2
What are the arguments for and against the
business case for diversity?
- BUSM017 Managing diversity -
Student ID: 200880259
1
, 2
TABLE OF CONTENT:
Content:
1. Introduction ………………………………………………………………………… 3
2. The business case of diversity …………………………………...……………… 4
3. Value in Diversity ………………………………………………………………..… 5
4. Diversity as process loss ………………………………………………….……… 9
5. Conclusion …………………………………………………………………………
11
6. Reference …………………………………………………………………….…… 13
2
, 2
Introduction
The idea of diversity "was originally created to justify more inclusion of people who
were excluded from schools, universities, corporations, and other kinds of
organizations" (Herring, 2009). UK legislation covers minimum standards regarding
age, disability, religion, race, sexual orientation and gender diversity. However, "an
effective diversity and inclusion strategy goes beyond legal compliance and seeks to
add value to an organisation, contributing to employee well-being and engagement"
(CIPD, 2020). This paper aims to provide arguments for and against the business
case for diversity. This research will evaluate diversity from two different
perspectives: a positive one (value-in-diversity) which brings benefits in
organizations, and a negative one (process-loss), which argues that diversity is not
relevant for the success of an organization, rather it creates conflicts and
misunderstandings among business stakeholders. Is diversity indeed an ultimate tool
used due to its numerous benefits as proposed by the value-in-diversity approach?
Or it is detrimental and not relevant to the success of a business? Or maybe diversity
can be simultaneously linked with both outcomes and be "associated with more
group conflicts and better business performance" (Herring, 2009). Thus, the
importance of this research questions is given by the fact that nowadays diversity is
something that every stakeholder is interested in when looking into a company.
However, is diversity helpful in reaching organizational goals, or is it damaging for
the organizational well-being? Using empirical evidence this paper will demonstrate
how racial and gender diversity is associated with maximization of sales revenue,
number of customers, profits and market share in organizations, and also how
increased diversity can be detrimental for organizations and create conflicts,
therefore decreasing productivity and the efficiency of an organization. To
demonstrate the first approach, where diversity is being seen as a valuable asset,
this research will analyze a study conducted by Herring (2009), where he used data
from the National Organizational Surveys to analyze samples of for-profit
organizations and test 8 hypotheses against the value-in-diversity concept. Also, the
example of Marriot International will be given to strengthening, even more, the
argument with an example of successful incorporation of diversity and inclusion
policies. Finally, Tsui and Gutek (1999) study be will analyzed to demonstrate how
3
What are the arguments for and against the
business case for diversity?
- BUSM017 Managing diversity -
Student ID: 200880259
1
, 2
TABLE OF CONTENT:
Content:
1. Introduction ………………………………………………………………………… 3
2. The business case of diversity …………………………………...……………… 4
3. Value in Diversity ………………………………………………………………..… 5
4. Diversity as process loss ………………………………………………….……… 9
5. Conclusion …………………………………………………………………………
11
6. Reference …………………………………………………………………….…… 13
2
, 2
Introduction
The idea of diversity "was originally created to justify more inclusion of people who
were excluded from schools, universities, corporations, and other kinds of
organizations" (Herring, 2009). UK legislation covers minimum standards regarding
age, disability, religion, race, sexual orientation and gender diversity. However, "an
effective diversity and inclusion strategy goes beyond legal compliance and seeks to
add value to an organisation, contributing to employee well-being and engagement"
(CIPD, 2020). This paper aims to provide arguments for and against the business
case for diversity. This research will evaluate diversity from two different
perspectives: a positive one (value-in-diversity) which brings benefits in
organizations, and a negative one (process-loss), which argues that diversity is not
relevant for the success of an organization, rather it creates conflicts and
misunderstandings among business stakeholders. Is diversity indeed an ultimate tool
used due to its numerous benefits as proposed by the value-in-diversity approach?
Or it is detrimental and not relevant to the success of a business? Or maybe diversity
can be simultaneously linked with both outcomes and be "associated with more
group conflicts and better business performance" (Herring, 2009). Thus, the
importance of this research questions is given by the fact that nowadays diversity is
something that every stakeholder is interested in when looking into a company.
However, is diversity helpful in reaching organizational goals, or is it damaging for
the organizational well-being? Using empirical evidence this paper will demonstrate
how racial and gender diversity is associated with maximization of sales revenue,
number of customers, profits and market share in organizations, and also how
increased diversity can be detrimental for organizations and create conflicts,
therefore decreasing productivity and the efficiency of an organization. To
demonstrate the first approach, where diversity is being seen as a valuable asset,
this research will analyze a study conducted by Herring (2009), where he used data
from the National Organizational Surveys to analyze samples of for-profit
organizations and test 8 hypotheses against the value-in-diversity concept. Also, the
example of Marriot International will be given to strengthening, even more, the
argument with an example of successful incorporation of diversity and inclusion
policies. Finally, Tsui and Gutek (1999) study be will analyzed to demonstrate how
3
