What are diversity and diversity management?

Structure Page

1. Introduction

2. What are diversity and diversity management?
2.1 Definitions
2.2 Types
2.3 Reasons

3. Opportunities and benefits

4. Obstacles and challenges
4.1 Cultural barriers
4.2 Negative attitudes
4.3 Mistakes in handling diversity

5. Integration possibilities of diversity
5.1 Training and recruitment
5.2 Personnel management
5.3 Managerial support

6. Conclusion

References and bibliography

1. Introduction

Issues to do with personnel diversity within organizations have increasingly become more relevant over recent years and Germany has not been exempted. In times of increasing shortages of skilled labor, companies must become more open to new groups of workers in order to adequately fill their vacant positions. One way of doing this is through employer branding, which helps a company position itself as a positive employer brand. Here, the Europeans are continuing to liberate themselves from the American roots of this concept and are defining their own concepts and ideas on how to implement diversity, which should take into account the specific cultural and institutional conditions. However, this also increases the risk of passing up on the pool of experience in the successful implementation of diversity management approaches in the USA, even though most of it can very well be adapted to European conditions.¹

This research paper looks to provide a clear overview of diversity and diversity management. After these terms have been defined, the focus will shift to some of the opportunities and obstacles associated with diversity, after which a conclusion shall be drawn to show why diversity management plays an important part in human resource management in a world that is becoming increasingly globalized.

2. What are diversity and diversity management?

The pursuit of diversity and diversity management in Europe is the inevitable consequence of globalization. Internationally active companies are increasingly confronted with American-style objectives and guidelines for diversity management during business mergers. These serve as catalysts in the development of a European-oriented approach that considers the different origins of the management systems and organization cultures in both cultural environments. Concurrently, a lack of consistency is still imminent in the current state of research on diversity management. Nonetheless, studies show that many companies have problems implementing a comprehensive diversity management approach.

There is no such thing as a universal definition of diversity and diversity management. As such, different authors formulate particular core statements based on their own personal views and preferences. This has therefore resulted in numerous definitions that cannot and should not be mentioned in this context. Instead, three definition attempts that draw closer to the term will be covered.

2.1 Definitions

In literal terms, diversity refers to variety or heterogeneity. However, the term is often also used within the context of diversity management and the related philosophy and strategy. In economics, diversity entails “[…] the variability and equality of people in terms of gender, race, age, ethnic origin, disabilities, religion, family status, social status, and status in the company.”² In light of this, entrepreneurial “monocultures” ought to be discouraged and “individual identities […] viewed as a valuable asset and not as an obstacle.”³

The following are two examples that try to define the terms diversity and diversity management:

Diversity:

“Diversity results from differences in age, gender, race, ethnicity, religion, sexual orientation, socioeconomic background, and capabilities or disabilities.” ⁴

“Diversity should be understood as the varied perspectives and approaches to work that members of different identity groups bring.” ⁵

Diversity Management:

“The practice of addressing and supporting multiple lifestyles and personal characteristics within a defined group. Management activities include educating the group and providing support for the acceptance of and respect for various racial, cultural, societal, geographic, economic and political backgrounds.” ⁶

According to Taylor Cox, diversity management entails “planning and implementing organizational systems and practices to manage people so that the potential advantages of diversity are maximized while its potential disadvantages are minimized.” ⁷

All in all, it can be said that the majority of authors focus on human “diversity” in their definitions. In terms of variety, diversity refers to the phenomenon of a diverse workforce or other reference groups of an organization whereas in the context of diversity management, it refers to a specific way of dealing with this diversity. Furthermore, the greatest consistency is with respect to gender, race, and age criteria. Anything beyond that creates room for preferences.

The analytical and design-oriented approach of diversity management is that in conventional organizations, diversity still exists to some extent, but there is also a so-called “dominant group” or a “homogeneous ideal”.⁸ This dominant group not only occupies the decisive positions in companies but also determines the key values, norms, and rules that apply to the organization, i.e. they shape the organizational culture.⁹ One of the characteristics of such an organizational culture is that diversity is perceived to be rather threatening from the perspective of the dominant group. The other employees (e.g., women or people with an migrant background) are categorized as “different” or “special” and are often also considered to be “deficient”. This is intended to justify why they should be assigned tasks from lower hierarchy levels and be paid less as well as why they are hardly offered any development opportunities. Moreover, members of the dominated groups are often expected to adapt to the values and practices of the dominant group. By contrast, diversity management aims to “unleash” and utilize the power and energy of all employees by creating conditions that are suitable for everyone (“multicultural organization”).¹⁰

2.2 Types

Different authors have, in different studies, defined different attributes of human “diversity” depending on their personal focus. Inspired by Miliken and Martins, Sepehri and Wagner distinguish between easily perceptible diversity criteria and those that are hard to recognize. Here, non-visible features such as cultural values and experiences (deep level diversity) are also considered in addition to visible demographic diversity characteristics such as age, gender, ethnic origin, religion, and level of education (surface level diversity).¹¹ Whereas visible attributes play a key role when it comes to participating in working and decision-making processes within a group, the quality and distribution of differences that are invisible or difficult to recognize can prove to be of significant relevance to a company’s performance and results.¹²

