CULTURAL DIVERSITY IN WORKPLACE AND ORGANIZATIONAL PERFORMANCE

CHAPTER ONE

INTRODUCTION

1.1. Background to the Study

Globally, in the business world of today, most businesses and organizations are faced with several problems as relating to their organizational or business performance. One of such problems is in the area of human management which refers to the utilization of human resources effectively and efficiently in order to achieve an organizations goals and objectives. An organizational performance lies on the overall efforts of its employees, that is, how well an organization manages its workforce towards productivity and overall business performance.

In USA, there is difficulty blending multiple personalities into a cohesive and unified team. This can be an enormous issue, regardless whether the team is part of the executive suite, special project team in an R&D lab, or an operating team in a production facility. People’s personalities vary widely, and the diversity of backgrounds, opinions, views, and experiences can cause challenges for teams. This creates a unique set of potential issues and opportunities. If an organization can get people to come into alignment to support common objectives, a diverse team of leaders can produce amazing results, take on the demands of customers, and meet the threat of competitors. However, if organizational leaders stay in their silos, protect their own “turf,” fail to share information, refuse to collaborate on shared problems, or lack the ability to think with an entrepreneurial mindset, the organization will under-produce, (Zammuto, 2012).

In Europe, some organizations have a lot of hardworking people who have good intentions. However, despite their experience in the service industry, their technical talent and the subject-matter expertise that many leaders bring to the table, creating a high-performance organization is often still out of reach, (O’Sullivan, & Lazonick, 2006). Sometimes leaders are aware of their behavioral shortcomings; in other cases, they are blind to their leadership deficits. People inside the organization are often afraid to candidly say what they think, and helping enormously successful leaders with their Achilles heels can be tricky. Leading and managing an organization is a complex task that requires a unique mix of skill leaders who have to utilize their natural strengths, they also have to search relentlessly for ways to close their own performance gaps and improve their behavior. Without continuous improvement, an organization’s capabilities will be severely limit In short, if leaders don’t constantly raise their game, they will suck all the energy and employ engagement out of an organization. Leaders need to be constantly aware of and working on their personal opportunities for improvement.

In Africa, organizations are faced with lack of poor communication and feedback. There seem to be two extremes in this area: either people do everything in their power to avoid confronting others and holding them accountable or they relish any opportunity to chew people out, belittle them, and crush their spirits. Many organizations in Africa have countless leadership teams which the number-one problem was a lack of honest, constructive, and open dialogue about team members’ practices, styles, skills, or behaviors. Without a culture of openness, feedback, and coaching, organizations will struggle to grow. Many organizational teams try to muddle through this somehow enduring the bully or trying to guess what other want and need from them. People often tell others that they fear reprisal or retaliation if they open up, but the reality is that leaders can’t execute on their strategies, lower costs, or effectively launch new processes or services when people fail to communicate with constructive candor, so this is an issue that must be overcome, (Boldman & Deal, 2003).

In West Africa, as technologies change practically at the speed of light, it’s vital for organizations in the service industry to innovate or be left behind. However, many organizations started their careers and businesses before many of these technologies even existed! Organizations can be vital for integrating new technologies, in particular mobile app development, and cloud computing. Lack of direction is one of the most common organizational issues.

According to Aluko (2003), building a solid organization in Nigeria takes hard work and a keen awareness of the culture and environment that exists in a business. Most executives are very busy people; a lot of things vie for their attention. Market conditions can change fast in business world and demand huge portions of leader’s time. Unfortunately, while they’re busy focusing on the many necessary operational distractions, many managers take their eye off the teamwork ball. This means that communication suffers and leaders get preoccupied and fail to recognize people, celebrate progress, build the talent pipeline, or invest time reviewing processes, practices, and better ways of working across functions. People then become disengaged, create marginalized, and lose focus and commitment in the organization.

In Europe, culture is indeed one of the keys to war and peace in the world. The identity crisis which has spared neither France nor Europe today largely explains the upheavals in the world. One of the main challenges facing us today is to convince our fellow citizens of the strength to be found in a solid identity, to help them live with globalisation and open themselves to others without fear of losing their own identity. It is thus in phase with the new role of cultural diplomacy, which is no longer merely a question of promoting the heritage and creation, but also of reviving and bringing out the strength of identities, in a spirit of peace and respect for others, in a world where most conflicts are first and foremost conflicts of identity. The globalisation of culture is a fact of life. It is at once an extraordinary opportunity for the circulation of ideas, people, works and products, but there is also a risk of everyone falling into the same mould, and their cultures and languages disappearing, (Giovanni, 2004).

