MGT8033: Leading Organisational Change

1. MGT8033: Leading Organisational Change Leadership & Diversity Material comes from two sources Daft & Pirola-Merlo, 2009 And Lussier & Achua, 2010

2. Lecture Overview Exploring and explaining diversity Why diversity is important to organisations Culture as an impediment to diversity? Minority groups: who are they and what challenges do they face? Solutions – what can leaders do to instil diversity in their organisation? Exploring the positive and negative sides of diversity

3. What is ‘diversity’ ? • Diversity means different things to different people so the starting point has to be finding a useful and common definition or understanding. • At the individual level diversity refers to characteristics of people which make us all different. • Age, mental/physical abilities, race and gender are included in this set (see Exhibit 10.1 Daft & Pirola-Merlo for other elements of diversity). • Workforce diversity means a workforce made up of people who have different human qualities or who belong to different cultural groups (Daft & Pirola-Merlo 2009, p.341) • Diversity is seen as a positive attribute of contemporary organisational life. You should give some thought to why this is and what it might enable or assist.

4. What is ‘diversity’ ? • Primary dimensions of diversity are differences that have some impact throughout your life, or differences with which you are born • include physical abilities and sexual orientation – in addition to those mentioned in previous slide • Secondary dimensions are acquired or changed over your lifetime • They include religion, work experience, education level, communication style • You should be able to see – these have some implications for organisational life and functioning

5. What is ‘diversity’ ? • Both primary and secondary dimensions can have a big impact in the organisation. For example, in some organisations, sexual orientation can result in barriers to entry. Then again, naturally quiet, introspective individuals are usually not well-suited to jobs that demand self-promotion, extensive networking and hype. • Diversity has entered the literature on organisation change through changing demographics (e.g. there is a large set of baby boomers in the workforce).

6. What is ‘diversity’ ? But other groups are also contributing, viz. • More women in management and traditionally male jobs. By 2020 women should make up 50% of the total US full-time workforce (Daft & Pirola-Merlo 2009, p.342) • Cultural minorities (Spanish-speaking group in the USA stretches the notion of ‘minority’) • Rising incidence of immigrant workers

7. What is ‘diversity’ ? • Globalisation has also raised the importance of diversity to organisational functioning and change • Persons with knowledge &/or experience of how other marketplaces operate are sought after. Note how many CEOs in large Australian companies are not Australian (including Qantas Airlines). Important knowledge/experience sets for high profile organisation leaders includes understanding of cultural differences • Diversity has become necessary. Wider market penetration exposes the enterprise to increasing numbers and types of cultures

8. Why diversity is important to organisations • Shifts in demographics make it necessary (e.g. if your overseas clients don’t speak/understand English, you need staff who can communicate with them). • Put more simply, the greater the diversity among suppliers, clients or customers, the greater the need for diversity within the organisation. • Note the figures given by Daft & Pirola-Merlo (2009) p. 343 - two-thirds of the USA population are minority group members or female or both. • Diversity in staff can help to build better relationships with customers. You should be able to explain how.

9. Why diversity is important to organisations • Diversity helps with the development of employee and organisational potential. When everyone is made welcome and treated equally, there are morale benefits • Insights into different cultures enables greater closeness to clients and customers (better understanding of needs) • Diversity in staff reflects fairness and equity in recruitment and other work practices. This can further attract quality people • Diversity develops greater org. flexibility, e.g. a broader and deeper base for experience in problem-solving and innovation (thereby providing competitive advantage)

10. National and organisational culture can impede the acquisition of diversity in organisations • See ‘actual cultural differences’ section in Daft & Pirola- Merlo 2009 p.362. Unawareness of the cultural drivers of behaviour in some contexts can lead to unpleasant and unproductive outcomes (as a ‘burp’ in some cultures reflects enjoyment of a meal, in others it simply shows poor manners). • Note the work of Hofstede and how different countries (cultures) differ across four dimensions (Daft & Pirola- Merlo 2009 p.348+). • Hofstede’s 4 dimensions are ... power distance, uncertainty avoidance, individualism, masculinity • See Waddell et al Chapter 4 pp. 118 -21 which builds on Hofstede’s model

11. National and organisational culture can impede the acquisition of diversityin organisations • Power distance: High power distance reflects people accept inequality in power in organisations and people in general. Low power distance indicates people expect equality in power • Uncertainty avoidance:A high measurement here indicates people are uncomfortable in ambiguity and uncertainty. Low uncertainty avoidance indicates people have a high acceptance/tolerance for ambiguity and uncertainty

