I Academy of Management Executive, 1991 Vol. 5 No.

The multicultural organization

Taylor Cox, Jr., The University of Michigan

Executive Overview Organizations are becoming increasingly diverse in terms of gender, race,
ethnicity, and nationality. This diversity brings substantial potential benefits
such as better decision making, greater creativity and innovation, and more
successful marketing to different types of customers. But, increased cultural
differences within a workforce also bring potential costs in higher turnover,
interpersonal conflict, and communication breakdowns.

To capitalize on the benefits of diversity while minimizing the potential costs,

leaders are being advised to oversee change processes toward creating
"multicultural" organizations. What are the characteristics of such an
organization, and how do they differ from those of the past? What mechanisms
are available to facilitate such a change?
/This articl^ddresses these questions. It aiso/aescribes a model for
understanding the required features of a multicultural organization and reviews
tools that pioneering companies have found useful in changing organizations
toward the multicultural model. /

Article As we begin the 1990s, a combination of workforce demographic trends and

increasing globalization of business has placed the management of cultural
differences on the agenda of most corporate leaders. Organizations' workforces
will be increasingly heterogeneous on dimensions such as gender, race, ethnicity
and nationality. Potential benefits of this diversity include better decision making,
higher creativity and innovation, greater success in marketing to foreign and
ethnic minority communities, and a better distribution of economic opportunity.
Conversely, cultural differences can also increase costs through higher turnover
rates, interpersonal conflict, and communication breakdowns.

To capitalize on the benefits and minimize the costs oi worker diversity,

organizations oi the '90s must be quite diiierent from the typical organization oi
the past. Specifically, consultants have advised organizations to become
"multicultural."' The term refers to the degree to which an organization values
cultural diversity and is willing to utilize and encourage if.^
Leaders are being charged to create the multicultural organization, but what
does such an organization look like, and what are the specific ways in which if
diiiers from the traditional organization? Further, what tools and techniques
are available to assist organizations in making the transition from the old to
the new?
This article addresses these questions. I have used an adaptation of the
societal-integration model developed by Milton Gordon, as well as available
information on the early experience of American organizations with managing
diversity initiatives, to construct a model of the multicultural organization.

34
Cox

Conceptual framework
In his classic work on assimilation in the United States, Milton Gordon argued that
there are seven dimensions along which the integration of persons from different
ethnic backgrounds into a host society should be analyzed. I use "integration" to
mean the coming together and mixing of people from different cultural identity
groups in one organization. A cultural identity group is a group of people who (on
average) share certain values and norms distinct from those of other groups.
Although the boundaries of these groups may be defined along many dimensions,
I am primarily concerned with gender, race, ethnicity, and national origin.
Gordon's seven dimensions are:

1. Form of acculturation
2. Degree of structural assimilation
3. Degree of intergroup marriage
4. Degree of prejudice
5. Degree of discrimination
6. Degree of identification with the dominant group of the host society
7. Degree of intergroup conflict (especially over the balance of power)

Although Gordon's interest was in societal-level integration, I believe his model

can be easily and usefully adapted for analysis of cultural integration for
organizations. Therefore, an adaptation of his seven-point framework is used here
as a basis for describing organizational models for integrating culturally divergent
groups. Exhibit 1 shows my proposed six-dimensional adaptation of the Gordon
framework along with definitions of each term.

Acculturation is the method by which cultural differences between the dominant

(host) culture and any minority culture groups are resolved or treated. There are
several alternatives, the most prominent being: I. a unilateral process by which
minority culture members adopt the norms and values of the dominant group in
the organization (assimilation); 2. a process by which both minority and majority
culture members adopt some norms of the other group {pluralism); and 3. a
situation where there is little adaptation on either side (cultural separatism).'^
Pluralism also means that minority culture members are encouraged to enact
behaviors from their alternative culture as well as from the majority culture. They
are therefore able to retain a sense of identity with their minority-culture group.
Acculturation is concerned with the cultural (norms of behavior) aspect of
integration of diverse groups, as opposed to simply their physical presence in the
same location.

Dimension Definition
1. Acculturation Modes by which two groups adapt to each other and
resolve cultural differences
2. Structural Integration Cultural profiles of organization members including
hiring, job-placement, and job status profiles.
3. Informal Integration Inclusion of minority-culture members in informal
networks and activities outside of normal working hours
4. Cultural Bias Prejudice and discrimination
5. Organizational Identification Feelings of belonging, loyalty and commitment to the
organization
6. Inter-group Conflict Friction, tension and power struggles between cultural
groups.
Exhibit 1. Conceptual Framework for Analysis of Organizational Capability for Effective
Integration of Culturally Diverse Personnel

