General approaches to diversity management

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General Approaches to Diversity Management Institutional Theory of Diversity Management This theory, based off of organization theory, recognizes that in order to determine an organization’s structure one can not separate the social environment found within an organization. In order to understand the structure of the organization it must also be understood that the behavior of employees in organizations and organizations themselves have limiting factors such as legislation, laws, rules, regulations, and social and professional norms. Because organizations are held to similar norms and regulations they tend to develop similar administrative structures. This conformity shows that organizations are willing to be consistent with these norms and they begin to garner legitimacy for their operations. By proving legitimacy through its actions, organizations prove what their priorities are and can begin to accumulate material resources from others. In summation, because laws require organizations to become diverse they must prove to both individuals within the organization and individuals outside of the organization that they are conforming to these laws and norms. If an organization fails to follow these laws or norms then its operations will be
questioned and it may also be terminated for violating the law. Resource Based Theory of Diversity Management The main focus of Resource Based Theory of Diversity Management is how the implementation of diversity will affect organizational resources. There are four categories of resources that organizations possess: physical capital, financial capital, human capital, and corporate capital resources. These resources can either assist or inhibit the operations of the organization. Organizations attempt to use these resources in ways that will of course assist and improve business. From a business perspective organizations that are more diverse gain an advantage compared to organizations that are homogenous. Racial diversity within organizations increases financial performance when a growth or innovation strategy is used (Richard, 2000; Richard, Barnett, Dwyer, & Chadwick, 2004; Richard et al., 2003 as cited in Yang & Konrad, 2011). Richard and Johnson's 1999 study (as cited in Yang & Konrad, 2011) found that firms with more diversity management practices in place experienced lower levels of turnover and that diversity management practices interacted positively with an innovation strategy, resulting in higher productivity and better market performance. Organizations that are diverse gain several advantages over organizations who fail to implement diversity policies. Specific Approaches to Diversity Management The Practitioner/Consultant Approach This approach focuses on the positive aspects of how making the workplace more diverse can increase productivity. In this approach organizations focus on how diversity can benefit their business. Dietz and Peterson (2006) argue that because organizations find it difficult to find qualified workers that have the talent and abilities necessary to do the job, they must examine all possible means to find the workers they need. Using this approach to find

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