5.

HRD & Diversity

1. Introduction

 Thomas defines managing diversity as “a comprehensive

managerial process for developing an environment
(organizational culture) that works for all employees.”
 This approach goes beyond both affirmative action and valuing
diversity because it focuses on building a positive environment for
everyone and on full utilization of the total workforce.
 It does not exclude women or minorities, nor does it exclude
whites or males. It is an attempt to create a level playing field for
all employees without having regard for cultural distinction
 Managing the diversity approach requires
 a long- term commitment to change;
 substantive changes in organizational culture;
 a modified definition of leadership and management roles;
 both individual and organizational adaptation; and
 Structural changes.

 It's important to understand how these dimensions affect

performance, motivation, success, and interactions with others.
Institutional structures and practices that have presented barriers
to some dimensions of diversity should be examined, challenged,
and removed
 Managing diversity 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.
 Managing diversity well provides a distinct advantage in an era
when flexibility and creativity are keys to competitiveness.
 An organization needs to be flexible and adaptable to meet new
customer needs.
 Heterogeneity promotes creativity and heterogeneous groups
have been shown to produce better solutions to problems and a
higher level of critical analysis. This can be a vital asset at a time
when the campus is undergoing tremendous change and self-
examination to find new and more effective ways to operate.
 With effective management of diversity, the campus develops a
reputation as an employer of choice. Not only will you have the
ability to attract the best talent from a shrinking labor pool, you
can save time and money in recruitment and turnover costs..
 Managing diversity focuses on maximizing the ability of all
employees to contribute to organizational goals. managing
diversity emphasizes business necessity.

2. Organizational culture
 Organizational culture is a system of shared assumptions, values,
and beliefs, which governs how people behave in organizations.
 These shared values have a strong influence on the people in the
organization and dictate how they dress, act, and perform their
jobs.
 Every organization develops and maintains a unique culture, which
provides guidelines and boundaries for the behavior of the
members of the organization.
 Let's explore what elements make up an organization's culture.
 It includes a shared perception of reality, regarding how things are
and how things should be.
 Furthermore, community and group culture determine the
willingness and conditions for knowledge sharing with other
members of the organization.

Culture is how organizations ‘do things’.” —

Robbie Katanga

 Knowledge, and knowledge sharing, are thus inseparable from

organizational culture.
 Culture also provides guidelines regarding training & development
of the employees. It is the surrounding in which employee and
organization connects each other.

Types of organizational culture

The basic types of organizational culture are

bureacratic

clan

enterpren
market
eurial
A. Bureaucratic Culture:

 In this type of culture the behaviour of employees is governed by

formal rules and standard operating procedures.
 Such a culture perpetuates stability
 Organizations with bureaucratic culture tend to produce
standardized goods and services, examples: Government
ministries Fast food establishments

B. Clan Culture:

 In a clan culture the behaviour of individuals are shaped by

tradition, loyalty, personal commitment, extensive socialization
and self-management.
 A clan culture achieve unity through socialization. Long-term
employees serve as mentors Members are aware of the
organization’s history and have an understanding of the expected
manner of conduct and organizational style.
 Members share feelings of pride in membership. Peer pressure to
adhere to important norms is strong

C. Market Culture:

 In a market culture, the values and norms reflect the significance

of achieving measurable and demanding goals mainly concerning
those that are financial and market based.
 Companies with a market culture tend to focus on Sales growth
Profitability Market share In a market culture the relationship
between individuals and the organization is contractual
(previously agreed).
 Individuals are responsible for their performance; whereas the
organization promises specific rewards for levels of performance.
 Managers are not judge on their effectiveness as role models or
mentors; but on monthly, quarterly, and annual performance
goals based on profit.
D. Entrepreneurial Culture:

 Organizations existing in the context of an entrepreneurial culture

are characterized by high levels of risk taking and creativity.
 There is a commitment to experimentation, innovation.

2.1 Building a strong organizational culture:

 A common behavioral style must be shared by managers and

employees.
 Have the same basic approaches to solving problems, meeting
goals, and dealing with stakeholders.
 Have share common norms that guide rule governing rewards and
punishment.
 A strong organizational culture assists in the creation of a stable
organization, the consequence of which lead to the achievement
of the company’s strategic goals.
 The top management people should become the positive role
models. They should set the examples through their own
behaviour.
 As employees learn the culture through stories, symbols and
rituals, the old stories, rituals and symbols should be replaced by
creating new ones which are currently in vogue.
 Adding new members, particularly at the higher level, is a
powerful strategy to change the culture, provided the new
members bring in new culture.
 The socialization processes should be redesigned to align with the
new values.
 Reward system establish and reinforce specific cultural behaviours
and therefore, a change in culture can be initiated and supported
by change in corporate reward systems.
 Unwritten norms and beliefs should be replaced with formal rules
and regulations that are tightly enforceable.
 Extensive use of job rotations should be made to shake current
subcultures.
 Change in the top management can have significant impact on
others in the organisation, because he may be, in a real sense, the
personification of the culture.
 Change in culture will be comparatively easy if peer group
consensus is got through use of employee participation and
creation of a climate with a high level of trust.