35
Academy of Management Executive

Structural integration refers to the presence of persons from different cultural

groups in a single organization. Workforce profile data has typically been
monitored under traditional equal opportunity and affirmative action guidelines.
However, to get a proper understanding of structural integration it is important to
look beyond organization-wide profile data, and examine cultural mix by function,
level, and individual work group. This is because, it is commonplace in American
companies for gaps of fifteen to thirty percentage points to exist between the
proportion of minority members in the overall labor force of a firm, and their
proportion at middle and higher levels of management.^

it is commonplace in Even within levels of an organization, individual work groups may still be highly
American companies segregated. For example, a senior human resource manager for a Fortune 500
for gaps of fifteen to firm who is often cited as a leader in managing diversity efforts, recently told me
thirty percentage that there are still many "white-male bastions" in his company. As an assistant
points to exist vice-president with responsibility for equal opportunity, he indicated that breaking
between the down this kind of segregation was a focal point of his current job.
proportion of minority
members in the The informal integration dimension recognizes that important work-related
contacts are often made outside of normal working hours and in various social
overall labor force of activities and organizations. This item looks at levels of inclusion of
a firm, and their minority-culture members in lunch and dinner meetings, golf and other athletic
proportion at middle outings, and social clubs frequented by organization leaders. It also addresses
and higher levels of mentoring and other informal developmental relationships in organizations.
management.^
Cultural bias has two components. Prejudice refers to negative attitudes toward an
organization member based on his/her culture group identity, and discrimination
refers to observable adverse behavior for the same reason. Discrimination, in turn,
may be either personal or institutional. The latter refers to ways that
organizational culture and management practices may inadvertently
disadvantage members of minority groups. An example is the adverse effect that
emphasizing aggressiveness and self promotion has on many Asians. Many
managers that I have talked to are sensitive to the fact that prejudice is a cognitive
phenomenon and therefore much more difficult than discrimination for
organization managers to change. Nevertheless, most acknowledge the
importance of reducing prejudice for long range, sustained change.

Prejudice may occur among minority-culture members as well as among

dominant-culture members. Putting the debate over whether rates of prejudice
differ for different groups aside, it must be emphasized that the practical impact of
prejudice by majority-culture members is far greater than that of minority-culture
members because of their far greater decision-making power (except under
extraordinary conditions, such as those of South Africa).

Organizational identification refers to the extent to which a person personally

identifies with, and tends to define himself or herself as a member in the
employing organization. Levels of organizational identification have historically
been lower in the United States than in other countries (notably Japan). Indications
are that recent changes in organizational design (downsizing and de-layering)
have reduced organizational identification even further. Although levels of
organizational identification may be low in general in the U.S. workforce, we are
concerned here with comparative levels of identification for members of different
cultural identity groups.

Finally, inter-group conflict refers to levels of culture-group-based tension and

interpersonal friction. Research on demographic heterogeneity among group
members suggests that communication and cohesiveness may decline as
members of groups become dissimilar.^ Also, in the specific context of integrating
minority-group members into organizations, concerns have been raised about

36
Cox

Dimension of
Integration Monolithic Plural Multicultural
Form of Assimilation Assimilation Pluralism
Acculturation
Degree of Structural Minimal Partial Full
Integration
Integration into Virtually none Limited Full
Informal Org.
Degree of Cultural Both prejudice and Progress on both Both prejudice and
Bias discrimination prejudice & discrimination are
against discrimination but eliminated
minority-culture both continue to
groups is exist especially
prevalent institutional
discrimination
Levels of Large majority- Medium to large No majority-minority
Organizational minority gap majority-minority gap
Identification* gap
Degree of Intergroup Low High Low
Conflict
'Defined as difference between organizationa identification levels between minorities and
majorities.
Exhibit 2. Organizational Types

backlash from white males who may feel threatened by these developments. It is
therefore important to examine levels of inter-group conflict in diverse workgroups.
Types of Organizations
This six-factor framework will now be employed to characterize organizations in
terms of stages of development on cultural diversity.^ Three organization types will
be discussed: the monolithic organization, the plural organization and the
multicultural organization. The application of the six-factor conceptual framework
to describe the three organization types appears in Exhibit 2.
Monolithic Organization
The most important single fact about the monolithic organization is that the
amount of structural integration is minimal. The organization is highly
homogeneous. In the United States, this commonly represents an organization
characterized by substantial white male majorities in the overall employee
population with few women and minority men in management jobs. In addition,
these organizations feature extremely high levels of occupational segregation with
women and racioethnic minority men (racially and/or culturally different from the
majority) concentrated in low-status jobs such as secretary and maintenance.
Thus, the distribution of persons from minority-cultural backgrounds is highly
skewed on all three components of function, level, and workgroup.

To a large extent, the specifications on the frameworks' other five dimensions

follow from the structural exclusion of people from different cultural backgrounds.
Women, racioethnic minority men, and foreign nationals who do enter the
organization must adopt the existing organizational norms, framed by the white
male majority, as a matter of organizational survival.