In work environments, people of different cultures and backgrounds have to work together, so they are able to interact and communicate on a daily basis. This can be exciting and interesting, yet it also brings about frustrations and uncertainties at times. It therefore becomes essential for any progressive organization to continuously seek ways to embrace and address these changes. Some of the prevailing issues on organizational performance can be attributed to matters concerning cultural diversity such as personality, culture and employee behavior (Maimuna & Rashad, 2013). Therefore, for organizations to survive and remain relevant and competitive, it is essential for them to be able to manage its cultural diversity efficiently and effectively in a bid to enhance organizational performance (Sunia, 2014).

In Asia, cultural diversity is the confusion between functional diversity and types of non-functional diversity. Functional diversity, or diversity that leads to more effective function or innovation (Bunderson & Sutcliffe, 2002), is often the form of diversity intended in common workplace statements such as “we need to focus on diversity,” or “diversity is something we strive for.” However, in practice there are many forms of diversity that can be encountered in organizations, not all of which are related to improving organizational effectiveness, and some of which may be harmful. Many of these forms of diversity have been termed social diversity (Bunderson & Sutcliffe, 2002).

A closer look on Africa from the perspective of cultural diversity reveals that there is an inherent and intrinsic relationship between Africa and cultural diversity which could be likened to the identity relationship between the snake and lengthy body. Cultural diversity is a central part of the African collective identity. This central aspect of the African identity has not always proven to be a blessing for Africa in dealing with herself and also in her history especially in her encounter with the rest of the world, (Bell, 2012). This is due to, among other things, the fact that the intrinsic African cultural diversity is dominantly an ethinicised cultural diversity. This implies that the respective African cultures are specifically bounded and integrated mostly within particular groups. These define different parts of the continent in contradistinction to one another, emphasizing more of the differences and local contextualities at the expense of the collective Africa perspective, (Bell, 2012).

According to Young (2013) in West African countries, cultural diversity may come with a huge language barrier that may hinder the process of working together towards a common outcome. Perceptual, cultural and language barriers need to be overcome for diversity programs to succeed. Ineffective communication of key objectives results in confusion, lack of countries reaching an agreement, lack of teamwork, and low morale. This can impact the perceived results and it results in the organization losing a lot of clients and profits.

Furthermore, in the submission of Odeyemi (2014) cultural diversity has been an obstacle to the overall political and economic development of Nigeria. He stressed further that ethnicity is the most definitive cause of social crisis, injustice, inequality and religio-political instability, fears and tension across the polity. Be that as it may, the poser is that, if the feeling of national identity is being threatened by cultural diversity what then can a nation-state like Nigeria do? This “national question” had dominated Nigerian politics and literature even before independence in 1960. On the other hand, the costs associated with more ethnic diversity would be related to more difficult communication and coordination (Lazear, 1999; Morgan & Vardy, 2009)

According to Klarsfeld (2014), organizations find it hard to come up with standardized policies to accommodate a much diversified group of employees. This can be an insurmountable challenge to advocates of diversity. In response to this, diversity advocates, armed with the results of employee assessments and research data, must therefore build and implement a customized strategy to maximize the effects of diversity in the workplace for their particular organization. The very same individuals that are trying to address the issue of cultural diversity may themselves have the very same issue amongst themselves thus making it difficult for them to manage it.

The issues of employee culture in the organization which ranges from different employee background, ethnic group, difference in language could have an endangering effect on the organizational productivity, due to the fact that, employees with same ethnicity might find it difficult communicating with other ethnic in the same workplace, which ultimately will create a feeling of minority from the majority and thereby affecting the overall organizational productivity.

Employee personality is the trait or characteristics an employee exhibit. The attitude of an employee in the workplace could have either a positive or negative effect on the organizational profitability. When bad attitude is shown by the employees in the organization, it will impact on bad performances to an organization, (Colquiit, 2009).  Whether a person as manager or subordinate employees will dealing with the people or individual who do not have same personality in the workplaces. A negative personality of employees in the workplace from one to another will significantly affect the overall organizational profitability.

The behavior put forward by employees in the organization towards others has a way of affecting the organizational efficiency. Employees who engages in shouting on fellow workers, spreading rumours, criticizing their boss and gossiping at workplace isn’t an healthy one for the organization. An employee who is rude to other team members is tending to affect the organizational efficiency. Since an organization is the working together of group of people towards a common goal, it is therefore required from an employee to be polite, and speak softly while addressing other team members in order to enhance organizational efficiency, as the rudeness of one employee will affect the performance of others.

