Diversity management beyond the business case

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GUEST EDITORIAL
Diversity management beyond
the business case
Inge Bleijenbergh, Pascale Peters and Erik Poutsma
Institute for Management Research, Nijmegen School of Management,
Radboud University, Nijmegen, Netherlands
Abstract
Purpose – This paper aims to introduce the theme of the special issue – diversity management
beyond the business case. It addresses two main questions: first, how increased diversification within
workgroups or labour is dealt with via diversity management, and second what the effects are of this
increased diversity for group performance.
Design/methodology/approach – The different contributions are embedded into two important
discussions in the literature: problems with the concept of diversity and problems with outcomes of
diversity management.
Findings – Reflecting on the contributions to this special issue, it is argued that solely emphasizing
business case arguments for supporting the implementation of diversity management may be rather
risky. They conclude with a plea for emphasis on arguments of justice and sustainability of the
employment relationship and discuss future avenues for research.
Originality/value – The paper shows the difficulty of universally applying the concept of diversity
and diversity management. In addition, it shows that the claimed positive impact of diversity
management is contingent on several factors.
Keywords Equal opportunities, Team working, Team performance
Paper type Conceptual paper
This special issue emerged from the 16th annual conference of the International
Employment Relations Association (IERA), held at Nijmegen School of Management,
Radboud University Nijmegen, The Netherlands, July 2008. The conference theme was
‘‘Diversity and New Employment Relationship’’ and most contributions focused on
problems with the concept of diversity and the problems and outcomes of diversity
management. In this special issue, we selected the main contributions around this
theme. We introduce the theme shortly and embed the different contributions and end
with future perspectives.
Diversity management
Across firms in industrialized countries, demographic diversified workforces are
becoming increasingly common. With the changing gender relations and the aging
population in western societies and the increased amount of migrant workers moving
around the globe, labor organizations face increased diversity of the workforce. An
important question addressed in this special issue is how this increased diversification
within workgroups or labor is dealt with via diversity management, and second what the
effects are of this increased diversity for group performance. On the one hand, diversity
The authors thank the key note speakers and the participants of the 16th annual conference of
the International Employment Relations Association (IERA), held at Nijmegen School
of Management, Radboud University Nijmegen, The Netherlands, July 2008 for the lively
debate on diversity management. They thank the editor of EDI, Mustafa O¨ zbilgin, for his
support, as well as all anonymous reviewers who helped develop this special issue.
Management
beyond the
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Equality, Diversity and Inclusion: An
International Journal
Vol. 29 No. 5, 2010
pp. 413-421
# Emerald Group Publishing Limited
DOI 10.1108/02610151011052744
2040-7149
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management may foster the attainment of the organization’s strategic goals. As a
‘‘business case,’’ diversity is believed to engender competitive advantage by establishing
a better corporate image, improving group and organizational performance and
attracting and retaining human capital. On the other hand, diversity management aims
for social justice. By advancing individual development and inclusion of different
employee categories, diversity management supports equal opportunities. In addition,
diversity management may also support claims of long-term sustainable employment.
Reflecting on the contributions to this special issue, we argue that solely emphasizing
business case arguments for supporting the implementation of diversity management
may be rather risky. Therefore, this special issue’s Introduction concludes with a plea for
emphasis on arguments of justice and sustainabilityof the employment relationship.
With addressing the two main questions of this special issue mentioned above, we
adopt a comparative and critical approach to diversity management. ‘‘Comparative’’ in
the sense that we compare the use of diversity management in different countries;
addressing the adoption of the concept and the adoption to the local contexts. ‘‘Critical’’
in the sense that we do not take for granted that diversity management is indeed the
best way to address demographic differences and to improve inclusion as well as
performance in labor organizations. Rather, diversity management is critically
evaluated. Therefore, this special issue addresses two main themes. Firstly, tensions
in the implementation of diversity management are scrutinized and, secondly, the
effectiveness of diversity management in diverse contexts is addressed.
Implementing diversity management
Principle problems
The concept of diversity management, which is originally developed in the USA, is
implemented in a variety of national contexts with diverse results (Egan and Bendick,
2003; Nishii and O¨ zbilgin, 2007). This US origin may also have had an impact on the
concept of diversity management and the practices that are covered by it. There are
different meanings attached to diversity management. Narrowly defined, diversity
management can be viewed a successor of the traditional affirmative action or equal
opportunities programs used in some countries, focusing on specific social groups
defined by sex, ethnicity/race and age, rather than on individuals. This narrow
definition of diversity primarily focuses on the recruitment regulations and procedures
of organizations. In contrast, using a broader definition, diversity management is a
more inclusive approach towards attracting new personnel, proposing a broader
understanding of individual differences that also includes factors such as sexual
orientation, skills and experience. Of course, the different definitions and related
perspectives influence the problems of implementation and the rules and arguments
guiding the development of diversity management.