Ethnocentrism and other prejudices cause little, if any, adoption of

minority-culture norms by majority group members. Thus, a unilateral
acculturation process prevails. The exclusionary practices of the dominant

37
Academy of Management Executive

culture also apply to informal activities. The severe limitations on career

opportunities for minority-culture members creates alienation, and thus the
extent to which they identify with the organization can be expected to be low
compared to the more fully enfranchised majority group.

One positive note is that intergroup conflict based on culture-group identity is

minimized by the relative homogeneity of the workforce. Finally, because this
organization type places little importance on the integration of cultural minority
group members, discrimination, as well as prejudice, are prevalent.

While the white-male dominated organization is clearly the prototypical one for
the monolithic organization, at least some of its characteristics are likely to occur
in organizations where another identity group is dominant. Examples include
minority-owned businesses, predominantly Black and predominantly Hispanic
colleges, and foreign companies operating in the United States.

Aside from the rather obvious downside implications of the monolithic model in
terms of under-utilization of human resources and social equality, the monolithic
organization is not a realistic option for most large employers in the 1990s. To a
significant degree, large U.S. organizations made a transition away from this
model during the '60s and '70s. This transition was spurred by a number of
societal forces, most notably the civil-rights and feminists movements, and the
beginnings of changes in workforce demographics, especially in the incidence of
career-oriented women. Many organizations responded to these forces by creating
the plural organization.

Plural Organization
The plural organization differs from the monolithic organization in several
important respects. In general, it has a more heterogeneous membership than the
monolithic organization and takes steps to be more inclusive of persons from
cultural backgrounds that differ from the dominant group. These steps include
hiring and promotion policies that sometimes give preference to persons from
minority-culture groups, manager training on equal opportunity issues (such as
civil rights law, sexual harassment, and reducing prejudice), and audits of
compensation systems to ensure against discrimination against minority group
members. As a result, the plural organization achieves a much higher level of
structural integration than the monolithic organization.

The problem of skewed integration across functions, levels, and work groups,
typical in the monolithic organization, is also present in the plural organization.
For example, in many large U. S. organizations racioethnic minorities now make
up twenty percent or more of the total workforce. Examples include General
Motors, Chrysler, Stroh Brewery, Phillip Morris, Coca-Cola, and Anheuser-Busch.
However, the representations of non-whites in management in these same
companies averages less than twelve percent.^ A similar picture exists in
workgroups. For example, while more than twenty percent of the clerical and
office staffs at General Motors are minorities, they represent only about twelve
percent of technicians and thirteen percent of sales workers. Thus, the plural
organization features partial structural integration.

Because of the greater structural integration and the efforts (cited previously)
which brought it about, the plural organization is also characterized by some
integration of minority-group members into the informal network, substantial
reductions in discrimination, and some moderation of prejudicial attitudes. The
improvement in employment opportunities should also create greater identification
with the organization among minority-group members.
38
Cox

The plural organization represents a marked improvement over the monolithic

organization in effective management of employees of different racioethnic,
gender, and nationality backgrounds. The plural organization form has been
prevalent in the U.S. since the late 1960s, and in my judgment, represents the
typical large firm as we enter the 1990s. These organizations emphasize an
affirmative action approach to managing diversity. During the 1980s increased
evidence of resentment toward this approach among white males began to
surface. They argue that such policies, in effect, discriminate against white males
and therefore perpetuate the practice of using racioethnicity, nationality, or
gender as a basis for making personnel decisions. In addition, they believe that it
is not fair that contemporary whites be disadvantaged to compensate for
management errors made in the past. This backlash effect, coupled with the
increased number of minorities in the organization, often creates greater
inter-group conflict in the plural organization than was present in the monolithic
organization.

The plural While the plural organization achieves a measure of structural integration, it
organization continues the assimilation approach to acculturation which is characteristic of the
represents a marked monolithic organization. The failure to address cultural aspects of integration is a
improvement over the major shortcoming of the plural organization form, and is a major point
monolithic distinguishing it from the multicultural organization.
organization in
effective management The Multicultural Organization
In discussing cultural integration aspects of mergers and acquisitions. Sales and
of employees of Mirvis argued that an organization which simply contains many different cultural
different racioethnic, groups is a plural organization, but considered to be multicultural only if the
gender, and organization values this diversity.^ The same labels and definitional distinction is
nationality applied here. The meaning of the distinction between containing diversity and
backgrounds. valuing it follows from an understanding of the shortcomings of the plural
organization as outlined previously. The multicultural organization has overcome
these shortcomings. Referring again to Exhibit 2, we see that the multicultural
organization is characterized by:

1. Pluralism
2. Full structural integration
3. Full integration of the informal networks
4. An absence of prejudice and discrimination
5. No gap in organizational identification based on cultural identity group
6. Low levels of intergroup conflict
I submit that while few, if any, organizations have achieved these features, it
should be the model for organizations in the 1990s and beyond.
Creating the Multicultural Organization
As I have discussed issues of managing diversity with senior managers from
various industries during the past year, I have observed that their philosophical
viewpoints cover all three of the organizational models of Exhibit 2. The few who
are holding on to the monolithic model often cite geographic or size factors as
isolating their organizations from the pressures of change.