12. National and organisational culture can impede the acquisition of diversityin organisations • Individualism versus collectivism:Individualistic cultures reflect values which accept and expect the person will look after himself/herself. Collectivism reflects preference for tight social networks where everyone looks out for each other • Masculinity versus femininity: each is linked with certain characteristics. Achievement is more aligned with masculinity. Group decision-making is more feminine

13. National and organisational culture can impede the acquisition of diversityin organisations • For each of Hofstede’s 4 dimensions, an argument can be made re how it may impede diversity. Develop your arguments. • For example, differences in power distance can be critical because some may simply accept inequality as a natural by-product of organisational life, in which case there is no impetus for change. Similarly, groups who are more team-oriented in their approach to work, are less likely to prosper where the prevailing managerial system is more outcome focussed.

14. Minority groups and the challenges they face • Minorities in general can be disadvantaged by others’ ethnocentrism (belief that one’s culture is superior to other cultures). • Ethnocentrism is a natural tendency for most • However, it can result in a culture that reinforces only one way of doing things (not consistent with diversity) • In its extreme form, this ethnocentrism presents as prejudice (the assumption that minorities are inferior and therefore unsuitable for responsible roles) • Stereotypes are often based on prejudice of some form

15. Minority groups and the challenges they face • Sometimes differences are also perceived as weaknesses or deficiencies • Minorities in general are also susceptible to others’ unequal expectations. Such groups may not be given opportunities because of these misperceptions • Minority persons in senior positions in attempting to delegate tasks, often encounter hostility from their employees • Women must feature in any minority list. The glass ceiling and the mummy track are both substantial obstacles (see def. Daft & Pirola-Merlo 2009, p. 355) for personal development in the workplace

16. Minority groups and the challenges they face • Minority can also be defined in terms of age. Older employees can be marginalised in some companies, sometimes because attitudes are unbending, and sometimes because they are unable to cope with consistent change (e.g. with new technologies). • Race also features. One of the major obstacles here is the opportunity gap (see Daft & Pirola-Merlo 2009, p. 357). Education and employment may be much more difficult to access for some racial groups. • See also ‘living bi-culturally’ p. 355. This set of perceptions held by minorities themselves can be very self-limiting in terms of personal development.

17. Remedies available to corporate leaders in dealing with diversity-related issues From Lussier & Achua 2010 re creating a diversity-supporting culture. • CEO must act as a role model. • Role of corporate philosophy, supported by policy and procedures and pro-diversity HR practices (e.g. clear recruitment practices which reinforce diversity. • Communications that install diversity as the norm. • Diversity as a criterion for measuring success.

18. Remedies available to corporate leaders in dealing with diversity-related issues • Leadership qualities: 4 personal qualities identified as necessary for leading diverse organisations • 1. A personal long-range vision. Plans which attract and include minorities in all levels of org. functioning • 2. Knowledge of dimensions of diversity and awareness of multicultural issues. Understanding of the operation of primary and 2ndary dimensions from Exhibit 10.1 (Daft & Pirola-Merlo 2009, 341) • 3. Openness to change • 4. Mentoring and empowering of diverse employees/minorities

19. Remedies available to corporate leaders in dealing with diversity-related issues • Change Corporate Culture: many contemporary organisations reflect the white male model of carrying out business. This disadvantages minorities. • May have to change formal policy and procedures and practices • Changes may have to extend to informal patterns of work behaviour and mindsets and attitudes of managers • Challenge unwritten rules and unhealthy norms • Address acts of racism (and ageism and sexism)

20. Remedies available to corporate leaders in dealing with diversity-related issues • Diversity awareness training: much variation in our sensitivity and awareness of other cultures, races and groups. This can inhibit diversity. • Objective is to uncover our own biases about thinking and treatment of other individuals and groups. • Can also help persons from different backgrounds to communicate and understand the language and customs of the workplace.

21. Positive and negative sides of diversity • With what you’ve read in this lecture and your notes, develop argument which reflects why the below developments may have both negatives and positives. • Minorities currently holding 1 in 4 jobs in the US. • Migration of African & Muslim people into Europe in particular (e.g. what pressures will this have on employment practices? ). • Entry into medicine, law, management, engineering - at accelerating rate for women. • Threats to white, male, managerial roles (cannot continue to enjoy protected species status in the future). • Rising numbers of skilled ethnic minorities in all aspects of work.