A basic problem regarding the implementation of diversity management is that its
approach sometimes does not fit the interpretations of equity and equality that prevail
in national or local contexts. Special treatment of diverse groups may be adequate
according to the principles of diversity management, but may be considered unjust
according to local traditions and jurisdiction of equal treatment. Of course, this has a
major impact on the implementation process. This special issue shows how this results
in tensions among managers and employees about the implementation. Sometimes
these tensions also engender resistance to the implementation of diversity policies.
This resistance especially appears when implementation is supported with the
ambiguous term ‘‘equality.’’
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The concept of equality is essentially contested. In relation to the concept of
diversity, different and sometimes even opposing interpretations of equality can be
given (Bacchi, 1990). To illustrate this debate, below we present an overview of three
possible, very different interpretations of the concept of equality.
Firstly, equality can be considered as giving the same treatment of diverse groups.
Diverse groups are treated in a similar, standardized way, notwithstanding eventual
differences in starting positions. Although this suggests an alleged fairness, it prevents
a policy directed towards certain underrepresented and structural marginalized groups
(Bacchi, 1990).
Secondly, equality can be interpreted as different treatment to reach equal outcomes
in terms of group representation. Specific groups are compensated for their backward
position in organizations or in society by being given preferential treatment to enter
certain positions or to being promoted. In fact, this is opposite to the first interpretation
of equality and it faces possible feelings of unfairness amongst certain groups which
may hinder implementation of policies (Bacchi, 1990).
There is also a third interpretation, that is, equality as meritocracy. Here the basic
principle is that individuals are treated equally, but that individual talents and merits
are the basis for extra support and preferential treatment given by the organization. In
contrast to the second approach, extra support is not given to reach equal outcomes
on group level, but to give equal chances on the individual level. This approach may
cause jealousy between the individuals involved.
These three interpretations of equality may have different consequences for the
opportunities organizations can give regarding extra support for specific individuals
or groups. In the same treatment approach, different treatment of any individual or
group is forbidden. In the different treatment approach, different treatment of groups is
only allowed to reach equal outcomes. In the meritocracy approach, only equal
entrance to special treatment has to be guaranteed for persons with the same merits.
Practical problems
As we address in this issue, the implementation of diversity management not only
encounter principal, but also practical problems. One of these issues is the situation of
the diversity management program in the whole personnel policy of a firm. As several
papers in this issue illustrate, in different national contexts, diversity management is
only scarcely connected to the general Human Resource System. In that case, diversity
management represents extra, additional policies on top of the Human Resource
System in place, rather than an approach that is integrated in the heart of personnel
management. This lack of ‘‘diversity mainstreaming’’ may cause a bureaucratic and
defensive implementation, rather than a flexible and proactive implementation.
Examples of such a limited implementation can be found in the British public sector as
presented by the contribution of Harris and Foster and in the Dutch private sector,
presented in the contribution by Heres and Benschop and by the study of Peters, den
Dulk and de Ruijter in the Netherlands, UK and Sweden.
For example, in the UK, tensions in the implementation of diversity management are
related to the dominant culture in the sector where diversity management is performed.
As Harris and Foster indicate that this culture opposes special treatment of persons
from underrepresented groups, while such a special treatment might be needed to
support their upward mobility towards leadership positions. Obviously, the principle
of neutrality is dominating the implementation of equality policies and diversity
management in the UK public sector. In this sector, there is a common belief that
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equality is best achieved by eradicating differences in treatment. However, Harris and
Foster show that this approach encourages defensiveness and bureaucratic behavior
rather than the flexible and proactive approach that is needed.
Diversity management is performed via talent management programs for which
individuals are proposed via self-selection. This system is based upon the meritocracy
argument. However, the researchers indicate that relatively fewer women and ethnic
minorities may see it as feasible to do the extra investment of a talent program. This
shows that self-selection does not always work for all groups of employees, although
employers experience the open character of self-selection as legitimate.
Moreover, individuals who are not selected identify themselves as not talented,
which would negatively affect their motivation. So, indirectly these programs work as
exclusionary. In addition, there are negative constraints regarding the fact that
development of individuals in a management program is detrimental to the costs of the
majority. Moreover, when individuals are involved in the talent program they are
considered a temporary loss of their performance to the team.
Also in the Netherlands, the dominant interpretation of equality defines how
diversity management is implemented. Considering diversity management as a
discourse, Heres and Benschop analyze corporate communication through
international and Dutch websites of ten leading companies in the Netherlands and their
annual reports as statements on diversity, diversity management and equality. The
meritocratic foundation of the diversity management discourse, stressing the added
value and unique contribution to the organization’s goals of every employee, fits in well
with the previous local policies on equality.