Some even maintain that because American white males will continue to be the
single largest gender/race identity group in the U.S. workforce for many years,
the monolithic organization is still viable today. I think this view is misguided.
By understanding the generic implications of managing diversity (that is, skill at
managing work groups which include members who are culturally distinct from
the organization's dominant group), it becomes clear that virtually all
organizations need to improve capabilities to manage diverse workforces.

39
Academy of Management Executive

Further, focusing too much attention on external pressures as impetus for

change, misses the fact that gross under-utilization of human resources and
failure to capitalize on the opportunities of workforce diversity, represent
unaffordable economic costs.

Fortunately, the monolithic defenders, at least among middle and senior

managers seem to represent a minority view. Based on my observations, the
majority of managers today are in plural organizations, and many are already
convinced that the multicultural model is the way of the future. What these
managers want to know is how to transform the plural organization into the
multicultural organization. Although progress on such transformations is at an
early stage, information on the tools that have been successfully used by
pioneering American organizations to make this transformation is beginning to
accumulate.

Exhibit 3 provides a list of tools that organizations have used to promote

organization change toward a multicultural organization. The exhibit is organized
to illustrate my analysis of which tools are most helpful for each of the six
dimensions specified in Exhibit 1.

Creating Pluralism
Exhibit 3 identifies seven specific tools for changing organizational acculturation
from a unilateral process to a reciprocal one in which both minority-culture and
majority-culture members are influential in creating the behavioral norms, values,
and policies of the organization. Examples of each tool are given below.

Training and Orientation Programs. The most widely used tool among leading
organizations is managing or valuing cultural diversity training. Two types of
training are most popular: awareness and skill-building. The former introduces the
topic of managing diversity and generally includes information on workforce
demographics, the meaning of diversity, and exercises to get participants thinking
about relevant issues and raising their own self-awareness. The skill-building
training provides more specific information on cultural norms of different groups
and how they may affect work behavior. Often, these two types of training are
combined. Such training promotes reciprocal learning and acceptance between
groups by improving understanding of the cultural mix in the organization.

Among the many companies who have made extensive use of such training are
McDonnell Douglas, Hewlett Packard, and Ortho Pharmaceuticals. McDonnell
Douglas has a program ("Woman-Wise and Business Savvy") focusing on gender
differences in work-related behaviors. It uses same-gender group meetings and
mixed-gender role-plays. At its manufacturing plant in San Diego, Hewlett
Packard conducted training on cultural differences between American-Anglos and
Mexican, Indochinese, and Filipinos. Much of the content focused on cultural
differences in communication styles. In one of the most thorough training efforts to
date, Ortho Pharmaceuticals started its three-day training with small groups (ten
to twelve) of senior managers and eventually trained managers at every level of
the company.

Specific data on the effectiveness of these training efforts is hard to collect, but a
study of seventy-five Canadian consultants found that people exposed to even the
most rudimentary form of training on cultural diversity are significantly more likely
to recognize the impact of cultural diversity on work behavior and to identify the
potential advantages of cultural heterogeneity in organizations.'°

In addition, anecdotal evidence from managers of many companies indicates that

valuing and managing diversity training represents a crucial first step for
organization change efforts.

40
Cox

Model Dimension Tools

I. Pluralism 1. Managing/valuing diversity (MVD)
Objective/s: training.
—create a two-way 2. New member orientation programs
socialization process 3. Language training
—ensure influence oi 4. Diversity in key committees
minority-culture 5. Explicit treatment of diversity in mission
perspectives on core statements
organization norms 6. Advisory groups to senior management
and values 7. Create flexibility in norm systems
II. Full Structural Integration 1. Education programs
Ob;ecfive/s 2. Affirmative action programs
—no correlation between 3. Targeted career development programs
culture-group identity 4. Changes in manager performance
and job status appraisal and reward systems
5. HR policy and benefit changes
III. Integration in Informal 1. Mentoring programs
Networks 2. Company sponsored social events
Objecfive/s
—eliminate barriers to
entry and participation
IV. Cultural Bias 1. Equal opportunity seminars
Ob;ecfive/s 2. Focus groups
—eliminate discrimination 3. Bias reduction training
—eliminate prejudice 4. Research
5. Task forces
V. Organizational Identification 1. All items from the other five dimensions
—no correlation between apply here
identity group and
levels of organization
identification
VI. Intergroup Conflict 1. Survey feedback
Ob;ec{ive/s 2. Conflict management training
—minimize interpersonal conflict 3. MVD training
based on group-identity 4. Focus groups
—minimize backlash by
dominant-group members
Exhibit 3. Creating the Multicultural Organization: Tools for Organization Change

