Diversity in the Workplace

Abstract

Diversity in the workforce is an offshoot of anti-discrimination legislation which seeks to bring workplace harmony, growth, productivity, creativity, and profitability to organizations, through the acceptance and harnessing of individual and group differences for the corporate good. There is no single method of implementing and managing diversity that works for all organizations, but there are certain factors that are essential for the creation of an environment that may engender success with diversity strategies. Corporations began to increasingly implement diversity, inclusion, and equity (DEI) initiatives into their organizations during the twenty-first century.

Overview

In most Western nations, the corporate workforce has historically been dominated by White males. In other parts of the world, the story is similar: One or a few groups of people tend to be the majority in the workplace. In the 1960s, the American government, under the leadership of President Lyndon B. Johnson, introduced the concept of affirmative action with the aim of correcting the wrongs caused by hundreds of years of slavery and segregation. The civil rights cause was then taken on by women and other minority groups, who likewise experience discrimination.

Legislation such as Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, and the Americans with Disabilities Act of 1990, helped to reduce discrimination among minority groups in the US, and gave organizations the mandate to maintain diverse workforces. US companies responded to legislation in the late 1960s by making formal efforts to eliminate discrimination. Further legislation followed with the Pregnancy Discrimination Act of 1978, which prohibited sex discrimination on the basis of pregnancy, and the Genetic Information Nondiscrimination Act of 2008.

Likewise, in Europe, cooperation through the European Union led to the removal of barriers and increased freedoms, such as the freedom of movement between member states, and the right to be treated equally. These developments gave rise to legislation such as the EU Article 13 Race and Employment Directives, the Racial Equality Directive 2000/43/EC, and the Employment Equality Directive 2000/78/EC, prohibiting discrimination on the grounds of religion or belief, disability, age, or sexual orientation.

A narrow definition of diversity is one that concentrates on race and gender, but diversity in the workplace can be broadly defined as differences, similarities, and related tensions among people in the workplace based on visible dimensions, secondary influences, and work diversities. All of these differences affect the manner in which people function within an organization. Visible dimensions include age, race/ethnic heritage, gender, physical ability and qualities (including obesity), mental ability and qualities, and sexual orientation. Secondary influences include religious beliefs, socioeconomic class, background, and education. Work diversities include differences like management versus union; functional level; classification; and proximity or distance to the corporate headquarters. Other differences include personality and work style.

In sum, diversity concerns the differences, similarities and related tensions between the characteristics and experiences of every individual in the workplace. There are also other, lesser recognized forms of diversity related to the workplace, such as customer, product, function, acquisition/merger, family, or community diversity.

Organizational Challenges Regarding Diversity. The increase in workplace diversity has led to increasing challenges for organizations seeking to have and maintain a diverse workforce. Even in the twenty-first century there is still much to learn about how to minimize the negative outcomes of diversity (for example, stereotyping, confusion, and discomfort), and how to maximize the positive outcomes.

Equal Employment Opportunity. Diversity is different from equal employment opportunity (EEO), affirmative action, or quota systems. With equal employment opportunity, every candidate has an equal chance at employment regardless of race, gender, religion, or any other characteristic. Emphasis is placed on avoiding discrimination and unfairness, and on increasing the proportion of minority groups—mainly women, people of color, and people with disabilities—in the workplace. EEO is more to do with positive action than corporate vision.

Affirmative Action. Affirmative action is a means of achieving EEO. It requires employers to pay heed to demographic factors like race/ethnicity, gender, and so on, when making employment decisions, either to meet government guidelines or to meet the goals an organization sets for itself. Affirmative action has been alleged to discriminate against one group to help another.

Management of Diversity. Compliance with legislation, through initiatives such as affirmative action and equal employment opportunity, still has its place; however, there is more to diversity than mere compliance or recruiting and retaining disenfranchised groups of people. So serious is the issue of diversity that some scholars believe that the management of diversity is the single biggest factor which will determine the survival of firms in the twenty-first century.

Diversity management involves making good quality decisions in the midst of a diverse workforce to eliminate the negative outcomes of interactions between individuals. Basically, diversity management involves enhancing an organization's effectiveness by developing suitable organizational structures, systematic strategies and processes, and by creating an equitable and fair work environment for all kinds of employees.

