Ebook Diversity in organizations (2nd edition): Part 1

(BQ) Part 1 book Diversity in organizations has contents: Introduction, theories and thinking about diversity, legislation, Blacks/African Americans, Latinos/Hispanics, Asians/Asian Americans, Asians/Asian Americans.

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Diversity in Organizations

SECOND EDITION

Myrtle P Bell

UNIVERSITY OFTEXAS, ARLINGTON

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1 2 3 4 5 6 7 15 14 13 12 11

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SECTION II EXAMINING SPECIFICGROUPS AND CATEGORIES 107

Chapter 4 Blacks/African Americans 109

Chapter 5 Latinos/Hispanics 147

Chapter 6 Asians/Asian Americans 187

Chapter 7 Whites/European Americans 223

Chapter 8 American Indians, Alaska Natives, and Multiracial Group Members 257

Chapter 9 Sex and Gender 283

Chapter 10 Work and Family 321

Chapter 11 Sexual Orientation 353

Chapter 12 Religion 377

Chapter 13 Age 399

Chapter 14 Physical and Mental Ability 431

Chapter 15 Weight and Appearance 459

Chapter 16 International Diversity and Facing the Future 491

Name Index 523

Subject Index 533

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Difficulties Resulting from Increased Diversity

and Organizational Responses 22

The“Value in Diversity” Perspective versus

Negative Impacts of Diversity 23

Individual Benefits of Diversity 24

Diversity, Individual Outcomes, and

Organizational Effectiveness 25

Organization of the Book 26

Introduction and Overview 28

Population 29

Education 30Employment, Unemployment, andParticipation Rates 30

Types of Employment and Income Levels 32Focal Issues 32

Individual and OrganizationalRecommendations 33International Feature 33Other Features 34Summary 35

Key Terms 35Questions to Consider 36Actions and Exercises 36

Diversity 37What Is a“Minority”? 38Identifiability 40Differential Power 40Discrimination 41Group Awareness 41Analysis of the Characteristics 41Categorization and Identity 42Social Categorization and Stereotyping 43Consequences of Social Categorization andSocial Identity 45

Aversive Racism, Ambivalent Sexism, andOther New Isms 53

Recommendations for Individuals andOrganizations 57

Summary 59Key Terms 59Questions to Consider 60Actions and Exercises 61

v

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CHAPTER3Legislation 63

Historical Background 65

Major Federal Acts Related to Diversity

in Organizations 66

The Equal Pay Act of 1963 68

Title VII of the Civil Rights Act of 1964 71

Affirmative Action in Employment 82

The Age Discrimination in Employment

Americans with Disabilities Act of 1990 96

The Civil Rights Act of 1991 98

The Family and Medical Leave Act

The Lilly Ledbetter Fair Pay Act of 2009 102

Other Relevant State, Local, and City

Ordinances 102

Future Federal Acts: What’s Ahead? 103

Effects of Diversity on the Judiciary and on

History of Blacks in the United States 111

Blacks in the Military 112

The Civil Rights Movement 115

Relevant Legislation 116Population 117

Education, Employment, and Earnings 118Education 118

Participation Rates 119Earnings by Educational Attainment 120Research on the Employment Experiences ofAfrican Americans 124

Access Discrimination 124Treatment Discrimination 128The Glass Ceiling and Walls 129Negative Health Effects ofDiscrimination 130Immigrant Blacks and Their Descendantsand Native-born Blacks—Similaritiesand Differences 131

African American Women at Work 133Discrimination against Customers 136Recommendations 137

Recommendations for Blacks 139Recommendations for OrganizationalChange 140

Consumer/Customer ServiceRecommendations 143Summary 143

History of Hispanics in the United States 148Mexicans 149

Puerto Ricans 151Cubans 152Relevant Legislation 154English-only Rules 154Population 156

Population by Race for Hispanics andNon-Hispanics 157

Education, Employment, and Earnings 158Education 158

Employment 159Earnings 162

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Organizational Experiences of Hispanics 162

Race and Hispanic Ethnicity and

Employment Outcomes 163

Access and Treatment Discrimination 163

Hispanic Immigrants at Work 166

Latinos and Blacks at Work 169

Latinas at Work 170

Bilingualism: An Uncompensated Skill 173

Racial Profiling, Police Misconduct, and

Differential Judicial Treatment against

Hispanics 175

Latinos as Customers 179

The Marketing Advantage 179

Discrimination against Hispanic

Customers 180

Recommendations for Individuals 181

Recommendations for Organizations 182

Summary 184

Key Terms 184

Questions to Consider 184

Actions and Exercises 184

History of Asians in the United States 189

Relevant Legislation 191

Asians and the Civil Rights Movement 192

Selected EEOC Cases 192

Population 195

Education, Employment, and Earnings 196

Participation and Occupations 200

Asians as the “Model Minority” 201

Asian American Entrepreneurs 206

Research on Experiences of Asian Americans

at Work 209

Asian American Women at Work 212

Focus on Selected Asian Americans: Chinese,

Indians, and Southeast Asians 215

History of Whites in the United States 225The Past Transiency and Current Meaning

of“Race” for Whites 226History of Whites as Allies ofDiversity 229

Relevant Legislation 231Population 238

Education, Earnings, and Employment 239Research on Whites and Diversity 241Similarities and Differences in theExperiences of White Womenand Men 241

The Meaning of Ethnicity for Whites 243Perceptions of“Quotas” and “ReverseDiscrimination” 244

Effects of Increasing Diversity on DominantGroup Members 248

Recommendations for Individuals 249Recommendations for Organizations 250Summary 253

and Multiracial GroupMembers 257

History of American Indians in NorthAmerica 259

Population 262Education, Employment, and Earnings 265Relevant Legislation 267

Research on American Indians at Work 269American Indian and Alaskan Native

Women 269Multiracial Group Members 272Introduction and History 272

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Blacks and Racial Determination 273

Sexual Harassment of Women 303

Sexual Harassment of Men 305

The Glass Ceiling and Other

Boundaries 307

Sex, Race, and Ethnicity 310

White Women and Women of Color 310

Unique Gender Issues 312

Gender and Poverty 312

Negotiating Pay 313

Recommendations for Individuals and

Organizations 314

Curbing Sexual Harassment 316

Breaking the Glass Ceiling 317

Summary 318

Key Terms 318

Questions to Consider 318

History of Work and Family 323Relevant Legislation 323

Equal Pay Act and Title VII 324Pregnancy Discrimination Act of 1978 325The Family and Medical Leave Act of