1.2. Statement of the Problem

The 21st century managers are saddled with the responsibility of both leading employees and responding to the needs of customers who are more ethnically and culturally diverse from each other. Leaders in both the public and the private sectors are focusing more attention on the issue of diversity. Whether the goal is to be an employer of choice, to provide excellent customer service, or to maintain a competitive edge, diversity is increasingly recognized and utilized as an important organizational resource. Leaders and managers within organizations are primarily responsible for the success of diversity policies because they must ensure that the policies are effective. The most important issues of cultural diversity are to address the problems of discrimination in terms of culture, personality, and behaviours.

The main purpose of this study is to examine cultural diversity in workplace and organizational performance. Various factors that enhance the relationship between cultural diversity in workplace and organizational performance as mediators are also explored. Employee culture, employee personality and employee behaviour are taken as the dimensions of diversity.

The discriminatory attitude of some employees, individual identity, lack of cooperation amongst employees has been extended by workers in same diverse organization beyond limits, which dampens morale with negative performance index. This is because departmental goals are pursued more at the expense of broad organizational goals and objectives. Corporate profitability dwindles because the core values of diversity are not properly harnessed (Salami, 2010). Countless studies have been conducted on cultural diversity. This study is provoked by the gap left unfilled by a substantial number of research works that has been conducted on cultural diversity and its significance on the organizational performance.

Studies undertaken by Irungu (2007), Awino (2007) and Sifa (2009) have all treated organization performance as a dependent variable. The findings of each of these studies indicate that performance is a function of a combination of factors. Irungu’s (2007) study revealed that there is a relationship between employee personalities and various indicators of organizational performance. Awino’s (2007) study focused on the effect of employee diversity on corporate performance while Sifa’s (2009) study focused on the influence of employee team behaviors and organization performance. Both of these studies indicated that organizational practitioners continue to be faced by a lot of employees’ problems that have their roots in the diversity, which ultimately impede progress towards achieving high performance. Ahiauzu (2000) states that, most of the literature on cultural influences on organizational performance and behavior is of poor quality consisting of anecdotes and prescriptions based on western experience and imagination

The above mentioned negative effect of cultural diversity in workplace is prevalent to organizations today, but requires solutions for organizations to perform optimally. Hence, this study investigated the impact of cultural diversity in workplace and organizational performance using Babcock University Ilisan Remo, Ogun State.

1.3. Objectives of the Study

The general objective of this study is to investigate how cultural diversity affects organizational performance in Babcock University, Ilisan Remo, Ogun State, Nigeria. However, the following sub objectives are considered to:

1. assess the effect of employee culture on organizational productivity;

2. determine the effect of employee personality on organizational profitability;

3. examine the effect of employee behavior on organizational efficiency; and

4. determine the combined effect of workplace cultural diversity on organizational performance.

1.4. Research Questions

Based on the objectives of this study, the following research questions are posed;

1. How does employee culture affect the organizational productivity?

2. What is the effect of employee personality on organizational profitability?

3. How does employee behavior affect organizational efficiency?

4. What is the overall effect of workplace cultural diversity elements on organizational performance elements?

1.5. Research Hypotheses

Based on the objectives and research question used, the following hypotheses were developed in order to make valid conclusions on the subject matter.

Ho1: Employee culture has no significant influence on organizational productivity level.

Ho2: Employee personality has no significant effect on organizational profitability.

Ho3: Employee behavior has no significant influence on organizational efficiency.

Ho4: The combined effect of workplace cultural diversity has no significant effect on organizational performance.

1.6. Operationalization of the Variables

The dependent variable is organizational performance, represented by productivity (PROD), profitability (PROF), efficiency (EFF) and workplace cultural diversity (WCD). On the other hand, cultural diversity, being the independent variable, is proxied by culture (C), personality (P), employee behavior (EB) and organizational performance elements (OPE).

Y= f (y1, y2, y3, y4)

Y =      Organizational Performance (OP).

y1 =     Productivity (PROD).

y2 =     Profitability (PROF).

y3 =     Efficiency (EFF).

y4 =     Workplace Cultural Diversity (WCD).

X= f ( x1, x2, x3, x4)

X=       Cultural Diversity (CD).

x1=      Culture (C).

x2=      Personality (P).

x3=      Employee Behaviour (EB).

x4=      Organizational Performance Elements (OPE).

The four specific objectives are operationally expressed as:

Assess the effect of employee culture on organizational productivity.

y1= f (x1)

y1= b0 + b1x1 + u

Determine the effect of employee personality on organizational profitability.

y2= f (x2)

y2= b0 + b1x2 + u

Examine the effect of employee behavior on organizational efficiency.

y3= f (x3)

y3= b0 + b1x3 + u

Determine the combined effect of workplace cultural diversity elements on organizational performance elements

Y4= f (x4)

Y4= b0 + b1x4 + u

1.7. Scope of the Study

This study examined cultural diversity in workplace and organizational performance. This study will be carried out in Babcock University, Illisan Remo, Ogun State, Nigeria.  The Educational sector was being considered because it is one of the most important sectors in Nigeria. Babcock University Illisan, Remo, Ogun State was selected because it is one of the very first private universities in Nigeria (Aluko, 2003), and is one of the fastest developing private University currently situated in Ogun State, Nigeria. The findings of this research are subject to culture, personality, employee behavior and overall organizational performance elements of the respondents. The study population for the study was 1,062 employees of Babcock University while the sample size was 252 employees of Babcock University to be selected randomly.