Diversity management involves a three-stage process:

• The identification stage, where the diversity composition is recognized and the necessary action determined;
• The implementation stage, where appropriate actions are selected and used;
• The maintenance stage.

Diversity management differs from affirmative action and EEO, in that it is based on scholarship and practice rather than law, and it includes organizational activities that are meant to enhance information sharing and acceptance—even celebration—of cultural differences.

Further Insights

Achieving Success through Diversity Programs. Many companies have experienced success with diversity programs. For example, diversity is touted as the untold reason for the successful turnaround of firms such as IBM in the mid-1990s. When IBM dramatically altered its already diverse composition, the company created millions of dollars in new business through expanding its minority markets. Most major corporations saw the development and implementation of DEI and diversity programs as essential to their organizations by the early twenty-first century. A 2023 Pew Research Center survey found that more than half of employees valued DEI initiatives in their workplaces.

Creating a Diverse Culture. Ensuring diversity in the workplace is a process which takes time, often years. Firstly, organizations must introduce the necessary changes in systems and processes; and secondly, they have to review their organizational culture. Real changes in organizational culture take place when the group with the most power (which is often the senior management team) considers its behavior and makes any necessary changes, both on a personal level and on an organizational level.

Diversity Audits. Before preparing a diversity management program, an organization must undertake a diversity audit, otherwise known as a cultural assessment, where current diversity levels and issues are assessed. The diversity audit is conducted through interviews, focus groups, surveys, and the collection of both archival and systems data.

Policy Documents. A diversity management program should be based on a policy document which must include a clear definition of diversity. The role of diversity in the organization should be clarified, as should leadership roles and the organization's expectations for its diversity initiatives. The advantages of diversity should also be stated, and in particular, the business case (the fact that diversity can lead to better organizational performance) should be highlighted. Furthermore, the diversity policy should include a plea for all employees to lend their support to the diversity program. As such, the policy should be widely published and circulated within the organization.

Diversity Consultants. Managing diversity involves the implementation of creative strategies for diversity recruitment, selection, retention and training, among others. To help in their moves towards greater diversity, organizations may choose to hire a diversity consultant, who can help design a diversity strategy tailored to the organization's unique culture and circumstances, which will be valued and supported in the organization's systems and processes. Diversity consultants can also steer leadership in the direction it needs to move. Diversity consultants can be brought in at any stage of the diversity management process, and they can also assist in areas such as education and training, conflict mediation, and team building.

A Changing Labor Force. In 2022, in the US, women represented 56.8 percent of total employment, according to the US Department of Labor. Similarly, in 2021 in Australia, women outnumbered men in the nation's population. With these kinds of demographic shifts, creative recruitment efforts will ensure that organizations have access to a large pool of recruits, and since the best employment candidates are not found in only one particular group of people, organizations would do well to recruit from the widest possible range of recruitment sources, making sure they have access to all groups and communities.

To this end, many organizations are now targeting minority colleges, such as Historically Black Colleges and Universities (HBCU) in the US, for their recruitment efforts, advertising to minority groups, and offering scholarships and awards to students of color. The very fact that an organization has—and implements—a diversity policy, also serves as an attraction or pull factor to potential employees, making the organization a likely employer of choice. Selection procedures must also be perceived as valid, reliable, and fair; and when these conditions are in place, they encourage improved performance from employees. Once new hires are in place, organizations must implement a range of long-term strategies to retain them.

Retaining Diverse Employees. Initiatives and workplace programs that help retain diverse employees in the workplace include the following:

• Talent management, which involves the identification and nurturing of talent, as well as the rewarding and promotion of talent by fair appraisal, treatment, and management.
• Flexible working, telecommuting, and adoption support, which appeal to certain groups such as working mothers and single parents.
• Mentoring, career development, and succession planning.
• Life-long learning to help employees meet their career goals without having to leave the organization.
• Enrichment programs.
• "Listening" forums, which allow the organization to acknowledge the different needs of different groups of employees.
• Network support groups, which can be enhanced through online discussion on corporate intranets.
• Flexible health and dependent care spending accounts.
• Seniority pay, part-time work, and phased retirement.
• Elder care.
• Domestic partner benefits, which are critical for employees with same-sex partners.