In addition, anecdotal New member orientation programs are basic in the hiring processes of many
evidence from organizations. Some companies are developing special orientations as part of its
managers of many managing diversity initiatives. Proctor and Gamble's "On Boarding" program,
companies indicates which features special components for women and minority hires and their
that valuing and managers is one example.
managing diversity Language training is important for companies hiring American Asians, Hispanics,
training represents a and foreign nationals. To promote pluralism, it is helpful to offer second language
crucial first step for training to Anglos as well as the minority-culture employees, and take other steps
organization change to communicate that languages other than English are valued. Leaders in this
efforts. area include Esprit De Corp, Economy Color Card, and Pace Foods. For many
years, the women's clothier Esprit De Corp. has offered courses in Italian and
Japanese. At Economy Color Card, work rules are printed in both Spanish and
English. Pace Foods, where thirty-five percent of employees are Hispanic, goes a
step farther by printing company policies and also conducting staff meetings in
Spanish and English. Motorola is a leader in the more traditional training for
English as a second language where classes are conducted at company expense
and on company time.

41
Academy of Management Executive

Insuring Minority-GTOup Input and Acceptance. The most direct and effective way
to promote influence of minority-culture norms on organizational decision making
is to achieve cultural diversity at all organization levels. However, an important
supplemental method is through ensuring diversity on key committees. An
example is the insistence of USA Today President Nancy WoodhuU on having
gender, racioethnic, educational, and geographic diversity represented in all
daily news meetings. She attributes much of the company's success to this action.

The most direct and Another technique is explicitly mentioning the importance of diversity to the
effective way to organization in statements of mission and strategy. By doing this, organizations
promote influence of foster the mindset that increased diversity is an opportunity and not a problem.
minority-culture norms Examples of organizations that have done this are The University of Michigan and
on organizational the Careers Division of the National Academy of Management. 'The latter group
decision making is to has fostered research addressing the impact of diversity on organizations by
explicitly citing this as part of its interest.
achieve cultural
diversity at all Another way to increase the influence of minority-group members on
organization levels. organizational culture and policy is by providing specially composed minority
advisory groups direct access to the most senior executives of the company.
Organizations which have done this include Avon, Equitable Life Assurance, Intel,
and U.S. West. At Equitable, committees of women. Blacks and Hispanics (called
"Business Resource Groups") meet with the CEO to discuss important group issues
and make recommendations on how the organizational environment might be
improved. CEO John Carver often assigns a senior manager to be accountable for
following up on the recommendations. U.S. West has a thirty-three member
"Pluralism Council" which advises senior management on plans for improving the
company's response to increased workforce diversity.

Finally, a more complex, but I believe potentially powerful, tool for promoting
change toward pluralism is the development of flexible, highly tolerant climates
that encourage diverse approaches to problems among all employees. Such an
environment is useful to workers regardless of group identity, but is especially
beneficial to people from nontraditional cultural backgrounds because their
approaches to problems are more likely to be different from past norms. A
company often cited for such a work environment is Hewlett Packard. Among the
operating norms of the company which should promote pluralism are: 1.
Encouragement of informality and unstructured work; 2. Flexible work schedules
and loose supervision; 3. Setting objectives in broad terms with lots of individual
employee discretion over how they are achieved; 4. A policy that researchers
should spend at least ten percent of company time exploring personal ideas. I
would suggest that item 4 be extended to all management and professional
employees.

Creating Full Structural Integration

Education Efforts. The objective of creating an organization where there is no
correlation between one's culture-identity group and one's job status implies that
minority-group members are well represented at all levels, in all functions, and in
all work groups. Achievement of this goal requires that skill and education levels
be evenly distributed. Education statistics indicate that the most serious problems
occur with Blacks and Hispanics.' ^

A number of organizations have become more actively involved in various kinds

of education programs. The Aetna Life Insurance Company is a leader. It has
initiated a number of programs including jobs in exchange for customized
education taught by community agencies and private schools, and its own
in-house basic education programs. The company has created an Institute for
Corporate Education with a full-time director. Other companies participating in
various new education initiatives include PrimAmerica, Quaker Oats, Chase

42
Cox

Manhattan Bank, Eastman Kodak, and Digital Equipment. In Minnesota, a project

headed by Cray Research and General Mills allows businesses to create schools
of its own design. I believe that business community involvement in joint efforts
with educational institutions and community leaders to promote equal
achievement in education is critical to the future competitiveness of U.S. business.
Business leaders should insist that economic support be tied to substantive
programs which are jointly planned and evaluated by corporate representatives
and educators.

