Diversity Mgt Defined Prevalence and Effects of Diversity Mgt Issues in Research on Diversity Mgt Diversity Mgt: Time for a new approach Ivancevich & Gilbert, 2000

Using demographic necessity as a business case –Assumes access will lead to advancement –Focuses on visible minority and females Broad defn is to recruit, hire, retain, reward & promote a heterogeneous (vms, females, disabled, gays?, whites) workforce Moral/Ideology based business cases will not survive in times of economic hardship Definitions of Diversity Mgt

Perceived effect vs. Real Effects vs Claims made by popular books Does Diversity Mgt have an effect?

92% believed diversity mgt policies affected profitability Towers Perrin 92 Perceived success of diversity training predicted by Rynes & Rosen, 95 Top mgt support for diversity, mandatory attendance, long-term eval of training results, rewards to mgrs for increasing diversity, inclusionary defn of diversity Not in article Perceived effects of Diversity Mgt

Among top 50 companies, 72% had diversity progs AT Kearney, % were developing progs, 8 % had scattered progs Predictors of the use of diversity training Top mgt support for diversity, Top mgt’s positive beliefs about diversity, high strategic priority to diversity compared to other objectives, presence of diversity mgt officer, other diversity supportive policies & Org size Rynes& Rosen, 95 Prevalence of Diversity Mgt Not in article

Case examples –Xerox –IBM –16 organizations case study Morrison, emphasized recruitment 12 used diversity related criteria for perf evaluation –6 linked accomplishment of diversity goals to special bonuses or merit pay increases (cf Stephan & Stephan) 11 had most admired corporation ranking in Fortune 3 had awards for TQM Prevalence of Diversity Mgt

Increased perceptions about managerial concern for diversity Ellis & Sonnenfeld Decreased perceptions that vms received too much attention Ellis & Sonnenfeld Effects of Diversity Training

Improved org culture, fairer treatment of VMs & women in large corporation Jew 1995 Increased understanding of diverse customers, increased creativity, increased commitment, better retention & attendance in 55 companies in CA Tsui & Porter Effects of Diversity Mgt

Increased cooperation in ethnically diverse groups Cox et al VMs have more positive perceptions of career advancement programs (Int’l Survey Research Company) Identity-conscious HR structures (i.e., recruitment, hiring goals, promotion vs. termination ratios, grievance rates) were positively associated with positive employment status outcomes for vms & women Konrad & Linehan Effects of Diversity Mgt

Stock price changes were –NEGATIVE after firms publicly announced settlements in discrimination lawsuits –POSITIVE for those firms winning awards for Equal employment opportunity Effects of Diversity Management (Wright et al)

Those Fortune 500 firms with the best record of promoting women to senior positions were more profitable (ROA 18% & ROI 69% higher than the median in industry) Adler Firms with 2 or more women on boards were more likely to be industry leaders in revenues & profits 6 yrs later Conference Board Effects of Diversity Mgt Not in article

Companies with the highest representation of women in top mgt teams had better financial performance (ROE 35.1% & TRS 34% higher) than those with the lowest representation Catalyst Not in article Effects of Diversity Mgt

Cf Issues in Diversity Training (Stephan & Stephan) Demographic vs. Attitudinal defn of diversity 1. Over time, effect of demographic diversity weakened whereas that of attitudinal diversity strengthened Harrison et al Inter-group interactions became less stereotypical as members learned about one another Issues in Research on Diversity Mgt EthnicityCollectivism Perceptions of group’s features Carpenter & Radhakrishnan 2.2. Not in article

Lack of research could be due to –fewer number of researchers in the area –Poor quality research –Bias of reviewers & editors –Encouragement of doctoral students –Gaining access to organizations Issues in Research on Diversity Mgt

Better research based on Improved research designs, Better theories More diverse samples Time-based studies Better statistical analyses (Radhakrishnan, in progress) Issues in Research on Diversity Mgt

Better Diversity training research (cf Stephan & Stephan chp) –Identify important program based criteria –Assess changes in criteria –Determine whether changes in criteria Are due to diversity training Will replicate with diff employees of same firm Will replicate with different firm (generalization) –Assess Affective, cognitive, skill based outcomes –Use utility estimation procedures to estimate economic benefits Issues in Research on Diversity Mgt

Diversity Mgt Defined Prevalence and Effects of Diversity Mgt Issues in Research on Diversity Mgt Diversity Mgt: Time for a new approach Ivancevich & Gilbert, 2000