Diversity Training. It is said that practically every employee claims to be 'diverse,' and that everyone has biases, although they may not admit it. When diverse, biased people come together in the workplace, people tend to be uncomfortable with cultural differences because of their limited knowledge and resistance to change. Organizations lose productivity and revenue due to the negative effects of diversity like high turnover, absenteeism, recruiting and retraining, miscommunication, and conflict.

The growing field of diversity training can help employees understand diversity and be receptive to change, both of which will, in turn, lead to the retention of talent. Diversity training helps promote harmony in the workplace, by affording all employees the opportunity to learn more about cultural diversity, the values of others, and their own responses to people who are different. Diversity training also helps employees improve their cross-cultural communication skills and develop leadership skills, thus promoting healthy information flows and good interpersonal relations.

Organizations differ greatly in their diversity training goals and methods, and therefore, training interventions do differ, but in order to ensure the effectiveness of training, diversity must be linked to business success, and must be defined to encompass all groups, including historically predominant groups such as White men. Diversity training must be well-organized and introduced to employees to avoid negative reactions from participants. Generally, attendance should be voluntary, and therefore, care should be taken so that employees are not forced into diversity training programs. However, senior and line managers must, at all cost, attend the diversity training courses. In addition, all staff must be briefed on discriminatory attitudes and behavior, disciplinary consequences, and how to raise a grievance.

Diversity training can be carried out formally or informally. Formally, it may be conducted through dedicated training programs or as a component of other programs. There are several forms of formal diversity training, including awareness training, skill-based diversity training, and aspects of leadership development, team building and mentoring programs. In particular, a diversity training program is likely to comprise one or more of the following components:

• Introduction to diversity;
• Ethnic, Black, or feminist studies;
• Skill building;
• Cultural awareness;
• Sexual or other forms of harassment;
• Psychotherapeutic approaches, which may involve group therapy for groups experiencing conflict;
• Sensitivity training;
• Dissonance creation, where dissonance is purposely created with the hope that the target audience will change their attitudes and behaviors;
• Legal awareness, where discrimination laws and illegal practices are explained;
• Focused awareness, with emphasis placed on understanding the nature, functions, and prevalence of various stereotypes through individual and small group interactions;
• Integrated diversity training, where appropriate diversity issues are integrated into the course of pre-existing and new training efforts that target specific functional skills or business goals.

Advantages of Diversity. Those who are not in favor of diversity tend to blame it for an increase in poor working relationships, which they deem wasteful and unnecessary. Nonetheless, the opposite is true: diversity results in numerous advantages. For example, greater creativity and innovation ensue when different cultures, ideas, and perspectives come together under one organizational umbrella. Therefore, diversity has been heralded as a means of improving organizational performance through greater adaptability and flexibility in today's rapidly changing marketplace.

Due to their partnerships with external stakeholders such as minority communities and suppliers, organizations with diverse workforces gain reputations as employers of choice. Furthermore, employee loyalty increases as employees gain pride in their organization for its corporate social responsibility (of which diversity is a part) and good community relations.

When diversity is well-managed, organizations gain competitive advantage through positive improvements in corporate culture, employee morale, retention, and recruitment. They also experience a reduction in costs associated with turnover, absenteeism, low productivity, and discrimination litigation. Return on investment increases, and organizations experience sustained growth in market share through an expanded, diverse customer base.

A diverse workforce will promote access to diverse sales and profits. Countries whose populations are becoming increasingly diverse are experiencing shifts in purchasing power, with minority groups growing in purchasing power. For instance, in the United States, the most diverse nation in the world, the purchasing power of people of color, including Black, Asian, and Hispanic consumers, has seen significant growth in the 2010s and 2020s and has been outpacing the national average. To be able to reach minority groups, organizations must make use of the knowledge of diverse employees who can relate to different groups in the marketplace. Likewise, when employees of color can relate to customers in the global marketplace, organizations will enhance their capacity to capture, retain and serve their international customers.

Discourse: Success with Diversity. Every organization will manage its diversity differently, depending on their unique business needs, workforce issues, and situational factors. However, there are certain factors that scholars and practitioners recognize as factors which help to engender success with diversity in the workplace. These include accountability, strong support, and commitment from an organization's leaders; total 'buy-in' from all employees; the expertise of strong diversity professionals; integration of management practices with diversity efforts; links between diversity and performance evaluation; and extended definitions of effective performance.

