Diversity Management and its Business Impact on CERA

This report provides a comprehensive business analysis of diversity management, emphasizing its necessity for organizations like CERA (Civil Engineering and Research Associates). It underscores the benefits of diversity, including enhanced performance, increased employee satisfaction and retention, and greater innovation. The report explores Human Resource Diversity Management (HRDM) practices for acquiring and maintaining a diverse workforce, covering recruitment, training, performance appraisal, and compensation. It recommends adopting a diverse workforce to CERA's CEO, Mark French, to achieve the company's mission of leading in smart construction solutions, highlighting how a supportive and inclusive environment can improve customer service and overall organizational performance. This resource, available on Desklib, offers students a valuable case study and insights into effective diversity management strategies.

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EXECUTIVE SUMMARY
This paper provides a business report on diversity. The study attempts to underscore the
necessity of diversity in the workplace such as better performance, employee satisfaction and
development, employee retention and greater innovation and creativity. The study also
unravels specific human resource diversity management (HRDM) practices that can be
implemented with the aim of acquiring and maintaining a diverse workforce. The report also
makes recommendations to Mark French, the CEO of CERA on the importance of adopting a
diverse workforce to achieve his mission of being a leader in the emerging field of smart
construction solutions.

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Table of Contents
EXECUTIVE SUMMARY........................................................................................................2
CHAPTER ONE: BACKGROUND INFORMATION.............................................................4
1.0 Introduction......................................................................................................................4
CHAPTER TWO: DIVERSITY MANAGEMENT AND IMPLEMENTATION
STRATEGIES............................................................................................................................5
2.1 Introduction......................................................................................................................5
2.2 Necessity of Diversity......................................................................................................6
2.2.1 Diverse Teams Perform Better..................................................................................6
2.2.2 Employee Satisfaction and Growth...........................................................................6
2.2.3 Employee Retention and Turnover............................................................................7
2.2.4 Greater innovation and creativity..............................................................................7
2.3 Implementation Strategies Using HRDM........................................................................8
2.3.1 Introduction................................................................................................................8
2.3.2 Recruitment and Selection.........................................................................................8
2.3.3 Training and Development........................................................................................9
2.3.4 Performance Appraisal..............................................................................................9
2.3.5 Compensation..........................................................................................................10
2.3.6 Occupational Development Practices......................................................................10
3.0 CONCLUSION..................................................................................................................12
4.0 RECOMMENDATIONS...................................................................................................13
References................................................................................................................................14

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CHAPTER ONE: BACKGROUND INFORMATION
1.0 Introduction
The objective of this report is to emphasize the impact of effective diversity management on
organizational performance and make recommendations to the Civil Engineering and
Research Associates (CERA). CERA is a civil construction consultancy company in Sydney
that was started in 2007. The organization target medium to large infrastructural projects in
Sydney. CERA is aimed at becoming a leader in the new innovative field of smart
construction solutions.
In order to accomplish its mission, CERA has engaged professional consultants who are
equipped with the necessary skills to undertake any construction project, have the right
attitude to work and focused on meeting the needs of the clients even beyond their
expectations. Additionally, the staff of consultants provides comprehensive services to ensure
total delivery. To sustain such quality of team, CERA attracts, rewards excellence and retains
the best of engineering employees that the market provides in addition to routine training
offered by the human resource department to equip their staff with the emerging techniques
to innovative construction solutions.
This report is structured in such a way that the first section is a discussion on the necessity of
diversity in the organization and its contribution towards improved customer service and
overall organizational performance. The second part will consider the implementation
strategies of managing diversity in an entity using HR functions. Then the report will give
recommendations to Mark French, the CEO of CERA on how to achieve the organization’s
mission through the implementation of diversity management.

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CHAPTER TWO: DIVERSITY MANAGEMENT AND IMPLEMENTATION
STRATEGIES
2.1 Introduction
Workplace diversity is defined by Briscoe, Tarique, & Schuler (2012) as the variety of
differences between the employees and the organization. Diversity is inclusive of individual
perception and how employees perceive each other. Workplace diversity can constitute a
race, gender, ethnic classes, belief, sexual orientation, age, among other distinctive variations
that exist between people.
Each organization adopts diversity at their place of work in their perspective to become more
innovative and flexible to change (Chen & Huang, 2009). The changing trends of the
workplace have led to more emphasis on improving workplace diversity and a significant
concern for the management. Because the management of a diverse workforce is still a
challenge to the managers, they are inclined to learn techniques required in a multicultural
setting.
The advantages of a diverse workforce cannot be overemphasized. It is the practice of the
leading firms to recruit competent staff from a diverse pool as this will lead to getting more
qualified candidates at a faster rate and low recruiting costs (Shen et al., 2009). At least there
is a diverse workforce in each organization because of globalization, a situation that calls for
effective management skills of a diverse workforce. This is because the management tries to
balance between creating a conducive work environment for the employees and meeting the
organizational objectives.
The workforce at CERA comprises of employees of varying skills combination with different
responsibilities working towards a common corporate objective of becoming a leader in the
new field of smart construction solutions. With a total of 45 qualified employees, the

