“Ethical Issues Behinds Diversity Hiring and Promotion”
Diversity Hiring
"The diversity debate has shifted from the moral obligation of affirmative action to a business
imperative. CEOs, faced with intense competition in global markets, record numbers of mergers
and acquisitions, and the global war for talent, are focusing on how to leverage diversity as their
competitive differentiator. The challenge for many CEOs is to directly infuse their diversity belief
systems into the organization. The test for diversity practitioners in many organizations is to
overcome diversity resistors and to leverage the power of the CEO's vision to make diversity
happen. "
--Dr. Vanessa Weaver
Introduction
It is irrefutable that current business operations have evolved over time, confounding
managers with new issues. The evolution of new business strategies is in response to the changes
in the external environment of business organizations. It should be noted that the developments
in the market mentioned were beyond the effects of neither the current economic turmoil nor the
technological revolution which radically altered the way business is done. The present mode of
business is strongly influenced by the emergence of hypercompetitive markets that resulted from
the rapid integration of markets brought about by globalization.
As businesses are faced with new challenges and opportunities, it is imperative that they
also employ a new approach in doing business. They do this by strengthening their core
competencies by aligning their respective resources to their various objectives. It is irrefutable
that human resource is the indispensable, if not the most important, asset in a business institution.
The contribution of human resource in the success and mere survival of a company cannot be
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overstated. As such, companies are seen to align their workforce in order to fully reap the
opportunities present in the market.
Diversity hiring is the new trend in choosing the employees to work for an organization.
As more and more companies are embracing this new system, more reports and empirical
evidences are also reported which support direct hiring. This report will look at direct hiring as
an ethical issue in business organizations. The first part will briefly look at the scope of direct
hiring in the United States. Discussions on its advantages and ethical considerations will also be
set forth. The paper will conclude with the key points tackled.
Scope of Diversity Hiring
The first step toward creating a more diversified workforce was taken by the President
John F. Kennedy with the establishment of The President’s Committee on Equal Employment
Opportunity. This effort gave way in the formation of workforce which is comprised of people
with different nationality. It should be noted that during this period there is a lack of appreciation
of the value of diverse teams. In contrast, the program was enacted to create equal opportunity
for prospective employees regardless of their ethnicity.
However, the present day situation is now different. The importance of having a diverse
team working for a business organization is not only done in order to comply with this
requirement but due to the perceived value of inclusivity. In fact, a leading proponent of
diversity recognized the importance of hiring employees with diverse backgrounds in order to
boost the performance of a business organization. Gloria Johnson Goins, the vice president of
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diversity and inclusiveness for the Home Depot asserted American businesses should willing
embrace this new trend in order for them to adapt to the nation’s business demographics.
According to ASME, workplace diversity is “the variety among people related to such
factors as age, culture, education, employee status, family status, function, gender, national
origin, physical appearance, race, regional origin, religion, sexual orientation, and thinking
style.” Thus, diversity embraces the differences among individuals and utilizes them for the
utmost benefit of the business organization.
As companies come to recognize the contribution of workplace diversity, it is widely
observed that players are closely monitoring the extent of diversity in its human resource.
Accordingly, there has been a constant updating on the quantitative and qualitative aspects of
diversity hiring. For instance, managers focus on the number of female, number of Hispanics,
number of African-Americans, number of married, and number of single employees. Keeping an
eye on these essential factors considered in creating a highly diversified group. Also, fervent
effort to reach minorities in order to attain the prescribed quota for the organization is also
prevalent.
Advantages of Diversity Hiring
The rationale in favoring a human resource with different origins, backgrounds, interests,
and status is fairly simple: diversity will is able to pool together various talents, ideas, skills, and
knowledge which serves the highly diversified market served by a business institutions.
As stated above, the emergence of diversity in the workplace is due to the changes in
business environment brought about by globalization. The rise in the proportion filled in by
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women and minorities in the American human resource is directly attributed to this.
Multinationals are continuously locating overseas, capturing profitable niches which were not
previously served. Also, as economies like India, China and others are undergoing rapid growth
and development, large corporations sees the opportunity to expand and market their products
abroad.
