Project of OB : [CULTURAL DIVERSITY MANAGEMENT IN Februry 2009

THE WORKPLACE]

CULTURAL DIVERSITY MANAGEMENT IN

THE WORKPLACE

By Ramdane BAKROR

Executive MBA , AUI university.

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Table of contents:

Introduction P3
1. Managing cultural diversity: implications for organizational
competitiveness P4
2. Competition by Effective Management of Cultural Diversity: The Case
of International Construction Projects. P5
3. The management of culture diversity: lessons from Brazilian
companies. P6
4. Creating a High-Performance Company Through Diversity at Exelon P7
5. Best Practices for Managing Organizational Diversity. P8
conclusion P9

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Cultural Diversity Management in the Workplace

“We see things not as they are but as we are”

Unknown

Introduction:

Diversity is the vast array of physical and cultural differences that constitute the spectrum
of human differences. Six core dimensions of diversity exist: age, ethnicity, gender, physical
attributes, race, and sexual/ affectional orientation. Other secondary forms of diversity (changeable
throughout the person’ life) include educational background, marital status, religious belief, and
work experience. more broadly, diversity encompasses all individual differences that affect the
performance of tasks or the conduct of relationships and thus may have an impact on the outputs,
outcomes and services, as well as on other facets of organizational life and activity.

In a globalized world with big multinational companies trading across the globe, a
culturally diverse workforce is a reality. Also in many developed and developing countries and due
to immigration policies, companies face the challenge of managing workers from different
backgrounds. Such differences in values, work ethics, and norms of behaviors if not well managed
could bring miscommunication, insensitivity, ignorance and hostility. The management of cultural
diversity in the workplace can be considered a response to the need to recognize, respect and
capitalize on the different cultural backgrounds.

The term managing diversity refers to a variety of management issues and activities related
to hiring and effective utilization of personnel from different cultural backgrounds. In the book
Beyond Race and Gender R. Roosevelt Thomas defined managing diversity as “a comprehensive
managerial process for developing an environment that works for all employees.”

In the following sections, we will discuss , based on relevant articles, the link between
diversity management and organization competitiveness, issues on cultural diversity impact on
project management (construction taken as example), diversity management in some Brazilian
companies and Exelon (US based company), and finally , the best practices and the field.

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1. Managing cultural diversity: implications for organizational competitiveness

Taylor H. Cox, University of Michigan Stacy Blake, University of Michigan

This article argue , based on relevant research and statistics, that a well planned and managed
diversity can create a competitive advantage for organizations, not only in achieving social
responsibility goals , but also regarding six others arguments, namely:

In order to implement cultural diversity management , companies must shift from traditional
organizations to multicultural ones, by focusing on five areas:
1. Leadership
2. Training
3. Research
4. Analysis and change of culture and human resource management systems
5. Follow up

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2. Competition by Effective Management of Cultural Diversity: The Case of

International Construction Projects.
Hossein DADFAR AND PETER GUSTAVSSON

The aim of this article is:

✔ To emphasize the impact of cultural diversity influences on performance of a project
management,
✔ To discuss some aspects of effective management of cultural diversity in the case of
construction projects.
A construction project is a complex entity that can be conceived as a system, the system approach
has been used by the authors to tackle this complexity on focusing on the social aspects of project
management system. Since the approach is explanatory, a detailed case study was carried out on a
sample of six international construction projects during 1986.
Five clusters of variables—including project characteristics, project management, project
organization, composition of work force, the actors involving in the project, and project
performance—were studied in detail.
The cases studied revealed that cultural impacts on project management are likely to be evident
from the very early days in the project process. This impact is felt even before the formal process
starts, for example and in the negotiation process in projects based in the Middle East, the
interpersonal relations play a important role in getting informations, and building this relations is
impossible without cultural awareness.
The cultural impacts on project management and project performance can be distinguished at three
levels:
1- The organization-set level :
Since there is a lot of actors in a projects (owner, consultants, subcontractors, government agencies
with different cultural background, the effective project management should take into account
sensitive cultural differences and should tackle them through training (among others).
2- The work-group level:
At the group level, project management and project performance were influenced by culture in
areas such as arranging work groups, evoking pride in workers, improving productivity, avoiding
conflicts, and changing working traditions.
Building various homogeneous work groups based upon their cultural background, in addition to
creating competition, can provide the project managers with flexibility in different situations.

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3- The Organizational Culture Level:

The project has its own organizational culture, which can differ from that of the headquarters. This
cultural diversity impacts the performance of the project. Failure to manage this diversity can
substantially delay completion of the project and incur substantially higher costs than were
originally planned. The international construction companies are aware of the problem. They often
choose a flexible organization to ease efficient communication between the project management
teams and headquarters.

