etc. Then a recognition of personal social status into one of these categories based on self identified similarities of attributes and criteria. Considering the assumption above, since the purpose of the exercise is to maximize personal worth, the categories identified with self are deemed as good and opposite as the bad. In this way the group of individuals closest to self identity are referred to as in-group and the opposite the out-group. Again as per the initial assumption since people tend to see themselves in the best light , positive characteristics such as honesty , trustworthiness, loyalty , integrity etc are often falsely attributed to members of the in-group and vice versa for the out-group ( [23]Pitts & Jarry, 2007; [24]Swann et al.2002; 2004; [25] Brewer 1979; [26 ] Stephan, 1985; [27] Tajfel, 1982 ). It is also argued that this false attribution of positive and negative attributes to the in and out groups respectively is a form of self- verification and validation of personal social assessment ( [23]Pitts & Jarry, 2007; [24]Swann et al.2002; 2004). Therefore this theory predicts a negative relationship between diversity and working relationships. According to this theory the group dynamic complexity is directly proportional to the diversity among its member. As a working groups become increasingly diversity,
8

Literature Review Workplace Diversity communication and cohesion are compromised leading to breakdown in efficiency of decision making process ( [27] Tajfel 1982; [28]Turner 1982, 1987). The difficulties in the process of working together lead to an end product of lower quality i.e. there is no synergy between the diverse ideas brought to the table by the group members as the communication of these ideas or options is not clear and relationships within groups are confused and strained due to lack of empathy, respect of understanding for each others contribution. 5.3 Similarity and Attraction Theory: This theory is based on the principles that

similarities among people lead to a broader understanding of each others perspective due to shared experiences and knowledge. Secondly similar people have more things in common with each other and therefore have an increased comfort level in communication and interaction with each other ([29]Bryne et al,1966). Research has indicated that in any scenario where a person has the choice of different people to interact with, he or she is most likely to choose a person that is most similar to him or her ([30]Burt and Regans, 1997; [31] Lincoln and Miller, 1979). This theory therefore also predicts a somewhat pessimistic view of the impact of diversity on working relationships. Since people have a better understanding of others that come from a similar background a diverse team may have communication and understanding issues which in turn negatively impact the team dynamics leading to low cohesion, delayed decision making, conflict at times and overall performance issues. The draw back of this theory is the lack of credence given to the commonalities of human nature, the ability to understand and empathize, the better informed nature of the workforce in which media and travel have exposed people to a wide variety of experiences. These broad pools of experiences allow most people to have at least some shared perspective.
9

Literature Review Workplace Diversity

6.0 Union perspective : Unions are often criticized for their focus on
bargaining efforts towards improvement of basic employment conditions only. ( [32]Metcalf,2000). This may be because the process involved in bargaining has traditionally been male dominated and based on liberal sameness models of equality ([33] Jewson and Mason, 19860) Union thinking is fearful of promoting the diversity issues as this seems to be at odds with concept of solidarity in bargaining issues and may lead to the weakening of the unions power and influence over members. Unions are also concerned about the implicit comodification of labor as a resource for organizational objectives, within the diversity discourse ([34]Kirton and Greene, 2005). The issue of diversity is problematic for the unions since it focuses on the individual difference rather then collective social group difference which may shift the focus of policy development from pattered discrimination and disadvantage. Unions see their role as that of drawing attention to an employees experience of discrimination rather then allowing them to be talked out of existence by the existence of some diversity initiative. Another area of concern is that diversity initiatives are often a top down endeavor with a business case logic attached to them. This could allow organizations to be selective about the dimensions of diversity to value and the ones to ignore as this is largely subjective to the managerial decision makers, often mistrusted by unions. Researcher argue that exercise of management discretion is core to diversity ([35] EOR,2001). This is in direct contrast to the equal opportunities formula promoted by the unions in order to keep management committed to consistent treatment of individuals and groups across the organization. Over all the unions are suspicious of the business case model of the diversity initiatives as effective means of valuing all individuals but fear them to be tactics that may lead towards the disintegration of processes involved in
10

Literature Review Workplace Diversity handling discrimination / inequality ([34]Kirton and Greene, 2005). It can be argued that since the unions emphasize formal rules and standard procedures, so if these can be adequately developed and implemented , the unions can in fact have a positive effect on the promotion of diversity ([36] Delaney and Lundy, 1996). Form this perspective the unions lend legitimacy to the diversity discourse and it does not constitute a threat to the union involvement in this arena ([34]Kirton and Greene, 2005).

