Substantial industrial competition, dynamic process of internationalization and globalization and fast-tracking of technological innovations – these are just few of the factors that affect the global workplace and human capital and labour. With such phenomenon affecting every organization, there is a need to identify the most suitable human resource solution in order to cope up with such emerging effects – beneficial or destructive – not only to the immediate human resources but to the organization in general. The role of human resource management (HRM) has long been recognized by work organizations and proven by numerous research studies (i.e. Gooderham et al 2006; Delaney & Huselid 1996; Delery & Doty 1996). Such researches are founded by the relationship of HRM and firm performance as they concluded that HRM practices have a significant effect on the organization, which leads to high performance (Haltiwanger et al 1999). While the function of this department mainly revolves around hiring, evaluating employees and other similar activities, the changing business and organizational trends have emphasized other significant functions of HRM, particularly in organizational performance and the development of the employees. This newfound recognition led to the common belief that the HR function champions the employees’ cause and achieves results for the organization.
Why this topic is important to the study and practice of human resource management?
The concept of culture at work, whether international, local or at the organizational level, extensive emphasis should be warranted for because effective HRM practices plays an effective role on achieving high performance levels of employees. Some main perspectives on international HRM rest upon the global and the comparative approach. With the sole reason that the global marketplace suffers from the identified conditions above, the human workforce is overly affected. In the future, HRM will face both challenges and opportunities (Gross & Connor 2007; Schuler 1990). Jain and Murray (1990) contend that HRM will remain a reactive function responding only to problems when they arise. It is heavily controlled by “forces that effectively work against the adoption of many of the policies that have been advocated by leading personnel experts for decades” (p. 25). Today’s multinational corporations are proving the decade of competition not only in terms of business performance and productivity but also to top employees themselves. Thus, human labour goes global. The challenge then for HR managers is how to manage diversity in the workplace. Do traditional HRM practices encompass the emerging trends in the contemporary workplace? How do HR managers administer cultural biases, discrimination, and other diversity-related issues? Because human labour is extended across geographical as well as cultural borders, there is a need to reinforce the knowledge on how traditional HRM practices address the demands of the current generation. Despite the existence of national legislative frameworks on equality, there continues to be evidence of discrimination in employment across the globe (Blair et al 2000). There is also a requirement on development of new body of knowledge or re-evaluation of HR policies and frameworks in order to address the issue of diversity in international human resources. . In short, while the global nature of a business may call for increased standardization, diverse cultural environments may, simultaneously and paradoxically, call for differentiation. These are also the potential issues affecting the HRM practice that is commonly utilised worldwide.
Key Issues Managing Diversity
Significant changes are already taking place in society and the workplace (Hays-Thomas 2004; Holvino 2002) and accepting the data as an illustration of the societal and workforce diversity, strong arguments for the importance of managing diversity emerge on the basis of the inevitable reality of considerable differences among people entering the workforce. According to Aronson (2002), diversity is important in an organization because it is about inclusiveness; that it is not simply a code word for minority concerns, but embraces a new way of thinking about maximizing the potential of everyone within the organization. It is basically about providing equality within the organization. Blair and colleagues (2000) stated that since the early 1990s, the debate on equal opportunities (EO) at work has been characterized by the introduction of the relatively new concept of managing diversity. With its many definitions, managing diversity was best described by Bartz and group (1990) as:
“…understanding that there are differences among employees and that these differences, if properly managed, are an asset to work being done more efficiently and effectively. Examples of diversity factors are race, culture, ethnicity, gender, age, a disability, and work experience” (p. 321).
Workplace diversity is one of the most effective strategies because it manages individuals with different characteristics who eventually create the team (Cross 2000, 137). Cross noted that “it is composed of theories and practices that help organizations reduce discrimination and enable employees with diverse characteristics and background to work together effectively” (p. 138). However, it is imperative to emphasise that EO is different for managing diversity. EO focuses on discrimination while managing diversity is concerned with ensuring that all people maximise their potential (Kandola 1995; McDougall 1996). Thus the emphasis in managing diversity is that differences between people should be effectively managed (Cassell 1996) as opposed to being avoided (Liff & Wajcman 1996), or viewed as a liability (Wilson & Iles 1999). Furthermore, the managing diversity approach focuses on individuals in contrast to EO’s focus on groups such as: women, ethnic minorities, and disabled people.
