Economic Business Environment Essay
Cox and Beale (1997 cited Harvey and Allard 2005) define diversity as a group of people in a social system that has different group ties. On the other hand, Thomas (1999 cited Harvey and Allard 2005:p3) defines diversity including not only differences but also similarities, indicating that diversity is “individuals who are different in some ways and similar in others”.
The term managing diversity is nowadays becoming more important to organizations, not only because they are interested in diverse groups or they are up to date with the Equal Opportunities legislation and policies, but because they are facing important challenges related to the management and development within a diverse workforce in order to survive in today’s global marketplace (Edwards, 1991 cited Henderson 1994). Ten years ago, the majority of organizations did not think about diversity in the workplace with the intention of having benefit from it.
Today, a vast percentage of organizations take advantage of diversity initiatives to enhance organizational performance and most important, they are committed to it (Berrios, 2003 cited Liberman, 2003). According to Mor Barak (2005), managing diversity is basically to bring together employees from different backgrounds. However, this definition does not take into account the influence that it might have on management behaviors.
According to Harvey and Allard (2005), diversity can affect people’s interactions in the workplace since it requires changes not only in the way people interact within each other, but also changes in the functionality of the organization, hence in the business’ performance. As it was mentioned before, diversity in a workforce includes employees with a variety of backgrounds in terms of race, gender, education, sexual orientation among others. This study will be focused on the understanding of a cultural diverse workforce with the aim of examining its influences on management styles.
For this, it is necessary to point out some important definitions and topics that are relevant to management style in an international and heterogeneous business environment. Therefore, to get a better understanding of cultural differences, this study will be based on and supported by three important authors who developed models through research in relation to cultural differences and its influence on management and organizations’ effectiveness. Hofstede, Trompenaars and Hall & Hall are three of the most important and significant contributors in what culture and workplace differences regard (Mullins, 2005).
For the above mentioned, a global company has been selected to examine the study in this field. ABC is an International superstore leader in the United States. This company is chosen due to its global market presence, which have given it the sensibility to diversity which they use it as a competitive advantage. In its networking group, it includes employees from African-American, Hipics/Latinos, Pakistani, among others, so it has a culturally diverse workforce, which is just right for the understanding of the relevance of the investigation. Statement of the Problem
Managing diversity is a reality that all Multinationals and International companies are facing. Most organizations nowadays are adapting programs to manage a cultural diverse workforce in order to fulfill their objectives and gain place in the global competitive marketplace, making the most of its employees potential. Globalization is one of the reasons workers are moving across borders, increasing the heterogeneity of organizations and development of cross-cultural interaction in order to enhance alliances that go beyond differences such as race, gender, and others (Harris et al, 2004).
The United States is facing the challenges that globalization has brought in order to reach common objectives such as encouraging innovation and business investment through Union identity and national diversity. In the early 21st century, organizations have been through important changes related to this trend of globalization where not only factors such as international competitive pressure and business activities have taken place, but also the diversity of human capital from all around the world where cross-cultural interaction has been in expansion (Mullins, 2005).
Therefore, it is important that these companies identify their strategies when managing cultural differences in order to have the right opportunities to gain competitive advantage (Schneider and Barsoux, 2003). Nevertheless, there are also some risks than can bring difference of cultures in the workplace or business activities; consequently, it is vital that organizations understand that different cultures execute procedures differently (Pooley, 2005; Adler, 1983 cited Miroshnik, 2002).
Furthermore, and being more specific, the management of these ethnically diverse workforce has been on the spot of many authors. As Tayeb (1996; p180-181) says “the first step in the management of a diverse workforce is to recognize and value such diversity”, then he argues that “once the diversity is recognized, the next step is to ensure that it is effectively utilized and handled”.
In this case, utilizing those differences contributes to an effective management, thus to bring opportunities for organizational learning and innovation creating competitive advantage in the global marketplace (Schneider and Bardoux, 2003; Mor Barak, 2005). To gain this, managers must have the needed skills to manage a multicultural workforce, this includes, having the ability to recognize and accept cultural differences between their workers as well as coordination, cooperation and communications (Lane et al, 1997; Ravlin et al cited Earley and Singh, 2000).