Impact of Socio-cultural Diversity on Leadership

Dissertation – A study on the
impact of socio-cultural diversity
on leadership in an organization
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Abstract
In today’s business world, every organization is striving hard to attract and
retain the best of talents, as it is now clear, that it is the human resources who make
or break the organization. Workforce diversity is one such very eminent concept, and
it is the imperative for every organization to bring in and manage diversity in its work
settings. It was the aim of this paper, to understand how diversity in the form of
socio-cultural aspects impacts the organization’s leadership and other operations.
Diageo Plc was chosen as the target organization on which the primary research
was conducted. Diageo was selected, as it is one of the most diverse companies of
today – having presence in more than 180 countries and employing more than
30,000 individuals.
Primary research and secondary research were conducted. Secondary
research in the form of literature review was done, where journals, articles, books
and studies conducted by large corporate were analyzed and the findings presented.
Primary research was done in two modes – qualitative research and quantitative
research on the management executives and employees of Diageo. It was found
that, diversity impacts leadership, and it is inclusive leadership which helps in the
sustenance and improvement of such diversity in the work settings of Diageo Plc.
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Table of Contents
Abstract................................................................................................................... 2
Table of Figures........................................................................................................ 5
Chapter 1. Introduction.............................................................................................. 6
1.1. Background.................................................................................................... 6
1.2. About the company.......................................................................................... 6
1.3. Research Rationale......................................................................................... 8
1.4. Academic Significance..................................................................................... 8
1.5. Positioning of the research................................................................................9
1.6. Research Aim................................................................................................. 9
1.7. Research Objectives........................................................................................ 9
1.8. Research Questions....................................................................................... 10
1.9. Structure of the dissertation.............................................................................11
Chapter 2. Literature Review.................................................................................... 12
2.1. Introduction................................................................................................... 12
2.2. Analysis....................................................................................................... 12
2.2.1. Workforce Diversity..................................................................................12
2.2.1.1. Advantages & Disadvantages.................................................................13
2.2.2. Leadership.............................................................................................. 15
2.2.3. Impact of diversity on leadership................................................................17
2.3. Conclusion.................................................................................................... 19
Chapter 3. Research Methodology............................................................................21
3.1. Nature of Research........................................................................................ 21
3.2. Research Design........................................................................................... 21
3.2.1. Research Methodology............................................................................. 21
3.2.2. Research Instruments............................................................................... 22
3.2.3. Data Collection........................................................................................ 23
3.2.4. Sampling Methods................................................................................... 24
3.3. Ethical considerations.................................................................................... 25
3.4. Reliability and Validity.................................................................................... 25
Chapter 4. Findings & Analysis................................................................................. 27
4.1. Qualitative Research Analysis & Findings..........................................................27
4.2. Quantitative Research Analysis & Findings........................................................31
4.2.1. Section A................................................................................................ 31
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4.2.2. Section B................................................................................................ 35
4.2.3. Section C................................................................................................ 37
4.2.4. Section D................................................................................................ 39
4.3. Final Inference.............................................................................................. 42
Chapter 5. Conclusion & Recommendations...............................................................44
5.1. Findings....................................................................................................... 44
5.2. Recommendations......................................................................................... 45
5.3. Construct Validity........................................................................................... 46
5.4. Assumptions & Limitations.............................................................................. 46
5.5. Scope for further research............................................................................... 47
Appendices............................................................................................................ 48
Appendix 1......................................................................................................... 48
Qualitative Research Questions............................................................................. 48
Appendix 2......................................................................................................... 49
Quantitative Research Questionnaire..................................................................49
Bibliography........................................................................................................... 54
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Table of Figures
Figure 1 - Gender Distribution of the QR2 Respondents...........................................26
Figure 2 - Age Distribution of the QR2 Respondents.................................................27
Figure 3 - Total Work Experience of the QR2 Respondents......................................27
Figure 4 - Total Association / Work Experience of the QR2 Respondents with Diageo
Plc...............................................................................................................................28
Figure 5 - Knowledge about Workforce Diversity.......................................................28
Figure 6 - Company supports Diversity & Inclusion...................................................29
Figure 7 - Adequate Initiatives present in the company for supporting diversity and
inclusion......................................................................................................................29
Figure 8 - Impact of Workforce Diversity....................................................................30
Figure 9 - Challenges which arise when diversity is not managed adequately.........31
Figure 10 -Important aspects of organization to bring about diversity and inclusion. 32
Figure 11 - Diageo Plc has adequate diversity policies.............................................32
Figure 12 - The leadership policies of Diageo are effective in bringing about diversity
and inclusion...............................................................................................................33
Figure 13 - Advantages of leadership at Diageo Plc..................................................33
Figure 14 - Whether diversity impacts leadership......................................................34
Figure 15 - Impact of Diversity on Leadership...........................................................35
Figure 16 - Whether leadership at Diageo Plc needs improvement..........................35
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Chapter 1. Introduction
1.1. Background
Diversity in the workplace is not just a mere impression of having individuals
from different genders, ages and races working with one another. It is a deep seated
concept which can push a company forward with innovative fresh ideas from a
shared group of experience, which otherwise one would not be able to grasp on
his/her own (Roberge & Dick, 2010). Workforce diversity does not act like a stamp,
which are carried by an organization but it is a realistic necessity of today, and it can
help a company survive and sustain in this increasingly competitive and connected
business environment. It is now a necessity in which all individuals hailing from
different ethnicities, social backgrounds, genders, ages, experiences, abilities work
together not for their own sake or for the sake of their own demographic classes, but
for the entire organization’s sake in which they are proud to be associated with
(Scroggins & Benson, 2010).