Other authors talk of primary and secondary dimensions. Primary dimensions, which tend to be more influential than secondary dimensions, are characterized by the fact that they are innate and cannot be altered. They have a continuous influence on one’s self-image and interpersonal relations. They include one’s ethnicity, gender, and sexual orientation. On the other hand, secondary dimensions are acquired over time and can be altered. They include education, residence, social status, family status, religious beliefs, profession, and experience.¹³

Regarding the implementation in an organization, Rosenzweig points out the need to pre-clarify the aspects to be considered and those to be disregarded: “[…] of the many dimensions we can identify, which are worthiest of attention - language, culture, education, race, gender, age, religion or some others? Faced with the complexity, it is hardly surprising that many firms broad pronouncement about the benefit of diversity but do not take any real step [...] about which dimensions are most important.”¹⁴

However, this selection depends on another basic assumption: A company must clarify why it considers diversity management necessary. The focus is set on different attributes based on how the meaning and purpose of heterogeneity in the company is perceived. Thus, a generalized specification would neither be helpful nor effective.

2.3 Reasons

The topic of diversity attained its virulence from developments within the American legal system. Constitutional prohibitions of any form of discrimination and the adoption of equality laws forced companies to deal with the issue. The so-called “general prevention” in the American legal system aims to counteract organizational discrimination through the threat and imposition of compulsory fines, most of which are in the seven-digit range. The success of diversity management therefore relies largely on a combination of legal and economical requirements (cost reduction through damage prevention).

A glance at the German legislation shows that diversity is also a German issue. Formal equality provisions are clearly laid down in the Basic Law (“men and women shall have equal rights”)¹⁵, the German Civil Code, the Disabilities Act, and the Act for the Promotion of Women’s Rights. However, a mere breakdown of the legal aspects with respect to diversity would be far too short-sighted. In the search for reasons for diversity management, the classification according to Thomas and Ely (1996) is quite helpful.¹⁶ The two Americans classified diversity as follows:

1) Fairness and discrimination approach

2) Market entry and legitimacy approach

3) Learning and effectiveness approach

[...]

¹ Gertraude Krell/Hartmut Wächter (Hrsg.), 2006: Diversity Management. Impulse aus der Personalforschung, Trierer Beiträge zum Diversity Management, Vol. 7, Rainer Hampp Verlag: Munich/Mering, p. III.

² Katharina Köhler-Braun, 1999: Durch Diversity zu neuen Anforderungen an das Management, in: Zeitschrift für Organisation 4/99, p. 188.

³ Dies., 1999: Durch Diversity zu neuen Anforderungen an das Management, in: Zeitschrift für Organisation 4/99, p. 188.

⁴ Jennifer M. George/Gareth A. Jones, 2012: Understanding and Managing Organizational Behavior, 6th edition, Pearsons Education: Upper Saddle River, p. 17; also in: Robert Münscher, Diversity and conflict management, AKAD-Studienbrief, p. 5.

⁵ David Thomas/Robin Ely, 1996: Making differences matter: A new paradigm for managing diversity,in: Harvard Business Review, No. 5, Harvard Business School Publishing, p. 80.

⁶ http://www.businessdictionary.com/definition/diversity-management.html (Accessed on 10.02.2017)

⁷ Hans-Jürgen Aretz/Katrin Hansen, 2002: Diversity und Diversity-Management im Unternehmen, in: Dieter Wagner/Payvan Sepheri, Managing diversity, Vol. 3, Lit Verlag: Münster, p. 11.

⁸ Marilyn Loden/Judy B. Rosener, 1991: Workforce America: Managing Employee Diversity as a Vital Resource, Business One Irwin: Homewood, p. 36 et seqq.

⁹ Gertraude Krell, 1996: Mono- oder multikulturelle Organisationen? „Managing Diversit“ auf dem Prüfstand, in: Industrielle Beziehungen, Vol.3, No. 4, p. 334-350.

¹⁰ Taylor H. Cox, 1993: Cultural Diversity in Organizations: Theory, Research and Practice, Berrett-Koehler Publishers: San Francisco, p. 229.

¹¹ Payvan Sepehri/Dieter Wagner, 2000: Managing Diversity - Eine empirische Bestandsaufnahme, in: Personalführung 7/00, p. 56. See also: Frances J. Milliken/ Luis L. Martins, 1996: Searching for Common Threads: Understanding the Multiple Effects of Diversity in Organizational Groups, in: The Academy of Management Review, Vol. 21, No. 2, New York University Press, p. 402-433.

¹² Mark Agars/Janet Kottke, 2004: Models and practice of diversity management: A historical review and presentation of a new integration theory, in: Margaret S. Stockdale/Faye J. Crosby (Hrsg.): The psychology and management of workplace diversity, Wiley-Blackwell: New Jersey, p. 73.

¹³ Boris Voss, 1998: Intercultural Management: A Journey towards Cultural Diversity in the Workplace, Verlag für interkulturelle Kommunikation: Frankfurt a.M., p. 4; see also: André Schulz, 2009: Strategisches Diversitätsmanagement. Unternehmensführung im Zeitalter der kulturellen Vielfalt, Gabler Verlag: Wiesbaden, p. 1-17.

¹⁴ Philipp M. Rosenzweig, 1999: Strategies for Managing Diversity, in: The Financial Times from 6th March 1998.

¹⁵ Art. 3, par. 2 Grundgesetz (GG).

¹⁶ Payvan Sepehri/Dieter Wagner, 2000: p. 51.