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Organizational Behavior Course Notes – Managing Cultural Diversity

The term diversity refers to a variety of management issues and activities related to hiring and effective utilization of personnel from different cultural backgrounds.

Diversity as a Competitive Advantage

Six areas where sound management can create a competitive advantage
Inevitability-of-diversity issues (the need to hire more women, minorities and foreign nationals because of national and cross-national workforce)

  1. Cost
  2. Resource acquisition

Value-in-diversity hypothesis (diversity brings net-added value to organization processes)

  1. Marketing
  2. Creativity
  3. Problem-solving
  4. Organizational flexibility


Resource Acquisition



Problem Solving

System Flexibility

Suggestions for Organization Change

Specific features of multicultural organizations

Five key components needed to transform traditional orgs to multicultural ones

  1. Leadership
    • Top management’s support and genuine commitment is crucial.
    • Champions are needed at lower levels, especially in key line managers.
  2. Training
    • Awareness training – creating an understanding of the importance
    • Skill-building training – educate on specific cultural differences and how to respond to differences in the workplace.
    • Treat training as an on-going education process rather than one-shot seminar.
  3. Research
    • Helpful in identifying issues to be addressed in the education process.
    • Identify areas where changes are needed and provides clues about how to make them.
    • Necessary to evaluate the change effort.
  4. Analysis and change of culture and human resource management systems
    • Uncover sources of potential bias unfavorable to members of certain cultural groups
    • Identify ways that corporate culture may inadvertently put some members at a disadvantage.
  5. Follow up
    • Monitoring change
    • Evaluating results
    • Institutionalizing the changes as part of the organization’s regular on-going processes
    • Should include:
      • Additional training
      • Repetition of the systems audit
      • Use focus groups for on-going discussions about diversity issues.