Organizational culture and Diversity

1. Organizational culture and Diversity eadarkoh

2. Introduction • Increasing globalization requires more interaction among people from diverse cultures, beliefs and backgrounds. • People no longer live in an insular market place. • People are now part of a worldwide economy with competition coming from nearly every continent. • For this reason, organizations need diversity to become more creative and open to change. • Maximizing the workplace diversity remains a significant organizational challenge. eadarkoh

3. Introduction (cont’d) • Managers and supervisors must be prepared to teach themselves and others within the organization to value multicultural differences in both associates and customers so that everyone is treated with some level of dignity. • Companies need to pay attention to diversity issues and look for ways to become totally inclusive organizations. • Diversity in organizations have the potential of yielding greater productivity. • Unmanaged diversity in the work place might become an obstacle for achieving organizational goals. eadarkoh

4. The Concept of Diversity • Diversity is a subjective phenomenon, created by group members themselves who on the basis of their different social identities categorize others as similar or dissimilar. • “A group is diverse if it is composed of individuals who differ on a characteristic on which they base their own social identity”(O’Reilly, Williams, and Barsade, 1998). • Loden and Rosener (1991) define diversity as that which differentiate one group of people from another along primary and secondary dimensions. • Primary dimensions of diversity are gender, ethnicity, race, culture, social class, sexual orientation, age and mental or physical abilities and characteristics. • The primary dimensions shape our basic self-image on groups in the workplace and society. eadarkoh

5. The Concept of Diversity (cont’d) • The secondary dimensions of diversity are less visible, and exert a more variable influence on personal identity and are more subtle. • They include: educational background, geographical location, religion, first language, family status, work style, work experience, military experience, organizational role and level, income and communication style, healthcare beliefs and recreational interests • The tertiary dimensions are often the core of individual identity and usually lie deeper below the surface . eadarkoh

6. The Concept of Diversity Table 1: Dimensions of Diversity eadarkoh

7. Cultural Diversity • Cultural diversity has been defined as “the representation, in a social system of people with distinctly different group affiliations of cultural significance”. • While some scholars (Cox et all, 1991) have argued that diversity within a group increases efficiency, others are of the view that diversity is associated with negative performance outcomes ( Pelled et. al, 1999). eadarkoh

8. Cultural Homogeneity • Within a culturally homogeneous group, members will have the tendency to communicate with each other more often and in greater variety of ways. • This they do because they share worldviews and a unified culture resulting from in-group attachments and shared perceptions. • According to social identity theory, cultural homogeneity in management groups may increase the level of satisfaction and cooperation and decrease emotional conflict. • Since homogeneous groups do not have significant cultural barriers to social intercourse, positive social associations and in-group social contacts are fostered. eadarkoh

9. Effects of Diversity • Diversity might have both positive and negative effects on organizational outcomes Advantages • Multicultural organizations have an advantage in attracting and retaining the best talents. Organizations that are able to attract and retain minority group members , gain competitive advantage and derive high quality human resource dividend. • A multicultural organization is better suited to serve a diverse external clientele in a more increasingly global market. Such organizations normally have a better understanding of the requirements of legal, political, social, economic and cultural environments of foreign nations. • In research-oriented and hi-tech industries, the broad base of talents generated by gender and ethnic diverse organization becomes a priceless advantage. Creativity thrives on diversity. eadarkoh

10. Effects of Diversity (cont’d) • Multicultural organizations are found to be better at problem solving, possess better ability to extract expanded meanings, and are more likely to display multiple perspectives and interpretations in dealing with complex issues. They are less susceptible to “groupthink” . • Multicultural organizations tend to possess more organizational flexibility, and are better able to adapt to changes. Women for instance, are said to have higher tolerance for ambiguity than men. eadarkoh

11. Drawbacks of Diversity • In problem solving situations, extraordinary costs in time and financial resources can negate the benefits of synergy and can degenerate into dysfunctional conflicts. • Diversity does not fare well under conditions of uncertainty and complexity which may lead to confusion and frustration. • It can lead to cultural clashes that can create work disadvantages for women and minorities. (In whose interests are conflicts resolved?) • It leads to lower levels of psychological identification with group members which tends to detract from overall performance and results in diverse effects on organizational measure of productivity, absenteeism, and turnover. eadarkoh

12. Milliken and Martins Typology on Diversity • Milliken and Martins (1996) have argued that diversity can affect an organization’s functioning through four types of mediating variables: 1. Diversity can have “effective consequences”, such as lower organizational commitment or lower satisfaction, because people prefer interactions with their kind. 2. Cognitive outcomes refer to an increase in creativity and innovation. Diversity can enhance a group’s ability to gather and process information and therefore could result in a greater creativity. 3. A diverse organizational workforce is a symbol of equality. These symbolic effects, are important for an organization’s reputation. 4. Diversity also has a clear implications on communication process within a group or organization. eadarkoh