Factors which affect the organization culture:

A. Individual working with the organization.

 The employees in their own way contribute to the culture of the

workplace.
 The attitudes, mentalities, interests, perception and even the
thought process of the employees affect the organization culture.
 Example - Organizations which hire individuals from army or
defence background tend to follow a strict culture where all the
employees abide by the set guidelines and policies.
 The employees are hardly late to work. It is the mindset of the
employees which forms the culture of the place.
 Organizations with majority of youngsters encourage healthy
competition at the workplace and employees are always on the
toes to perform better than the fellow workers.

B. The sex of the employee

 The sex of the employee Also affects the organization culture.

 Organizations where male employees dominate the female
counterparts follow a culture where late sitting is a normal
feature.
 The male employees are more aggressive than the females
who instead would be caring and softhearted.

C. The nature of the business

 The nature of the business also affects the culture of the

organization. Stock broking industries, financial services,
banking industry are all dependent on external factors like
demand and supply, market cap, earning per share and so on.
 When the market crashes, these industries have no other
option than to terminate the employees and eventually affect
the culture of the place.
 Market fluctuations lead to unrest, tensions and severely
demotivate the individuals.
 The management also feels helpless when circumstances can
be controlled by none. Individuals are unsure about their
career as well as growth in such organizations.

D. The culture of the organization is also affected by its goals and

objectives.

 The strategies and procedures designed to achieve the targets of

the organization also contribute to its culture.
 Individuals working with government organizations adhere to the
set guidelines but do not follow a procedure of feedback thus
forming its culture.
 Fast paced industries like advertising, event management
companies expect the employees to be attentive, aggressive and
hyper active.

E. The management and its style of handling the employees

 It also affect the culture of the workplace. There are certain

organizations where the management allows the employees to
take their own decisions and let them participate in strategy
making.
 In such a culture, employees get attached to their management
and look forward to a long term association with the organization.
 The management must respect the employees to avoid a culture
where the employees just work for money and nothing else.
 They treat the organization as a mere source of earning money
and look for a change in a short span of time.
3. LABOUR MARKET CHANGES

3.1 INTRODUCTION

 A labour market in an economy functions with demand and

supply of labour. In this market, labour demand is the firm's
demand for labour and supply is the worker's supply of labour.
 The supply and demand of labour in the market is influenced by
changes in the bargaining power.
 Labor markets continue to be affected by three principal forces of
change: globalization of competition; technological advances; and
changes in the demographic structure of the workforce.
 Some industries, such as construction, are very sensitive and
prone to peaks and troughs, as well as significant regional
variations.
 Despite economists’ best efforts, some changes are not foreseen,
making some labour market predictions, especially in the long-
term, unreliable, and vulnerable to, for example, changes in
government policy or world events.
 Everyone needs to be aware of skill shortage areas and of the fact
that employers expect an increasingly better qualified workforce.
 Young people need to fulfil their academic
 Potential and develop strong employability skills to compete in
the job market.

Definition :

A labor market is the place where workers and employers interact

with each other. In the labor market, employers compete to hire the
best, and the workers compete for the best satisfying job
3.2 Important Classification of Labour Market suggested by Clark Ker is

a. The perfect market

 This kind of market is made up of a large number of relatively
small and undifferentiated buyers and sellers.
 There is a complete freedom of entry and exit, complete
knowledge and complete mobility of all resources within the
market area. Under such circumstances, the single price prevails
and the market is regularized.
b. The neo-classical market
 The neo-classical market recognizes the existence of
‘imperfections.’ The supply of skilled workers cannot be expanded
suddenly because it takes time for a worker to acquire skill.
 In spite of the imperfections, it is assumed that wages will tend
towards equality for workers in a given skill classification.
c. The natural market
 In the natural market, the typical worker has a very limited
knowledge of the market as a whole and unless he is unemployed
or just entering the labor force, he is not ‘actively in the market.’
 The workers’ knowledge of the labour market may be limited to
his own office jobs about which he has general information.
 Workers do not regularly weigh the advantages of the jobs they
hold against other alternatives.
 They also do not grudge against the employers not constantly
hiring and firing workers in an effort to find the greatest bargains
in the labour market.
d. The institutional market
 The institutional market is one in which the policies of unions,
employers and the government have more to do with wage
movements than free competitive forces. Indeed, the objective of
policies developed by all three unions, employers and the
government is to limit the free operation of the forces of demand
and supply.
 Institutional policies, rather than the market, set the upper and
lower limits of wages and these clearly reduce the mobility of
labor.
 Uniform wages are often found for a given grade of workers in
the institutions markets but this is because of the influence of
institutions and not a result of the interaction of demand and
supply.
e. The management market
 The management market, like the perfect market, does not exist
in the real world. The objective of management market would be
to tie the wage setting and labor movement more closely
together than they are in the natural market.
 This would proceed along with the imposition of state controls on
wage setting and on allocation of labour.
 The long run trend in India has been towards the institutional
labor^ market where the influence of demand and supply is
considerably curtailed by policies of unions, employers and the
government.
3.3 Forces of Change

