Essay: How companies benefit from a diverse workforce

Because of globalization and the progression of the economy worldwide, businesses are forced to find ways that could help them succeed within the area they want to be successful in. One of the ways they can do this is by carefully studying and getting to understand the local market’s demands. This can take a long time, unless you have employees that already understand and have the ideas your company needs. This is the strategy (recruiting local employees) companies use to stay one step ahead of the competition and give them the opportunity to establish themselves in an unfamiliar market. All the different types of diversity that will be included in this research are gender and racial. The research will also talk about the effectiveness of diversity training. Along with is diversity important to a successful business. I am limiting my research of diversity to racial and gender diversity and the effect of diversity training programs. Although largely used by international companies, this technique could also be used by local companies willing to increase their sales rates by hiring employees with different backgrounds and experiences. Therefore, the purpose of this report is to explain what diversity is and how it affects the organizations/businesses.
The goal of this report is to show why it would benefit companies to hire a diverse workforce. First, this report will start off by defining “workplace diversity” to give you an idea of what all is considered under this term. Secondly, this report will go into the keys of having gender and racial diversity in the workplace. But working with a diverse group of employees will take training, so therefore we will talk about the importance and benefits of having a diversity program. After these steps, we’ll wrap it all up with the importance of diversity and how it leads to a functioning workplace.
What is diversity?
Before thinking about the influences that it could have on a business, it is important that we define “workplace diversity” first. If wanting to simplify the definition, it could be defined as just having a variety of employees with different backgrounds working within your business. Fortunately for this report, it is way more complex than just one simple sentence. Diversity’s definition does not just stop itself at accepting, valuing or acknowledging the differences in race, gender or age of employees. Although when discussing this topic, these are probably the most known and used terms to describe diversity today, according to Abdul Ghafar Khan and Xu Hongyi (2016) it is not just “limited to those attributes which are observed but also include invisible characteristics such as the difference in educational background, creativity, comprehension, learning style and problem-solving ability.” (pg. 201) Also, according to Michalle E. Mor Barak (2016), the main principle of diversity, or as he calls it “inclusion,” does not only relate to the activity within the organization, but also the elements that are relevant to its survival within the area: the local community, the wider national sphere and the global context. (pg. xvi) Now the road that the acceptance of workplace diversity has taken, has evolved heavily. The discussion “has blossomed from a nascent practice area into a burgeoning specialization within business, governmental, and nonprofit organizations.” (Barak, 2016, pg. xvi) The business world went from setting up laws in to fight for diverse workforces to a point where most international organizations have “executive positions in charge of diversity” (Barak, 2016, pg. xvi) and workplace diversity becoming “a recognized field of scientific inquiry.” (Barak, 2016, pg. xvi)
Patrick (2014) described managing diversity as the following:
“Diversity management is a process intended to create and maintain a positive work environment where the similarities and differences of individuals are valued, so that all can reach their potential and maximize their contributions to an organization’s strategic goals and objectives.” (pg. 3)
Diversity management can also be seen, in general, as a strategy that aims at getting “excluded minorities better represented in employment.” (Wrench, 2016, pg. 3)
Gender Diversity
When talking about diversity in the workplace, there are many different ways to create a diverse business. But the easiest way to achieve diversity in your business is by increasing the gender diversity. Whether it be gender diversity within the common workplace or gender diversity in leadership (Higher Management) it can lead to a successful business. A diverse workforce is one that is beneficial for business, without it customer numbers would be down. “Gender diversity is associated with increased sales revenue, more customers, and greater relative profits.” (Herring P. 208). Gender diversity may be valuable even if changes in an organization’s composition make incumbent members uncomfortable.
The more I look at the large businesses and the successful businesses the less I see this type of gender diversity within the higher management or the leadership roles of a company. According to the Global Women’s Forum, “Women are less likely to sit ahead of a business, but recent studies have shown that more women are securing managerial ranks”. Within each business in the world the roles of genders have been separated and spread evenly throughout the common work place and the leadership roles. Gender diversity in leadership is strongly correlated with higher returns, profitability, and shared price. This fact leads us to see an increase in women leadership within large companies/organizations.