Success with diversity also requires operating philosophies that state that all employees are different but equal. In addition, it requires the development of a diversity scorecard which is capable of providing financial and non-financial recognition of diversity return on investment initiatives, as well as relevant feedback.

The Role of Human Resources. The human resources professionals, who are best placed to engender an organizational culture that promotes successful diversity, are those with experience in areas such as team building, change management, conflict resolution, and cross-cultural communication. In order to enhance an organization's competitive advantage through diversity management, human resources experts must take care to continually assess and improve all their company policies, programs, and diversity initiatives, to eliminate any biases that may create potential challenges for diverse employees.

Human resources professionals must also identify individuals within the organization who can champion the diversity cause and help bring about the necessary change. They must also network with human resources professionals outside the organization, to discover different styles of diversity management, challenges encountered, and recommended best practice.

Diversity places many challenges on the leaders of organizations, as they attempt to encourage teamwork and cooperation between increasingly diverse work groups. Conflict increases as teams become more diverse, and to bring out the best from teamwork, the teams must view conflict as a necessary part of the creative process to get the best results. Managers must be trained to find the good in conflict and diversity, and turn it around, knowing that the culture of the company is most important.

To carry out their work effectively, an organization's leaders will need to develop additional skills, not only in the area of conflict management, but also in the areas of interpersonal communication, feedback gathering, and role modeling.

Human resources professionals must constantly remind the CEO and top management team that diversity is a business strategy. In order for diversity in the workplace to be successful, the organization's leaders must be accountable; they must have a passion for diversity; and they must have sustained involvement in all diversity initiatives. Their commitment must be visible to all employees. As often as possible, diversity should be on the agenda at executive meetings and organizational conferences, and where possible, diversity candidates should be appointed to top positions. Clear roles and responsibilities should be assigned to the senior management team regarding diversity management, and participation in diversity councils should be recommended as a development path for senior leaders.

Increasingly in the twenty-first century, diversity, inclusion, and equity (DEI) became the preferred term in discussions of diversity in the workplace. Under DEI initiatives, diversity refers to the involvement and engagement of people from diverse backgrounds and viewpoints, especially those who have historically been underrepresented; equity encompasses equal access to opportunities and fair treatment; and inclusion refers to creating a sense of community in a setting where everyone is embraced, valued, and treated with respect.

Terms & Concepts

Affirmative Action: Affirmative action is a means of achieving equal employment opportunity (EEO). It requires employers to pay heed to demographic factors like race/ethnicity, gender, and so on, when making employment decisions, either to meet government guidelines or to meet the goals an organization sets for itself.

Diversity: Diversity in the workplace can be broadly defined as differences, similarities, and related tensions among people in the workplace based on visible dimensions, secondary influences, and work diversities.

Diversity Audit: A diversity audit, also known as a cultural assessment, is a process by which current diversity levels and issues within an organization are assessed. The diversity audit is conducted through interviews, focus groups, surveys, and the collection of both archival and systems data.

Diversity Consultant: A diversity consultant is a person with experience in managing diversity, who can help an organization design a diversity strategy tailored to the organization's unique culture and circumstances, and which will be valued and supported in the organization's systems and processes.

Diversity Management: Diversity management involves making good quality decisions in the midst of a diverse workforce to eliminate the negative outcomes of interactions between individuals.

Diversity Scorecard: A diversity scorecard is a means of evaluating the impact of diversity on organizational performance.

Diversity Training: Diversity training is specialized training which helps promote harmony in the workplace, by affording all employees the opportunity to learn more about cultural diversity, the values of others, and their own responses to people who are different. Diversity training also helps employees improve their cross-cultural communication skills and develop leadership skills, thus promoting healthy information flows and good interpersonal relations.

Equal Employment Opportunity (EEO): Equal employment opportunity is based on a regulation which allows every candidate to have an equal chance at employment regardless of race, gender, religion, or any other characteristic. Emphasis is placed on avoiding discrimination and unfairness, and on increasing the proportion of minority groups in the workplace.

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