Diversity Management And Leadership Challenge: A Case Study Of A UK-based MNC

Diversity Management

Discuss about the Diversity Management and Leadership Challenge.

In this globalized environment, business needs to maintain a diversified workforce that can work across boundaries. Diversified workforce aims at maintaining a multicultural and inclusive workforce to retain global workforce effectively, reduce conflict and enhance productivity. Diversity is crucial to ensure equal rights to all individual; it is based on the core belief that all individuals are different from each other on various terms. Diversity aims at fostering multi-belief system, values and information within organization; it facilitates in understanding employees, their thinking and behavior pattern that influence overall working culture.

Despite of being a widely accepted concept, it involves number of challenges while execution. Due to immense challenge during implementation, diversity is liked by all but implemented by only few. This paper involve similar scenario in context of a UK based renowned MNC that deals in groceries and various other businesses. This paper also presents a general perspective on diversity, its principles. Further, it elaborates on different challenges faced by managers in creating and managing diversified workplace that help in understanding major hindrances in the implementation process. Later part of the report aims to present solution on discussed problem by presenting various strategies that help in proper and successful diversity management.

Selected MNC is a renowned brand in global market. It is an UK based grocery and merchandise retailer that operates globally. It operates using various store formats, presently the brand own 923 stores worldwide, it have very strong presence in UK market with almost 75 percent of the stores located locally. It is expanding its business in new international markets and also opting for product diversifications. There is problem of ageing population which shows need for new employees in the company. Presently the company has total work strength of 460,000 employees; wide availability of staff ensures high capability of the company to fulfill requirements. The company follow the strategy of market expansion, so for acquiring new market, company need to hire new staff to meet requirements.

The concept of culture is closely associated with diversity. Culture is the set of belief and values that people use to generate their social behavior which distinguish one group of people from other. It involve understanding of people of particular society, their way of living and it also help in understand the way they behave with each other (Barak, 2013). This difference between people from one culture to another is diversity. Though successful diversity implementation can help in gaining competitive advantage in the market, it also helps in enhancing overall employees as well as organizational productivity, commitment and reducing potential conflicts. Diversity can be defined as concept that helps in understanding and respecting individual differences within organization. It deals in number of elements such as ethnicity, gender, race, physical ability, social and economic status, religion, political belief system etc. Diversity management is a process of planning and implementing organizational strategies to management workforce in such manner that advantages from diversity can be used maximum and weaknesses can be minimized by promoting flexibility and creativity within organization (D’Nettoa, Shenb, Chelliahc, & Mongab, 2013).

Principles of Diversity Management

Especially in context of retail industry, diversified workforce plays key role due to high degree of interdependence on each other. Cultural conflict might lead to low productivity and adverse supply chain management. For instance, selected company operates in 14 different countries, it has headquarter in UK, there is need to establish synergy at work, coordination among operations in different countries by balancing right degree of freedom and control. Retail organizations try to attract talented, dedicated workforce, creative thinkers; whereas employees are also interested in working with companies that offer them growth. There are different types of diversities exists within organizations.

Selected company operates in global market, internal policy of the company aims to maintain diversity and inclusive culture by incorporating people from different background within organization. It also aims to maintain gender equality workforce. The diversity management strategy of the company involves recruitment, training and development; therefore three major stages of doing so include talent plans for business, career plans for individuals and succession plans for jobs. Internally the organization maintains a rigid anti-discrimination policy to ensure equality for all. There is strict whistle blowing policy that fosters zero tolerance towards any form of discrimination, harassment or victimization within company. It is registered with Equality Commission in Northern Ireland to hire handicapped people and provide them scope for development (www.ourtesco.com, 2015).  Despite of such actions and strategies, there is several discrimination case registered against this company, which shows that some loophole is present in the system. Therefore, focus needs to be given on principles of diversity management that would ensure better system implementation.

