Contemporary Issues in Business Management

Name: Faiqa Akram

Student no: W1747750

Business Theme: Employee Diversity

Working Title: The Impact of Employee Diversity on

Corporate Image
Abstract
Diversity is still one of the most important factors for most businesses
worldwide. Diversity is a key concern even in nations with little ethnic or racial
diversity, such as Argentina, since it produces a feeling of customer orientation
and representation. In the present global economy, however, firms are
recruiting more women onto their executive boards or even as managers than at
any previous period in recent history when males dominated important
positions. This improves the businesses' reputation and image, resulting in
improved financial situations due to greater revenue and profitability. This
research tries to determine how the diversity of a company's personnel
influences customer perceptions of its goods and services, resulting in the
brand's life or decay if the company does not create a varied working
environment. This report is based on a study of 300 IT workers. The research
indicates that effectively managing diversity may result in more dedicated,
pleased, and high-performing workers and possibly greater financial results for
a company and impressing corporate image among the customers.

Introduction
Diversity in the workplace benefits both organizations and their people because
it fosters innovation, creativity, and empathy that homogenous cultures seldom
do. Diversity is about respecting and accepting varied ideas, promoting
everyone is different, and appreciating uniqueness. Diversity means embracing
people of different ages, gender, race, religion, and sexual orientation and those
having different ideologies. It involves adopting these differences to promote
understanding and Inclusiveness. It involves knowing other people and
accepting many differences that exist. Companies learn that there are
advantages beyond image when supporting and promoting a diverse and
inclusive workplace.
 Embracing and appreciating the different cultures, religions, and languages has
become inevitable for the organization in the world. The respect for abilities
and experiences that are different promote tolerance and innovation among the
employee in the organization. Diversity at the workplace means having a
variance of the employee in the corporations. Workplace diversity refers to the
wide range of variances among employees in a company. Age, personality,
educational background, race, gender, organizational role, and more promote
diversity. The interaction among people and their perception of other people
define diversity, and their engagement is influenced by their views and
perception of other people at the same workplace. HR managers need to
effectively communicate and be flexible in hiring diverse people to perform
well as an organization. Increased diversity increases consumer loyalty,
resulting in improved company success. People nowadays place higher
importance on diversity in the workplace and are more loyal to firms that
promote diverse employees.

Three Theories about workplace diversity

The foundation of corporate social justice is to ensure that the workplace
maintains a diverse environment. This ensures the acknowledgment of
fundamental rights and freedoms and fosters a climate of trust between
corporations and consumers, frequently missing.

1. The definition of diversity has evolved from what it used to be. According to
one idea, before a company can adopt a diversity plan, it must first grasp
diversity. According to this idea, many individuals are still focused on outdated
models of diversity, which are concerned with social justice concerns such as
gender or race. In contrast, now is the time for diversity to concentrate on
building an environment that nurtures connection.
2. A second argument suggests that you should take advantage of diversity to
attract new customers. A firm would be better equipped to address specific
 audiences if it employee diversified personnel staff. Engaging with anybody
outside that group would be difficult if a firm was staffed only by that
population.
3. According to a third view, organizations should concentrate more on knowing
their customers than workplace diversity. Making a product appealing is less
about what occurs behind closed doors and more about transparent promotion.

There are several definitions of diversity and numerous approaches to achieving

it. The diverse workplace has become more significant, and it should be a
driving force to effect positive change in the organization.