7.0 Diversity in Canada: In Canada cultural diversity is often referred to a

refection of equality and inclusion. It is a unifying factor, a source of collective strength and an essential constituent of the Canadian identity. Diversity within this frame work is a thing of beauty and something to be proud of. Many organizations have developed initiatives towards diversity in which the focus is ensuring that everyone is included and valued within the organization as well as have a workforce that is reflective of the community constituents. Some however have given it little value and equate it to something of a disability. Such organizations participate in diversity initiative only to the level necessary to comply with the laws of accommodation for the workforce. There are others who have taken a more material stand and use diversity initiatives just to tap into the ethnic customer markets without any real commitment to long term goals.

8.0 Conclusion : There are two types of workforce diversity; task diversity and
inherent diversity that are part of the business environment, with the first one being of interest to operational management practices and the second one that of human relations management practices. Researchers though all agree with the necessity of a diverse work force as a strategic initiative towards business prosperity have varied views on the management challenges it brings. The three most well recognized theories of work force
11

Literature Review Workplace Diversity diversity and its implications each give us a unique perspective to develop and enhance understanding of all how the norms and interactions of day to day business transactions are impacted by a diverse workforce. Unions being an important third party besides the employee and the employer in this issue have their one perspective of what a diverse work force entails. An overview of these aspects in this paper gives if not an in-depth then certainly a well-balanced understanding of the complexities of work force diversity and its implications on the major stakeholders employees, employers and the unions. The concluding note to the discussion is that no matter which theory or research perspective appeals to an individual or a business, we must remember that central to promoting respect for diversity is the recognition of the relationship between the individual and his or her place within the local, national and global communities and that diversity is a natural phenomenon that needs to be respected whether it is cultural, ethnic, racial or ideological. Therefore it is important to not loose focus of humanitys commonality when considering the differences between cultures. Humanitys commonality includes the humane traits and values such as those of compassion, mercy, forgiveness, truthfulness, selflessness and humility.

9.0 References :
1.

Boone and Kurtz (1999), 9th Ed., The Dryden Press, Orlando, available at: boneandkurtz@contemporartybusiness.com
12

Literature Review Workplace Diversity 2. Wright, P.M. and Noe, R.A. (1996), Management of Organizations, Irwin McGrawHill. 3. Fleury, M.T.L. (1999), The management of culture diversity: lessons from Brazliian companies, Industrial Management & Data Systems, Vol. 99 No3, pp. 109-14. 4. Demers, J. (2002), Crossing the cultural devides, CMA Management, Vol. 76 No.6.
5.

Martha L. Maznevski, Katherine M. Chudoba (Sep/Oct 2000). Bridging space over time: Global virtual team dynamics and effectiveness, Organization Science. Linthicum,Vol. 11, Iss. 5, p. 473-492.

6.

Lavaty, S. and Kleiner, B.H., (2001), Managing and understanding the French employee, Management Research News, Vol. 24 No. , pp 45-8.

7. Illes, P. , Learning to work with difference, Personnel Review, Vol. 24 No. 6, pp 44-60. 8. Bhadury, J., Mighty, E.J. and Damar, H. (2000), maximizing workforce diversity in project teams: a network flow approach, Omega, Vol. 28, pp 143-53. 9. Chevrier, S., (2003), Cross-cultural management in multinational project groups, Journal of World Business, Vol. 38, pp 141-9. 10. Harung, H.S., and Harung, L.M. (1995), Enhancing organizational performance by strengthening diversity and unity, The Learning Organization, Vol.2 No 3., pp 921. 11. Lawrence, P.R. and Lorsch, J.W., (1967), Differentiation and integration in complex organizations, Administrative Science Quarterly, Vol. 12 No 1., pp.1-47.
13

