Diversity: Tangible Effects on Culture and Leadership

‘Diversity’ is frequently debated as an empty-bellied decorative corporate leadership maxim that does not bring tangible consequences. But, is that true? As a by-product of Fortune 500 organizations, of course, I am pro-diversity. While we all distinguish that there are unique strengths and equal opportunities, first, comprehending and associating the concept of diversity into leadership styles is vital (Demby, 2015). Diluting stereotypes and stigmas, which are severely embedded in one’s character and in an organization’s culture is the overall key objective of diversity (Ollapally and Bhatnagar, 2009).

Diversity Re-defined

Tangible statistical and empirical research have verified that leveraging on diversity in the workplace for imminent leadership success establishes not only as an inherent competitive advantage, but also as a business imperative and incentive to attain more informed decision-making, greater cultural and linguistic competence, and increased credibility and legitimacy (McCarthy, Rivera, and DeSimone, 2018). Sure, approaches vary depending on the organizational group, industry, national culture, and level of business success aspired for. Through leadership styles on affective, cognitive, and communication, symbolic successes are commonly linked to the types of diversity management being utilized in organizations (Milliken and Martins, 1996). Various custom-designed and action-oriented strategic dimensions, such as customer orientation, corporate social responsibility, human resource management, scientific management, and shareholder value are being explored in greater detail to help managers and leaders develop into more exceptionally holistic and diversity-centric ones (Goldsmith, Baldoni, and McArthur, 2010).

Diversity and Theories

Referencing theories like Geert Hofstede’s culture dimensions Theory, Iceberg Model of Culture, McKinsey 7S Framework, Deal & Kennedy Four Generic types of culture, and Sigmund Freud’s Theory of the Mind, more and more organizations are integrating concepts into their cultural diversity practices. One particular academic study shared how the framework of Blau’s Theory of Heterogeneity contextually provided value and curvilinear relationships between diversity (racial, gender) in management and successful team performance (innovation, financial success) (Richard et al., 2004). These theories are carefully integrated and applied into diversity management trends (outsourcing, offshoring, mergers, acquisitions) and initiatives taken by organizations, which as an effect, have been associated with increased greater market share, sales revenue, and more customers (Herring, 2009).

Diversity and Organizations

Through proactive efforts, leaders can utilize diversity management strategies to transform organizational paradigms and experience measurable bottom-line results (Gilbert, Stead, and Ivancevich, 1999). One study of 33 Information Technology firms discovered that there is a strong relationship between team diversity and firm performance, indicating that diversity: through functional background and locus-of-control, reinforces high-quality decisions and organizational effectiveness (Boone and Hendriks, 2009). Another study of 209 organizations found that even if the focus of diversity management is different across cultures if the basic premise of human resource management on diverse backgrounds (foreigners nationals, females, persons with disabilities, ageing workers) are being practised, it serves as enablers of communication and integration within teams (Kemper, Bader, and Froese, 2016).

Diversity and Leaders

Leadership through diversity plays an important part in creating curiosity that leads to innovation and ultimate success. One study finds that there is 19% more revenue achieved from diversity-driven leaders, because of its myriad of new and novel ideas from its leadership and teams (Powers, 2018). A different study from McKinsey involving 15 countries and 1,000+ large companies reveal that impressive gains in diversity, brought by adopting systematic, business-led innovative leadership by creating a long-lasting “social listening” culture and leaders’ behaviour (Dixon-Fyle et al., 2020). A study of Fortune 500 firms also revealed that global leaders would even go for culturally related international diversification and culturally unrelated globalization to strengthen their innovative diversity management practices (Gomez-Mejia and Palich, 1997). Some of these Best Leadership Workplaces for Diversity include Cisco, Accenture, Hewlett-Packard, and Marriott (Valet, 2019).

Reflection

Even if surface-level diversity is the starting point, which reaps minimal positive effects, as the leadership and teams progress into a deeper level of engagement and meaningful interactions through time, long-lasting diversity cohesion is achievable (Harrison, Price, and Bell, 1998). Yes, I surmise that cultural differences can bring either potential interpersonal conflict or communication breakdowns. Nonetheless, coming up with customized diversity-centred models of engagement can reap substantial benefits in better leadership and organizational decision making (Cox, 1991). Diversity not only provides an engaged learning type of leaders, but as an effect, positive consequences on sociocultural engagement (St. John, Rowley, and Hu, 2009).

Moreover, innovation remarkably plays a part in creating a culture of diversity and inclusion. With the rising generation of new leaders (generation Z, millennials), priorities for management to positively mirror equality and inclusion to ensure self-efficacy and to achieve cross-level effects are more pronounced (Choi, Price, and Vinokur, 2003). Through diversity management, leaders become more engaged against environmental favorability, environmental uncertainty, and organizational isomorphism (Pitts et al., 2010). These can be seen through wildly inspiring leaders like Pandora’s Global Diversity/Inclusion Officer – Adelmise Warner, Conbase’s Global Head of Belonging – Tariq Meyers, and Pfizer’s Global Director Diversity/Inclusion – Rachel Cheeks-Givan (Young, 2019). I cannot disregard how diversity brings about accelerated and tangible innovation, be it directly or indirectly, resulting in either cultural or commercial success.

With the constant increase of diversity-driven research, initiatives, leaders, and organizations, I cannot help but anticipate more newfound tangible consequences out of it.

Care to share your diverse thoughts?

^{This blogpost is intended to be interactive, so feel free to leave a comment in the section below or, alternatively, you can send a request to find out more about the academic references used in this article.}