1993 328Lilly Ledbetter Fair Pay Act of 2009 329Population, Participation, and Education 329Earnings 332

Part-time Work and Earnings 334Flexible Schedules 335

Flexible Schedules for Singles 338Unpaid and Paid Leaves 338

Career Outcomes for Employees Who TakeLeaves of Absence 339

Same-Sex Couples in Family Relationships 340Men, Work, and Family 341

Beyond the Family: Society, Organizations,and Family Issues 342

Family Policies in Selected Countries 343Elder Care 345

Parenting Again: Grandparents Caring forGrandchildren 346

Recommendations for Individuals 347Recommendations for Organizations 348Summary 350

History of Gay Rights in the United States 355Population 357

Education and Income Levels 357Relevant Legislation 359

Partner Benefits 362HIV/AIDS at Work: Unfounded Fears 364Determinants of Attitudes toward Gays andLesbians 367

Codes of Silence: Not Just the U.S

Military 367

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Out at Work? 370

EEOC Guidelines on Religious Exercise

and Religious Expression in the

The Diversity among Arab Americans and

Muslims in the United States 387

Racial Profiling of Arabs (or People

Who Look as though They Might

Be Arab) 387

Religion as an Invisible Identity 388

Women’s Roles in Organized

Religion 389

Religion and Diversity in Sexual Orientation

at Work 390

Conflicts between Religion and Sexual

Orientation: Two Cases with Different

Outcomes 392

Resolving Conflicts 394

Legal Protections for Younger Workers 406Population, Participation Rates, and

Employment 408

An Intergenerational Workforce 409Education 410

Research on Employment Experiences ofOlder Workers 413

Age, Accidents, and Injuries atWork 414

Training and Development 414Bridge Employment and Layoffs 416Older Women at Work 418

Research on Employment Experiences ofYounger Workers 421

Sexual Harassment of Teen Workersand the EEOC’s Youth@WorkInitiative 422

Long-term Consequences of Harassment

of Young Workers 425Recommendations for Individuals 426Recommendations for Organizations 427Summary 429

Ability 431History 433

Relevant Legislation 433Essential and Marginal Functions 436Reasonable Accommodations 438Medical Examinations 440Population, Education, and Employment 440Employment Experiences of People withDisabilities 443

Intellectual Disabilities 443

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The Glass Ceiling, Walls, and Secondary

Job Markets for People with

Customers with Disabilities 450

Changing Negative Attitudes at

Population 463

Education, Employment Levels, Types,

and Income 466

Effects of Attractiveness of Appearance

on Employment and Income 467

Legislation Relevant to Weight and

Appearance 469

The ADA and Weight 469

State and Local Statutes Prohibiting

Weight and Appearance

Considerations for Employers:

Weight 482Considerations for Employees:

Weight 484Recommendations to Individuals andOrganizations for MinimizingAppearance Discrimination 485Summary 486

SECTION III

GLOBAL VISION 489

Facing the Future 491Discrimination and Differential Treatment asWorldwide Phenomena 495

Sex and Gender: The Status of Womenaround the World 497

Population and Participation Rates 497Sexual Harassment, Segregation,

Discrimination, and OtherInequities 498

Wage Inequity and the Glass Ceiling 499Focus: “Think Manager, Think Male”

Worldwide? 500People with Disabilities 500Population and Participation 503Legislation 504

Focus: Disabled People’s Experiences

in the Workplace in England 504Sexual Orientation 505

Legislation Prohibiting Sexual OrientationDiscrimination 505

Focus: Anti-Gay Sentiment amongYouth in Belgium and Canada 506

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Other Employment Considerations 516

Diversity for Service Providers 516

The Role of the Media 518

Recommendations for Change at anIndividual Level 518

Capitalizing on the Strength of Diversity

in the United States 520Summary 522

Name Index 523

Subject Index 533

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In the years since I wrote the first edition of

Diversity in Organizations, many significant

events related to diversity have occurred In

2008, the United States elected its first Black

president, the man identified as “Barack

Obama, U.S Senator” in the multiracial

chapter of the first edition Although my

prescient Goolsby Leadership students in the

spring of 2006 referred to him as“the hope

of our generation,” when I wrote that feature

in 2005, I had no thought that Senator

Obama would be elected U.S president That

he was elected was momentous in and of itself,

as were the diverse backgrounds of the people

who voted for him

Obama’s election led to claims of a

“postracial” America, which have not yet

been realized Even so, the diversity of those

who voted for him does speak of immense

progress from the point where few believed,

even in a time of recession and two wars,

that a Black man would ever be elected U.S

president or that women would also be

seriously considered candidates during the

election

As I began writing the second edition and

investigating the status of each racial and

ethnic group, women and men, people with

disabilities, and other non-dominant group

members, it became even more clear that the

need for diversity research and study remainsstrong Blacks continue to have nearly twicethe unemployment rate of Whites—a problemthat persists even at the same education levels.Residential segregation and the fact thatBlacks with similar credit histories, personalbackgrounds, and in similar residential loca-tions were more likely to be given subprimeloans help explain the current higher foreclo-sure rates among Black Americans.1Althoughwomen became the majority in the workforce

as men’s jobs were lost during the recession,the wage gap remains tenacious Sexualharassment, discrimination, and segregationcontinue to be severe and pervasive problemsfor working women Arizona passed a lawthat seemed to support racial profiling ofLatinos Employer targeting of Hispanics fordiscrimination and harassment, while at thesame time preferring them to and discriminat-ing against Blacks and Whites for some low-wage, often exploitative jobs continues

Although gays and lesbians have servedadmirably in the military for years,“Don’tAsk, Don’t Tell” continued to be the law untilvery recently, and challenges to it continued to

be met with tenacious resistance For everynon-dominant group some disparities persist,and, in some cases, have worsened since thefirst edition It is no surprise that discrimination