Affirmative Action. In my opinion, the mainstay of efforts to create full structural

integration in the foreseeable future, will continue to be affirmative action
programs. While most large organizations have some kind of program already,
the efforts of Xerox and Pepsico are among the standouts.

The Xerox effort, called "The Balanced Workforce Strategy," is noteworthy for
several reasons including: an especially fast timetable for moving minorities up;
tracking representation by function and operating unit as well as by level; and
national networks for minority-group members (supported by the company) to
provide various types of career support. Recently published data indicating that
Xerox is well ahead of both national and industry averages in moving minorities
into management and professional jobs, suggests that these efforts have paid off
(Wall Street Journal, November 5, 1989).

Two features of Pepsico's efforts which are somewhat unusual are the use of a
"Black Managers Association" as a supplemental source of nominees for
promotion to management jobs, and the practice of hiring qualified minorities
directly into managerial and professional jobs.

Career Development. A number of companies including Mobil Oil, IBM, and

McDonalds have also initiated special career development efforts for minority
personnel. IBM's long standing "Executive Resource System" is designed to
identify and develop minority talent for senior management positions. McDonald's
"Black Career Development Program" provides career enhancement advice, and
fast-track career paths for minorities. Company officials have stated that the
program potentially cuts a fifteen year career path to regional manager by fifty
percent.

Revamping Reward Systems. An absolutely essential tool for creating structural

integration is to ensure that the organization's performance appraisal and reward
systems reinforce the importance of effective diversity management. Companies
that have taken steps in this direction include The Federal National Mortgage
Association (Fannie Mae), Baxter Health Care, Amtrak, Exxon, Coca-Cola, and
Merck. Fannie Mae, Baxter, Coca-Cola, and Merck all tie compensation to
manager performance on diversity management efforts. At Amtrak, manager
promotion and compensation are tied to performance on affirmative action
objectives, and at Exxon, evaluations of division managers must include a review
of career development plans for at least ten women and minority men employees.

For this tool to be effective, it needs to go beyond simply including effective

management of diversity among the evaluation and reward criteria. Attention
must also be given to the amount of weight given to this criterion compared to
other dimensions of job performance. How performance is measured is also
imporiant. For example, in addition to work-group profile statistics, subordinate
evaluations of managers might be useful. When coded by cultural group,
differences in perceptions based on group identity can be noted and used in
forming performance ratings on this dimension.

43
Academy of Management Executive

Benefits and Work Schedules. Structural integration of women, Hispanics, and

Blacks is facilitated by changes in human resource policies and benefit plans that
make it easier for employees to balance work and family role demands. Many
companies have made such changes in areas like child care, work schedules, and
parental leave. North Carolina National Bank, Arthur Anderson, Levi Strauss, and
IBM are examples of companies that have gone farther than most. NONB's "select
time" project allows even officers and professionals in the company to work
part-time for several years and still be considered for advancement, Arthur
Anderson has taken a similar step by allowing part-time accountants to stay
"on-track" for partnership promotions, Levi Strauss has one of the most
comprehensive work-family programs in the country covering everything from
paternity leave to part-time work with preservation of benefits. These companies
are leaders in this area because attention is paid to the impact on advancement
opportunities and fringe-benefits when employees take advantage of scheduling
flexibility and longer leaves of absence. This kind of accommodation will make it
easier to hire and retain both men and women in the '90s as parents struggle to
balance work and home time demands. It is especially important for women,
Hispanics, and Blacks because cultural traditions put great emphasis on family
responsibilities. Organization change in this area will promote full structural
integration by keeping more racioethnic minorities and white women in the
pipeline.

Creating Integration in Informal Networks

Mentoring and Social Events. One tool for including minorities in the informal
networks of organizations is company-initiated mentoring programs that target
minorities, A recent research project in which a colleague and I surveyed 800
MBAs indicated that racioethnic minorities report significantly less access to
mentors than whites. If company-specific research shows a similar pattern, this
data can be used to justify and bolster support among majority-group employees
for targeted mentoring programs. Examples of companies which have established
such targeted mentoring programs are Chemical Bank and General Foods.

A second technique for facilitating informal network integration is

company-sponsored social events. In planning such events, multiculturalism is
fostered by selecting both activities and locations with a sensitivity to the diversity
of the workforce.

Support Groups. In many companies, minority groups have formed their own
professional associations and organizations to promote information exchange and
social support. There is little question that these groups have provided emotional
and career support for members who traditionally have not been welcomed in the
majority's informal groups. A somewhat controversial issue is whether these
groups hinder the objective of informal-network integration. Many believe that
they harm integration by fostering a "we-versus-they" mentality and reducing
incentives for minorities to seek inclusion in informal activities of majority-group
members. Others deny these effects, I am not aware of any hard evidence on this
point. There is a dilemma here in that integration in the informal networks is at
best a long-term process and there is widespread skepticism among minorities as
to its eventual achievement. Even if abolishing the minority-group associations
would eventually promote full integration, the absence of a support network of
any kind in the interim could be a devastating loss to minority-group members.
Therefore, my conclusion is that these groups are more helpful than harmful to the
overall multiculturalism effort.

