THE EFFECT OF WORKPLACE DIVERSITY ON ORGANIZATIONAL PRODUCTIVITY

Abstract

Workforce diversity includes the differences and similarities of the employees. Organizational performance is the extent to which the organizational objectives and goals are being achieved. Most business organizations fail in Nigeria because galvanizing diverse workforce to work as a team has been ineffective in terms of policy, training, exposure and approach to specific and overall goals. This has made profitability index difficult to measure in Nigeria. Despite the adoption of the employee diversity legislation by public institutions, the impact of the diversity programs at the organization level still need to be identified since these programs are executed deliberately by human resource managers, and may have varied adaptations and unintended consequences. The study categorised employees diversity under the categories of skills diversity, values diversity and social diversity. The study targeted the employees of selected state corporations using simple random sampling technique. The study adopted a descriptive survey design. Primary data was collected via structured questionnaires using the “drop and pick” method. The data was analyzed using both descriptive statistical measures. Employee diversity was found to affect customer satisfaction, market share, employee satisfaction, labour costs and employee performance with the most significant impact being on employee performance.

CHAPTER ONE

                                                INTRODUCTION

• Background of the study

The workforce is defined as the totality of the people working in an organization (Hornby 2005). Workforce diversity is defined by Kreitner and Kinichi (2004) as the multitude of the individual differences and similarities that exist among the people working in an organization. There is growing recognition on a global basis of the undeniably critical role that human capital plays in the sustainability of organizations in all sectors of business and community-related activity. In the resource-based view of the firm, human capital is frequently assumed to contribute to competitive advantage due to its inimitability based on its intangible, firm-specific, and socially complex nature. Consistent with this view, investments in firm-specific human capital have a significant impact on learning and firm performance. Empirical evidence exists that demonstrates of the inimitability of human capital unlike other firm tangible or intangible assets that contribute to a firm’s competitive advantage (Nile & Dyer, 2004). This definition is chosen because it underscores three important issues about managing workforce diversity, namely that there are many different dimensions or components of workforce diversity. This implies that workforce diversity pertains to everybody in the organization. It is not an issue of demographic characteristics such as age, race, or gender (Thomas, 2016). In other words, it pertains to the host of the individual differences and similarities that make all the workers in the organization unique and different from the others. In other words, workforce diversity is not synonymous with the differences of the workers. Rather, it encompasses both differences and similarities. This means that managing workforce diversity entails dealing with both simultaneously (Thomas, 2016). Thus, workforce diversity includes the collective mixture of differences and similarities of the workers. Dealing with workforce diversity requires managers to integrate the collective differences and similarities. Both of them have to be properly examined, determined and established (Thomas, 2016). Harold and Kumar (2012) pointed out that in organizational performance index, diversity should capture practices that involve understanding and appreciating interdependence of humanity, culture, and the natural environment; practicing mutual respects for qualities and experiences that are different from our own; understanding that diversity includes not only ways of being but also ways of knowing; recognizing that personal, cultural and institutionalized discrimination creates and sustains privileges for some, while creating and sustaining disadvantages for others; and building alliances across differences in other for people to work together to eradicate all forms of discrimination. Cultural differences are experienced as essential, natural, and joyful enabling the organization to enjoy diversity. Diversity in population and workplace is unavoidable fact and no manager can afford to ignore it in the organizational life. Organization always strives to attain and maintain best human talent. Individuals enter in the organization with unique characteristics and they perceived the world through these diverse attributes. Demographic composition of the Pakistan’s population is dramatically changed in last two decades. Rural population migrated to urban sites in search of job. They belong to different socio-cultural back ground. These demographic changes present a new set of challenges for the management particularly in public sector organizations. In case organization ignores the management of workplace diversity, it will eliminate trust, mutual understanding, co-operation and respect amongst employees which adversely affect employees’ performance. Organization always strives to enhance the productivity of its worker by valuing and appreciating their diverse contribution toward achievement of goals. Diversity may be referred as admitting, appreciating, understanding, recognizing, valuing, and enjoying divergence among worker (Kreitz, 2008). Workplace diversity states specific similarities and differences of the employees. It consists of age, working environment, gender, perceptions, ethnicity, marital status, region, work experience, sexual alignment, income, nationality with each other, which support to organizational essential values (Bassett, 2015). Constructive and destructive impact of diversity connected with the performance of worker in any enterprise. Miliken and Martins (2016) are proponents of positive outcomes of workplace diversity like broader perspectives. While Alserhan, Forstenlechner & Al-Nakeeb, 2010 state detrimental effect because of problem of group consistency.