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charges filed with the EEOC reached their

highest number ever, in multiple categories.2

Because most people who experience

discrimination do not sue, other motivations

for fair treatment, non-discrimination, and

diversity and inclusion remain important

As a result, organizations are continuing to

emphasize diversity and inclusion in

recruiting and marketing, funding employee

resource groups, supporting diverse family

units, and in many other ways There is still

much work to be done, but there is still

progress amid retrenchment and there is still

hope for a better, fairer, more just future

CHANGES TOTHISEDITION

As was the first edition, this edition of

Diversity in Organizations is research-based,

using hundreds of articles, chapters, and

books from the fields of management,

sociol-ogy, psycholsociol-ogy, economics, criminal justice,

and health as resources This edition contains

a general updating of the content of all

chap-ters, including data on population,

participa-tion, and employment, legislaparticipa-tion, litigaparticipa-tion,

relevant research, and features Objectives and

Key Facts in each chapter have been updated

as well This edition emphasizes diversity and

inclusion and the degree to which“different

voices of a diverse workforce are respected

and heard”3

and offers more insight intoimplications for organizations interspersed

throughout the chapters Each chapter

in-cludes new examples of litigation under

diversity-related laws, including those recently

passed, and new relevant empirical research

Chapter 7 now includes an interview of the

chief diversity executive at a major tion The discussion of theories has beenconcentrated in Chapter 2, which includesmore psychological theories and processesthat affect diversity and research evidence

corpora-on reducing bias in selecticorpora-on Secticorpora-on II hasbeen reorganized such that the topics of sexand gender, work and family, and sexualorientation follow each other, improvingflow and cohesion Chapter 16,“InternationalDiversity and Facing the Future,” includesmore research on diversity issues in aninternational context and contains a featureessay focusing on the perspective of an inter-national organization on global diversity andinclusion

Key changes in this edition include:

● Added an adaptation of Cox’s InteractionalModel of the Impact of Diversity onIndividual Career Outcomes and Organiza-tional Effectiveness

● New research on structured interviews

to reduce similarity bias

● Discussions of new legislation, includingthe Genetic Information Nondiscrimina-tion Act (2008), Americans with Dis-abilities Amendments Act (2008), andLilly Ledbetter Fair Pay Act (2009)

● The inclusion of research on the effects ofdiversity in the judiciary on judges’decisions

● New sections on immigrant Blacks and onBlacks and Hispanics

● New features on Surgeon General ReginaBenjamin and Supreme Court JusticeSonia Sotomayor

● New research on race and color nation across races

discrimi-2

http://www.eeoc.gov/eeoc/statistics/enforcement/charges.cfm, accessed November 23, 2010.

Ethics, 54: 129–147.

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● New research on discrimination and

health care

● Updated information on participation and

employment of older workers since the

economic recession

I thank Jeff Hahn, Scott Person, and the staff

at Cengage and its affiliated and support

organizations for their patience and

persever-ance throughout the development of this

edition I thank Pradhiba Kannaiyan and the

copy editors at PreMediaGlobal for their

editorial assistance I am especially grateful to

Jennifer Ziegler at Cengage, and Margaret

Trejo at Trejo Production for their outstanding

last minute work and conscientiousness

I am grateful to the many colleagues who

reviewed and offered valuable feedback on the

Sacramento City CollegeJanet Sayers

Massey UniversityAlthough not listed by name, I appreciatethe many members of the Gender and Diver-sity in Organizations division of the Academy

of Management who offered feedback andsupport for the first edition, along withsuggestions for improving this one Thosecolleagues and friends continue to examineimportant questions in their research, provid-ing the research evidence that is the founda-tion for this book I am grateful that they arecommitted to doing work that matters

I thank the Diversity Connections sortium and Terry Howard, its founder andfuel, for keeping me thinking, growing, andencouraged to continue this work I am for-tunate to belong to such a group of people sopassionate about equality, diversity, and in-clusion and thank Ed McFalls for introducing

Con-me to the group

Many thanks are due to Frank McCloskey,the inaugural vice president of diversity atGeorgia Power, for agreeing to be featured inChapter 7 and for helping me focus on whatmattered most to say I appreciate JosefineVan Zanten, vice president of diversity andinclusion at Shell, for her willingness to sharehow Shell sees diversity from a global per-spective Thanks also go to Karsten Jonsen formaking the connection

The Society for Human ResourceManagement and Dr Shirley Davis, director,

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Global Diversity & Inclusion, twice funded a

gathering of 100 Global Diversity Thought

Leaders to discuss the future of the field and

efforts to establish formal credentials for

diversity professionals I am honored to have

been part of such a group As the respected

organization that validates the credentials of

human resources professionals (e.g., PHR,

SPHR, GPHR), having a SHRM certification

for those who do diversity work would

cer-tainly help bring credibility and legitimacy to

the field I hope SHRM is successful in this

important work

Very special appreciation goes to my

wonderful students at UT Arlington, who

keep their“diversity hats” on and who e-mail

me years later to let me know what a

differ-ence the book and course have made for

them and to share their continued diversity

learning experiences I thank them for

enrolling in my Diversity in Organizations

course, for sharing their ideas, questions, and

hopes, and for going out into the world of

work to make things better, fairer, and more

inclusive, helping their organizations,

employees, and customers

I thank Laura Ratcliff Lenoir, Henry

Toney, Mingo Johnson, Geylon and Minnie

Johnson, and many other ancestors whose

lives, love, and sacrifice helped pave the way

for me to do this work I am grateful that my

mother, Iris Johnson, instilled in me the value

of knowing and opening our home to peoplefrom various parts of the world and variousparts of town My heart is open to love andconcern for both similar and very differentothers as a result of early, frequent, andcontinued lessons from her Daphne Berry,through the lens of her education in feministtheory and political economy, opened my eyes

to aspects of diversity that I may otherwisenever have seen; the issues are much biggerthan individual acts of discrimination andexclusion My daughter and son are my inspi-ration to continue this work, in hopes for abetter future and world for them and thosewho are yet to be born My husband, Earnest,encouraged me to write this edition and thefirst, and provided every support imaginable,including well-timed words and cups of coffeewhen I felt too exhausted to continue Withouthim, my work and my life as I know it wouldnot be Lastly, but most important, I am espe-cially grateful to God for providing me with thetools, courage, and privilege to do this work

ANCILLARIES

The Instructor’s Resource CD includes aninstructor’s manual, teaching notes, andsuggested testing options PowerPoint filesare also available for each chapter of thetextbook

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1

Introduction

Chapter Objectives

After completing this chapter, readers should have a

firm understanding of the importance of diversity in

organizations Specifically, they should be able to:

❏ explain what “diversity” encompasses in the

United States and the considerations used in

determining the relevant diversity concerns in

other countries

❏ discuss the historical background for the study

of diversity in organizations

❏ define key diversity terms, including types of

discrimination, productive characteristics, and

inclusion

❏ discuss research supportive of the individual

and organizational benefits of diversity

Key Facts

Despite extraordinary corporate and media attention paid to diversity in the past thirty years, discrimination, inequality, and exclusion persist in organizations.

Valuing diversity can benefit organizations in the areas of cost, resource acquisition, marketing, creativity, problem solving, and system flexibility.

