Workplace Diversity In Modern Organizations – Benefits and Challenges

Diversity –What does it actually mean?

Diversity is classically defined as respecting, valuing, accepting and acknowledging differences among the people with respect to age, class, ethnicity, gender, race, physical and mental ability, sexual orientation, and spiritual practice. In business terms, diversity is defined as “one of the lenses through which we look at customer and community stakeholders”. Whatever be the type of business, an organization exists in the context of a global marketplace which is characterized more by differences among people than by similarity. Customers, clients, employees, vendors and others that any organization comes in contact on a regular basis are likely to come from various sections of the society. Either it be a retail shop or the more sophisticated e-commerce, the people in the business always encounter diversity on a regular basis.

Diversity – Why is it required?

With changing needs of the business in modern day scenario, the need for diversity is gaining attention in almost every organization. Diversity in workplace if managed successfully can be instrumental in financial success of any organization. A report on economic imperative of managing diversity concluded simply: “Organizations which excel at leveraging diversity (including hiring and advancement of women and people from different culture and race into senior management jobs, and providing a climate conducive to contributions from people of diverse background) will experience better financial performance in the long run than organizations which are not effective in managing diversity. The several other benefits of having a diverse environment in an organization are:

  1. More adaptability – Organizations with a diverse pool of talent can provide greater variety of solutions to problems in servicing, sourcing and allocation of resources. Employees from diverse backgrounds bring individual talents and experiences in suggesting ideas that are flexible in adapting to fluctuating markets and customer demands.
  2. Diversity in view-points – A diverse workforce that feels comfortable communicating varying points of view provides a larger pool of ideas and experiences. The organization can draw from that pool to meet business strategy needs and the needs of customers more effectively.
  3. Effective Execution – Companies that encourage diversity in the workplace inspire all of their employees to perform to their highest ability. Company-wide strategies can then be executed; resulting in higher productivity, profit, and return on investment.

In simple terms, diversity is beneficial for both employer as well as the employees. Diversity in workplace can reduce lawsuits, increased in marketing opportunity, recruitment, creativity and business environment. In an era where flexibility and creativity are keys to competitiveness, diversity is the new mantra for success of any organization.

Challenges of Diversity Management

Although diversity is of great benefit to any organization, managing the diverse force has many challenges associated with it. Diversity in workplace if not managed properly can be damaging to the organization. The challenges frequently encountered in diversity management are:

  1. Resistance – In any organization, there will always be a set of people who resist change. These people with their cynical attitude can damage morale, slow down the positive change and decrease productivity of any organization.
  2. Communication – Due to presence of people belonging to different ethnicities, age-groups, sexes and religion, the difficulty in communicating with each other can be a big barrier to the success of the diversity management. It’s easy to misunderstand someone who communicates differently. Misunderstanding leads to misinterpretation and poor office relationships.
  3. Disorganization – Implementing an unorganized diversity plan is nothing but just waste of money. Thus managers must have a proper diversity management plan before the implementation of the same.

Diversity – How and Why should it be properly managed?

According to Taylor Cox diversity management is defined as “planning and implementing organizational systems and practices to manage people so that the potential advantages of diversity are maximized while its potential disadvantages are minimized”. The organization with properly managed diversity always develops the reputation of organization of choice. In an era where it has become very difficult to cut down attrition rate, the organization with great diversity management program will always be able to retain the best talent from the ever shrinking labor pool. The managers of the organization must take following steps to manage workplace diversity.

  1. Fair is not same concept – It is a misunderstood common conception that “fairness” means treating everyone the same. With a diverse pool of people treating everyone in same manner does no good. For example, when employees have limited English language skills or reading proficiency, even though that limit might not affect their ability to do their jobs, transmitting important information through complicated memos might not be an effective way of communicating with them. In that case a manager must take the pain to help the persons who are not too good in English. This not only instills confidence in the employees but also improve the efficiency of the organization.
  2. Creating a “safe” environment to communicate – One important aspect in managing diversity is creating a safe environment for the people to communicate. Managers must implement policies to empower their associates. Also, associates should never be denied of any necessary and critical feedback required for their growth.
  3. Say no to personal prejudice – Managers must not allow their personal prejudice to take over their logical mind. Negative attitudes and personal favoritism can never help in managing workplace diversity.


A diverse force is an essence of modern day business organizations. In an era where flexibility and creativity are keys to the growth and development of any organization, properly managed diversity is the new born baby destined to win the bigger battles for the organizations. The companies must take into consideration the ways to manage the diversity program to extract the full potential of workplace diversity.

*This article is written by Vishwas Vats and Akash Bhatia(1st year, MHRM(2015-17)  


One comment

Dharmendra Singh

Nice read. Diversity is more than acknowledging differences between people. At organisational level, biggest challenge is implementation of diversity inclusion initiatives. Organisation need to have Talent acquisition, Employee policies, CSR and compensation aligned with diversity inclusion strategy. Also, maintaining diversity can be a daunting task.