Heres and Benschop’s findings suggest that business case arguments make the
diversity programs selective, partial and contingent, focusing mainly on gender and
ethnicity issues. In fact, the translation of diversity management in the Dutch context
has neither challenged nor replaced the traditional local discourse of meritocracy
and equality. Heres and Benschop conclude that diversity management is rather used
as an approach to increase the acceptance for pre-existing target group policies, by
stressing the equality discourse. The lack of focus on individual differences increases
stereotyping and reduces inclusion of all workforce categories.
These findings show that the Dutch translation limits the effectiveness of the
diversity management initiatives, especially since diversity is still portrayed as
minority and women’s issues, and stereotypes are still being (re)produced. Moreover,
diversity statements are often not backed up by substantive firm-wide policies and
structures, and, therefore, no fundamental change to the way organizations deal with
issues of equality and diversity may come about.
Effectiveness of diversity management
The second theme addressed in this special issue is the extent to which diversity
management is effective? Scholars and policy makers using business case arguments
claim various advantages for organizations that are able to increase the team diversity
in their organizations. But under what conditions do diversity measures really live up
to their fullest potential?
Measuring effectiveness of diverse teams is methodologically complicated, as the
contribution by Haas shows. First of all, due to the variety of factors and
operationalization outcomes of different studies are hard to compare. In addition, most
studies do not take relevant moderating context variables into account. Finally, test of
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non-linearity is not always performed, while interaction terms with context and nonlinearity are highly relevant in order to arrive at results meaningful for practice.
Therefore, in this special issue, also the role of ‘‘context’’ in explaining the effects of
diversity management is addressed, particularly in the contributions of Haas and
Lo´pez-Ferna´ndez and Sa´nchez-Gardey.
Haas presents a literature review of research on team work and diversity, focusing
on the role of gender, age and ethnicity, respectively. He distinguishes between three
main theories that cover the relationship between diversity and team performance. The
first, frequently used in research on diversity, is the Social Identity Theory. Based on
Festinger’s earlier work (1954), this theory focuses on social identity development
resulting from individuals comparing themselves with other group members. This
social comparison may lead to positive or negative self-images and a desire to belong to
the group, or to leave the group. Between-group comparison (them vs us) strengthens
the ties between group members. In-group diversity may lead to the development of
subgroups which is detrimental to the performance of the overall-group.
The second theoretical perspective Haas distinguishes is the Similarity – Attraction
Theory (Byrne, 1971). Depending on demographic characteristics, individuals perceive
themselves as similar to other group members, which fosters trust and mutual
cooperation and interaction. The result is the emergence of subgroups, thus leading to
less effective functioning of the team at large.
The third perspective distinguished by Haas, frequently addressed by proponents
of diversity management, are the Information-Processing and Decision-Making
Theories (Gruenfeld et al., 1996). This perspective suggests that heterogeneity within a
group improves information exchange and enables decision-making. Members of
diverse groups have access to a great variety of resources using more diverse networks
than homogeneous groups would do. Note that this perspective emphasizes positive
outcomes of diversity, whereas the others tend to focus more on negative outcomes of
group structures and processes.
In his review of studies on the diversity – team performance linkage, Haas shows
that the first two perspectives are much more supported by the results of the empirical
studies reviewed than the third one. Most studies report negative outcomes of diverse
group structures and group processes. We may conclude, therefore, that the elegance of
the ‘‘information processing and knowledge diversity perspective’’ is defied by the
messy reality of interpersonal and group processes in organizations. In other words, we
experience a much more ‘‘tousled, emotional and political world of work’’ (Klein and
Harrison, 2007) or that the power of diversity meets the reality of diversity of power
and interest.