Literature Review
Employee diversity refers to the state of a particular company's employees
having different attributes based on age, gender, race, religion, and culture. This
widens the knowledge available to the employees as they are from different
backgrounds and have a variety of experiences. According to Mansoor, Tran,
and Ali, 2020), the social exchange theory establishes that employees want to
profit from their interactions with their colleagues. For a diverse workforce to
function well for the benefit of a company, it must be managed appropriately
through impartial policies. A concentration on employee welfare, particularly
focusing on diversity, also reflects on the society and target markets they serve,
resulting in the company caring for them so customers can easily trust the
company to meet their needs, which translates to a good corporate image.
Having a good corporate image is very important as it works for its benefit.
Past research has also established that employees want to be related to
companies whose perception of the masses is good. This culminates in
partnerships which bring in extra income for the company and an excellent
turnover for investors and shareholders. The cumulative effect of increased
profitability is increased economies of scale, resulting in a better competitive
advantage. This image can be asserted through measures such as having an
active social media presence to engage their customers or an active corporate
social media responsibility program that benefits their community. With
diversity impacting employee engagement, the motivation is also reflected in
their willingness to participate in corporate social responsibility programs.
Notably, the cornerstones of corporate social responsibility are based on
economic, legal, ethical, and philanthropic responsibility. Through working
with the community in various missions, corporations create a good image for
themselves and a reputation for community engagement.
Companies may experience increased communication as people with
different perceptions may differ concerning the direct performance measures.
Company processes must state how to address issues to maintain teamwork.
This is established through their vision-mission statements and internal policies.
A diverse workforce is more likely to come up with more ideas. This betters
their creativity and innovation and how to go about it. More ideas, particularly
supported by a bottoms-open organizational structure, translate to better
employee decision-making, affecting productivity. It is also noteworthy that
diversity comes with a lower probability for discrimination. Everyone's voice at
the table is equal to any other, and their contribution is as valid as anyone else's.
In summary, diversity provides a clear avenue to improve a company's image to
potential and existing customers while its reputation grows as the best option
among its competitors.

Cultural Diversity and Performance

Most businesses are interested in learning more about the connection between
diversity and corporate culture, its effect on diversity adoption, and the
relationship between diversity and increased results at both the individual and
organizational levels as the importance of diversity in the workplace has grown.
Patrick (2010) observed that diversity impacts an organization's openness to
differences among individuals, workgroups, and culture. International relations
necessitate that we communicate with one another on a human level, despite the
technological advancement of today's world.
Diversity, according to research, increase performance by broadening the
perspectives of the group. There is ample evidence that strong diversity
management leads to better organization. With time, group members' ability to
expound on specific information may increase as they get more familiar with
each other's perspectives. It demonstrates that they need a longer tenure and
start-up time than more homogeneous organizations. The industries ranging
from oil and gas embrace the diverse work environment to win customer loyalty
and long-term growth.

Diversity: Affirmative Action and Creativity

According to empirical research, diversity implementation may have a positive
spillover effect in the workplace. According to Gilbert, Stead, and Ivancevich
(1999), women who worked in companies that prioritized diversity were
deemed competent for the occupations they held. But still, women working are
stigmatized regardless of the job they have.
On various attitude criteria, teams with homogeneous attitudes were
outperformed by teams with diverse attitudes in terms of innovation as they
were more creative and possessed better problem-solving skills. When team
members had similar skill levels, the findings demonstrated that diverse teams
were more inventive than homogeneous organizations. They were more likely
to have an impressive image among the customers.

Objective of the Study

Organizations are adopting diverse work environments to promote inclusivity
and innovation. Indian companies and organizations are at the forefront,
particularly in the IT industry. This has increased to different employees in the
organization, which makes it difficult to manage. Every organization is facing a
hurdle in incorporating diverse individuals and their ideas. The consequences of
 failing to manage diversity include a lack of skills, competencies, and interests
among workers, which will result in increased employee turnover and a
significant deterioration in individual and organizational performance.
Employees are more committed to organizations that manage diversity and are
happier and perform better.
Diversity management fosters a positive work atmosphere in which people's
abilities and differences are valued, enabling everyone to reach their full
potential and contribute to their strategic goals and objectives. Diversity
management values that all employees have the opportunity to work based on
their full potential, develop as individuals, and contribute to the company. It
recognizes that people from all walks of life may bring fresh ideas and views to
improve job productivity and the quality of products and services. Successful
diversity management allow businesses to foster creativity and innovation,
enabling them to tap into previously untapped possibilities for growth and
increased competitiveness.
Previous studies have considered national cultural differences and their effect
on organizational performance. This research aims to learn about employee
views about workplace diversity. It would allow firms to implement diversity
initiatives that consider everyone's unique abilities, increasing job satisfaction
and productivity. The survey also revealed the most common roadblocks to
adopting diversity in the workplace.
The organizations will enhance diversity in our workplace in the coming years,
and successful firms will adopt a diverse work climate. They will increase the
investment to promote workplace diversity. This research paper is an effort to
identify the impact and effect of adopting diverse work culture in corporations
and organizations. This research includes following point:
 To map attitudes toward workplace diversity in the IT industry
 Identify the most effective techniques for enhancing workplace diversity
 To examine the mitigating measures that may be made to preserve a positive
business image and reputation,
 Identify the most encountered impediments to adopting workplace diversity.
 To figure out benefit of implementation of diverse work climate on the
reputation of corporations

