Week 5: Understanding & Managing Diversity

1. Week 5: Understanding & Managing Diversity Agenda for Today • Understand the dimensions of diversity • Understand the factors that lead to discrimination and fairness • Understand how diversity builds competitive advantage • Understand the differences between Affirmative Action Plans and Managing Diversity • What are some of the best practices to managing diversity • In-class activities: Denny’s case and a video clip on Xerox

2. Trends in Workforce Diversity • Changing demographics in the workforce • 49.5% new entrants between 1990-2005 will be women • People of color projected to add 34.7% of new entrants • Median workforce age projected to reach 40.6 by 2005 • Increased education: educational mismatches • Underemployment • High school Dropout rate • Increased awareness of competitive advantage & benefits offered by organizational diversity • Legislation and laws that make discrimination illegal • Globalization of business places premium on understanding different cultures, customs, social norms and mores

3. Dimensions of Diversity (Loden, 1996) First language Military experience Education Sexual orientation Age Religion Work style Mental/ physicalabilities andcharacteristics Mental/ Physical abilities and characteristics Gender Income Communication style Ethnic heritage Race Work experience Family status Geographic location Primary dimensions Organizational role and level Secondary dimensions

4. Primary (Observable) Demographic in nature Immutable and inborn Exert important and sustained influence throughout our lives Shapes our core identity Salient to other people & self (i.e., we tend to notice it about it each other) Likely to evoke stereotypes, biases etc because of their visibility & salience Secondary (Not observable) Acquired, discarded, modified throughout life Less visible and salient to others Situations may increase salience Less influence on core identity than primary dimensions Influences self-esteem and self-definition Dimensions of Diversity (Loden, 1996)

5. Dimensions of Diversity • Primary and secondary dimensions dynamically interact to: • Influence Self-image, values, needs, goals & expectations • Define your diversity identity • Influence how you are perceived and treated by others

6. Types of Discrimination • Access Discrimination: Occurs at the time of entry into the organizations. Takes the form of limits on job availability through restrictive advertising & recruiting, rejecting applicants or offering a lower starting salary. • Treatment Discrimination: Occurs after a person is hired. Takes the form of limiting advancement opportunities or harassing individuals because of who they are. • Promotion (glass ceiling, concrete ceiling & brick wall; perf. eval ) • Pay (Women, women of color and men of color earn less) • Harassment (sexual, race, age) • EEO laws cover both types of discrimination, but more needs to be done to eliminate discrimination

7. Model of Organizational Fairness in Career Advancement Opportunities(Greenhaus, Callanan, & Godshalk, 2000) • Beliefs and Feelings • Stereotypes • Psychological Distance • Cultural Misunderstanding • “Lost Opportunities” Through Differential Treatment • Unsatisfactory supportive relationships • Restricted developmental opportunities • Restricted job power • Peripheral career path assignments • Exclusionfrom informal networks Cultural Dissimilarity Job Performance Assessments & Attributions Career Advancement Opportunities

8. Historical Perspectives on Diversity • “Difference as Deficiency” Perspective(Loden & Rosener, 1991) • Diversity is threatening to organizational functioning • Members of diverse groups should assimilate • Melting Pot Model (Assimilation) • Emphasis is on fitting in with dominant group’s values • Emphasis on homogeneity – give up unique group identity • Color-blind, gender blind model, i.e., “we are all the same” & “we should aspire to being all the same.” • “Difference as Better” Model(Thomas, 1990; Thomas & Ely, 1996) • Mulligan stew not puree (out of a melting pot model) • Appreciation of all types of differences – not just race & gender • Recognition of differences without value judgments

9. Diversity and Affirmative Action: Why AA Plans are not Enough (Thomas, 1990) • Assumption: The pipeline is not filled with qualified minorities and women, hence not enough people to promote to top management • Fact: problem is not in getting enough qualified people through the door – it is in retaining them • Glass ceiling persists because of: • Prevalence of stereotypes and organizational biases • Male model of successful management • Inhospitable corporate culture • Exclusion from mentoring programs & informal communication/information networks

10. Diversity & AA Plans (contd.) • Focus on pipeline issues fails to address organizational culture issues & biases (e.g., stereotypes) • Dominance of male model of management places burden of change on newcomers • Fails to move away from melting pot model – assimilation is key to advancement • Does not address subtle forms of treatment discrimination (e.g., developmental assignments, performance appraisals) • Fails to provide mentoring opportunities & effective role models • “Win/lose” & “we/them” perspective hurts everyone • Encourages AA backlash; charges of reverse discrimination

11. How Diversity can Help Increase Competitiveness(Cox & Blake, 1991; Robinson & Dechant, 1997) • Win the competition for talent • Organizations that are better able to recruit, develop, retain and promote diverse employees will have an edge • Cost savings • Understand causes of turnover, absenteeism, & lawsuits and minimize frequency of occurrence • Improve Marketplace understanding • Open up new markets through cultural insights & sensitivities that enhance organizations’ marketing efforts • Attract increased business by matching the diversity of consumer base with diversity in their workplace • Cultural competence that extends to cross-cultural business situations