Meanwhile, cultural diversity necessitates a contextual and cultural examination of the values, behaviours and attitudes that underlie every individual (Temple 1997). Thus, while difference in culture itself is sufficient explanation in the misunderstanding and sometimes barriers that governs relationships of different nationalities, extending this dissimilarity is instrumental in establishing better relationships with other people in terms of HR practices. The managing diversity approach has been suggested as engaging with a strategic perspective, playing a critical role in ensuring economic and competitive success (Wilson 1996), and is described as being the responsibility of all employees (Ross & Schneider 1992), but particularly managers (Kandola & Fullerton 1994). EO on the other hand, is largely considered as the concern of personnel departments or human resource specialists (Wilson 1996).
It is then sound to select an overall global approach which uses analytical frameworks and broad thematic interpretations to understand HR issues on a global scale in contrast to the comparative approach which compares and contrasts the different ways in which HRM is practiced in light of culture, history and other factors. Is there a competitive advantage to be derived from a global IHR strategy? Adler (1986) is among many who unequivocally respond, no. She argues that a standardized approach to HRM may put the firm at a disadvantage because cultural differences are ignored, rather than being built upon. Further, Agars and Kottke (2004) recognise the importance of diversity management as they noted it not a fad nor a short-term reality but a critical aspect of contemporary organization.
Henderson (1994) had observed that in the past decade, we have seen the dramatic metamorphosis in our workforce. Edwards (1991) explains that corporations are “managing diversity” to survive. That is contrary to the usual belief that corporations are getting kinder and gentler towards culturally diverse groups. To survive, many companies are recruiting, training, and promoting culturally diverse employees. In view of this, Riche (1991) had seen all of this as nothing but to broaden human resources. The role of managing diversity in business has been considered important particularly to the welfare of the employees. It places an important emphasis on the nature of organizational culture (Ross & Schneider 1992; Kandola 1996; McDougall 1996) and management styles (Iles 1995). Certainly it has been asserted that cultural transformation is integral to the managing diversity approach (Carnevale & Stone 1994), with the organisation adapting and changing, rather than individuals conforming to long established processes (Carnevale & Stone 1994; Liff 1999). Further, a diverse work force should better understand and be able to deal with varied demands and expectations of a diversified customer (Knouse 1999). Therefore, managing diversity involves building a healthy workplace for all members of the team, and giving them opportunities to develop themselves as a person, as well as their performance at work (Thiederman 2003). This is a long-term strategy that will prepare the organization to meet the challenges of the evolving business world.
Possible Silences or Gaps in Current Discussions and Research
Most researches tackling the issue of workplace diversity are dynamic if not restricted to traditional HRM literatures. Most literatures in generic HRM is focused on HR strategy and firm performance yet there is lacking association of all the areas concerned in overall firm productivity (e.g. Huselid 1995; MacDuffie 1995; Boudreau 1991; Jones & Wright 1992; Kleiner 1990). Aside from this, the rapid changes in global HR practices brought about by emerging trends necessitate HR experts to redirect the existing HR policies related so as to serve the demand, for instance in global workplace diversity. Some researches are also difficult to understand and are expected to be case-to-case basis. For example, Williams and O'Reilly (1998) presented some other reasons on why managing diversity is important focusing on the examination of the relationship between diversity and performance. Although, there are difficulties in identifying the underlying processes, in which their review reveals that diversity does impact processes, functioning, and performance, and in many contexts, this impact is a negative one. These findings underscore the need for organizations to identify and develop best ways of managing diversity. Research between diversity management to business outcomes is limited or applicable to a particular business case (e.g. Frink et al 2003; Richard et al 2003). With these facts, the need to undergo further and specific empirical research exploration on workplace diversity is recommended.
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