To foster differences positively, it is crucial to understand differences properly, there is need to evaluate different ideas, values, perspectives to ensure fair treatment towards all employee. Another key factor is communication, which can make or break employee relationship, management need to practice inclusion policy to increase employee participation, information sharing and also better problem discussions.  There are two approaches to diversity management, one is human resource management and another is multi culture organization. Human resource process of diversity management can opt for four different approaches to manage it, which include diversity enlargement which involves inclusion of people from different ethnic backgrounds in the workforce. Another is diversity sensitivity which involve understanding potential problems encountered due to difference in culture and individuals. Third is culture audit, which involve examining the overall organizational scenario and identifying potential problems encountered by employees (Dass & Parker, 1999). For example, this strategy is also adopted by Ford motors, the company conduct global staff satisfaction survey to evaluate employee commitment, issues etc. fourth is strategies to achieve diversity and organizational goals which aims to ensure that diversity should help in achieving organizational goals and it should not be treated as goal in itself. Further, the multicultural paradigm also involves three approaches, which include monolithic organization, plural organizations and multicultural organization.

Challenges in Diversity Management

To ensure effective diversity, management need to set clear goals and objectives that should be used to build metric to measure short and long term goals. It is crucial to recruit candidates who fulfill diversity criteria, it helps in improving performance. Another is to provide training to employees to help them in understanding and accepting differences. While recruitment, equal opportunities must be given to all employees from different backgrounds.

Though there is detailed policy implementation on diversity management, still there are issues within companies; there are employee conflicts, legal cases which are hampering organization brand image adversely and also causing financial losses. Diversity management is easy said than done, it require continuous efforts, changes for proper execution. Different challenges that management or implementation team might encounter during diversity management are discussed below.

First among all is the communication challenges, when an organization operates in global market there are language barriers encountered by employees. For example, in America, English is the business language but in China, people prefer to talk in local language. This language barrier often causes different miscommunication between employees, such as wrong interpretation of message, perception barriers, wrong decoding of non-verbal cues etc. These scenarios impact team productivity adversely; it might also impact employee motivation negatively leading to low morale, productivity and efficiency (Kulik, 2014).

 A research was conducted on diversity in Australian manufacturing sector, findings states that government is also implementing various laws to implement diversity; even government is treating diversity management as mandatory requirement for doing successful business in market, for example Federal agencies does not deal with suppliers who does not maintain proper diversity culture within their organizations. Analysis also shows that lack of information about overseas skills, cost of training also causes hindrance in creating effective diversified workplace. Lack of training is considered as major challenge in diversity management, which causes perceptual barriers, language barriers etc. Though focus is given on internal barriers but employees also fail to adjust due to family responsibilities, failure in balancing non-work and work activities.

Employees are the one who encounter diversity in their daily jobs, they need to cope with it properly, and however rigid attitude towards change, reluctant and ignorant towards development also causes challenges. Employees might perceive diversity as threat to their job security, which gives rise to competition and conflict. Employees might have fear that being cooperative with different culture might cause job loss to them, such negative attitude leads to poor team performance. In case of selected organization, there are several instances in which there is diversity and inclusive policy is written but execution varies, therefore all employees might not perceive and implement policy in standardized manner (mend.org.uk, 2013).  Another key challenge is to establish a cultural synergy within organization, in diversified organization culture, people from various culture operates together, which might lead to conflicts and issues due to lack of knowledge regarding culture differences, misunderstanding of cultural symbols and other barriers, all this factors impact organizational productivity adversely.

Apart from this, there are challenges that internal management encounter in diversity management, for instance executing team find it challenging to make a sound appealing to different types of workers, for instance female employee prefer flexibility whereas male candidates prefer more challenging work. Different groups have different job expectation which might not be fulfilled by single job, similarly it is also challenging task to target diversified work groups. Third key challenge that internal management encounter is biasness in interviewing process, analysis and responses (Perlmutter, Bailey, & Netting, 2011).