Theoretical Framework and Hypothesis

Two concerns must be addressed: What does it mean to be diverse in the

workplace? What effect does workplace diversity management have on
employee satisfaction and diversity awareness?

H1: According to the Workplace Diversity comparison, there is a relationship

between diversity awareness and employee job satisfaction.

H01: There is no connection between workplace diversity awareness and

employee job contentment; according to the Job Satisfaction observation,

H2: Diversity awareness is influenced by demographic factors such as years of

service, gender, ethnicity, and age.

H02: Diversity awareness was unaffected by many demographic factors such as

years of service, gender, race, and age.

Methodology
Employees from information technology companies were selected as the study's
units. A reliable sampling method was used to choose the sample participants.
The respondents were selected randomly from the top 15 IT companies in India.
To ensure some degree of large representation, a sample size of 350
respondents was determined from diverse backgrounds. The questionnaires
were provided to people with at least two years of experience familiar with its
diversity policy. The survey was sent to 350 individuals, but only 310 people
answered, yielding an 88.57 percent response rate. Furthermore, ten responses
were removed due to considerable missing data, resulting in a final sample size
of 300. (With an effective response rate of 85.71%).
Based on the study's objectives, the researchers created a questionnaire. The
authenticity of the scales was assessed using Cronbach's alpha, and the findings
are reported in the tool description. Validity was established using selections
from Al-Lamki (2002) and Johnson's writings (2003). The assertions' content
validity was based on a thorough review by ten IT HR experts, five diversity
training specialists, and seven organizational behaviour academics.
Techniques of Analysis
Statistical approaches were used to examine the data received from the
respondents. The ranking questions were examined using the Friedman test to
find disparities in rankings. The rating questions were investigated using
descriptive statistics (Ms and SDs).

Major Findings and Discussion

How to Enhance Workplace Diversity

Table 2 provides an analysis of approaches to enhance workplace diversity.

Organizations must embrace diversity as a cultural value in their members to
strengthen corporate culture. The most popular tactics utilized to attain this aim
were unleashing creativity and performance (2.07), raising employee morale,
productivity, and retention (2.20), enabling new workers to work in areas where
they may expect to progress (3.12); and enhancing client connections (3.30).
Reducing employee complaints and lawsuits, a relatively limited approach was
the least favoured option for workplace diversity.
 To see whether there was a difference in ranking, Friedman's test was used. It
was discovered that various techniques for improving workplace diversity had
substantial disparities in mean ranking.

Table 1. Profile of the Respondents

Variable Levels %
Gender Male 84.0
Female 16.0
Age 21-25 years 23.3
26-30 years 65.7
31-35 years 11.0
Educational qualifications Diploma 7.3
Graduate 45.3
Postgraduate 47.3
Experience 2 years 11.7
2-5 years 49.0
5-10 years 29.0
10+ years 10.3
Type of company MNC 82.0
Indian 14.3
Indian MNC 3.7
Employee strength 0-1,000 19.0
1,000-2,000 4.3
2,000-4,000 13.7
4,000+ 63.0
Attitude toward diversity Diversity optimists 32.3
Diversity realists 67.7

Table 2. Various Approaches to Increasing Workplace Diversity

Approaches to improve workplace diversity Mean rank
 Unleashing creativity and performance to improve 2.07
company culture
Improve Employee morale, productivity 2.20
Employees new to the company can work in areas they 3.12
hope to progress.
Enhance relationships with clients 3.30
Reduce employee complaints and litigation 4.31
Friedman chi-square 398.349
Asymptotic significance 0.000

