Chapter

2. Chapter 11 Managing the Diverse Workforce

3. Learning Objectives • After studying Chapter 11, you will know: • how changes in the U.S. workforce make diversity a critical organizational and managerial issue • the distinction between affirmative action and managing diversity • how companies can gain a competitive edge by effectively managing diversity • what challenges a company is likely to encounter with a diverse workforce • how an organization can take steps to cultivate diversity

4. Diversity: A Brief History • Managing diversity • recognizing the characteristics common to specific groups of employees while dealing with such employees as individuals and supporting, nurturing, and utilizing their differences to the organization’s advantage • understanding and appreciating employee differences to build a more effective and profitable organization • not a new issue • European immigrants came to the U.S. throughout the 1800s and early 1900s • 1960s - white male members of ethnic and religious groups accepted

5. Diversity: A Brief History (cont.) • Managing diversity (cont.) • ‘melting pot’ notion • ethnic and racial differences were blended into an American purée • in fact, most racial and ethnic groups retained their identities • companies are more accommodating of differences • realization that a diversified workforce can provide a competitive advantage

6. Diversity Today • Diversity • broad term used to refer to all kinds of differences • members of different groups share common values, attitudes, and perceptions • there is still much diversity within each group • U.S. businesses must learn to manage a diverse workforce • Managing diversity • must be aware of characteristics common to a group • must manage employees as individuals • must support, nurture, and utilize these differences to the organization’s advantage

7. Workforce Diversity Components Of A Diversified Workforce Gender Age Racial and ethnic minorities in the United States Other Religious affiliation Veteran status Sexual orientation Expectations and values Lifestyle Skill level Educational level Economic class Workstyle Function and/or position within the company Immigrants Physically and mentally disabled

8. Ineffective 2% Undecided 13% Somewhat effective 49% How Effective Is Your Diversity Program? Very Effective 8% Somewhat ineffective Effective 22% 8%

9. Diversity Today (cont.) • Size of the workforce • U.S. civilian labor force is expected to reach 158 million by 2010 • slowing in both the number of people joining the labor force and the rate of labor force growth • U.S. traditionally had a surplus of labor • number of jobs created expected to exceed the growth of the labor force • employers likely to outsource some work

10. Diversity Today (cont.) • Workers of the future • until recently, white, American born males dominated the U.S. workforce • now, they only account for 15 percent of the net growth

11. Women In The Workforce • Women make up about 47 percent of the workforce • 99 percent of women will work for pay at some point in their lives • Overall labor force participation rate of women continues increasing while the participation rate of men declines • The long-term increase in the female labor force largely reflects the greater frequency of paid work by mothers • Today, 40 percent of multiple job holders are women • One of every five married women who works outside the home earns more than her husband

12. Diversity Today (cont.) • Workers of the future (cont.) • gender issues - a growing number of women working outside the home • balancing work life with family responsibilities and parenting presents an enormous challenge • employers offer benefits such as on-site child care and physical therapy, in-home care for disabled and elderly family members • average full-time working female earns about 75% of the average full-time working male • disparities greatest at the executive level • glass ceiling - invisible barrier hindering women and minorities from moving beyond a certain level in the corporate hierarchy • women often faced with the choice between career and family

13. Diversity Today (cont.) • Workers of the future (cont.) • gender issues (cont.) • sexual harassment - conduct of a sexual nature that has negative consequences for employment • quid pro quo harassment - submission to or rejection of sexual conduct is used as a basis for employment decisions • hostile environment - unwelcome sexual conduct has the purpose or effect of reasonably interfering with job performance or creating an intimidating, hostile, or offensive working environment • the changing status of women has given men the opportunity to redefine their roles, expectations, and lifestyles

14. Minorities And Immigrants • Nonwhites make up about one-third of the growth rate in the workforce • Ethnic Americans now comprise nearly 25 percent of the total population • By 2020, most of California’s entry-level workers will be Hispanic • English has become the second language for much of the population in California, Texas, and Florida • The number of foreign-born U.S. residents is at its highest level in U.S. history (one in ten residents) • The younger Americans are, the more likely they are to be persons of color • 6.8 million people in the U.S. identify themselves as multiracial

15. Diversity Today (cont.) • Workers of the future (cont.) • minorities and immigrants - growing percentage of the workforce • term “minority” as typically used may quickly be outdated • troubling disparities • unemployment rates are higher for minorities • weekly earning are lower for minorities • fewer executive, administrative, and managerial people of color • organizations are trying to provide more opportunities for minorities