12. How Diversity can Help Increase Competitiveness (contd.) • Increase Productivity through: • Creativity & Innovation • Better problem solving • Lower turnover and absenteeism costs • Improved employee morale • Enhance system flexibility • Anticipate and meet needs of all employees • Flexible organizations more adaptable to environmental changes • Enhance leadership effectiveness • Heterogeneity in top management conducive to financial effectiveness

13. Comparison of AA, Valuing Differences &Managing Diversity (Gardenswartz & Rowe, 1993) • Affirmative Action • Quantitatively driven: achieving equality of opportunity through changing organizational demographics. Monitored through statistical reports & analysis • Legally driven: Written plans & statistical goals for specific groups utilized; reports mandated by EEOC & consent decrees • Remedial: Specific target groups benefit as past wrongs remedied; previously excluded groups have an advantage • Assimilation model: pressure to fit in & assimilate • Opens doors in organizations; hiring & promotion decisions • Resistance: perceived limits to autonomy in decision-making; fears of reverse discrimination

14. Comparison of AA, Valuing Differences &Managing Diversity (contd.) • Valuing Differences • Qualitatively driven: emphasizes appreciation of differences & creating an environment where everyone feels valued & accepted . Monitored by attitude surveys • Ethically driven: Moral and ethical imperatives drive culture change • Idealistic: Everyone benefits; everyone feels valued & accepted in an inclusive environment • Diversity model: Assumes groups will retain unique values; shape organization & be shaped by it • Opens attitudes, minds & culture: Affects attitudes • Resistance: Due to fear of change, discomfort with differences; desire to return to “good old days.”

15. Comparison of AA, Valuing Differences &Managing Diversity (contd.) • Managing Diversity • Behaviorally driven: emphasizes building of specific skills & creating policies to get best from everyone Monitored by progress toward achieving these goals & objectives • Strategically driven: Behaviors & polices seen as contributing to org. effectiveness; tied to rewards and results • Pragmatic: Organization & employee benefit: morale, productivity and profit increase • Synergy model: Assumes diverse groups will create new ways of working together • Opens the system: Affects managerial practices & polices • Resistance: Due to denial of demographic differences, difficulty in learning new skills, altering existing systems, finding to work toward synergistic solutions

16. Generic Action Options to Deal with Any Diversity Issue (Thomas, 1996) • Include/Exclude: Outgrowth of AA progs., Goal is to increase or decrease no. of diverse people at all levels in organization • Deny: Deny differences exist. Claim decisions are gender-blind, color-blind, age-blind & based on merit & performance • Assimilate: All diverse employees will learn to fit in with dominant group • Suppress: Differences are squelched. Tell people to “quit whining” or “you’ve got to pay your dues” to maintain status-quo • Isolate: Set diverse people off to the side, special projs., “silos” • Tolerate: Acknowledge differences, but not value or accept them • Build relationships: Good relationships can overcome differences; focus on similarities, minimize differences • Foster Mutual Adaptation: Recognize & accept differences; agree that everyone & everything open for change. Greatest accommodation of diversity

17. Generic Action Options to Deal with Any Diversity Issue (contd.) • None of the options are inherently good or bad. All can be used in a positive or negative fashion • “Fostering mutual adaptation” is the only way to unquestionably endorse ‘diversity management.’ • Action options can be used alone or in combination • How to best manage diversity is a dynamic process determined by context at hand (e.g., companies not ready to manage diversity can best hope to start with including diverse people) • Options apply to all types of differences and similarities, not restricted to race and gender

18. Common Organizational Diversity Practices (Morrison, 1992) • Accountability Practices: Focus on treating diverse employees fairly. Objective accomplished by creation of administrative procedures aimed at integrating diverse employees into management ranks. • Development Practices: Focus on preparing diverse employees for greater responsibility & advancement. • Recruitment Practices: Focus on attracting job applicants at various levels who are willing to accept challenging work assignments

19. Accountability practices Top management personal intervention Internal advocacy groups Emphasis on EEO stats, profiles Inclusion of diversity in performance eval. goals, ratings Inclusion of diversity in promotion decisions, criteria Inclusion of diversity in management succession planning Work and family polices Policies against racism, sexism Internal audit or attitude survey Active AA/EEO committee, office Development Practices Diversity training programs Networks and support groups Development programs for all high-potential managers Informal networking activities Job rotation Formal mentoring program Informal mentoring program Entry development programs for all high-potential new hires Internal training (e.g., personal safety, language) Recognition events, awards Common Organizational Diversity Practices (contd.)

20. Common Organizational Diversity Practices (contd.) • Recruitment Practices • Targeted recruitment of nonmanagers (at entry level jobs) • Key outside hires • Extensive public exposure on diversity (AA) • Corporate image as liberal, progressive, or benevolent • Partnerships with educational institutions • Internships • Publications of PR products that highlight diversity • Targeted recruitment of managers for senior positions • Partnership with nontraditional groups