Diversification and market development strategies are often faced with the need of
acquiring valuable knowledge in the new market being considered. This necessitates an in-depth
research on the targeted industry, market, and preferences which will be eased by employing
someone who has a first hand in the particular country. This is acknowledged by Dibble: “In an
increasing global marketplace, cultural sensitivity that comes from the awareness of cultural
distinctions can make or break a company’s success in a given market.”
This point is further illustrated by Chevrolet’s “disastrous roll-out” of the Nova in Latin
America. The car manufacturer incurred losses because of its inability to relate and understand
its target market. It should be noted that in Latin America, “no va” means “doesn’t go” which is
in direct contrast with what a car should do. In order to avoid this disaster, companies are now
very eager to hire employees who thoroughly understand the culture of the foreign market. This
point is fully captured by Hymowitz:
“If companies are going to sell products and services globally, they will need a rich mix
of employees with varied perspectives and experiences. They will need top executives
who understand different countries and cultures. They will need executives around the
world who intuitively understand the markets they are trying to penetrate.”
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One of the most significant features of the evolving hypercompetitive countries is the
more intense competition among companies and the higher power of consumers. It is also
irrefutable that as companies operate globally, the international and domestic consumer base is
altered. The emergence of customer centered and market-oriented approaches in doing business
is also pushing businesses to focus on adding value to the customers by understanding their
culture and preferences. A good definition of a global business is “one that sees value in cultural
uniqueness and a variety of global markets, not one that attempts to render culture differences
insignificant or trivial.” Thus, the overall ability of companies to respect and respond to
differences may prove to be a competitive advantage over slower, single-solution companies.
This feat can be accomplished by a more diverse workforce.
Mauricio Velasquez of The Diversity Training Group states that corporate diversity
efforts are all about money, business, and the bottom line. He further added that diversity is
being employed by its clients in order to generate more profits and meet customers’ expectations.
This paper will further elucidate this by real world example.
The most notable examples of improved sales abound. One is the Petro-Canada site in
Vancouver’s Chinese community which has been benefited by employing a diversified
workforce comprised in part by employees who can speak and write Chinese. An effort to
increase the company’s presence in the locality as well as boost sales is posting advertisements
both in English and Mandarin. The result was 15% growth in kiosk sales, and gasoline sales were
3.1 million liters in 1994, up from the 2.7 million liters recorded in 1991 (Benefits of Diversity
3).
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PepsiCo is another company which modified its workforce structure and largely reaped
the gains of workforce diversity. It should be noted that the beverage and snack food giant has
been transformed from a “mostly white male fraternity” to a more diverse human resource.
PepsiCo expressed its satisfaction with the new system, attributing the 1% in the overall 8%
revenue growth to the diversity efforts. Products which are inspired by workforce diversity are:
guacamole-flavored Doritos chips and Gatorade Xtreme, aimed at Hispanics; Mountain Dew
Code Red, which appeals to African-Americans; and a newly launched wasabi-flavored snack
aimed at Asians (Hymowitz 8-10). The examples of Petro-Canada and PepsiCo are only few of
the numerous companies who are pursuing to generate sales, increase market share, and profit
through the modification of their resources.
Another pay-off of a company’s diversity effort is the improved retention, recruitment,
and promotion of employees. Fast food giant McDonalds is known for going beyond the trend of
recruiting younger employees. The company actively seeks older workers for its management
and employs thousands of older employees in its restaurant. McDonald noted that older workers
are generally more disciplined, well motivated, and with better work habits than their younger
counterparts (Benefits of Diversity 7-9).
It is often overlooked but workplace diversity also facilitates the eliminations of
complaints and litigation. Accordingly, “the cost of an unhappy employee can go far beyond low
productivity, high turnover or absenteeism” but “increasingly, they may include a lengthy public
court battle.” In 1996, Texaco was sued for racial discrimination forcing it to shell-out $35
million in order to establish a Task Force to implement the changes in their human resource
programs. The new plan include recruitment and hiring procedures to reflect diversity in the
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workforce, concentrating on much-needed career development and retention of current
employees, and increasing the number of women-and minority-owned business partners
(Benefits of Diversity 10-11).