1.8. Significance of the Study

This research is relevance to various stakeholders such as the government, university management, researchers and academics on how employee cultural diversity affects organizational performance.

To the government, policy makers obtain data that guides them in regards to recruitment of employees with diverse cultural orientations in its different sectors. This in return makes our government competitive economically since the success of a government globally, is becoming increasingly dependent on its ability to deal with the challenges of cultural diversity.

To the University Management, the management benefits by obtaining information on the significance of employee cultural diversity on its organizational performance. The findings of the study are an opportunity for strategy formulation and implementation for not only Tertiary institution in Ogun State and Nigeria in general.

To the researchers and academics, the researchers benefit from the findings of this study as it contributes to the package of knowledge and skills on enhancing performance in a diverse cultural organization. The research also opens up new areas for future research by interested academicians, scholars and researchers.

1.9. Definition of Operational Terms

Employee Culture: is a man’s medium that forms the human life of an individual (Tayeb, 2003)

Organizational Performance: is the execution or accomplishment of work, tasks or goals to a certain level of desired satisfaction (Ely & Thomas, 2001)

Cultural diversity: is the existence of diverse individuals from different cultures or societies whose differences arise from language, religion, race, sexual orientation, gender, age and ethnicity (Grobber, 2002).

Personality: are the unique traits that differentiate an individual behavior or look from others. (Guilford, 1959)

Organization Productivity: is the correlation that exists between the quantity of inputs and outputs from a clearly defined process, (Bhatti, 2007)

Organization Profitability: means ability to make profit from all the business activities of an organization, company, firm, or an enterprise. (Adi, 2011)

Organization Efficiency: is productivity of estimated effects; specifically productivity without any form of waste. (Salas, 2010)

1.10. Brief History of Babcock University, Ilisan Remo, Ogun State, Nigeria

BABCOCK UNIVERSITY (BU)—as it is now known—actually began on September 17, 1959 as Adventist College of West Africa (ACWA). Established by the Seventh-day Adventist Church as a senior college for training church workers from the West African sub-region, ACWA opened its doors with only seven ministerial students.

By 1966, when it graduated the first set of Bachelor of Arts degree holders in its own name, enrolment included students taking Business Administration as potential accountants within and outside the Church; and two-year Pre-Nursing students in preparation to pursue a nursing career at the Church’s School of Nursing at Ile-Ife, Osun State. History was made in 1975 when ACWA became the first institution in Nigeria to sign and operate an affiliation agreement with Andrews University, Berrien Springs, Michigan, USA. This relationship enabled it to award Bachelor of Arts degrees from Andrews University in Biology, Business Administration, History, Religion and Secretarial Studies.

1975 was also the year ACWA was renamed Adventist Seminary of West Africa (ASWA) in response to the dynamics of its socio-political environment. In 1983, restricting local factors again necessitated the phasing out of the Bachelors programmes in Biology and Business Administration. In 1988, ASWA reached another academic milestone through an affiliation agreement with the Seventh-day Adventist Theological Seminary of Andrews University, which authorized it to offer Master of Arts in Pastoral Ministry. Master of Arts in Religion was added in 1990 and both programmes were operated during Summer sessions from 1997 to 2007. In order to attain national recognition for its status and programmes, an attempt to obtain a local affiliation with University of Ibadan, under the name “Babcock College” was initiated.

The process of affiliation with the University of Ibadan was still in progress when the Federal Government of Nigeria included Babcock University as one of the first three private universities in the country, announced on April 20, 1999. At a public ceremony presided over by the then Honourable Minister of Education, Mr. Sam Olaiya Oni, at the National Universities Commission (NUC), Abuja, on May 10, 1999, the Certificate of Registration No:002 was handed over to BU Pioneer Chancellor and Chairman of the University Council, Pastor Luka T. Daniel in his capacity as the President of the Africa-Indian Ocean Division of the Seventh-day Adventist Church. The Proprietors formally inaugurated the University on June 17, 1999. Being a pioneer private University in Nigeria since 1999, Babcock has continued this legacy of upholding a cutting-edge excellence in education. Babcock now has a postgraduate school which took off in the third quarter of 2010 and a medical school which took off in January 2012.

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