• STATEMENT OF THE PROBLEM

Human capital is the organization’s resource that cannot be duplicated by other organizations. The Human capital comes from a pool of workforce that brings diverse skills, backgrounds and experiences all of which contribute to the success of an organization. Anderson and Metcalf ( 2003) identify three different categories of employee diversity: Social category diversity relates to differences in demographic characteristics; Informational diversity refers to diversity of background such as knowledge and functional background; and Value diversity includes differences in personality and attitudes. Every organization that embraces management of workforce diversity enjoys more creative decision making, satisfying work environment, and better products because all employees are involved and feel encouraged to contribute in a meaningful way. This yields a knowledge base due to knowledge sharing and improved performance (Munjuri, 2012). However, Kochan (2003), finds no significant direct effects of either racial or gender diversity on business performance and stipulates that gender diversity has positive effects on group processes while racial diversity has negative effects. In a research on Workforce Diversity Management and Employee Performance in the Banking Sector in Nigeria by Munjuri and Maina (2013), it was found out that cultural diversity management seems more sensitive in the Bank and served a pivotal role. Another study by Kundu (2001) in his research on Managing Cross Cultural Diversity concluded that organizations with high levels of well managed diversity are effective in steering corporate cultures that have new perspectives, pioneering capabilities and fresh ideas necessary to survive. Jerono (2012) studied the participation of women in University leadership and noted that women involvement in leadership was below one-third of the constitutional requirement and was only concentrated in the lower hierarchy of university leadership. However, despite several studies that have been conducted on workplace diversity, none of these studies focused on the effect of diversity on organization performance in state corporations in Nigeria.

• OBJECTIVE OF THE STUDY

The study has one main objective which is sub-divided into general and specific objective, the general objective is to examine the effect of workplace diversity on organizational productivity. The specific objectives are;

1. To examine the effect of workplace diversity on organizational productivity in Nigeria
2. To ascertain if there is any significant relationship between workplace diversity and organizational productivity

• To access the effect of employees’ values diversity on organization performance of selected state corporations

1. To proffer suggested solution to the identified problem
   • RESEARCH QUESTIONS

The following research questions were formulated by the researcher to aid the completion of the study;

1. Is there any effect of workplace diversity on organizational productivity in Nigeria?
2. Is there any significant relationship between workplace diversity and organizational productivity?

• Does employees’ values diversity have effect on organization performance of selected state corporations?
  • RESEARCH HYPOTHESES

The following research hypotheses were formulated by the researcher to aid the completion of the study;

H₀: There is no significant relationship between workplace diversity and organizational productivity

H₁: There is a significant relationship between workplace diversity and organizational productivity

H₀: employees’ values diversity does not have an effect on organization performance of selected state corporations

H₂: employees’ values diversity does have an effect on organization performance of selected state corporations

• SIGNIFICANCE OF THE STUDY

The purpose of this study was to examine the effect of workplace diversity on organization productivity. The study findings will be useful to state corporations’ management as it will inform design and implementation of employees’ diversity programs in the organizations by outlining best practices that can further the impact of these programs on organization performance. The finding of this research will also be used by other organizations and the government to further best practices in employees’ diversity management through building sustainable diversity management models and programs. Additionally, the study will stimulate further interest and more studies in the area of workplace diversity at the work place especially in Nigeria.

1.7 SCOPE AND LIMITATION OF THE STUDY

The scope of the study covers the effect of workplace diversity on organizational productivity, but in the course of the study there were some factors limiting the scope of the study.

There are limited studies in the area of employee diversity in Nigeria since existing research has focused mainly on developed economies. It is crucial to examine employee diversity in the context of developing economies.

AVAILABILITY OF RESEARCH MATERIAL: The research material available to the researcher is insufficient, thereby limiting the study

TIME: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

FINANCE: The finance available for the research work does not allow for wider coverage as resources are very limited as the researcher has other academic bills to cover.

• OPERATIONAL DEFINITION OF TERMS

Workplace

Workplace is an online collaborative software tool developed by Meta Platforms. It facilitates online group work, instant messaging, video conferencing, and news sharing.

Diversity

It is a combination of our differences that shape our view of the world, our perspective and our approach

Organizational productivity

Organizational productivity: Capacity of a business to produce desired results with a minimum expenditure of resources (time, money, human resources).

1.9 ORGANIZATION OF THE STUDY

This research work is organized in five chapters, for easy understanding, as follows

Chapter one is concern with the introduction, which consist of the (overview, of the study), statement of problem, objectives of the study, research question, significance or the study, research methodology, definition of terms and historical background of the study. Chapter two highlight the theoretical framework on which the study its based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding.  Chapter five gives summary, conclusion, and recommendations made of the study.