13. Cultural dimension of OD • Organizational development is long-term effort, led and supported by top management to improve and organization’s visioning, empowerment, learning, and problem-solving processes, through an ongoing, collaborative management of organization culture-with specific emphasis on the culture of intact work teams and other team configurations-utilizing the consultant-facilitator role and the theory and technology of applied behavioural science including action research eadarkoh

14. Characteristics of OD • Culture and processes with specific encouragement of collaboration between leaders and members; • The human and social side of the organization, the importance of teams of all kinds, and participation and involvement in problem-solving and decision-making; • Total system change with organizations viewed as complex social systems. eadarkoh

15. Organizational Culture • Culture has a huge impact on the behaviour and actions of people within the organizational setting. • Culture is explained as “how things are done around here”. • Organizational culture reflects the underlying assumptions about the way work is performed ; what is acceptable and not acceptable and what behaviour and actions are encouraged and discouraged. eadarkoh

16. Organizational Culture (cont’d) • Organizational culture is further defined as “the collection of traditions, values, beliefs, and attitudes that constitute a pervasive context for everything we do and think in an organization. • Organizational culture is often linked to the personality of an organization. • Organizational Culture are norms and values that shape the behaviour of people in an organization. eadarkoh

17. Organizational Culture Defined • According to Armstrong, organization culture is “the pattern of values, norms, beliefs, attitudes and assumptions that may not have been articulated but shape the ways in which people behave and things get done”. • Meyerson and Martin (1987) have defined organizational culture as a “code word for the subjective side of organization life”. • Eldridge and Crombie (1974) have also defined it as the unique configuration of norms, values, beliefs and ways of behaving that characterize the manner in which groups and individuals combine to get things done. eadarkoh

18. Organizational Culture Defined (cont’d) • To Deal and Kennedy (1982), organizational culture “is a system of informal rules that spell out how people are to behave most of the time”. • Furnham and Gunter (1993), have also defined organizational culture as “ the commonly held beliefs, attitudes and values that exist in an organizations” Put simply “culture is the way we do things around here”. • Purcell et al (2003), organizational culture is a system of shared values and beliefs about what is important, what behavious are important and about the feelings and relationships internally and externally. eadarkoh

19. Levels of culture • Schein has identified three levels of organizational culture. These are: • Level 1. Artefacts and creation- this is the most visible level of culture. It encompasses the constructed physical and social environment. It is includes the physical space and layout, the technological output, written and spoken language and the overt behaviour of group member. • Level 2. Espoused values- the solutions that have worked become values that are ultimately transformed into beliefs upon which group members justify their behaviour and actions. eadarkoh

20. Levels of culture (cont’d) • Level 3. Basic underlying assumptions – when a solution to a problem works repeatedly, it is normally taken for granted. The basic assumptions implicitly guide behaviour and determine how group members perceive, think and feel about things. • The basic assumptions are treated as the essence-what culture is –and values and behaviours are treated as observed manifestations of the culture essence.; eadarkoh

21. Types of Organization Culture Handy (1993) has identified four types of organizational cultures • Power culture • Role culture • Task culture • Person culture eadarkoh

22. Power culture • It depends on central power source • It is found in small organizations • It depends on the following for its effectiveness: • Trust • Empathy • Personal communications • Control is exercised by few selected individuals. • There are few rules and regulation and very little bureaucracy. eadarkoh

23. Role Culture • It is often stereotyped as a bureaucracy and works with rationality. • The organization rests on the function of specialist in: Finance, purchasing and production. • The interactions between the pillars is controlled by rules and procedures. • It puts more emphasis on position than the individuals occupying those positions. (the position is the main source of power). eadarkoh

24. Person Culture • The individual is the focus and the structure exist to serve the individual within it. • It usually emerges when a group of people decide to come together in their own interests. (E.g. barristers, architects, doctors or consultants). • It is found in few organizations, but many individuals have preference for this type of culture, e.g. University Lecturers. • Control is usually by mutual consent. • Individuals are largely independent and autonomous. eadarkoh

25. Task Culture • This is job oriented and project-oriented. • The task culture is like a net. • It brings people together and unify their resources • It tends to unify the power of the group. • Influence is widely dispersed and usually based on expertise or expert power than position power. eadarkoh

26. Four Generic Types of Culture • Tough-guy, macho culture • Work hard/play-hard culture • Bet-your company culture • Process culture eadarkoh

27. Influences on the development of culture • History • Primary function and technology • Strategy • Size • Management and leadership • Location • The environment eadarkoh

28. Criteria for a suitable culture • It must be strategically relevant; • people care about what is important: and • The culture must have an intrinsic ability to adapt to changing circumstances. eadarkoh

29. Managerial Tools to Develop, Manage and Change Culture • Recruitment and selection; • Social tools and training; • Reward system. eadarkoh

30. Importance of Culture The culture of an organization has a considerable effect on the following: • Effective human resource management • Decision-making; • The design of structure; • Group behaviour; • Work organization; • Motivation and job satisfaction • Management control • Organizational performance eadarkoh