Obstacles to Accepting Diversity in the Workplace

Table 3 depicts a breakdown of the barriers to implementing workplace
diversity. The most prevalent impediments were found to be discrimination
(2.75), prejudice (2.94), and ethnocentrism (2.94). (3.83). Other barriers were
less prevalent, including victim-blaming (4.06), stereotypes (4.44), and
harassment (4.77), with backlash being the least common (5.21).
To examine whether there was a difference in ranking, Friedman's test was
utilized. The average rankings of the major impediment to workplace diversity
vary substantially.
Table 3. Identifying the Most Commonly Faced Barriers
Impediment to adopt workplace diversity Mean rank
Discrimination 2.75
Prejudice 2.94
Ethnocentrism 3.83
Victim Blaming 4.06
Stereotypes 4.44
Harassment 4.77
Backlash 5.21
Friedman chi-square 319.781
Asymptotic significance 0.000
Ways to Enhance Inclusiveness
Table 4 offers a breakdown of the many approaches to promoting Inclusiveness.
Learning about cultural differences is considered an effective strategy to
enhance Inclusiveness. Learning about cultural differences and how businesses
operate in the nation where the abroad assignment is (3.79), encouraging
workers to accept foreign assignments (3.67), and providing language
workshops to employees (3.67). Accepting overseas assignments whenever
possible (3.58), analyzing employee practices to confirm that the company is
not differentiating based on religion or ethnicity (3.26), adapting to new country
customs, and knowing natives while on a foreign work (3.25), and providing
transition assistance were among the other strategies preferred by the
respondents (3.25).
Table 4. Mean and Standard Deviation for Approaches to enhance
Inclusiveness
Strategies to enhance Inclusiveness M SD
Knowing about the cultural differences and business 3.83 1.16
practices in the nation where the foreign assignment is
located.
Employees are taught to be aware of and sensitive to cross- 3.79 1.022
cultural differences.
Employees are more likely to accept international assignments if 3.67 1.106
encouraged to do so.
Employees may benefit from language training. 3.67 1.219
Working in a foreign country whenever given an opportunity 3.58 1.203
Examining staff procedures to verify that the organization is not 3.26 1.505
discriminating against anybody based on their religion or
ethnicity, whether deliberately or accidentally.
While on an international assignment, adjust to the new 3.25 1.083
country's culture and know the locals.
 By offering pre-departure and post-departure transition 3.23 1.121
counseling to workers and their families
By learning other languages 3.01 1.057

Findings And Discussion

Diversity and business performance

According to research, diverse teams offer various firms' employees from
different walks of life to contribute their perspectives, ideas, and experiences to
the table, resulting in more resilient and productive firms than those that do not.
According to the Boston Consulting Group research, firms with more diverse
employee teams generate 19 percent more income due to innovation. This
conclusion is critical for IT companies, start-ups, and other industries that
depend on innovation to succeed. It shows that diversity is more than financial
performance; it is a necessary component of a successful company.

Based on the research conducted on the western countries, Asian countries are
developing at their own pace on equality. Due to several cultural changes in the
last 4 decades, South-East Asia currently has 42 percent female employees,
which is more than the global female workforce of 39 percent.

Based on the 2018 Hays Asia Diversity & Inclusion report, the benefits of
diversity include and are not limited to enhanced organizational culture,
leadership, and innovation. However, a huge majority of participants agreed that
factors such as age, gender, disability, ethnicity, religion, and sexuality might
limit access to money, job, and professional opportunities for persons of
equivalent ability. Flexibility and adaptability are more vital than ever for
individuals, organizations, and countries, and the best way to develop these
qualities is to do so in a culturally diverse atmosphere. To guarantee that today's
workplace accurately represents and supports the region's people, assumptions
must be challenged, discussions must be held, and corporate culture must be
altered

Women in the workplace

Participation of women in the workforce has become an important discussion

point for corporations globally. The companies promote gender equality as
indicated by the research that corporations with more women in the higher
managerial positions are more financially profitable. Several companies still
employ fewer women and are underrepresented in the corporate pipeline than
men.

To support and progress women, corporations must have a comprehensive plan.

