Types of Organizations
Taylor Cox Jr., an expert in the field of organization behavior, cited three primary organization types in the realm of cultural diversity development. When considering how to manage diversity, it is critical to understand what type of organization you are attempting to manage. Most U.S. businesses fall under one of the the three types of organizations.
Monolithic Organizations
The first type of organization is called the monolithic organization. This type of of organization has a homogeneous workforce which is composed of mostly white males. In this type of organization white males hold most of the managerial positions while women and minority members hold a very small number of these same positions. Minority members and women are often confined to lower-paying, subordinate positions. Cox does not that because of the homogeneity of the workforce, inter-group conflict based on culture-group identity is minimized. However because this type of organization does little to integrate women and minority members prejudice and discrimination are likely to occur. It is suggested that when women and minority members enter these types of organizations they recognize and conform to the norms already in place.
Plural Organizations
The second type of organization is the plural type of organization. This type of organization is more heterogeneous than the monolithic organization and it takes steps to include members of cultural backgrounds who are not members of the majority group. This type of organizations give preferential treatment when hiring and promoting minority members, fair and equal opportunities for advancing within the organization, and review of compensation to ensure fair treatment. These initiatives to include members who are not part of the majority group lead to greater levels of social interaction between members of different backgrounds. However even though plural organizations have these initiatives to be fair and equal to all employees, there is still little representation of minority members in management positions. Also because of these initiatives, white males within the organization may have the perception that decisions are made not based on performance but instead they are based on race, gender, and cultural background. These types of problems can create inter-group conflict in the plural organization that was not found in the monolithic organization.
Multicultural Organizations
The third type of organization described by Cox is the multicultural organization. This type of organization integrates minority members into all levels within an organization. The thinking is that because both minority and majority members are evenly distributed within an organization then this should lead to an elimination of prejudice and discrimination. Also the multicultural organization must perpetuates the idea that not only diversity being accommodated for, but it is valued.
Taylor Cox Jr., an expert in the field of organization behavior, cited three primary organization types in the realm of cultural diversity development. When considering how to manage diversity, it is critical to understand what type of organization you are attempting to manage. Most U.S. businesses fall under one of the the three types of organizations.
Monolithic Organizations
The first type of organization is called the monolithic organization. This type of of organization has a homogeneous workforce which is composed of mostly white males. In this type of organization white males hold most of the managerial positions while women and minority members hold a very small number of these same positions. Minority members and women are often confined to lower-paying, subordinate positions. Cox does not that because of the homogeneity of the workforce, inter-group conflict based on culture-group identity is minimized. However because this type of organization does little to integrate women and minority members prejudice and discrimination are likely to occur. It is suggested that when women and minority members enter these types of organizations they recognize and conform to the norms already in place.
Plural Organizations
The second type of organization is the plural type of organization. This type of organization is more heterogeneous than the monolithic organization and it takes steps to include members of cultural backgrounds who are not members of the majority group. This type of organizations give preferential treatment when hiring and promoting minority members, fair and equal opportunities for advancing within the organization, and review of compensation to ensure fair treatment. These initiatives to include members who are not part of the majority group lead to greater levels of social interaction between members of different backgrounds. However even though plural organizations have these initiatives to be fair and equal to all employees, there is still little representation of minority members in management positions. Also because of these initiatives, white males within the organization may have the perception that decisions are made not based on performance but instead they are based on race, gender, and cultural background. These types of problems can create inter-group conflict in the plural organization that was not found in the monolithic organization.
Multicultural Organizations
The third type of organization described by Cox is the multicultural organization. This type of organization integrates minority members into all levels within an organization. The thinking is that because both minority and majority members are evenly distributed within an organization then this should lead to an elimination of prejudice and discrimination. Also the multicultural organization must perpetuates the idea that not only diversity being accommodated for, but it is valued.
Theories of Diversity Management
There two general approaches and three specific types of approaches to managing diversity. The two approaches that are very broad are the Institutional Theory of Diversity Management, and the Resource Based Theory of Diversity Management. Bairoh (2007) identified the three specific approaches as the practitioner/consultant approach, the mainstream approach, and critical approaches. Each of these types of approaches explains how the incorporation of diversity can help organizations develop effective strategies to reach organizational goals.