Literature Review Workplace Diversity 12. Lee, C., and Chon, K. (2000), An investigation of multicultural training practices in the restaurant industry: the training cycle approach, International Journal of Contemporary Hospitality Management, Vol. 12 No. 2, pp 126-34. 13. Jackson, T., and Bak, M. (1998), Foreign companies and Chinese workers: employee motivation in the Peoples Republic of China, Journal of Organizational Change Management, Vol. 11 No. 4, pp 282-300. 14. Diribarne, P., (2002),Motivating workers in emerging countries: universal tools and local adaptations, Journal or Organizational Behavior, Vol. 23, pp 243-56. 15. Uysal, N. (1994), Globalizm: Sinirsiz ve Cok Kulturlu sirket Duzenine Dogru, Garanti Bankasi Dergisi, Vol. 79, pp 3-8. 16. Appelbaum, S.HJ., Shapiro, B. and Elbaz, D. (1998), The management of multicultural group conflict, Team Performance Management, Vol. 4, No5., pp 211-34. 17. Tziner, A and D. Eden. 1985. Effects of Crew Composition on Crew Performance: Does the Whole Equal the Sum of the Parts? Journal of Applied Psychology 70:85-93. 18. Ancona, D.G., and D.F. Caldwell. 1992. Demography and Design: Predictors of New Product Team Performance. Organization Science 3: 321-341. 19. Jehn, KJ.A., G.B. Northcraft, and M.A. Neale. 1999. Why Some Differences Make a Difference: A Field Study of Diversity, Conflict and Performance in Workgroups. Administrative Science Quarterly 44: 741-763

14

Literature Review Workplace Diversity 20. Zenger, T and B. Lawrence. 1989. Organizational Demography: The Differential Effects of Age and Tenure Distributions on Technical Communications. Academy of Management Journal 32: 353-376 21. Bantel, K and S. Jackson. 1989. Top Management and Innovations in Banking: Does the Composition of the Team Make a Difference? Strategic Management Journal 10: 107-124. 22. Pelled, L. 1997. Relational Demography and Perceptions of Group Conflict and Performance: A Field Investigation. International Journal of Conflict Resolution 22 (1): 54-67. 23. Pitts, D.W., In press. Representative Bureaucracy and Ethnicity in Public Schools: Examining the Link Between Representation and Performance, Administration and Society. 24. Swann, W.B., J.T. Polzer, D.C. Seyle, and S.J. Ko, 2004. Finding Value in Diversity: Verification of Personal and Social Self Views in Diverse Groups. Academy of Management Review 29 (1): 9-27. 25. Brewer, M. 1979. Ingroup Bias in the Minimal Intergroup Situation: A CognitiveMotivational Analysis. Psychological Bulletin 86: 307-324. 26. Stephan, W. 1985. Intergroup Relations. Pp 599-658 in G. Lindzey and E.Aronson, eds. Handbook of Social Psychology. New York: Random House. 27. Tajfel, H. 1982, Social Identify and Intergroup Relations, Cambridge: Cambridge University Press.

15

Literature Review Workplace Diversity 28. Turner, J. 1982. Toward a Cognitive Definition of the Group. Pp 15-40 in H. Tajifel, ed., Social Identify and Intergroup Relations. Cambridge: Cambridge University Press. 29. Byrne, D., G. Clore, and P. Worchel. 1966. The Effect of Economical SimilarityDissimilarity as Determinants of Attraction. Journal of Personality and Social Psychology 4: 220-224. 30. Burt, R. and R. Regans, 1997. Homophily, Legitimacy, and Competition: Bias in Manager Peer Evaluations. Working Paper. Graduate School of Business, University of Chicago. 31. Lincoln, J and J. Miller. 1979. Work and Friendship Ties in Organizations: A comparative Analysis of Relational Networks. Administrative Science Quarterly 24: 181-199. 32. Metcalf, D. (2000), Fighting for equality, Centrepiece, Summer. 33. Jewson, N. and Mason D. (1986), The theory and practice of equal opportunities policies: liberal and radical approaches, Sociological Review, Vol. 34 No. 2, pp 307-34 34. Kirton, G. and Greene, A.M. (2005). The Dynamics of Managing Diversity: A Critical Text, 2nd. ed. Butterworth-Heinemann, Oxford. 35. EOR (2001), Diversity now the ultimate test of management capacity, Equal Opportunities Review, No. 96, pp. 11-17. 36. Delaney, J. and Lundy, C (1996), Unions, collective bargaining, and the diversity paradox, in Kossek, E. and Lobel, S. (Eds), Managing Diversity, Blackwell, Oxford, pp. 245-72.
16