Organizing

Organizations are systems created to achieve common goals through people-to-people and people-
to-work relationships. They are essentially social entities that are goal-directed, deliberately
structured for coordinated activity systems, and is linked to the external environment. Organizations
are made up of people and their relationships with one another. Managers deliberately structure
and coordinate organizational resources to achieve the organization’s purpose.

Each organization has its own external and internal environments that define the nature of the
relationships according to its specific needs. Organizing is the function that managers undertake to
design, structure, and arrange the components of an organization’s internal environment to
facilitate attainment of organizational goals.

Organizing creates the framework needed to reach a company's objectives and goals.

Organizing is the process of defining and grouping activities, and establishing authority relationships
among them to attain organizational objectives.

Importance of Organizing

A comprehensive approach to organizing helps the management in many ways. Organizing aligns the
various resources towards a common mission.

Efficient Administration

It brings together various departments by grouping similar and related jobs under a single
specialization. This establishes coordination between different departments, which leads to
unification of effort and harmony in work.

It governs the working of the various departments by defining activities and their authority
relationships in the organizational structure. It creates the mechanism for management to direct and
control the various activities in the enterprise.

Resource Optimization

Organizing ensures effective role-job-fit for every employee in the organization. It helps in avoiding
confusion and delays, as well as duplication of work and overlapping of effort.

Benefits Specialization
It is the process of organizing groups and sub-divide the various activities and jobs based on the
concept of division of labor. This helps in the completion of maximum work in minimum time
ensuring the benefit of specialization.

Promotes Effective Communication

Organizing is an important means of creating coordination and communication among the various
departments of the organization. Different jobs and positions are interrelated by structural
relationship. It specifies the channel and mode of communication among different members.

Creates Transparency

The jobs and activities performed by the employees are clearly defined on the written document
called job description which details out what exactly has to be done in every job. Organizing fixes
the authority-responsibility among employees. This brings in clarity and transparency in the
organization.

Expansion and Growth

When resources are optimally utilized and there exists a proper division of work among departments
and employees, management can multiply its strength and undertake more activities. Organizations
can easily meet the challenges and can expand their activities in a planned manner.

Formal Organisation

In every enterprise, there are certain rules and procedures that establish work relationships among
the employees. These facilitate the smooth functioning of the enterprise. Further, they introduce a
systematic flow of interactions among the employees. Effectively, all of this is done through a
formal organisation.

Notably, the management is responsible for designing the formal organisation in such a way that it
specifies a clear boundary of authority and responsibility. Coupled with
systematic coordination among various activities, it ensures achievement of organisational goals.

Again, the management builds the formal organisation. It ensures smooth functioning of the
enterprise as it defines the nature of interrelationships among the diverse job positions.
Additionally, these ensure that the organisational goals are collectively achieved. Also, formal
organisation facilitates coordination, interlinking and integration of the diverse departments within
an enterprise. Lastly, it lays more emphasis on the work to be done without stressing much on
interpersonal relationships.

Advantages

 The formal organisation clearly outlines the relationships among employees. Hence, it

becomes easier to rack responsibilities.

 An established chain of commands maintains the unity of command.

  As the duties of each member is clearly defined, there is no ambiguity or confusion in
individual roles whatsoever. Further, there is no duplication of efforts which eliminates any
wastage.

 In a formal organisation, there is a clear definition of rules and procedures. This means that
behaviours and relationships among the members are predictable. Consequently, there
is stability and no chaos existing in the enterprise.

 Finally, it leads to the achievement of organisational goals and objectives. This is because
there exist systematic and well thought out work cultures and relationships.

Disadvantages

 Decision making is slow in a formal organisation. It is important to realise that any

organisational need has to flow through the respective chain of commands before being
addressed.

 Formal organisation is very rigid in nature. This means that there prevails perfect discipline
coupled with no deviations from the procedures. Hence, this can lead to low recognition of
talent.

 Lastly, the formal organisation does not take into account the social nature of humans as it
talks about only structure and work. Interestingly, we cannot eliminate this integral part of
our nature. Hence, it does not entirely display the functioning of the organisation.

Informal Organisation

It’s easy to understand that if we interact with certain people regularly we tend to get more informal
with them. This is because we develop interpersonal relationships with them which are not based
solely on work purposes. Rather, these relationships might arise because of shared interests, like if
you get to know that your colleague likes the same football club of which you’re a fan of.

As a matter of fact, informal organisation arises out of the formal organisation. This is because when
people frequently contact each other we cannot force them into a rigid and completely formal
structure. Instead, they bond over common interests and form groups, based upon friendship and
social interactions.

Unlike formal organisation, informal organisation is fluid and there are no written or predefined
rules for it. Essentially, it is a complex web of social relationships among members which are born
spontaneously. Further, unlike the formal organisation, it cannot be forced or controlled by the
management.

Also, the standards of behaviour evolve from group norms and not predefined rules and norms.
Lastly, as there are no defined structures or lines of communication, the interactions can be
completely random and independent lines of communication tend to emerge in informal
organisation.

Advantages
  In this type of organisation, communication does not need to follow the defined chain.
Instead, it can flow through various routes. This implies that communication in an informal
organisation is much faster relative to formal organisation.

 Again, humans are social animals. The needs to socialize exists deep within our existence.
The informal organisation ensures that there is socialization within the enterprise.
Consequently, members experience the sense of belongingness and job satisfaction.