General Approaches to Diversity Management
Institutional Theory of Diversity Management
This theory, based off of organization theory, recognizes that in order to determine an organization’s structure one can not separate the social environment found within an organization. In order to understand the structure of the organization it must also be understood that the behavior of employees in organizations and organizations themselves have limiting factors such as legislation, laws, rules, regulations, and social and professional norms. Because organizations are held to similar norms and regulations they tend to develop similar administrative structures. This conformity shows that organizations are willing to be consistent with these norms and they begin to garner legitimacy for their operations. By proving legitimacy through its actions, organizations prove what their priorities are and can begin to accumulate material resources from others. In summation, because laws require organizations to become diverse they must prove to both individuals within the organization and individuals outside of the organization that they are conforming to these laws and norms. If an organization fails to follow these laws or norms then its operations will be questioned and it may also be terminated for violating the law.
Resource Based Theory of Diversity Management
The main focus of Resource Based Theory of Diversity Management is how the implementation of diversity will affect organizational resources. There are four categories of resources that organizations possess: physical capital, financial capital, human capital, and corporate capital resources. These resources can either assist or inhibit the operations of the organization. Organizations attempt to use these resources in ways that will of course assist and improve business. From a business perspective organizations that are more diverse gain an advantage compared to organizations that are homogenous. Racial diversity within organizations increases financial performance when a growth or innovation strategy is used (Richard, 2000; Richard, Barnett, Dwyer, & Chadwick, 2004; Richard et al., 2003 as cited in Yang & Konrad, 2011). Richard and Johnson's 1999 study (as cited in Yang & Konrad, 2011) found that firms with more diversity management practices in place experienced lower levels of turnover and that diversity management practices interacted positively with an innovation strategy, resulting in higher productivity and better market performance. Organizations that are diverse gain several advantages over organizations who fail to implement diversity policies.
Specific Approaches to Diversity Management
The Practitioner/Consultant Approach
This approach focuses on the positive aspects of how making the workplace more diverse can increase productivity. In this approach organizations focus on how diversity can benefit their business. Dietz and Peterson (2006) argue that because organizations find it difficult to find qualified workers that have the talent and abilities necessary to do the job, they must examine all possible means to find the workers they need. Using this approach to find qualified workers, making the workplace a more diverse environment helps employers make minorities and other potential employees who may be qualified more available and noticeable. The Practitioner/Consultant Approach to managing diversity also helps employers to better understand their needs of their diverse customer base. If employers can create diversity in the workplace then these new perspectives of the more diverse employees should translate into economic success. If the workplace is diverse than these more diversified employees should be better able to understand what their diverse customers want. According to Lorbiecki and Jack (2000), diversity in the workplace can even improve productivity, increase creativity and innovation, and mitigate costs associated with mitigation.
Along with the benefits previously mentioned, proponents of the Practitioner/Consultant Approach to managing diversity feel that businesses can benefit from making their workplaces more diverse in the following ways:
· improves utilization of the competencies of all employees
· strengthens the commitment between the employee and the organization and decreases employee turnover
· boosts the image of the organization among its shareholders
· allows for greater adaptability and flexibility in fast-paced and rapidly changing marketplaces
· attract and retain the most talented employees
· reduces costs associated with turnover, absenteeism, and low productivity
· return on investments from various initiatives, policies, and practices
The Mainstream Approach
At its core, the Mainstream approach is supported by social-identity theory and self- categorization theory. Social-identity theory describes group membership and behavior within a group (Hogg et al., 1995). Self-categorization theory exists when people stereotype themselves by attributing to themselves the attitudes, behaviors and other attributes they associate with membership in a particular group Kulik and Bainbridge (2006). These two theories can explain how diversity should be managed at both the macro and the micro level within an organization.
At the macro level, the organizational level of business, the goal of diversity management is to moderate and observe the relationship between diversity in the workforce and performance. While there are a few macro level models of managing diversity the model created by Thomas and Ely (1996) is the most widely used. Thomas and Ely’s model focuses on the relationship that workplace diversity has on the outcomes of the organization. Thomas and Ely proposed three types of perspectives for managing diversity at the organizational level: discrimination-and-fairness, access-and-legitimacy and integration-and-learning. Of these three perspectives Thomas and Ely found that workgroups function best under the integration-and-learning perspective. The integration-and-learning perspective focuses on generating positive inter-group relations, feelings of being valued and respected by other group members, and having employees feel positively about their racial identity in the workplace (Thomas & Ely 1996).