Creating a Bias-Free Organization

Equal opportunity seminars, focus groups, bias-reduction training, research, and
task forces are methods that organizations have found useful in reducing
culture-group bias and discrimination. Unlike prejudice, discrimination is a
44
Cox

behavior and therefore more amenable to direct control or influence by the

organization. At the same time, the underlying cause of discrimination is
prejudice. Ideally, efforts should have at least indirect effects on the thought
processes and attitudes of organization members. All of the tools listed, with the
possible exception of task forces, should reduce prejudice as well as
discrimination.

Most plural organizations have used equal opportunity seminars for many years.
These include sexual harassment workshops, training on civil rights legislation,
and workshops on sexism and racism.

Focus Groups. More recently, organizations like Digital Equipment have used
"focus groups" as an in-house, on-going mechanism to explicitly examine
attitudes, beliefs, and feelings about culture-group differences and their effects on
behavior at work. At Digital, the center piece of its "valuing differences" effort is
the use of small groups (called Core Groups) to discuss four major objectives: 1.
stripping away stereotypes; 2, examining underlying assumptions about
outgroups; 3, building significant relationships with people one regards as
different; 4. raising levels of personal empowerment. Digital's experience suggests
that a breakthrough for many organizations will be achieved by the simple
mechanism of bringing discussion about group differences out in the open.
Progress is made as people become more comfortable directly dealing with the
issues.

A very powerful tool Bias-Reduction Training. Another technique for reducing bias is through training
for reducing specifically designed to create attitude change. An example is Northern Telecom's
discrimination and (to 16-hour program designed to help employees identify and begin to modify
a smaller extent) negative attitudes toward people from different cultural backgrounds. Eastman
prejudice, is to Kodak's training conference for its recruiters is designed to eliminate racism and
conduct and act on sexism from the hiring process. This type of training often features exercises that
expose stereotypes of various groups which are prevalent but rarely made explicit
internal research on and may be subconscious. Many academics and consultants have also developed
employment bias-reduction training. An example is the "Race Relations Competence
experience by cultural Workshop," a program developed by Clay Alderfer and Robert Tucker of Yale
group. University, They have found that participants completing the workshop have more
positive attitudes toward Blacks and inter-race relations.

Leveraging Internal Research. A very powerful tool for reducing discrimination

and (to a smaller extent) prejudice, is to conduct and act on internal research on
employment experience by cultural group. Time Inc. conducts an annual
evaluation of men and women in the same jobs to ensure comparable pay and
equal treatment. A second example comes from a large utility company which
discovered that minority managers were consistently under-represented in lists
submitted by line managers for bonus recommendations. As a result of the
research, the company put pressure on the managers to increase the inclusion of
minority managers. When that failed, the vice president of human resources
announced that he would no longer approve the recommendations unless
minorities were adequately represented. The keys to the organization change
were, first obtaining the data identifying the problem and then acting on it. My
experience suggests that this type of research-based approach is underutilized by
organizations.

Task Forces. A final tool for creating bias-free organizations is to form task forces
that monitor organizational policy and practices for evidence of unfairness. An
example of what I consider to be a well-designed committee is the affirmative
action committee used by Phillip Morris which is composed of senior managers
and minority employees. This composition combines the power of senior
executives with the insight into needed changes that the minority representatives

45
Academy of Management Executive

can provide. Of course, minority culture-group members who are also senior
managers are ideal but, unfortunately, such individuals are rare in most
organizations.

Minimizing Intergroup Conflict

Experts on conflict management have noted that a certain amount of interpersonal
conflict is inevitable and perhaps even healthy in organizations. '^ However,
conflict becomes destructive when it is excessive, not well managed, or rooted in
struggles for power rather than the differentiation of ideas. We are concerned here
with these more destructive forms of conflict which may be present with diverse
workforces due to language barriers, cultural clash, or resentment by
majority-group members of what they may perceive as preferential, and
unwarranted treatment of minority-group members.

Survey Feedback. Probably the most effective tool for avoiding intergroup conflict
(especially the backlash form that often accompanies new initiatives targeting
minority-groups of the organization) is the use of survey feedback. I will give three
examples. As one of the most aggressive affirmative action companies of the past
decade, Xerox has found that being very open with all employees about the
specific features of the initiative as well the reasons for it, was helpful in diffusing
backlash by whites. This strategy is exemplified by the high profile which
Chairman David Kearns has taken on the company's diversity efforts.

A second example is Proctor and Gamble's use of data on the average time
needed for new hires of various culture groups to become fully integrated into the
organization. They found that "join-up" time varied by race and gender with white
males becoming acclimated most quickly, and black females taking the longest of
any group. This research led to the development of their "on-boarding program"
referred to earlier.