3. The management of culture diversity: lessons from Brazilian companies.

Maria Tereza Leme Fleury, University of São Paulo, São Paulo, Brazil.

BRAZIL is an extremely diversified society. Even so, and according to the author, the issue of
managing cultural diversity in the workplace is rather new in Brazilian enterprises, more related to
the need of creating competitive advantages and adding value to the business by developing
competencies.
In order to better understand this theme, the author accomplished an explanatory research among
seven Brazilian companies that had developed a diversity management program, around three
issues:
✔ The origins of the programs,
✔ In the case of subsidiaries, the differences between the programs implemented in the Head
offices and Brazilian subsidiaries,
✔ The main policies and practices effectively implanted.
Table 1 synthesizes the main results:

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As a conclusion, the author state that:

✔ The concept of cultural diversity adopted by those companies is still quite restricted,
dealing with gender and race only,
✔ In the case of subsidiaries, the concept is defined globally by the head office; the practice is
conceived locally and has to be consistent with the strategy of the business and adapted to
the Brazilian environment.

4. Creating a High-Performance Company Through Diversity at Exelon

Patricia Bayerlein end Rey B. Gonzalez

As one of the leading electric and gas utility companies in the United States, Exelon Corporation
— with more than 5 million customers, $M billion in annual revenue and 20,000 employees — has
made commitment to diversity a core part of its business strategy. Diversity is embraced at the
highest levels of its organization and is incorporated in the company’s vision statement; One
Company, One Vision.
Exelon created a Corporate Diversity council, charged with understanding issues of diversity,
examining diversity best practices, working with the business units to implement diversity
initiatives and overseeing a communications strategy to inform employees, customers and the
community about Exelon's commitment to diversity.
Exelon also established the Office of Diversity to leverage its varied employee base and culture to
deliver high performance and better ideas, increased customer satisfaction, higher productivity,
innovation and retention, and a positive impact on the bottom line. The office focuses on four core
strategic areas:
✔ work force diversity,
✔ civic and social commitment,
✔ education and support,
✔ and supplier diversity.
The office is responsible for leading the efforts critical to achieving the strategic diversity goals set
by leadership and the Corporate Diversity Council, as well as ensuring accountability for driving
the key success factors at Exelon.

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5. Best Practices for Managing Organizational Diversity.

Patricia A. Kreitz Director, Technical Information Services, Stanford University.

This article reviews best practices applied in managing diversity and includes an annotated
bibliography of resources selected from diversity management writings in business, social
sciences, and library and information sciences.
Best practices are defined as “practices which are most appropriate under the circumstances, esp.
as considered acceptable or regulated in business; techniques or methodologies that, through
experience and research, have reliably led to desired or optimum results.”
Two core resources for workplace diversity best practices are:
Aronson’s article on “Managing the Diversity Revolution: Best Practices for 21st Century
Business”, which outlines how to institute a diversity initiative, summarizes the principles on
which it should be based, and provides many best practices examples implemented by various
companies
The U.S. Government Accountability Office’s (US GAO) report on “Diversity Management:
Expert-identified Leading Practices and Agency Examples.” the GAO identified nine best
practices:
1. Top leadership commitment—a vision of diversity demonstrated and communicated throughout
an organization by top-level management
2. Diversity as part of an organization’s strategic plan—a diversity strategy and plan that are
developed and aligned with the organization’s strategic plan
3. Diversity linked to performance—the understanding that a more diverse and inclusive work
environment can yield greater productivity and help improve individual and organizational
performance
4. Measurement—a set of quantitative and qualitative measures of the impact of various aspects of
an overall diversity program
5. Accountability—the means to ensure that leaders are responsible for diversity by linking their
performance assessment and compensation to the progress of diversity initiatives
6. Succession planning—an ongoing, strategic process for identifying a diverse talent pool and
developing them into an organization’s potential future leaders
7. Recruitment—the process of attracting a supply of qualified, diverse applicants for employment
8. Employee involvement—employee’s contributions in driving diversity throughout an
organization
9. Diversity training—organizational efforts to inform and educate management and staff about
diversity’s benefits to the organization.

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Conclusions:
Twenty-first century organizations are living with and being challenged by diversity on three
levels:
✔ an increasingly diverse workforce,
✔ a multicultural customer base,
✔ a growing challenge for market share from international competitors.
To take advantage of the benefits diversity can bring to an organization and minimize its
potentially negative effects; an organization must manage diversity strategically: with data-driven
planning, carefully articulated goals, judiciously applied organizational changes, and soundly
gathered and analyzed metrics. Senior managers must support diversity initiatives and be willing to
commit sufficient resources to the effort.

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