If an organization develops a reputation for valuing all types of employees, it will become known as an employer of choice, in which workers from all backgrounds feel they have the opportunity to work, grow, and be treated fairly.

Working in and learning in environments with people who are different can benefit individuals through intellectual engagement, perspective taking, and greater understanding

of the implications and benefits of diversity.

A supportive climate for diversity results in benefits for individuals and organizations, but diversity without a supportive climate can result in negative consequences.

3

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Introduction and Overview

What Is Diversity?

In this book, diversity is defined as real or perceived

differences among people in race, ethnicity, sex,

age, physical and mental ability, sexual orientation,

religion, work and family status, weight and

appear-ance, and other identity-based attributes that affect

their interactions and relationships 1 These areas are

differences that are based on power or dominance

relations between groups, particularly “identity

groups,” which are the collectivities people use to

categorize themselves and others 2 Identity groups

are often readily apparent to others, strong sources

of personal meaning, and related to historical

dispa-rities among groups in treatment, opportunities, and

outcomes.

The definition of diversity includes the terms

real and perceived to acknowledge the social

con-structions of many areas of difference In particular,

race is socially constructed, yet perceptions of race,

beliefs about people of different races, and

discrimi-nation on the basis of race strongly affect people’s

life experiences Similarly, gender is also socially

constructed, representing perceptions of how males

and females should behave, rather than being

repre-sentative of biological differences between them

that might cause them to behave differently These

beliefs about the differences between males and

females strongly affect the experiences of men,

women, and boys and girls in society and

organizations.

In contrast to the categories focused on in this

book, some research has explored diversity in terms

of functional area (e.g., marketing, finance, or

accounting), tenure, values, and attitudes as they fect people’s organizational experiences These categories may also be sources of real or perceived differences that affect people’s interactions, outcomes, and relationships at work For example, engineering, finance, and accounting managers typi- cally earn more and have greater occupational status than human resources managers However, one’s functional area at work is less likely to be readily apparent, a strong source of personal identity, or associated with historical disparities in treatment, opportunities, or outcomes in society at large Thus, this book does not consider diversity in functional area, personality, learning style, and other sources considered in some research Focusing on any individual difference, rather than differences having strong personal meaning and stemming from or co- inciding with significant power differences among groups, would make all groups diverse and would make the entire concept of workplace diversity meaningless 3

af-Employment or labor market discrimination occurs when personal characteristics of applicants and workers that are unrelated to productivity are valued in the labor market 4 Access discrimination occurs when people are denied employment opportunities, or “access” to jobs Treatment discrimination occurs when people are employed but are treated differently once employed, receiving fewer job-related rewards, resources, or opportunities than they should receive based on job-related crite- ria 5 Access and treatment discrimination are forms

of employment discrimination In cases of access or treatment discrimination, people with identical productive characteristics are regarded differently

Company, p 394.

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because of demographic factors such as race,

ethnic origin, sex, age, physical ability, religion, and

immigrant status Productive characteristics include

occupational and human capital variables, such as

education, skills, and tenure 6

Also relevant to how people from different

backgrounds are treated is the concept of inclusion,

which is the degree to which “different voices

of a diverse workforce are respected and heard.” 7

In inclusive organizational cultures, employees feel

as though they are accepted, belong, and are able

to contribute to decision-making processes 8 In addition to efforts to ensure discrimination is avoided and employees are diverse, efforts to ensure employees are also included and able to fully contribute are critical to organizational success 9

Thus, throughout the book, “valuing diversity” refers to diversity and inclusion.

DETERMINING“DIVERSITY”IN ANINTERNATIONAL CONTEXT

Many issues related to inequality, discrimination, and diversity are lar, but it is important not to apply concepts from one area to another inwholesale fashion without considering contextual factors.10 Race, ethnic-ity, sex, age, physical and mental ability, sexual orientation, religion,work and family status, and weight and appearance are important differ-entiating factors in the United States, and some of these factors are alsoimportant in many other regions of the world Depending on nationalcontext, culture, political and socioeconomic structures, and history,different factors of“diversity” will be of most importance in the interac-tions and relationships among people.11

simi-Identifying and studying differences based on power or dominancerelations, stemming from historical disparities and perpetuated by contin-ued differential and pejorative treatment, can help determine key identitygroups in different contexts around the world For example, althoughslavery officially ended after the Civil War in the United States, segrega-tion and discrimination continue to affect the experiences, opportunities,and outcomes of American Blacks Moreover, even in the United

Kingdom, where slavery was considerably shorter-lived than in the UnitedStates, long-standing differences in the treatment of Black, Asian, and

6

Group & Organization Management, 31(2): 212–236.

Groups? The Moderating Role of Leader-Member Exchange in the Diversity to Turnover

Management Practices.” The International Journal of Human Resource Management, 20(12):

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minority ethnic immigrants (e.g., Turks, Pakistanis, Indians) and theiridentifiable descendants compared with Whites in the United Kingdomcontinue to exist Racial inequality is also an issue in South Africa wherethere has been a long history of discrimination against Blacks.12 InAustralia, British and European immigrants shaped restrictive immigra-tion policies toward later, non-White immigrants, particularly Chineseand Pacific Islanders.13Similar histories and current disparities existbetween “minority” and “majority” racial, ethnic, or religious groupsaround the world In addition, the status of women makes sex andgender a relevant difference in virtually all societies Regardless of region,then, particular factors affecting different groups may be identified andthen addressed in order to reduce discrimination and increase equality,inclusion, and organizational competitiveness.

MULTIPLEGROUPMEMBERSHIPS ANDPERMEABILITY OFBOUNDARIES

People’s group memberships affect their outcomes, opportunities, andexperiences in society and in organizations Such things as employment,compensation, advancement, retention, participation, and competitivenessare a few of the outcomes that are related to demographic background Inthe United States, those who are White, male, and do not have a disabilitygenerally earn higher wages and have higher organizational status thanpersons who are non-White, female, or have a disability.14Whites aremore likely to work in theprimary labor market, which includes jobs inlarge organizations, with more opportunities for advancement and retire-ment, vacation, and medical benefits Blacks and Hispanics are morelikely to work in thesecondary labor market of low-skilled, low-paid,insecure jobs.15

The categories of race, ethnicity, sex, age, physical ability, sexualorientation, and religion are not mutually exclusive Everyone possesses aracial and ethnic background, age, sexual orientation, and, possibly,religion Some of the categories are immutable, but others are not and

Journal of Human Resource Management, 20(2): 235–251.

Personnel Review, 39(1): 96–115.