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management should apply diversity management to ensure that the employees work in a
supportive environment, the customers that deal directly with these staff are satisfied with the
service, and the organization achieves its objective of leading the innovative and providing
customized quality customer service. Some of the primary benefits of managing a diverse
workforce are outlined below.
2.2 Necessity of Diversity
2.2.1 Diverse Teams Perform Better
Research has shown that cognitively diverse groups find solutions to issues much faster than
those that are not diverse (Kearney et al., 2009; Shin et al., 2012). The studies observed that a
high level of cognitive diversity led to improved learning and performance in situations that
were new, unpredictable and complicated. Also, when the staff is confident that their
company is committed and promotes diversity, it develops a feeling of inclusion in them and
the innovative ability increases as well (Shin et al., 2012).
The reason for the better performance of diverse teams is that first, they comprise of
individuals with varying experiences and exposure, and also they feel that all of them are
strangers and no preferences concerning the employee to approach for help. Thus they can
share knowledge widely and work toward a common goal of solving the issue at hand. The
employees also feel part of the team and that their contributions are of value thus developing
a feeling of uniqueness and belonging. Diversity also increases organizational performance
due to the individual performance of the diverse teams. Organizations with different
workforce can satisfy the demands of the customers, more so minority customers because a
diverse workforce can identify with their daily encounters (Shin et al., 2012).
2.2.2 Employee Satisfaction and Growth
A diverse workplace offers an opportunity for individual growth of the staff (Choi & Rainey,
2010). The exposure of the employees to new cultures, ideas and views, they intellectually

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reach out and develop a more precise insight of their stand in the international and local job
market. The more time they spend with co-workers with diverse cultures, the more they will
break down the subconscious hindrances of chauvinism and ethnicity, thus influencing
workers to become more experienced. Additionally, the more the staff knows, the more they
would like to know, and through working in different circumstances, the employees will learn
different styles of working in different cultures (Choi & Rainey, 2010).
2.2.3 Employee Retention and Turnover
Effective management of a diverse workforce will lead to employee satisfaction. The
satisfaction is as a result of the feeling by the employee that the company is determined by
treating each separately because of their uniqueness (Herring, 2009). Employees tend to stay
longer in a specific organization because of the sense of satisfaction even if competitor
companies provide better perks (Yap et al., 2010).
A satisfied workforce will own the organizational objectives and work with minimal
supervision towards attaining them. This will reduce employee turnover and increase
retention at the same time. Most organizations would like to retain their skilled employees for
as long as possible because the costs of recruiting and training a new candidate are high and
it’s not certain that they may get a more qualified candidate for a given position. Thus,
workforce diversity instills a sense of belonging and exceptionality to the employees, and
hence their commitment to the company grows (Yap et al., 2010).
2.2.4 Greater innovation and creativity
According to Østergaard et al. (2011) employees from diverse backgrounds and experiences
will approach issues from different viewpoints, thus evoking alternative responses and
techniques when deliberating a problem. If properly managed, the strengths and improved
comprehension of each person can be joined to improve output. The combination of different
staff promotes creativity and innovation because brainstorming over an issue generates ideas

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that can be supported and fashioned differently by other team members leading to creativity
(Shin et al., 2012).
2.3 Implementation Strategies Using HRDM
2.3.1 Introduction
The human resource management (HRM) is a combination of characteristic functions,
activities, and processes that are geared towards attracting, directing and sustaining an
organization’s workforce (Kazlauskaitė & Bučiūnienė, 2008). Studies have shown the
relationship between specific human resource management practices and diversity
management. Shen et al. (2009) studied various human resource diversity management
practices and found out that they are formulated to be applied in a diverse workforce and are
not biased and value the contribution of minority staff. These practices will ensure that there
is cohesiveness among the diverse team in the organization since the HRDM practices are
aimed at dealing with all employees in a fair and equitable manner (Shen et al., 2009). There
are multiples of HR practices that can be implemented for diversity management, but the
most common ones include recruitment and selection, performance management, training and
development and compensation (Briscoe, Tarique, & Schuler, 2012).
2.3.2 Recruitment and Selection
Recruitment and selection are two important practices in the sector of human resource
management, and should thus be factored into the human resource plan. Furthermore, human
personnel is the central corporate resources that should be adequately managed. Shen et al.
(2009) observe that an organization needs to ensure that recruitment and selection practices
are unbiased and free from discrimination in order to capitalize on diversity. Thus, the right
approach to diversity will enable the company to select the best candidate for the position.
According to Cooke & Saini (2010) distinct and clearly outlined labor force diversity creates
a workplace environment that attracts job candidates from different labor markets.

