Does workforce diversity always result in better organizational performance?
In today’s global competitive environment, workforce diversity became a competitive edge that helps firms better understand different cultures and different ways of conducting business globally (“Benefits and problems”). Taylor Cox emphasized that increasing workforce diversity for better organizational performance is still an essential business issue that receives great attention, as “most of today's small business owners and corporate executives recognize that attention to the challenges and opportunities associated with the growing trend toward culturally diverse work forces can be a key factor in overall ...view middle of the document...
Rob McInnes added that the greatest benefit of workforce diversity comes from the company’s ability to better manage diversity and employ people because of their individual differences in terms of “personality, age, gender, race, ethnicity, nationality, culture, religion, sexual orientation, income, marital status, work experience, and perceptions that uphold organizational core values” (Mkoji & Sikalieh, 2012).
Despite workforce diversity importance for today’s companies to succeed in global operations, they still need to understand workforce diversity mechanisms (benefits and disadvantages) to minimize its impact when it threatens to exacerbate the organizational performance.
Benefits of workforce diversity
Creativity increases: when people with different ideas and perspectives work together, they come up with more creative and better solutions to a problem (“Advantages and disadvantages”).
Client base increases: when a firm is well known by its adoption of workforce diversity, its customer base will increase believing in firm’s commitment to its community (Mayhew).
New processes: “people with different ideas collaborate together to bring multiple skills to working environment, think cross culturally, and adapt quickly to new situations” (“Advantages and disadvantages”).
Conflict: conflict helps diverse workforce to come up with more effective decisions and solutions, and thereby better performance and results (“Benefits and problems”).
Lawsuit reduction: workforce diversity helps reduce lawsuits against companies applying equal employment opportunity practices, and thereby increasing recruitment and enhancing their images (“Benefits and problems”).
Shareholder value increases: diversified knowledge and experiences with international markets and various customer bases help in increasing profits (“Benefits and problems”).
Disadvantages of workforce diversity
Complexity increases: diverse workforce had difficulty reaching agreements on decisions and actions due to increased complexities of processes during problem solving (“Benefits and problems”).
Training cost increases: all organizational members should attend training programs that support diversity within the organization (“Advantages and disadvantages”).
If not well managed, workforce diversity can lead to “lower team cohesiveness” and slower decisions due to stress and tension resulting from miscommunications and misunderstandings (“Benefits and problems”).
Conflicts increase: diverse workforce is more susceptible to conflicts due to ignorance or unwillingness to accept different cultures, thus creating stereotype and ethnocentrism attitude (Deshwal & Choudhary, 2012).
Competition rather than teamwork: diversity initiates competition among employees in case they ignore or not accept other cultures (“Advantages and disadvantages”).
Failure to respect others: lack of respect between different cultures will restrain effective communication among diverse...