Los Angeles: Roxbury Publishing Company; Braddock, D., & Bachelder, L (1994) The Glass Ceiling and Persons with Disabilities Washington, D.C.: Department of Labor.

Ethnic-ity, and Gender Thousand Oaks, CA: Pine Forge Press.

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may change over one’s lifetime People may be born with or acquire abilities, and everyone ages A person may be a member of the majoritygroup in one area but not in another, for example, White and female ormale and Latino A White man may have a disability, be an older worker

dis-or of a mindis-ority religion, and personally experience job-related nation He may also have a working wife, mother, or sister who has facedsex-based salary inequity or harassment or a daughter or granddaughterwhom he would prefer not to have to face such discrimination at work.White men are considerably more likely to occupy leadership posi-tions (executive, board member, or manager) than other groups Diversityresearch indicates that the commitment of top management to diversityincreases the effectiveness of diversity initiatives Therefore, White menare more likely to have the power to implement important changes at theorganizational level and to influence behaviors and perspectives about theoverall benefits of diversity; their commitment to diversity is essential.Although data clearly show, and we emphasize here, that members ofsome groups face more barriers and organizational discrimination, thisbook stresses the value of diversity to everyone Like Roosevelt Thomas, apioneer in diversity work, we suggest that“managing diversity is a com-prehensive managerial process for developing an environment that worksfor all employees.”16

discrimi-At the same time, it is nạve to ignore the fact thatmembership in some groups or that some combinations of memberships(e.g., minority female) have more negative ramifications for job-relatedopportunities and success than others.17Commitment to diversity requires

a concerted effort to recognize, acknowledge, and address historical crimination, differential treatment, and unearned advantages rather thanundermining efforts to address inequities in the name of inclusiveness.18The research and recommendations in this book make apparent the need

dis-to consider the past and present while working dis-toward a more friendly future

diversity-Misperception: Diversity is beneficial only to minorities and women

Reality: Diversity can benefit everyone

Managing Diversity New York: AMACOM, p 10.

I Brown (Ed.), Latinas and African American Women at Work: Race, Gender, and Economic Inequality New York: Russell Sage Foundation.

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This book is relevant to large and small companies, colleges anduniversities, religious organizations, military organizations, and any otherorganizations in which people work or wish to work or that have clients,customers, or constituents Although under U.S laws some organizations(e.g., churches, private clubs) are often allowed to prefer certain types ofpeople over others as employees, many of the concepts in this book alsoapply to such organizations and can be of benefit to their leaders Forexample, religious organizations may legally require that employees bemembers of a particular faith, yet they will likely have employees withwork and family issues or may be wrestling with the issue of ordainingwomen Similarly, the U.S military is a unique, historically male organi-zation, yet its issues with sexual harassment and sexual orientation diver-sity can help inform other types of organizations As will be apparentfrom the variety of organizations discussed in this book, diversity issuesaffect all organizations at some point.

TERMINOLOGY

In this book, when referring to the U.S population, the following sions are used somewhat interchangeably: sex/gender, Blacks/AfricanAmericans, Latinos/Hispanics, Asians/Asian Americans/Asians and PacificIslanders, Whites/Anglos/European Americans/Caucasians, and minorities/people of color.19Although the linked terms are not exactly the same(e.g., sex is biological while gender is socially constructed, and not allBlacks consider themselves African American), they are widely recognized,their meanings are generally well understood, and they are often usedinterchangeably Even so, there are important differences among them

expres-Indeed, some scholars have argued persuasively that the ambiguity andfluidity of terminology render“race” and “ethnicity” almost meaning-less.20Some researchers go so far as to use quotation marks at any men-tion of the word race to indicate its lack of meaning

Like gender,“race is socially constructed to denote boundariesbetween the powerful and less powerful” and is often defined by the morepowerful group.21In the United States, these social constructions arereflected by the changes in terminology used by the Census Bureau over

particular terms are acknowledged and respected.

Race in America Armonk, NY: M E Sharpe.

Press, p 282.

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the years and in court rulings about who was or was not White Latinosmay be of any race, and people may be of more than one racial or ethnicbackground, which adds to the complexity of understanding race andwhat it means Although all Latinos are categorized as such, there aresubstantial differences in the diversity-related experiences of MexicanAmericans, Puerto Ricans, and Dominicans and between Black Nicara-guans and White Colombians.

Ethnicity refers to a shared national origin or a shared cultural tage Thus, “Hispanic” is an ethnic description, although it is often trea-ted as a racial one “Asian” is another ambiguous term Is it an ethnicity,since ethnicity refers to a shared national origin, or is it a race, as the term

heri-is often used and understood? As with differences among Latinos, thereare also considerable differences among Asians who are from Korea andthose from India or Vietnam, and among Black Americans, South AfricanBlacks, and those from the West Indies These and other contextualcomplexities related to race, ethnicity, sex, and gender and their effects

on individuals in organizations will be explored in later chapters

As discussed further in Chapter 2, instead of the terms majorityand minority, which reflect population size, the terms dominant and non-dominant are used at times to distinguish between more powerful and lesspowerful groups, acknowledging the importance of power in access to andthe control of resources The powerful control more resources and are

“dominant,” whether or not they are more numerous (such as Whites inSouth Africa and men in the United States and most other nations)

THESTIMULUS FOR THEFOCUS ONDIVERSITY: WORKFORCE2000

In 1987, the Hudson Institute published Johnston and Packer’s research

on the changes in the nature of work and in the demographic background

of workers in the twenty-first century.22 The research shocked tions and the media and was an impetus for much of today’s diversityresearch Johnston and Packer noted that by the year 2000, 85% of thenet new entrants into the U.S workforce would be women and minorities.Often quoted, this statement was widely misunderstood to mean that by

organiza-2000, White men would constitute only 15% of the workforce However,White men were then, and remain still, the largest single group in thelabor force It was the net new entrants who were increasingly womenand people of color The phrase net new entrants refers to the differencebetween those who entered the workforce (newcomers to the workforce)

Indianapolis, IN: Hudson Institute.

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and those who left the workforce (e.g., via retirements, death) Althoughwomen and minorities would comprise 85% of the net new entrants,because of the immense size of the workforce and because White men arethe single largest majority in the workforce, it will be a long time beforeWhite men are no longer the largest single group This misunderstanding

or misinterpretation of terminology and projections about the increasingdiversity of the workforce fueled interest in the topic and prompted con-cerns about the organizational ramifications of these changing

of large numbers of baby-boomers, resulting in a plateauing of worker age.What has happened to the U.S population now that the year 2000has come and gone and we are proceeding toward the year 2020?