However, managing workforce diversity effectively and efficiently is not an
easy task, and requires specialized management strategies and leadership skills.
Diversities in employees and differences in their socio-cultural aspects, can leave an
impact on the manner in which an organization is governed and the manner of
leadership (Alcazar, Fernandez, & Gardey, 2013). How and to what extent such
socio-cultural diversities impact the leadership styles and skills in a multinational
organization, became the purpose of this paper.
1.2. About the company
Diageo Plc is a United Kingdom based multinational manufacturer and
distributer of alcoholic beverages and has been in operation since 1997.
Headquartered at London, the main products of this company is spirits, wine and
beer. The company owns over 200 brands some of which are – Smirn Off, Baileys,
Johnny Walker, Ciroc, Captain Morgan, Guinness Don Julio, Buchannan etc. The
company boasts of possessing a product line, which meets every category possible
in consumer demands – new or old, small or large, local or global etc. The products
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of Diageo are sold in more than 180 countries in every price points – starting from
very affordable to luxurious premium brands (Diageo Plc, 2018).
Though the business is comparatively new, but the principles on which the
business operates now has been led on the foundations created by the iconic figures
of this beverages industry – Elizabeth Cumming, John Walker, Arthur Guinness etc.
The company has been built on the inspiration of their philosophies, ideas,
determination and grit. The aim of Diageo is to become one of the most trusted and
best performing consumer product companies in the whole world. They feel they are
in a very strong position to achieve this, due to their scale of operations, wide
geographical diversity and the continuous desire to out-perform their own selves.
Diageo believes that innovation, and creativity have been central to their strategy of
growth, and they are extremely proud of their 30,400 employees working around the
globe to grow their business and nurture their brands, creating new categories and
products and developing newer experiences for their consumers (Diageo Plc, 2018).
The company has very strong values and commitments in place and they
attribute their success on these values and overall business philosophy. The work
culture of Diageo is deeply embedded in these values and sense of purpose. The
company believes in – being passionate about their customers and their consumers;
they work as a team and provide each other the freedom to succeed; they are proud
of what they do, and follow the highest standards of social responsibility and
integrity; they strive to be the best and are always improving and lastly, they value
each other and strive to create mutually beneficial partnerships and relationships.
As mentioned before, Diageo has more than 30,000 employees working all
around the globe together to nurture the business and grow their brands. The
company is focused on these employees’ personal and professional development
and ensures that the work culture is positive, intellectually stimulating and rewarding
for every individual who operates here. The company has a very vibrant and diverse
workforce, and they specifically look for individuals having a variety of personalities,
perspectives and experiences to create a very innovative and diverse work
environment which can provide everyone with a chance to flourish. The company
itself focuses its attention on achieving diversity in its workplace (Diageo, 2018).
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1.3. Research Rationale
Advancements in technology, the ever rising competition in business,
regulatory changes, the opening up of trade barriers together all of these have made
the whole world into one uniform place (Pollitt, 2005). Individuals now work in
organizations which have headquarters in other nations, people move around the
globe; individuals are connected with one another irrespective of how far they are
geographically situated. Though with globalization we are increasingly ceasing to be
different from one another but there is one aspect which differentiates each and
every one of us – and that is our culture (Parekh, 2002).
In such a backdrop, it was felt only logical to conduct a research on
how such diversities in work are managed effectively, and whether these socio-
cultural diversities impact specifically the leadership and its functions within an
organization. Diageo is chosen, as it is one of the largest organizations consisting of
a huge diverse workforce present throughout the 180 countries, in which the
company operates. Therefore, this organization can act as the right basis on which
the research can be done – as it has wide presence in a large number of countries
having different values, norms, cultures, social structures etc, and alongside it has its
management directing and working with diverse employees in its operations. Hence,
conducting this research on Diageo would help the researchers in gaining firsthand
knowledge about the implications of a diverse workforce and the ideal leadership
style and skills to manage such diversity effectively.
1.4. Academic Significance
The academic significance of this dissertation lies in the fact that, workforce
diversity is an aspect which has been thoroughly analyzed and studied in the last five
decades and with passing time this is gaining even more importance. However,
within a specific nation, employees can be diverse as they can hail from different
socioeconomic and other cultural backgrounds. A typical example can be taken of
United Kingdom, where due to repeated migrations there is mix of different ethnic
groups, religions etc present in the nation. The question arises, as to how to handle
such diverse groups of people, who might be apparently similar and coming from the
same place but inherently are different in terms of race, ethnicity, religion, family
values etc. Therefore, even when in a company there are no “expatriates” working or
employees hailing from other nations, still diversity exists and this paper intends to
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