The micro level, or the individual employee level, is based on understanding and managing stereotypes, prejudices, and discrimination (Dietz and Petersen 2006). Proponents of managing workplace diversity at the micro level also feel that prejudices and stereotypes are immediate precursors for discrimination in the workplace. Discrimination is either completely eliminated or controlled by controlling prejudices and stereotypes. Dietz and Peterson (2006) also argue that there are other antecedents of discrimination which include social psychological processes such as:
· the development of social identities and social categorizations
· experience of realistic group conflict
· contact with demographically different persons
Individual differences in social dominance orientation are more distal antecedents of discrimination than stereotypes and prejudices. Dietz and Peterson (2006) found that prejudice still affects the relationships and interactions between demographically different employees, and that these types of prejudices are more complicated than they were just a few years ago. Dietz and Peterson (2006) also argue that in order to control discriminatory behavior and inter-group conflict, the main goal of managing diversity at the micro level should be to eliminate prejudices. Justification factors such as employee pay or productivity, also fuel discriminatory behavior. If needed organizations should also hold diversity management interventions to control or eliminate:
· negative stereotypes or prejudices
· justification factor
· discrimination
Critical Approaches
Prasad et al. (2006) argue that too much of the literature focusing on managing diversity ignores the real problems created by inequality and discrimination and the effects that these concepts have on organizational outcomes, and instead focus too much on training and workshops as a means to teach how diversity should be managed.
According to Lorbiecki and Jack’s (2000) critical discourse analysis, they examined how manages and other policy makers within organizations defined and viewed the term diversity. They found that managers see diversity as something that should be managed. Lorbiecki and Jack feel that because groups are identified and viewed as different because they need to be managed this helps to erase the differences found between diverse individuals.
Litvin (1997) claims that because individuals are seen as being diverse within an organization, co-workers are forced to view them in a certain light. Because mainstream approaches to diversity place individuals into socially constructed demographic categories that are portrayed as obvious, natural, and undisputable that they make it almost impossible for change to occur. Lorbiecki and Jack (2000) agree with Litvin (1997) that because traditional approaches to diversity management assign differences to individuals that there will be no movement within or between diverse groups.
Prasad et al. (2006) have also begun to question the relevance of the Anglo-Saxon understanding of diversity management and its applicability in countries that are multicultural. Instead we should seek to find the most effective way to manage diversity instead of relying on the methods and approaches that are already in use. The current methods and approaches may not always be the best way to manage diversity because of shifting cultural identities.
There two general approaches and three specific types of approaches to managing diversity. The two approaches that are very broad are the Institutional Theory of Diversity Management, and the Resource Based Theory of Diversity Management. Bairoh (2007) identified the three specific approaches as the practitioner/consultant approach, the mainstream approach, and critical approaches. Each of these types of approaches explains how the incorporation of diversity can help organizations develop effective strategies to reach organizational goals.
General Approaches to Diversity Management
Institutional Theory of Diversity Management
This theory, based off of organization theory, recognizes that in order to determine an organization’s structure one can not separate the social environment found within an organization. In order to understand the structure of the organization it must also be understood that the behavior of employees in organizations and organizations themselves have limiting factors such as legislation, laws, rules, regulations, and social and professional norms. Because organizations are held to similar norms and regulations they tend to develop similar administrative structures. This conformity shows that organizations are willing to be consistent with these norms and they begin to garner legitimacy for their operations. By proving legitimacy through its actions, organizations prove what their priorities are and can begin to accumulate material resources from others. In summation, because laws require organizations to become diverse they must prove to both individuals within the organization and individuals outside of the organization that they are conforming to these laws and norms. If an organization fails to follow these laws or norms then its operations will be questioned and it may also be terminated for violating the law.
Resource Based Theory of Diversity Management
The main focus of Resource Based Theory of Diversity Management is how the implementation of diversity will affect organizational resources. There are four categories of resources that organizations possess: physical capital, financial capital, human capital, and corporate capital resources. These resources can either assist or inhibit the operations of the organization. Organizations attempt to use these resources in ways that will of course assist and improve business. From a business perspective organizations that are more diverse gain an advantage compared to organizations that are homogenous. Racial diversity within organizations increases financial performance when a growth or innovation strategy is used (Richard, 2000; Richard, Barnett, Dwyer, & Chadwick, 2004; Richard et al., 2003 as cited in Yang & Konrad, 2011). Richard and Johnson's 1999 study (as cited in Yang & Konrad, 2011) found that firms with more diversity management practices in place experienced lower levels of turnover and that diversity management practices interacted positively with an innovation strategy, resulting in higher productivity and better market performance. Organizations that are diverse gain several advantages over organizations who fail to implement diversity policies.
Specific Approaches to Diversity Management
The Practitioner/Consultant Approach
This approach focuses on the positive aspects of how making the workplace more diverse can increase productivity. In this approach organizations focus on how diversity can benefit their business. Dietz and Peterson (2006) argue that because organizations find it difficult to find qualified workers that have the talent and abilities necessary to do the job, they must examine all possible means to find the workers they need. Using this approach to find qualified workers, making the workplace a more diverse environment helps employers make minorities and other potential employees who may be qualified more available and noticeable. The Practitioner/Consultant Approach to managing diversity also helps employers to better understand their needs of their diverse customer base. If employers can create diversity in the workplace then these new perspectives of the more diverse employees should translate into economic success. If the workplace is diverse than these more diversified employees should be better able to understand what their diverse customers want. According to Lorbiecki and Jack (2000), diversity in the workplace can even improve productivity, increase creativity and innovation, and mitigate costs associated with mitigation.