Although not exact (because not everyone participates in the workforce),the population demographics are similar to the predictions in Workforce

2020 As shown in Table 1.1, White men and women are the majority ofthe population, followed by Latinos, Blacks, and Asians The currentworkforce is indeed more diverse than it was in the prior century, butWhites remain the largest group numerically The workforce is aging, andyounger workers are more diverse in race and ethnicity than in the past

Recession-related economic changes have prevented many aging workersfrom retiring, resulting in even more age diversity in organizations than inthe past Women are now obtaining more college degrees than men, yetwomen’s earnings continue to be less than men’s (see Table 1.1) Theseissues have important implications for individuals, employers, andorganizational diversity

In addition to the changes in the demographic makeup of Americanemployees, as the Hudson Institute predicted, economic changes andglobalization have resulted in more service-oriented jobs and moreinternational customers and business relationships The loss ofmanufacturing jobs, where there is less opportunity for contact withdissimilar others, and the growth of service industry jobs, which involveconsiderable person-to-person interaction with dissimilar others, con-tinue These changes in types of jobs make awareness of and efforts tounderstand and learn to interact with those who are dissimilar more

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critical than ever Further, service industry jobs, often occupied bywomen, continue to increase, while manufacturing jobs, often occupied

by men, continue to decline through layoffs, plant closures, and shoring As a result of these changes, at one point in late 2009, womenfor the first time comprised the majority of the U.S labor force

off-Increasing globalization has also resulted in greater interaction amongpeople from diverse backgrounds Not only do employees interact withpeers from diverse backgrounds in their local environment, they alsotravel around the world, interacting with people who are from different

T ABLE 1.1 Highlights from the U.S 2000 and 2008 Census Demographic Profiles

Native Hawaiian and other Pacific Islander 398,835 0.1 427,810 0.1

Social Characteristics

Foreign born (% of total population) 31,107,889 11.1 37,960,935 12.5 Speak a language other than English at home

Economic Characteristics

Participating in labor force (population 16 years and over) 138,820,935 63.9 157,465,113 65.9 Median earnings male full-time, year-round workers n/a $45,556

Median earnings female full-time, year-round workers n/a $35,471

*The Census Bureau introduced a new set of disability questions in the 2008 ACS questionnaire.

Source: Adapted from 2000 and 2008 U.S Census Bureau, American FactFinder http://factfinder.census.gov, accessed

August 12, 2010.

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cultures and belief systems and who often speak different firstlanguages.

Demographic changes are occurring in many countries around theworld In the United States and Canada, where growth of the workforce isslowing, fewer younger workers are being added than in the past In someEuropean countries and in Japan and China, the workforce is actuallyshrinking; more people are leaving than joining it Along with the strikingage of Japan’s workforce, its underutilization of women workers is nota-ble and has received considerable criticism.24As a result of some of thedemographic changes, many countries increasingly view developingnations as sources of new employees, even though a number of thesecountries have historically resisted, and sometimes continue to resist,immigration Immigrants often have educational backgrounds, languageskills, strengths, and weaknesses different from those of native workers,thus requiring special effort to integrate immigrants successfully Thisbecomes even more difficult when they are also identifiable by appear-ance, name, or cultural differences Both the need for these new workersand the resistance to them make paying attention to issues of diversityand inclusion particularly important

DIVERSITY ANDORGANIZATIONALCOMPETITIVENESS

What is the meaning of increasing diversity to individuals and tions? What should organizations do to ensure that applicants haveopportunities to work and workers have opportunities to contribute andsucceed? How can organizations integrate new workers into a formerlyhomogenous organization? How should organizations address resistance

organiza-to immigration when immigrants are key sources of applicants, ees, and customers? We will examine in this book these and otherdiversity-focused questions

employ-In their often-cited article on the implications of cultural diversity fororganizational competitiveness, Cox and Blake proposed that there are sixspecific business-related reasons why organizations should value diversity.They explained that effective management of diversity could benefit orga-nizations in the areas of cost, resource acquisition, marketing, creativity,problem solving, and system flexibility.25Numerous management,marketing, and organizational behavior textbooks, as well as news magazines

http://www.jef.or.jp/journal/jef_contents_free.asp?c=3766, accessed June 8, 2010.

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and the popular press, have discussed these benefits of diversity and continue

to shape the thinking about its value Cox and Blake focused on those six sons in order to highlight areas that had previously received limited researchattention, not to imply that they were the only reasons for valuing diversity.Along with the business reasons, we also consider the social, moral, and legalreasons In addition, Cox and Blake’s suggestions focused on diversity as itapplies to women and minorities; we apply their suggestions to the effects ofdifferent aspects of diversity—such as age, religion, sexual orientation, andothers—on an organization’s competitiveness

rea-Cost

Employee turnover and litigation The costs associated with doing a poorjob of integrating workers from different backgrounds can be extremelyhigh: lower job satisfaction and the subsequent costs of turnover amongwomen, minorities, and, likely, people of various religious faiths, gays andlesbians, and others whose contributions are often devalued in organiza-tions Cox and Blake and other researchers have reported lower satisfac-tion and higher turnover of women and minorities when compared tomen and Whites This finding is an important organizational concern,particularly as the number of women and minorities in the workforce in-creases If, along with women and minorities, workers from other groups(such as those with child and/or elder care responsibilities or people withdisabilities) are dissatisfied and quit in response to negative organizationaltreatment, organizational costs related to turnover may be tremendous.However, researchers have found that, for some employees, organiza-tional efforts to support diversity can enhance commitment and reduceintentions to quit even when employees perceive discrimination.26 On theother hand, if minority employees feel that their organization’s commit-ment to diversity is insincere, dissatisfaction, lowered commitment, andcynicism can result.27

Although the majority of research focuses on the turnover of womenand minorities, one study found that increasing organizational diversitywas associated with lowered attachment for Whites and males but not forwomen and minorities.28Other research indicates that at times both mi-norities and Whites experience discomfort in cross-race interactions, with

Efforts to Support Diversity Moderate the Effects of Perceived Racial Discrimination on Affective

Employees.” Journal of Managerial Psychology, 18(1): 22–45.

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minorities expecting to be targets of prejudice and Whites fearing beingperceived as prejudiced.29The possibility that increased diversity isassociated with lower attachment, turnover, and discomfort for people ofdifferent backgrounds suggests that organizations should take proactivemeasures to address and circumvent these negative outcomes while maxi-mizing the positive outcomes.

