There are many advantages to having culturally diverse teams in the company. In their book Workforce 2020, Judy and D'Amico discuss some important statistics. They stated that in the US the number of white non-Hipics would decrease from 80 percent of the nation’s population in 1980 to only 64. 3 percent in 2020 (Judy and D'Amico, 1997). This is important for a company to know and understand. A company that is prepared for such a change in demographics will be prepared for the future as the market changes as well as the pool of applicants.
The company will also be able to experience many of the advantages that a diverse workplace can bring. Having a diverse workplace creates an increase in attracting and retaining the most qualified candidates. The Strategic Human Resource Management (SHRM) study found that 91 percent of respondents think diversity initiatives helped their organisations maintain a competitive advantage. According to the study, 79 percent of the companies believe their diversity programmes improved corporate culture, 77 percent think they helped in recruitment and 52 percent said they fostered better client relations (Pelled et al, 1999:17).
Companies are likely to obtain a competitive advantage of being able to market and deliver their products within different countries and cultures. Having inside information on how to communicate and what a community would like to see in a product is a great asset. According to White, a company employing multicultural workforce can penetrate and widen their markets with the knowledge of political, social, legal, economic and cultural environments (White, 1999:477). Moreover, employing someone within the organisation who can negotiate, understand and speak the language of the country is a very valuable even strategic asset.
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For instance, Chevrolet committed a marketing mistake in the Latin America, when the company produced a car, called the Nova. The product was not having success with it in the Latin countries, until they learned that Nova, or “no va” as the Spanish speaking communities perceived it, meant “does not go” when translated from Spanish. Practically, it could have been prevented if the company appreciated the value of multicultural workforce, which in many cases can help avoid instances of cultural blindness. White asserts that “creativity thrives on diversity” (White, 1999:477).
This quote implies that a company with a diverse workforce can experience higher creativity and innovation. When people of different cultures come together to solve a problem or come up with an idea, they are more able to reach a common solution. Different cultures can bring insightful alternatives to the table. Every company is in search of an idea, which will bring them added value. Ideas, which will increase profit for the business, create a competitive advantage and cannot be copied by their competitors are in great demand.
Since only people can create these ideas, the more diverse the company is the greater the chances are for creating these new ideas. One group of people is no better than another at generating these ideas; and no one can say who will come up with the next big idea. Along with new ideas comes an increase in productivity. When people are brought together to achieve a common goal there is an increase in support for it. People who believe in its success will in turn work harder. Finally, a multicultural firm is better able to adapt to change and is more flexible.
For example, a woman is more likely to have a higher tolerance for uncertainty than men. Also, bilinguals are more capable to have a higher level of contrasting thinking and cognitive flexibility than those who only speak the common language (White, 1999:477). From the critical perspective, Adler’s notions regarding frequent lack of productivity among culturally diverse groups are justified because the approach to the management of these groups has been usually inadequate. For instance, the company should understand that usually many people feel threatened by working with people of a different age, sex, or culture.
Unlike dealing with mono-cultured teams, the company’s management must anticipate an increase in the cost of training, in the form of seminars, programmes and lectures conducted to promote diversity in the organisation. Practically, various training programmes are to be integrated at all levels of personnel within the company. Normally such programmes teach employees how to understand and appreciate the personalities and ideas or thoughts of other group members as well as how to deal with conflicts and prejudice in a professional and civil manner (White, 1999:478).
Simultaneously, implementing the emphasis on multicultural teams, the management should be aware that diversity can trigger an increase in conflicts, which usually are not anticipated within single cultural groups. For instance, in contemporary business environment many companies implement the strategy of virtual teams, which proves to be very productive and efficient from the financial perspective. However, in a virtual team communication is a pivotal element for team success. According to Chidambaram (1992) communication is an essential human behavior and one that is necessarily influenced by culture.
Differences may include initiation and coordination mechanisms, temporal orientation and modes of reaching decisions. In real groups, conflict can arise due to prejudice, derogatory comments, etc and as White indicates, “this can produce negative dynamics such as ethnocentrism, stereotyping and culture clashes” (White, 1999:477). Ignorance of exhibited by the management can play a detrimental role in such circumstances, because as a logical result of these conflicts the teams’ performance may suffer (White, 1999:478).
If the management is successful in implementing necessary programmes of cultural tolerance, workplace ethics and communication skills, team members will work harder to gain acceptance by creating a solution or invention first. In addition, these goals can be attained if managers reconcile competing goals, promote in a representative manner, stand behind the minority group member, and act when resources are plentiful and cultural differences are low or well understood (White, 1999:480). As articulated above, mismanaged cultural diversity can have long-reaching effects on company’s productivity particularly on international scope.
It should be also emphasized that cultural minority-group members often feel less valued than do majority-group members due to problems of stereotyping, ethnocentrism, and prejudice. Therefore, when organisation’s management ignores the existence and importance of cultural diversity, conflict can emerge and neither the company nor its employees will realize their potential. Conclusion It is evident that more and more companies in contemporary business environment serve customers/clients of diverse backgrounds in one way or another.
By creating a diverse workplace, managers are not only more capable of dealing with diversity externally in the community, but also facilitate effective organisational learning. When assessing the goals, strategies, advantages, and disadvantages of creating and managing a culturally diverse workforce management should examine if they could accomplish these factors and become a successful diverse organisation. Whilst cultural diversification becomes an acute need for every international company, it implies the application of adequate diversity-oriented managerial approaches and OB techniques.
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