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Furthermore, there is harmony in a culture that fosters workforce diversity (Choi & Rainey,
2010).
2.3.3 Training and Development
Workforce training and development process comprises of strategies, tools, and procedures
formulated to improve the ability and capability of the staff (Chen & Huang, 2009). Noor et
al. (2013) assert that better management training and development practices can lead to the
success of the business. Also, the scholars opine that these practices can be used to overcome
corporate issues such as turnover among others. According to Noor et al. (2013), such
practices also affect the attitudes and performance of employees which translates to overall
customer satisfaction and organizational performance.
Training programs are useful in diverse workforces because it can be used to address team
differences issues and assist in promoting respect for personal differences with regard to
attitudes, ethics, and conduct. Effective management of a diverse workforce is fulfilled when
after recruitment process, the employees are retained through the provision of sufficient
training and development (Noor et al., 2013). Bezrukova et al. (2012) found out that training
on diverse awareness improves integration amongst minority employees and other staff.
2.3.4 Performance Appraisal
Effective performance appraisal in diversity management practices should be impartial, just
and without discrimination to all the staff (Briscoe, Tarique, & Schuler, 2012). The appraisal
committee should include multicultural representatives so that the appraisal process can be
much more appreciated and to aid in the establishment of fair performance process of
appraisal (Munjuri & Maina, 2012).
Shen et al. (2009) recommend the inclusion of minority employees in the process of
performance appraisal to minimize any perceived discrimination amongst the staff. Failure to
implement appropriate human resource diversity management practices during the process of

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evaluation will cause employee dissatisfaction which will further affect their productivity and
organizational performance. Thus, employee performance can be enhanced through just and
balanced performance appraisal process Shen et al. (2009).
2.3.5 Compensation
From the perspective of an organization, compensation also termed as remuneration, pay or
reward structures used to encourage the workforce (Goel, 2012). Compensation is a
significant element of HRM that stresses planning, organizing, and regulating various
payment systems for rewarding the staff for the work done or service delivered (Goel, 2012).
Studies have shown that equality in payment may result in sufficient diversity management
and corporate performance (Armstrong et al., 2010; Nielsen & Nielsen, 2013).
Additionally, remuneration diversity management requires the implementation of principle
equal pay and performance-based pay systems. Factors such as personal differences should
be factored in when formulating the structure of compensation. Good compensation practices
can attract and retain the best pool of candidates which are generally relied upon by an
organization to improve customer satisfaction and organization performance; Nielsen &
Nielsen, 2013).
2.3.6 Occupational Development Practices
Occupational development is the corporate techniques used to help the staff to attain their
career objectives (Briscoe, Tarique, & Schuler, 2012). These include the formulation and
implementation of corporate processes which allows career planning and management to be
done in a manner that meets the needs of the organization and employee preferences (Foong-
ming, 2008).
Yap et al. (2010), observes that an organization can overcome negative stereotypes of
minority discrimination at the workplace by identifying talents and providing career
development opportunities to the qualified minority groups. Such an initiative will make the

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organization to be perceived as a fair, friendly and developing workplace and will attract
employees from different labor market thus enabling the firm to have a mixture of expertise
thus promoting creativity.

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3.0 CONCLUSION
The objective of this report was to ascertain the impacts of effective diversity management on
organizational performance. The report demonstrates that globalization has played a
significant role in the existence of diversity workforce in almost every organization. This has
necessitated the need for the management to learn diversity management skills so as to know
how to strike a balance between meeting both organizational objectives and employee’s
needs. This is because to the existing and overwhelming evidence of the importance of a
diverse workforce. A diverse workforce performs much better which translates to improved
organizational performance.
Cognitive diverse groups tend to find solutions to issues much faster, and their integration
improves learning and performance due to the sharing of knowledge and ideas. A diverse
workforce also provides opportunities for exposure to new cultures and ways of doing things
which promotes growth and employee satisfaction thus minimizing turnover and increasing
retention. A diverse workforce constitutes different individuals with varying experiences and
exposure. Such a combination of staff fosters creativity and innovation when brainstorming
over issues and sharing ideas.
The report also found out that diversity management strategies can efficiently be
implemented using specific HRDM practices namely recruitment and selection, training and
development, performance appraisal, compensation and occupational development practices.
It is common for discrimination to exist among employees in a diverse workforce. Therefore,
the human resource management practices on diversity management should aim at
overcoming diversity issues at every stage right from recruitment and selection, to training
and development up to compensation. The practical implementation of such HRDM