A final example is Corning Glass Works' strategy of fighting white-male resistance

to change with data showing that promotion rates of their group was indeed much
higher than that of other groups. This strategy has also been used by U.S. West
which recently reported on a 1987 study showing that promotion rates for white
men were seven times higher than white women and sixteen times higher than
non-white women.

The beauty of this tool is that it provides the double benefit of a knowledge base
for planning change, and leverage to win employee commitment to implement the
needed changes.

Conflict-Resolution Training. A second tool for minimizing intergroup conflict is

management training in conflict resolution techniques. Conflict management
experts can assist managers in learning and developing skill in applying
alternative conflict management techniques such as mediation and superordinate
goals. This is a general management sldll which is made more crucial by the
greater diversity of workforces in the '90s.

Finally, the managing and valuing diversity training and focus group tools
discussed previously are also applicable here. AT&T is among the organizations
which have explicitly identified, stress and conflict reduction as central objectives
of its training and focus group efforts.

Conclusion
Increased diversity presents challenges to business leaders who must maximize
the opportunities that it presents while minimizing its costs. To accomplish this,
organizations must be transformed from monolithic or plural organizations to a
multicultural model. The multicultural organization is characterized by pluralism,
46
Cox

full integration of minority-culture members both formally and informally, an

absence of prejudice and discrimination, and low levels of inter-group conflict; all
of which should reduce alienation and build organizational identity among
minority group members. The organization that achieves these conditions will
create an environment in which all members can contribute to their maximum
potential, and in which the "value in diversity" can be fully realized.

Endnotes ' See, for example, Lennie Copeland, Adminisfrafive Science Quarterly, Vol, 24, 1979,
"Valuing Workplace Diversity," Personnel 181-199,
Administrator, November 1988; Badi Foster et ' The concept of stages of development
al. "Workforce Diversity and Business," toward the multicultural organization has been
Training And Development Journal, April 1988, suggested in an unpublished paper titled
38-42; and R, Roosevelt Thomas, "From "Toward the Multicultural Organization" written
Affirmative Action to Affirming Diversity," by Dan Reigle and Jarrow Merenivitch of the
Harvard Business Review, Vol, 2, 1990, 107-117, Proctor and Gamble Company. I credit them
^ This definition has been suggested by with helping me to recognize the evolutionary
Afsavch Nahavandi and Ali Malekzadeh, nature of organizational responses to workforce
"Acculturation in Mergers and Acquisitions," diversity.
Academy oi Management Review, Vol, 13, 83, ° See note 5.
^ In his book, Assimiiation in American Life ^ A,L. Sales and P,H, Mirvis, "When Cultures
(New York; Oxford Press, 1964) Gordon uses the Collide: Issues of Acquisitions," in J.R,
term assimilation rather than integration. Kimberly and R,E, Quinn, Managing
However, because the term assimilation has Organizafionai Transition, 1984, 107-133,
been defined in so many different ways, and '° For details on this study see, Nancy J.
has come to have very unfavorable Adler, International Dimensions of
connotations in recent years for many Organizational Behavior, (Kent Publishing Co.,
minorities, I will employ the term integration 1988), 77-83.
here, " For example, see the book by William
* These definitions are loosely based on J,W, Julius Wilson which reviews data on
Berry, 1983. "Acculturation: A Comparative educational achievement by Blacks and
Analysis of Alternative Forms," in R.J, Samuda Hispanics in Chicago, The Truly
and S,L, Woods: Perspectives in Immigrant and Disadvantaged: Inner City, the Underclass and
Minority Education, 1983, 68-77, Public Policy (The University of Chicago Press,
' This conclusion is based on data from 1987), Among the facts cited is that less than
nearly 100 large organizations as cited in "Best half of all Blacks and Hispanics in inner city
Places for Blacks to Work," Black Enterprise, schools graduate within four years of high
February 1986 and February 1989 and in Zeitz school enrollment and only four in ten of those
and Dusky, Best Companies for Women, 1988. who do graduate read at the eleventh grade
® Examples of this research include, Harry level or above,
Triandis, "Some Determinants of Interpersonal '^ For example, see Organization Behavior:
Communication," Human Relations, Vol, 13, Conflict in Organizations, by Gregory Northcraft
1960, 279-287 and J,R, Lincoln and J, Miller, and Margaret Neale, (The Dryden Press, 1990),
"Work and Friendship Ties in Organizations," 221,

About the Author Taylor Cox, Jr. is assistant professor of Organizational Behavior at The
University of Michigan where he frequently teaches executive courses on career
issues of women, non-whites and older workers. He has published many articles
on race, gender, and age as factors in organization behavior and careers, and is
a consultant to several Fortune 1000 companies on managing and valuing
cultural diversity.

47