Other benefits of diversification will be, “an ability to move into emerging markets,
improved employee morale, and improved communication between employees and working
units (Benefits of Diversity 12).”
Ethical Issues in Workplace Diversity
While a lot of corporate players recognize the role of workplace diversity, this trend also
raises ethical concerns among organizations. Diversity hiring has been met with skepticism by
critics, who perceive it as an opposition to equality, to hiring who is best, and reluctant to have
women and minority in the workplace.
In the real corporate world, the effects of diversity hiring in the workplace is amazing.
Though it is often regarded with the benefits that it generates, the other side of the coin should
also be revealed. Take for example, an HR manager who considers candidates for promotion.
While a typical manager would choose the “best” candidate for the position based on the
performance and accomplishments of the candidates, an HR manager who is a strong adherent of
diversity will look at other factors. First, she will take into account the group that the candidate
will be joining assessing if he/she satisfies the “requisite diversity factors.” Thus, this practice
often leads to choosing the “diverse” instead of the best candidate. To critics this can be labeled
as inequality. Roscelli argued that the hiring goal should be equality and not diversity adding
further that “candidates should be judged on their skills, not on immutable characteristics.”
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Diversity hiring is regarded as an inefficient method of selecting prospective employees as it is
focused on the creation of a diverse workforce instead of pooling individuals which are best in
their fields.
Another concern in diversity hiring is the reaction of other employees especially
subordinates who have women or minority as immediate superiors. This somehow raises
reluctance in them in functioning efficiently as the situation is seen as “degrading.” This leads to
a workforce who is not motivated to excel in their respective positions resulting to lower
productivity and job satisfaction.
Conclusion
The emergence of diversity in the workplace has been brought about by the rapid changes
and development in the domestic and global market. This current workforce strategy is seen as
business organization’s response in coming with the demands of the new business environment.
This is their way of aligning their resources to take advantage of the present opportunities,
generate revenues, increase market share, and squeeze more profits from their sales. Diversity in
the workforce had also increased retention, recruitment, and promotion of employees as well as
decreased litigation and complaints.
However, the other side of the story tells of the ethical concerns raised by diversity
hiring. According to critics, this new trend reflects inequality and higher lower quality
employees. Another destructive effect of workplace diversity hiring is subordinates’ reluctance
to be under the supervision of women or minority resulting to low employee morale.
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As with other business strategies, diversity in the workplace generates benefits to the
company and incurs costs. A business organization planning to create a more diversified human
resource should be ready to face the challenges posted by this new system. A thorough cost and
benefit analysis should be employed to ascertain the true value and effectiveness of diversity.
However, it will be complicated as benefits such inequality cannot be quantified. What seems to
be the best approach is come up with other means to eliminate or minimize the perceived costs
brought about by diversity.
Works Cited
“Benefits of Diversity.” Professional Practice Curriculum. 24 May 2006
<http://www.professionalpractice.asme.org/communications/diversity/2.htm>
Dibble, David. “Diversity 101: The Changing Face of Business.” Texas Magazine, Fall/Winter
2001
“History.” Professional Practice Curriculum. 24 May 2006
<http://www.professionalpractice.asme.org/communications/diversity/0b.htm>
Hymowitz, Carol. “Diversity in a Global Economy—Ways Some Firm Get it Right.” The Wall
Street Journal Online. 16 November 2005. 24 May 2006
<http://www.careerjournal.com/myc/diversity/20051117-hymowitz.html>
Roscelli, Paul. “Is Hiring Goal Diversity or Equality.” San Francisco Chronicle. 28 August
2000. 24 May 2006 <http://www.sfgate.com/cgi-bin/
article.cgi?file=/chronicle/archive/2000/08/28/ED84210.DTL>
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“Speaker says inclusiveness is the answer.” Idohostateman.com. 24 May 2006
<http://www.idahostatesman.com/apps/pbcs.dll/article?AID=/20050922/NEWS02
/509220332&SearchID=73221248042928&template=printart>
“What is Workplace Diversity.” Professional Practice Curriculum. 24 May 2006
<http://www.professionalpractice.asme.org/communications/diversity/index.htm>
.
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