16. Percentage Of Minority Managers 1995 10.60% Senior 1992 7.40% 1995 15.10% Middle 1992 11.20% 1995 19.30% Front-line 1992 14.50%

17. Diversity Today (cont.) • Workers of the future (cont.) • mentally and physically disabled - largest unemployed minority population is the U.S. • Americans with Disabilities Act (ADA) • disability - a physical or mental impairment that substantially limits one or more major life activities • caused a dramatic increase in accessibility to public facilities • unemployment rate for disabled persons remains virtually unchanged • disabled lack access to educational and workplace environments • attitudes of employers an important barrier to employment

18. Diversity Today (cont.) • Age of the workforce • average age is increasing • people of ages 50 to 65 will increase • people of ages 16 to 24 is expected to drop • entry-level workers will be in short supply • retirement-age workers can be encouraged to remain or reenter the workforce on a flexible or part-time basis • results in cost savings on turnover and training • capitalizes on the experience of older workers

19. Approaches Considered Very or Moderately Effective (%) Businesses that Have Implemented the Approach (%) Approaches to More Fully Utilizing Older Employees Top Five Approaches For More FullyUtilizing Older Employees Benefit packages targeted toward older employees Part-time work arrangements with continuation of benefits Educating managers about ways to utilize older employees Increased availability of part-time work for older employees (regardless of benefits) Skill training for older employees 68% 64 60 55 55 18% 30 25 36 44

20. Diversity Today (cont.) • Future jobs and workforce qualifications • the U.S. is becoming a predominantly service-oriented economy • people without high school diplomas are at a distinct disadvantage • gap is growing between the knowledge and skills jobs require and those many employees and applicants possess • illiteracy is often the underlying problem • companies do not hire skills-deficient applicants • employers are combating this basic-skills gap • offer in-house basic-skills training program • partnerships with various educational institutions

21. Remedial Programs In The Workplace Total Small Large Exporter Non-exporter Union Non-union Offered in the last 5 years Plan to introduce in the next 5 years 100% 90 80 70 60 50 40 30 20 10 0 Any Classroom On-the-Job Apprenticeship Supplier/Vendor Coaching/Mentoring

22. Managing Diversity Versus Affirmative Action • Affirmative action (AA) • instituted to curb discrimination and correct the past exclusion of women and minorities from U.S. organizations • nonetheless, employment discrimination still persists • equal employment opportunity and AA have not adequately improved the upward mobility of women and minorities • reverse discrimination exists when qualified white males are passed over for employment opportunities • Managing diversity • means moving beyond legislated mandates to embrace a proactive business philosophy that values differences • eliminates barriers that hinder attainment of full potential

23. Managing Diversity Versus Affirmative Action (cont.) • Competitive advantage through diversity • original impetus to diversity workforces was social responsibility and legal necessity • today, many organizations are also approaching diversity from a more practical, business-oriented perspective • diversity viewed as a tool for building a competitive advantage • ability to attract and retain motivated employees • companies with reputation for diversity have competitive advantage in the labor market • companies will be sought out by most qualified employees • employees who believe that their differences are valued may become more loyal, productive, and committed

24. Managing Diversity Versus Affirmative Action (cont.) • Competitive advantage through diversity (cont.) • better perspective of a differentiated market • as the composition of the American workforce changes, so does the customer base of these companies • diverse customers may prefer to patronize such organizations • a multicultural workforce can provide a company with greater knowledge of the preferences and consuming habits of this diversified marketplace • ability to leverage creativity and innovation in problem solving • people from different backgrounds hold different perspectives • diverse work groups are freer to deviate from traditional approaches

25. Managing Diversity Versus Affirmative Action (cont.) • Competitive advantage through diversity (cont.) • enhancement of organizational flexibility • managing diversity requires a corporate culture that tolerates different styles and approaches • less restrictive policies and procedures and less standardized operating methods enable organizations to become more flexible

26. Managing Diversity Versus Affirmative Action (cont.) • Challenges of a diverse workforce • lower cohesiveness - lack of similarity in culture causes diverse groups to be less cohesive than homogeneous groups • communication problems - most common negative effect • diversity increases errors and misunderstandings • mistrust and tension - mistrust and misunderstanding of those who are different due to a lack of contact and low familiarity • stereotyping - inappropriately stereotype their “different” colleagues rather than accurately perceiving and evaluating those individuals’ contributions, capabilities, aspirations, and motivations • stereotypes affect how people are treated