Despite the fact’s women are still underrepresented in the upper echelons of organizations. Women are really set up to fail Barreto states “women are regularly recruited for upper-level positions that are associated with a high risk of failure, and female managers are stereotyped as either competent or warm, but not both.” (Barreto, 2017). Many have offered women viable suggestions for making career choices and for thriving in the hard-won positions they have attained.
Racial Diversity
Although, I looked deeply into the importance and the differences between common workplace and leadership with gender diversity. Now we take a leap into my opinion of the most controversial type of diversity which is racial diversity. No matter where you look you will always see some sort of racial discrimination happening in the workplace. It may not be obvious to see, but racial diversity can affect how a company is doing drastically. As said earlier with gender diversity, racial diversity is associated with increased sales revenue, more customers, greater market share, and greater relative profits. Racial diversity is needed to have a successful business/organization.
Racial diversity adds a cultural diversity to your workplace which increases the innovations and may help the business reach out to a wide range of customers. Racial diversity enriches the workplace by broadening employee perspectives, strengthening their teams, and offering greater resources for problem resolution. “Racial diversity does in fact add value and, within the proper context, contributes to firm competitive advantage. “(Richard, 2017). When it comes to racial diversity in leadership it resembles the same as the gender diversity. Many leaders have realized that the extent to which these demographic workforce changes are effectively and efficiently managed will affect organizational functioning.
Racial diversity in leadership is a great thing to see, but it can end up hurting an organization. According to the article “Does Diversity Pay?” it says, “firm performance declines with increases in the representation of racial minorities in leadership up to a point, beyond which further increases in diversity are associated with increases in performance.” With these facts there needs to be more focus on achieving a racially diverse workforce and allowing them to be successful and not have declining numbers when they have a chance to lead a company.
Diversity Training Programs
Now that the world is changing, and the workplace is becoming more diverse it’s time to implement some training. There needs to be a way to teach employees how to deal and cooperate with a diverse work place. The solution is a diversity training program. Many companies have implemented these diversity training programs for employees to try out. For example: NetSuite, an enterprise software company, “launched a new mentoring initiative that has helped improve the diversity of its workforce.” (Big Think Edge, 2017).  Along with Google, “who has turned diversity training into a way of life for the company’s hiring process, which helps to ensure stronger diversity and inclusion moving forward.” (Big Think Edge, 2017).  Those two examples are two successful companies who have implemented a diversity training program and seeing positive results. Speaking of positive results, the diversity training programs have a very high success rate. Diversity training is a simple way to lead to a more efficient and successful organization. Due to the fact that the employees know how to cooperate better with those of different gender and race. Diversity training also leads to a gain of knowledge of contemporary and emerging trends in diversity and inclusion. As mentioned before the diversity training helps employees bring new ideas and also helps one another understand trends from the different genders and races within the company. Diversity training programs are very important to having a successful and diverse workplace.
Diversity Importance
As we have talked about this whole report having diversity in the workplace is key to having a successful organization. Businesses have started to recognize diversity in the workplace as a business strategy that maximizes productivity, creativity, and loyalty of employees while meeting needs of their clients or customers. The diversity in the workplace can determine whether a product sells or not. Diversity in the workplace leads to new ideas and innovations. Diversity gives you access to a greater range of talent, not just the talent that belongs to a particular world-view or ethnicity. With diversity you get to see the combination of different gender, races, and ages ideas come together as one and be sent out to be purchased or used by customers. Diversity is important to having a functioning organization.
Conclusion
Again, the purpose of this business report is to explain what diversity is and how it effects the organization. Workplace diversity is an important thing to anyone who is trying to have a successful business/organization. As mentioned earlier the road of acceptance of workplace diversity has evolved majorly. With the overall research we looked over how gender and racial diversity differ between leadership roles and the common workplace. We also did research on how diversity training was an effective and successful tool for an organization. Then to wrap it all up we talked about the importance of diversity within a functioning organization. Now that we have all this I’ll leave you with two questions. The first one is what steps in this business could you take to make this company more diverse? The second one is would diversity training be beneficial to your company? If you look into both of these questions and really answer them then you will see noticeable success within your company.