Costs associated with turnover include exit interviews, lost ity while positions are unfilled, and recruiting costs for replacementemployees Organizations may find replacement more expensive thanretaining current employees This is particularly true when the learningcurve and training costs of replacements are also taken into consideration.Specific organizational efforts to address needs of specific workers mayminimize turnover For instance, research indicates that workers withchild care responsibilities (commonly, women; increasingly, men) havemore organizational commitment and lower turnover when companiesprovide child care subsidies, on-site day care, or other child care sup-port.30In addition, educating all workers about the benefits of increasingdiversity may reduce dissatisfaction, detachment, and fear among employ-ees while also communicating that diversity is desirable

productiv-Lastly, many people think of the costs associated with doing a poorjob of integrating workers largely in terms of discrimination lawsuits Coxand Blake did not specifically include litigation expenses among their costfactors, however Further supporting organizations’ concerns over liti-gation is the media attention surrounding large damage awards involvingmajor companies As discussed further in Chapter 3, research suggeststhat large damage awards are indeed effective in improving opportunitiesfor groups that have experienced discrimination, at least in the short term.However, despite the substantial media attention, the likelihood of anorganization being sued by an aggrieved individual is relatively small, butthe continuing costs associated with low job satisfaction and high turn-over are high For example, the number of discrimination-related chargesfiled by individuals with the Equal Employment Opportunity Commission(EEOC) between 1997 and 2010 ranged from about 75,000 to nearly100,000 Although these are substantial numbers, they are quite smallrelative to the number of firms in the United States and relative to the

139 million people in the workforce The majority of workers who feelthey are treated unfairly, not valued, or discriminated against do not sue

Instead, they may simply leave the organization and tell their family and

Group Members.” Group Processes and Intergroup Relations, 6: 171–185.

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friends about their experiences, which affects the organization’s ability toattract other workers (e.g., resource acquisition).

Misperception: The risk of being sued by an individual for discrimination isfairly high

Reality: Overall, an organization’s likelihood of being sued by an individual isvery small

Lost business Costs associated with lost business should be added to thecosts of absence, turnover, and discrimination lawsuits that are commonlyassociated with mismanagement of diversity When employees or custo-mers learn of or personally experience unfair treatment toward theirgroup by an organization, they are less likely to patronize it In addition,other groups who were not personally affected may find overt discrimina-tion or other negative behaviors offensive and choose to spend theirdollars elsewhere Dealing with negative publicity and protests againstdiscriminatory policies can be expensive and time-consuming for organi-zations, as experienced by Cracker Barrel in response to its discriminatorypolicies toward Black customers and gay and lesbian employees, discussed

in Chapters 4 and 11, respectively.31

Resource Acquisition

An organization’s ability to attract and retain employees from differentbackgrounds is referred to as resource acquisition Depending on thenational context, those who have been overlooked as potential employeesoften include women, racial and ethnic minorities, workers with disabil-ities, gays and lesbians, and people from non-dominant religious faiths.Cox and Blake proposed that if an organization develops a reputationfor valuing all types of workers, it will become known as an employer

of choice, increasing its ability to compete in tight labor markets

Empirical research provides support for the positive effects of neous recruitment ads on minorities’ desire to work for organizations.32Conversely, if an organization develops a reputation for valuing

http://www.nytimes.com/1992/04/09/us/gay-rights-groups-take-aim-at-restaurant-chain-that-s-hot-on-wall-street.html, accessed June 2, 2010.

in Recruitment Advertising.” Journal of Applied Social Psychology, 34(1): 146–161; Perkins, L A.,

Psychology and Marketing, 17: 235–255.

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only a subset of workers, it may miss out on hiring excellent workerswho do not fall into that subset Other researchers have similarlyargued that “talented people may be predisposed to avoid companiesthat discriminate.”33

Such organizations may also have higher ensation costs because of drawing from a smaller pool of workers(i.e., supply would be lower, making demand costs higher) As discussed

comp-in Featured Case 1.1, such an organization may also see lower tivity from both the preferred subset of workers and those who are notpreferred

produc-In addition to Fortune’s annual issue on the best companies forminorities, DiversityInc, Working Mother, Latina Style, Catalyst, theAmerican Association of Retired Persons (AARP), Hispanic Today, andother entities routinely publish lists of best companies for women, minor-ities, parents, and other groups These reports are widely read andprovide substantial publicity for the companies that make, or fail to make,the lists The high level of attention from the media may affect applicants’interest in companies as well as companies’ ability to market to diverseconsumer groups

MarketingCox and Blake proposed that an organization’s reputation for valuing alltypes of workers will also affect its ability to market to different types ofconsumers This is accomplished in multiple ways First, consumers whoappreciate fair treatment for everyone will be more likely to patronize anorganization known to value diversity and to treat all workers fairly andless likely to patronize organizations known to discriminate Employersknown for contributing to particular organizations (such as the UnitedNegro College Fund or the Human Rights Campaign) receive recognitionfrom those organizations and their patrons This recognition may trans-late into purchases and customer loyalty

Second, having employees who are from various backgroundsimproves a company’s marketing ability because such organizations will

be better able to develop products that meet the needs of and appeal todiverse consumers After a period of declining sales and profits, AvonProducts was able to successfully market to Blacks and Hispanics byincreasing their representation among marketing managers Avon’s profit-ability increased tremendously as a result

Third, organizations with employees from various backgrounds mayalso be more likely to avoid expensive marketing blunders associated with

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having homogeneous advertising or marketing teams In the early history

of Frito-Lay’s Frito’s corn chips, the major focus of its advertising was thecharacter Frito Bandito, who was known for stealing Fritos because theywere so good that he was unable to resist The character had a heavy

F EATURED

C ASE 1.1 Case Study of Fictitious Company, Inc.

Assume that people from demographic groups A

and B are employed at Fictitious Company, Inc.

Both A Workers and B Workers have a similar

number of excellent performers and poor

performers in their group Workers from both

groups expect fair performance evaluations, pay

raises, and promotions based on their

performance After a period of working for and

excelling in performance, high-performing B

Workers realize that despite their high

qualifications and strong performance, their

performance is rated lower than that of A

Workers, their pay raises are lower, and they

are not likely to be promoted This perception is

validated when B Workers consider the

management and executive levels of Fictitious

Company and see very few people from the B

Workers category in those levels What is the

expected result on motivation and future

performance of high-performing B Workers?

Low- and average-performing B Workers are

observing They realize that high-performing B

Workers, despite their high performance,

receive low performance ratings and few-to-no

raises and promotions What is the expected

effect on the motivation to work harder and the

future performance of low-performing B Workers?