Analysis states that though there are problems in executing diversified work culture nonetheless, these barriers can be overcome through planning and strategic implementation. This sections aims to evaluate various strategic actions that can be taken to establish diversity within organization, overcoming challenges; here reference from other successful cases will be taken to plan a strategy for the company.   

Diversity analysis

First stage of proper diversity management is to evaluate it from three different perspectives, which include micro level, macro level and meso level. Micro level analysis aims to evaluate the regional and cultural level belief system of people working in the company; information is collected through interactive sessions. Macro level diversity analysis involve legislative and institutional law regarding diversity within country, labor laws, migration laws, minority laws etc. This analysis helps in understanding national culture difference between regions such as Middle East and UK. Third is meso level analysis which aims at evaluating present policies regarding human resource management, diversity planning within organization? This analysis will facilitate management in evaluating differences in working style in different region and also in deciding strategies which cannot be implemented within particular markets. For example, in UK market employees are motivated through independent working powers whereas in Asian market employee seeks for collective decision making. Therefore, to overcome this, management needs to adopt global diversity policy which needs to be flexible in adopting local needs. Therefore company management can give power to subsidiary companies to make changes according to local conditions, cultures (Houkamau, 2011).

It is also advised to the management to opt for comprehensive planning model to implement diversity within organization, it should state step by step approach towards diversity development and management. It involve understanding of present requirement by conducting assessment, it will help in evaluating present level of differences in the system. Further management need to develop a diversity implementation plan, top management plays crucial role in this process, they establish worldwide unity and policy statement for the company; this plan needs to include SMART objectives and then implementation and follow-up (Kramar, 2012). Management need to integrate diversity plan in leadership system and management training modules. Regional units will be responsible for monitoring diversity implementation according to set objective. Company can also put incentive on diversity target implementation (Combs, 2002).

To foster diversity, it is crucial to implement it within all HR practices such as recruitment, selection, appraisal, compensation etc. Generally during recruitment, interviewers are bias towards participants with similar cultural values, which causes hindrance in diversity. While making new hiring management needs to ensure diversity workforce selection, it can be done by increasing number of women, minorities and physically handicapped people in the workforce. It is also recommended to implement multi culture workforce and avoid implementation of attraction-selection-attrition model (Kulik, 2014). One of the key reasons behind Apple innovative culture is its acceptance towards differences; it operates with open culture that offers ideas from any part of the world and from any employee. Apple even promotes diversity by building business relationship with companies or suppliers that keep diversity as their priority. Similarly, Wal-Mart major operates on the basis of goal achieved strategy, they set diversity goals and review their achievement in quarterly basis and report it to governance board. Similarly, during appraisal employees with any disadvantage, minority are not promoted, there are very few women employees promoted to management level, therefore equal promotion opportunities must be given to all.

Training helps in overcoming number of problem, it helps in creating awareness among employees, overcoming negative attitude towards change, removing cultural barriers, enhance social cohesion and teamwork. Training can also help in providing cross culture information to employees, providing adequate scope of development, overcoming job security fear and resistance. Skill development training helps in overcoming employee fear and enhances flexibility (Shena, Chandaa, D’Nettob, & Mongaa, 2009).

Conclusion

Changing external environmental scenario creates war for talent in the industry, companies are striving hard to hire best talent and retain it. With market expansion, there is rising demand for new talent as well as developing present employees; however in past women, minorities and other groups have been excluded by several companies during recruitment, which imposed challenges for economy growth. With governance and institutional improvements, now organizations need to provide equal opportunities to all employees and also foster diversified work culture by including workforce from different geographical, ethnic and religion. Diversified work culture helps in improving competitiveness in the market, employees are biggest resource for any organization, therefore diversified workforce help in improving learning, knowledge sharing, productivity, motivating employee, lowering employee turnover, increase employee retention and increase overall productivity and profitability.

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