Along with the benefits previously mentioned, proponents of the Practitioner/Consultant Approach to managing diversity feel that businesses can benefit from making their workplaces more diverse in the following ways:
· improves utilization of the competencies of all employees
· strengthens the commitment between the employee and the organization and decreases employee turnover
· boosts the image of the organization among its shareholders
· allows for greater adaptability and flexibility in fast-paced and rapidly changing marketplaces
· attract and retain the most talented employees
· reduces costs associated with turnover, absenteeism, and low productivity
· return on investments from various initiatives, policies, and practices
The Mainstream Approach
At its core, the Mainstream approach is supported by social-identity theory and self- categorization theory. Social-identity theory describes group membership and behavior within a group (Hogg et al., 1995). Self-categorization theory exists when people stereotype themselves by attributing to themselves the attitudes, behaviors and other attributes they associate with membership in a particular group Kulik and Bainbridge (2006). These two theories can explain how diversity should be managed at both the macro and the micro level within an organization.
At the macro level, the organizational level of business, the goal of diversity management is to moderate and observe the relationship between diversity in the workforce and performance. While there are a few macro level models of managing diversity the model created by Thomas and Ely (1996) is the most widely used. Thomas and Ely’s model focuses on the relationship that workplace diversity has on the outcomes of the organization. Thomas and Ely proposed three types of perspectives for managing diversity at the organizational level: discrimination-and-fairness, access-and-legitimacy and integration-and-learning. Of these three perspectives Thomas and Ely found that workgroups function best under the integration-and-learning perspective. The integration-and-learning perspective focuses on generating positive inter-group relations, feelings of being valued and respected by other group members, and having employees feel positively about their racial identity in the workplace (Thomas & Ely 1996).
The micro level, or the individual employee level, is based on understanding and managing stereotypes, prejudices, and discrimination (Dietz and Petersen 2006). Proponents of managing workplace diversity at the micro level also feel that prejudices and stereotypes are immediate precursors for discrimination in the workplace. Discrimination is either completely eliminated or controlled by controlling prejudices and stereotypes. Dietz and Peterson (2006) also argue that there are other antecedents of discrimination which include social psychological processes such as:
· the development of social identities and social categorizations
· experience of realistic group conflict
· contact with demographically different persons
Individual differences in social dominance orientation are more distal antecedents of discrimination than stereotypes and prejudices. Dietz and Peterson (2006) found that prejudice still affects the relationships and interactions between demographically different employees, and that these types of prejudices are more complicated than they were just a few years ago. Dietz and Peterson (2006) also argue that in order to control discriminatory behavior and inter-group conflict, the main goal of managing diversity at the micro level should be to eliminate prejudices. Justification factors such as employee pay or productivity, also fuel discriminatory behavior. If needed organizations should also hold diversity management interventions to control or eliminate:
· negative stereotypes or prejudices
· justification factor
· discrimination
Critical Approaches
Prasad et al. (2006) argue that too much of the literature focusing on managing diversity ignores the real problems created by inequality and discrimination and the effects that these concepts have on organizational outcomes, and instead focus too much on training and workshops as a means to teach how diversity should be managed.
According to Lorbiecki and Jack’s (2000) critical discourse analysis, they examined how manages and other policy makers within organizations defined and viewed the term diversity. They found that managers see diversity as something that should be managed. Lorbiecki and Jack feel that because groups are identified and viewed as different because they need to be managed this helps to erase the differences found between diverse individuals.
Litvin (1997) claims that because individuals are seen as being diverse within an organization, co-workers are forced to view them in a certain light. Because mainstream approaches to diversity place individuals into socially constructed demographic categories that are portrayed as obvious, natural, and undisputable that they make it almost impossible for change to occur. Lorbiecki and Jack (2000) agree with Litvin (1997) that because traditional approaches to diversity management assign differences to individuals that there will be no movement within or between diverse groups.
Prasad et al. (2006) have also begun to question the relevance of the Anglo-Saxon understanding of diversity management and its applicability in countries that are multicultural. Instead we should seek to find the most effective way to manage diversity instead of relying on the methods and approaches that are already in use. The current methods and approaches may not always be the best way to manage diversity because of shifting cultural identities.