1. Demographics-
 Labour force growth has slowed and a retirement bulge looms.
Female participation in the labour force has grown over the last
25 years, but has now plateaued.
 Immigration is increasingly relied upon to meet the demand for
skilled workers and support economic growth.
 The ageing of the labour force presents a key challenge. Will
skill needs be met? Will Canadians be able to realize their
aspirations (regarding learning, work, and retirement) in their
older years.
 Our ageing, ‘top heavy’ population has major implications for
the labour market – people will be working for longer. Young
people trying to launch careers will be competing against an
older, experienced workforce.
 There is increasing demand for scientists and health care
workers to deal with the implications of ill health in the elderly
2. Technological Change-
 Changes in technology have had a number of impacts on the
labour market. They have contributed to the shift in Canada’s
industrial structure away from primary and manufacturing
industries and towards services.
 Mass production systems (large scale, standardized methods,
highly delineated jobs) have been transformed into production
systems characterized by smaller scale, greater flexibility in the
organization of work, greater emphasis on skill, and flatter
hierarchies.
 Technological change has also increased the demand for highly
skilled work relative to that for less skilled work, a phenomenon
referred to in the economics literature as ‘skill-biased’
technological change. As a result of rapid technological change,
companies today face shorter business cycles and truly global
competition.
 Few industries are safe from disruption. Automation, facilitated
by better artificial intelligence, is poised to have a major impact
on jobs. Up to 47 percent of U.S. jobs in 2010 were rated as highly
likely to become computerized in the next 10-20 years.
 Even as old roles are swept away, technology is facilitating the
emergence of new work models that may help solve some of the
current labour market issues
 It is one of many solutions emerging and, as in times past, human
ingenuity enabled by new technologies will make our world more
prosperous for all.

3. Globalization

 The globalization of the economy has been characterized by:

 more mobile capital (resulting in part from greater protections for
foreign investors in trade agreements such as NAFTA or through
the WTO);
 freer trade in goods and services; enhanced mobility of highly-
skilled workers; enhanced mobility of Human Resource
Development –highly-skilled jobs (e.g., information technology
work for North American companies being located in Asia);
 Globalization, by making the markets for goods and services more
competitive, has heightened the need for economic and social
policies to foster competitiveness.
 It has also put a higher premium on workplace practices that
support flexibility and adaptability, such as multi-skilling,
teamwork, and pay-for-performance schemes.
 There is also evidence that globalization has contributed to a
reduction in wage differentials across countries for labour of
similar skill, but has (along with technological change) led to an
increase in wage inequality between lower and higher skill levels
within high-wage countries.
 Fortunately, the present dysfunction and apparent contradictions
are spurring changes. Rather than returning to business as usual
after the recession, the labour market is settling into a new
normal.
 If we chart our course well we can navigate the changing world of
work and unleash new employment opportunities and economic
growth for the Fourth Industrial Revolution.

i. Shifting demographics, dynamic workforces

 Trends like aging and declining birth rates mean the days of
abundant labour are drawing to an end in much of the world.
Sixty percent of people now live in countries with stagnant or
shrinking workforces.
 China’s working age population peaked in 2010; by 2050 more
than a quarter of its people will be over 65, up from eight percent
today. In Germany, the labour force will shrink by six million
workers over the next 15 years—this is one reason their
politicians are more open to migrants.
 Faced with labour shortages, employers and policymakers are
being forced to think differently about talent sourcing. In Japan,
where a quarter of the population is over age 65 (compared to 15
percent in the U.S.)
 A more intense search for talent is beginning, and we are already
seeing interesting people practices emerge. Aerospace
companies, faced with graying workforces, have pioneered
flexible working, phased retirements, “encore careers,” and a slew
of knowledge transfer programs to train the next generation.
 Companies that can’t find the talent they need in one country use
remote working to employ people elsewhere.
 Around the world, employers are experimenting with new policies
to better appeal to underrepresented groups—women, young
people, minorities, people with disabilities, migrants, etc.

