Liveraging Diversity to Improve Business Performance: Recommendations for Organizations

Abstract

Research findings from industrial and organizational psychology and other disciplines cast doubt on the simple assertion that a diverse workforce inevitably improves business performance. Instead, research and theory suggest several conditions necessary to manage diversity initiatives successfully and reap organizational benefits. This article reviews empirical research and theory on the relationship between workforce diversity and organizational performance and outlines practical steps HR practitioners can take to manage diversity initiatives successfully and enhance the positive outcomes. @ 2004 Wiley Periodicals, Inc. Does diversity help organizations perform better? Ask many organizations today and the answer is very much"yes". Initially started by many, as an effort to meet govemmental and legal requirements, has evolved into a strategic priority aimed at positioning organizations more competitively in the marketplace. It is estimated that organizations spent lump sum amount annually on diversity training. In addition, organizations devote resources to a variety of other diversity-related initiatives, including dedicated diversity management staffs and workplace programs and benefits such as flexible work arrangements, domestic partner benefits, corporate-sponsored employee affinity groups, and other programs designed to attract and retain a diverse workforce.