27. Multicultural Organizations • Monolithic organizations • an organization that has a low degree of cultural integration • employs few women, minorities, or other groups that differ from the majority • minority employees hold low status jobs • minority employees must adopt the norms of the majority • has a highly homogeneous employee population • Plural organizations • have a more diverse employee population • use an affirmative action approach to managing diversity • some acceptance of minorities into the informal network • much less discrimination and less prejudice

28. Multicultural Organizations (cont.) • Multicultural organization • values cultural diversity and seeks to utilize and encourage it • fully integrate gender, racial, and minority group members both formally and informally • absence of prejudice and discrimination • low levels of intergroup conflict • synergistic environment • all members contribute to their maximum potential and the advantages of diversity can be fully realized

29. How Organizations Can Cultivate A Diverse Workforce • Top management leadership and commitment • top management support for diversity programs is critical • incorporate the organization’s attitudes toward diversity into the corporate mission statement, strategic plans, and objectives • establish corporate offices or committees to coordinate the companywide diversity effort that provides feedback to top management • minority advisory groups or task forces to monitor organizational policies, practices, and attitudes • assess program impact on diverse groups • provide feedback and suggestions to top management

30. How Organizations Can Cultivate A Diverse Workforce (cont.) • Organizational assessment • establish an ongoing assessment of the organization’s workforce, culture, policies, and practices • evaluate the demographics of the labor pool and customer base • identify problem areas • make recommendations where changes are needed • corporate values and norms should be identified and critically evaluated regarding their necessity and their impact on the diverse workforce

31. How Organizations Can Cultivate A Diverse Workforce (cont.) • Attracting employees • recruitment - a company’s image can be a strong recruiting tool • a reputation for hiring and promoting all types of people can be a competitive advantage • many minorities and economically disadvantaged people are physically isolated from job opportunities • companies can bring information about job opportunities to the source of labor • companies can transport labor to the jobs

32. Set numerical standards Calculate percentages Identify qualified workers Match positions to U.S. census categories Set general qualifications Steps In Diversity Planning

33. How Organizations Can Cultivate A Diverse Workforce (cont.) • Attracting employees (cont.) • accommodating work and family needs • corporate work and family policies are now one of the most important recruiting tools • providing child care leads to: • decreased turnover and absenteeism • improved morale • assist with care for elderly parents • offer time off to care for sick family members • concerns for dual-career couples expressed by: • limiting relocation requirements • providing job search assistance to relocated spouses

34. How Organizations Can Cultivate A Diverse Workforce (cont.) • Attracting employees (cont.) • alternative work arrangements • offer flexible work schedules and arrangements • compressed workweeks • job sharing - two part-time workers share one full-time job • teleworking - working from home • telecommuting - working from home via computer hookup to the main worksite

35. How Organizations Can Cultivate A Diverse Workforce (cont.) • Diversity training • attempt to identify and reduce hidden biases and develop skills needed to effectively manage a diversified workforce • awareness building - designed to increase awareness of the meaning and importance of valuing diversity • sensitize employees to assumptions they make about others • become familiar with myths, stereotypes, and cultural differences • become familiar with organizational barriers that inhibit the full contributions of all employees • teach the unwritten “rules” or cultural values to those who need to know them

36. How Organizations Can Cultivate A Diverse Workforce (cont.) • Diversity training (cont.) • skill building - designed to allow all employees and managers to develop the skills they need to deal effectively with one another and customers in a diverse environment • most of the skills taught are interpersonal • develop personal action plans before they leave the program • experiential exercises and videotapes often are used

37. Guidelines For Diversity Training Position training in diversity strategy Do needs analysis Incorporate diversity programs into training Distinguish between education and training Thoroughly test training Use participative design process Diversity training

38. How Organizations Can Cultivate A Diverse Workforce (cont.) • Retaining employees • support groups - form minority networks to promote information exchange and social support • provide emotional and career support • help diverse employees understand work norms and cultures • mentoring - higher-level managers help ensure that high-potential people are introduced to top management and socialized into the norms and values of the organization • help diverse employees enter the informal network • career development and promotion - establish teams to evaluate the career progress of diverse employees • devise ways to move them up through the ranks

39. How Organizations Can Cultivate A Diverse Workforce (cont.) • Retaining employees (cont.) • systems accommodation - recognize: • cultural and religious holidays • differing modes of dress • dietary restrictions • needs of individuals with disabilities • accountability - managers held accountable for workforce development • performance appraisal and reward systems reinforce the importance of effective diversity management