After a period of employment at Fictitious

Company, A Workers realize that they are

continually rated highly and receive pay raises

and promotions regardless of their performance.

If they make their sales and quality goals, they

receive high raises and are promoted If

they miss their sales and quality goals, they

remarkably receive high raises and are promoted If they are chronically late or absent

on Mondays and Fridays, there are few-to-no negative consequences What is the expected result on future performance and motivation of

A Workers who are truly good performers but observe A Workers who miss sales and quality goals still being promoted and rewarded? What

is the expected result on the motivation to improve and the future performance of A Workers who are low performers but receive rewards nonetheless?

To summarize, at Fictitious Company, performing B Workers receive clear messages that their high performance is not valued Low- performing B Workers receive messages that there is no reason to strive for high performance because people like them receive no reward for high performance A Workers receive messages that their low and high performers are valued and rewarded similarly, so there is no need to strive for excellence What is the result of this scenario for the overall performance and competitiveness

high-of Fictitious Company, Inc.?

Contrast this scenario to that of Fictitious Savvy Company, Inc., in which members of A Workers and B Workers expect, and receive, fair performance evaluations, promotions, and raises What is the expected result on the future motivation and performance of high, average, and low performers among A Workers and B Workers in Fictitious Savvy Company, Inc.? What

is the expected result on the organizational performance of Fictitious Savvy Company?

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accent, his appearance was stereotypical, and the portrayal of Latinos asstealing was insulting Complaints from Latinos resulted in Frito-Lay’sdiscontinuing Frito Bandito.34

Though not an advertising blunder, American Airlines’ Latin AmericaPilot Reference Guide, an internal document, once caused the companynegative publicity that could have affected its ability to market to Latinoconsumers (and other groups) The guide reportedly warned pilots thatLatin American customers would call in false bomb threats to delay flightswhen they were running late and that they sometimes became unruly afterdrinking too much on flights When news of the statements in the refer-ence guide hit the press, the airline apologized and stated it would revisethe manual.35

Creativity and Problem SolvingResearch indicates that groups composed of people from different back-grounds bring with them differences that result in greater creativity andproblem-solving ability These abilities stem from the different life experi-ences, language abilities, and education that groups composed of diversemembers have Empirical research also supports the idea that diversitypositively affects group performance, creativity, and innovation In longi-tudinal research, Watson, Kumar, and Michaelsen investigated the effects

of diversity (in race, ethnicity, and nationality) on group performance

Following diverse and homogeneous groups of students over the course of

a semester, these authors found that, initially, the homogeneous groupsoutperformed the diverse groups By the end of the semester, however,the performance of the diverse groups exceeded the performance of thehomogeneous groups After learning to interact with each other, the diversegroups developed more and higher-quality solutions to problems than ho-mogenous groups, exhibiting greater creativity and problem-solving skills.36McLeod, Lobel, and Cox have empirically investigated the effects ofracial diversity on idea generation in small groups Using brainstormingtechniques (which are commonly used in organizations for developingnew ideas), they found that groups composed of diverse membersproduced higher-quality ideas than groups composed of homogenous

August 12, 2010.

123(8): 57.

36

of Management Journal, 36: 590–603.

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members.37 As global competition increases, the ability to generate ior ideas is vital to success.

super-In his research on the logic of diversity, Scott Page, professor ofComplex Systems at the University of Michigan, used simple frameworks

to demonstrate how individuals with diverse problem-solving tools (as aresult of diverse backgrounds) are able to outperform others in problem-solving tasks.38As an example, two people with diverse backgroundswould choose to test different potential product improvements differently,increasing the probability of finding a useful innovation In problem-solving experiments, Page demonstrated how groups composed of diverseproblem solvers confronting a difficult problem outperformed groupscomposed of the best individual performers His research also showedhow combinations of different tools can be more powerful than the toolsthemselves

System FlexibilitySystem flexibility is the sixth reason for valuing diversity, in that it pro-vides organizations with a competitive advantage Cox and Blake arguedthat women have a higher tolerance for ambiguity than men Tolerancefor ambiguity is associated with cognitive flexibility and success in uncer-tain situations Bilingualism and biculturalism are indicative of cognitiveflexibility and openness to experience.39In the United States, Latinos andAsians are often bilingual and bicultural, Blacks tend to be bicultural, andNative Americans who have lived on reservations among their native cul-ture and also outside learn to navigate between two worlds.40In the manyregions of the world where the populations are multilingual and multicul-tural, cognitive flexibility, openness to experience, and navigating betweenworlds are common and are desirable diversity attributes In addition,although they are not traditionally perceived as bi- or multicultural, thelife experiences of some people with disabilities, gay males, and lesbiansmay provide them cognitive flexibility and openness to experience similar

to that of bi- or multicultural individuals Exposure to other cultures,languages, or the experiences and challenges of being different from those

Small Group Research, 27(2): 248–264.

Manage-ment Perspectives, 21(4): 6–20.

Theory.” Psychological Bulletin, 114: 395–412.

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in the majority may help individuals develop the flexibility and opennessnot possessed by others, which can be beneficial in diverse organizationalsettings.

Other Areas Where Diversity Can Be Advantageous

Cooperative behaviors Researchers have found that groups composed ofmembers from collectivist backgrounds (such as Asian, Black, and Latino)instead of individualist backgrounds (such as White/European American)displayed more cooperative behavior on group tasks.41In an increasinglyglobal and diverse environment, where cooperation is important to busi-ness success and where teamwork is vital, organizational diversity willtherefore be an asset

Interaction effects with organizational strategy Orlando Richard’s study

of the relationship between racial diversity and firm performance found

a complex interaction effect.42 Firms with a growth strategy (requiringinnovation, idea generation, and creativity) were more successful whenemployees were diverse Richard suggested that when firms have agrowth strategy, racial diversity increases productivity, which increasesfirm performance Thus, organizations might wish to actively seek outdiversity as a particular source of a competitive edge when pursuing agrowth strategy Although Richard did not test other aspects of diver-sity, diversity in gender, age, and other areas may also be advantageousfor high-growth firms In another study, researchers following firms overtime found that racial diversity had a positive, linear impact on long-term performance In companies with more than moderate levels ofdiversity, there was a positive effect on both short- and long-termperformance.43

Financial returns An association between effective management of sity and stock prices has been established by Wright and colleagues Usingsix years of data, they assessed the effect of positive publicity from affir-mative action programs (which they used as evidence of valuing diversity)and negative publicity from damage awards in discrimination lawsuits onthe stock returns of major corporations They found positive influences on

43

Manage-ment Journal, 28: 1213–1233.

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