It will require a workplace cultural shift, which means investing in employee
skills and greater flexibility during work hours. According to a Pew Research
Centre study, women are more powerful in key politics and business sectors.
Based on survey participants, women are:

 34 % better at working out negotiating

  34% are honest and ethical
 25% stand up for their beliefs
 30% provide fair pay
 25% better at mentoring

Employing and empowering more women in the workplace should be a top

focus for forward-thinking companies, not just as a moral necessity but also as a
sound financial strategy. According to McKinney's newest Delivering Through
Diversity research, companies that promote gender diversity on their executive
teams perform competitively and achieve 21% profitability. They also
outperform their competitors 27% more in long-term sustainable growth.
Different customer needs, product advancements, and corporate well-being
contribute to a successful business. By 2025, reducing the gender gap will
increase 26% contribution to the global economy by $28 trillion to the world's
GDP. Corporations and communities are more likely to flourish and prosper
when women are given equal opportunities and attain financial independence.

Taking a stand for diversity in business

Businesses must take a position and encourage tolerance and diversity in the
workplace. Nike's support for Colin Kaepernick, a civil rights activist, and
American football player, is a great example of this. It was more than a
publicity ploy; it showed the rest of the world that most well-known companies
were willing to back one man in his struggle against racial injustice and
discrimination.

Procter & Gamble's (P&G) 'We See Equal' Campaign featured boys and girls
defying gender preconceptions to fight gender stereotyping and promote
equality for everyone. Women make up 45 percent of the company's
management and a third of its board of directors. Thus, it has a long history of
advocating the cause. The commercial came off as genuine because of P&G's
evident dedication to equality among its employees.

Limitations of the Study

This research has several limitations. The study used a large sample size of the
top 15 IT firms and ignored the trends in other industries and organizations.
Due to limitations to IT firms, the sample is a complete representation, and the
research result cannot be applied to the entire IT industry or other
organizations. But we are witnessing the diversity trend across the globe. More
research is still required to assess the benefits and consequences of diverse
corporations across the IT industry and other corporations such as service and
manufacturing. There is also a need to assess employee job satisfaction in a
diverse workplace and their productivity during work time. There's also a need
for further study on how different ethnic groups, religious groups, and
marginalized groups see workplace diversity.

Conclusion
Companies with a diverse workforce are better positioned to provide excellent
customer service in an increasingly global market and win customer loyalty
and an improved image. These organizations are more conscious of the
demands placed on them by the rapidly changing environment. The research
outcomes shed light on existing diversity management techniques in the IT
industry. Most employees feel confident in dealing with various situations
(diversity realists). Even yet, a small percentage of the workforce has
comprehended, adjusted, and is willing to work and benefit from healthy
workplace diversity (diversity optimists). Companies utilize basic tactics to
increase Inclusiveness, such as teaching employees to be aware of cultural
differences and providing language workshops. Employees in India's IT
businesses, according to the research, encounter problems in embracing
workplace diversity. Discrimination was the most prevalent barrier to
workplace diversity adoption, followed by prejudice and ethnocentrism.
According to the research, businesses should manage diversity to maximize
employee potential and achieve a competitive advantage.
Workplace diversity is vital in every firm. Because of diversity's many
benefits, management must place a premium on diverse recruiting. Despite
some small downsides, diversity has a beneficial impact on every company.
Businesses worldwide are scrambling to create a workplace that adopts
diversity. Establishing a workplace that embraces diverse staff is pressing on
the heels of organizations worldwide due to rapid globalization. Fighting it
and remaining in traditional management would be futile since there is no
one-size-fits-all management approach for all businesses. Each organization
will be required to adopt a diversity management plan and particular
requirements. The advantages of having a diverse workplace are many and
beneficial to any company. Companies will rapidly recognize that recruiting a
diverse team was the right move, even if it is more challenging at first. Every
organization should have a complete diversity plan before doing anything
related to a diverse staff and environment. Creating and implementing a
diversity management strategy does not have to be difficult; various studies
have shown what works best for firms and how to solve common difficulties
from diverse workplaces. Regulatory compliance should not be the goal of
diversity management or training. The business and corporation must
embrace the importance of diversified employees to reap the benefits in the
future. If this trend is applied across the board, the corporation will witness
massive innovation and financial performance, ultimately leading to a better
image among the customers.
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