The role of context regarding the effectiveness of diversity management is
addressed by Lo´pez-Ferna´ndez and Sa´nchez-Gardey. Diversity is defined from a
multidimensional point of view, including both demographic diversity and human
capital diversity. On the one hand, the authors hypothesize that human capital diversity
may add value to group activity as it has the capacity to increase the workgroup’s
skills, knowledge and cognitive abilities to recognize problems and to find creative and
innovative solutions. On the other hand, demographic diversity is expected to affect
intra-organizational social relationships and social processes negatively and, therefore,
to lead to a loss of trust and reciprocity. In their theoretical framework, Lo´pezFerna´ndez and Sa´nchez-Gardey stress that diversity does not influence organizational
or group performance directly, but indirectly through particular workgroup processes,
such as decision-making processes. In fact, different configurations of HRM-practices
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may affect workgroup dynamics differently, and, ultimately, may have different effects
on workgroup performance and sustainable competitive advantage. Consequently, in
order to profit from diversified workgroups, organizations may need to adjust their
Strategic HRM systems. The authors question, therefore, the conditions under which
workgroup diversity actually leads to better workgroup performances, particularly
since Lo´pez-Ferna´ndez and Sa´nchez-Gardey distinguish between three different
Strategic HRM-orientations. The first is labeled the individualistic control orientation,
referring to an orientation which is characterized by: (i) a focus on individuals rather
than on workgroups, (ii) rigid control mechanisms and little self-control within
workgroups; and (iii) a strong market orientation for achieving human capital rather
than emphasizing the intra-organizational development of human capital. The second
orientation is labeled the group development orientation characterized by: (i) a strong
focus on workgroups rather than on individuals; (ii) a system of open and flexible
HRM-practices, which allow self-control within workgroups; and (iii) a focus on intraorganizational development of human capital. The third HRM-orientation is labeled the
group control orientation characterized by: (i) a strong emphasis on groups, (ii) rigid
external control mechanisms and little self-control, and (iii) a preference for external
markets to recruit employees and no stress on intra-organizational development of
human capital. Using data from 53 larger firms (>250 employees) operating in the
Spanish chemical industry and employing structural equation modeling, the authors
show that an individualistic control pattern hinders decision-making processes in
diversified groups. A group orientation, in contrast, in combination with either a selfcontrol orientation (empowerment), or with more rigid control mechanisms (both
orientations 2 and 3), fosters the cognitive dimension of social capital and, hence, highquality decision making. With regard to the relational dimension of social capital, only
the ‘‘group development orientation,’’ focusing both on building collective competences
and flexible management and control structures, was shown to reduce the unintended
consequences of demographic diversity on interpersonal relationships in the
workgroups, and, therefore, to foster the potential benefits of diversity. The authors
conclude that to foster cognitive benefits of diversity, a collective and interactive HRMorientation suffices to benefit from workgroup diversity. To mitigate relational
problems associated with diversity, however, flexibility, empowerment and intraorganizational development of human capital is also needed.
The contextual approach to workplace diversity policies and practices and,
consequently, inclusion and exclusion of particular groups in the work place is also
addressed in the paper by Peters, Den Dulk and De Ruijter. They discuss a totally
different aspect of diversity management, namely the work-life interface. Employees
increasingly demand for opportunities to work part of their contractual working hours
at home, using information and communication technologies to communicate with
others inside or outside their offices. This HR-practice may engender inclusion of
workers who have to combine work and family life in the work-place. In practice,
however, employees demand for home-based telework goes beyond the supply of
access to these facilities by their managers. As Peters, Den Dulk and De Ruiter argue
the adoption and diffusion of telework policies and practices falls short of expectations.
This mixed methods study amongst managers in financial service sector companies in
the UK, Sweden and the Netherlands tries to explain this situation by focusing on
managers’ arguments for or against home-based telework, and how these are weighed
in the telework-attitude formation process. Particularly, managers’ arguments
articulated in the semi-structured interviews reveal views of the employment
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relationship. Managers’ control and coordination arguments against telework appear
to be dominant, which mirrors managers to hold a traditional view of the employment
relationship as a governance relationship. Apparently, most managers basically fear
the loss of control over individual employees. However, the quantitative vignette study
shows that managers are inclined to allow some employees, particularly highly valued
and skilled workers, to work from home, for they fear a loss of commitment to the
organization if they would not grant the individual workers’ telework requests.
Obviously, not all employees are trusted equally, which reveals that managers do not
consider the employment relationship as a cooperation relationship. Strikingly, in this
study, managers in governmental organizations hold more positive attitudes than
managers in the private sector.
The particular contribution of Peters, Den Dulk and De Ruijter shows that diversity
management goes beyond managing a more diverse work-force, but is also connected
to managing the growing interface between work and family life and its related policies
and practices being part of the HR-system. Moreover, the study shows that in most
cases telework is rather considered an ‘‘idiosyncratic deal’’ which may include some,
but excludes others, as home-based telework has to be negotiated individually with
managers. In other words, managers’ traditional view of the employment relationship
(i.e. the governance relationship) leads to new inequalities in the workplace.
Interestingly enough, this demands similar management skills and competences as is
needed with regard to managing diverse teams; namely flexibility, trust, and allowing
employees more job autonomy. Like Lo´pez-Ferna´ndez and Sa´nchez-Gardey’s study
focusing on the Spanish context, Peters and colleagues show that also in the northern
part of Europe, there is an increasing need for manager – employee relationships,
which are based on exchange and cooperation rather than coordination and control.
The need for a fundamental transformation of management styles seems to hold for
all western industrializes countries.