ii. The rise of individual choice

 Theirs is a new mindset. Rather than hanging on to a job for life,

the goal today is to be employable to develop the skills,
experience and expertise necessary to move on or up, regardless
of your employer.
 Ideally, this gives people greater choice and flexibility to ride
career waves or slow down at different stages of their longer
working lives.
 As employers adapt to this workforce trend, wages and
opportunities will increasingly be dictated by skills, not tenure.
 they are able to manage their own careers and command higher
salaries. Helping this group to upskill is the defining labour
challenge of our time, and requires extraordinary efforts from
educators, policymakers and most of all employers.
 In the near term, individual choice is causing problems in the
labour market. Companies understandably ask: why should I train
you if you’ll leave and work for my competitor? However, with
talent shortages looming, the need to retain employees may soon
tip the balance back towards greater investment in development
programs. By providing learning opportunities, employers become
a talent destination.
 Focusing on employment for life, rather than protecting specific
jobs in companies, will increase workforce mobility, protect the
individual and encourage lifelong learning and development.
 people practices and work models. An uncertain transition state is
never easy, but we will ultimately emerge stronger for it.

4. Discrimination adapting to demographic changes

 Demographic change is the main reason organizations need to

adapt their practices in order to respond to increasing diversity
within labor markets.
 Diversity alters pools of potential employees, and the needs of
employees, as well as influencing broader business objectives like
service provision.
 In addition, the constantly changing demographic profile of the
broader population means that organizations need to develop
strategies that will meet the needs and desires of the country’s
citizens. In most countries there will be stakeholder groups
interested in workplace issues that include diversity.
 These include government agencies interested in work,
immigration, government employment bodies, industry groups,
human rights groups, trade unions, specialized stakeholder
agencies;
 These demographic changes will have profound implications for
organizations and managers in the coming decades.
 Implications include: the need to have better understanding and
awareness of different cultures including their practices and
religious beliefs;
 An appreciation of how diversity can benefit organizations; need
to implement flexibility in work whilst ensuring quality of work is
not eroded; the creation of non-discriminatory environments
within organizations; and better integration of work and life so
that workplaces are more family-friendly.
 Diversity brings business benefits. These include the following: the
development of economically beneficial partnerships; new
markets; legal compliance; products and services that are
culturally sensitive and appropriate;
 people who are adept at social networking and team-work; social
and environmental responsibility;
 A diverse workforce brings its own rewards in terms of increasing
cultural awareness, sensitivity and awareness in individuals and
firms.
 There are a number of demographics that can affect a business.
Demographics are various traits that can be used to determine
product preferences or buying behaviors of consumers.
 Most companies identify their key customers through these
various traits. They then target consumers with like characteristics
in their advertisements and promotions. Targeting consumers
with similar demographic characteristics helps maximize a
company's sales and profits.

a.Income Influence
 Income is one demographic variable that can affect businesses. A
company's products usually appeal to certain income groups. For
example, premium products such as high-end woman's clothing
usually appeal to women with higher incomes.
 Conversely, people with comparatively lower incomes are more
sensitive to price and, therefore, may prefer purchasing discount
products. People with lower incomes have less disposable
income.
 Value is a major determinant in the products they purchase.
Hence, a company may best reach lower-income people through
discount retailers and wholesalers and attract higher-income
buyers in specialty retail shops.
b.Age Variables
 Age is another demographic element that impacts businesses. A
company's products and services are more likely to appeal to
certain age groups.
 Younger people under 35 are often the first consumers to
purchase high-tech products like cell phones, electronic books and
video games. The millennial generation is increasing buying power
and growing market share while baby boomers remain a large and
viable group as well.
C.Geographic Region
 People's buying preferences also vary by geographic region,
which is another type of demographic. Those who meet
buyers' needs and requirements in certain geographic
regions can earn higher sales and profits.
 For example, people often prefer certain food and drink
flavors in certain markets. Companies that sell the flavors
consumers desire in various areas are more likely to profit.
Those who do not offer these flavors may risk losing
customers to other competitors.
Obtaining Demographic Information
 One of the best ways to collect consumer demographic
data is through market research surveys. These surveys
can be conducted by phone, mail, Internet or in person.
 The key is collecting as much demographic information as
possible. Other demographic variables, besides age,
income and geography, include household size, education,
occupation, gender, race and employment status.
 Most marketing research professionals include demographic
questions at the end of their surveys. Warranty cards are
another way to collect this information from customers.