 Informal organisation, getting true feedbacks and reactions is not easy. Hence, in informal
organisation, various limitations of formal organisation is covered up.

Disadvantages

 The informal organisation is random and can result in the spread of rumours. Again, we
cannot manage and control informal organisation. Consequently, this may result in chaos
within the enterprise.

 It is important to realise that it is not possible to effect changes and grow without the
support of the informal organisation. This can work in both ways, for growth or decline of
the enterprise.

 To point out again, informal organisation conforms to group standards and behaviours. If
such behaviours are against the organisational interests, they can eventually lead to
disruption of the organisation.
Line authority relationship

Chain of command

Line authority is between the superior and his subordinate. When authority is delegated to the
subordinates, a chain of command is created. This chain of command is the actual relationship
between each superior and subordinate in a formal organization.

Channel of communication

The line authority also facilitates a channel of communication between the members of the
organization. The communication flows up and down through the line relationship. For effective
functioning of the organization, everyone in the organization has to be connected to this
communication channel.

Line Organization

Line organization, as the name suggests, is an organization wherein a direct vertical relationship
between the superior and subordinate exists. It relies on the scalar principle, which encompasses
that authority flows downward, i.e. the person at the top, delegates authority to the person at the
middle, who in turn delegates the authority to the bottom level.

When it comes to the quantum of authority, it is highest at the foremost level, which tends to
decrease at each following level.

This type of organization is characterised by a direct chain of command, which is like a thread that
passes through all the members of the organization. So, who is responsible for what and who is
accountable to whom is defined, that is to say, subordinates work under the supervision of the
superior

Line and Staff functions/Relationship/ Authority

The line functions are those which are direct responsibility for achieving the organizational goals. 
Production and Sales (and sometimes finance) are classified as line functions. Line positions are
engaged with line personnel and line managers. Line personnel carry out the primary activities of a
firm and are considered significant to the basic functioning of the organization. Line managers make
the majority of the decisions and direct line staff work to achieve company goals. An example of a
line manager is a finance executive.
The staff functions are those who provide service & help and advice the line to work most effectively
in accomplishing the objectives of the enterprise. Staff positions serve the business by indirectly
supporting line functions. Staff positions include staff personnel and staff managers. Staff personnel
contribute technical competencies to support line personnel and aid top management in various
business activities. Staff managers provide support, advice, and knowledge to other individuals in the
chain of command.

Even though staff managers are not part of the chain of command related to direct production of
products or services, they do have authority over personnel. An example of a staff manager is a legal
adviser. He or she does not actively engage in profit-making activities, but does provide legal support
to those who do. Therefore, staff positions, whether personnel or managers, engage in activities that
are supportive to line personnel.

ine and staff organization is the organization that combines the merits of line and functional
organization, by adding the functional specialist to the line organization. Here, line authority stays
same, as in the case of line organization and it flows downward. The functional experts, give advise
to the front line managers, in the matters relevant to the object of the organization. The specialist
works as staff and serves the line officials, by supporting and guiding them, whenever necessary.

There are a number of benefits of line and staff organization, in the sense that it gives relief to the
line managers and they can concentrate on the implementation of policies and plans. Moreover,
there is a benefit of specialization, as in work is divided between the line and staff executives, and
they focus on their respective area.

In this type of organization, the decision making is quick and easy, as the expert advice can help in
making better decisions
Key Differences Between Line and Line & Staff Organization

The points given below explain the difference between line and line & staff organization:

1. Line organization can be understood as a vertical organization, wherein the superior can give
orders to a subordinate, through a direct chain of command. Line and staff organization is
the organization structure, in which there is a normal departmentation of the regular
business operations, and there is the functional specialist to perform specialised activities.

2. While line authority relies on command, line and staff authority is based on command and
advise.

3. As we talk about discipline, line organization, is strict, whereas line and staff organization is
loose.

4. In a line organization, the line executives are the generalist, who is directly responsible for
accomplishing the objectives of the organization. On the other hand, in line and staff
organization, the staff executives are specialist who supports and advice the line managers
in the accomplishment of organization’s objectives.

5. There is centralization of authority in a line organization, and so all the decisions of the
organization are taken by the top authority only. Conversely, in line and staff organization,
there is a combination of centralisation and decentralisation, in essence, some of the
decisions are centrally taken while some are diffused.
 6. Line organization, is good for small corporations, as, in such a structure, the authority is
concentrated at the top, which makes it difficult to manage if the number of employees are
large. On the contrary, Line and staff organization, is best suited for large corporations due
to the presence of staff specialist, who use their knowledge to advice line managers on
complex issues.

Centralization and Decentralization

A simple way to understand if an organization is working in a centralized or decentralized manner is

by looking at two important aspects:

1. The place of the decision-making authority in the hierarchy of the management i.e.

Centralized.

2. The degree of decision-making power at the lower echelons in the organization i.e.
Decentralized.

An organization has a greater degree of decentralization if the number of decisions made and
functions affected at the lower level are higher.

Further, while decentralization and delegation of authority might seem similar, you must not
confuse one with another. A decentralized way of working is more about the philosophy of the
organization.

Unlike delegation, it is not just about handing over a part of the authority to a subordinate but a way
of approaching the decision-making process in the organization.

Decentralization is a choice, while delegation is a must. Let’s take a quick look at the advantages of
centralization and decentralization:

Advantages of Centralization

 The organization can strictly enforce uniformity of procedures and policies.

 It can help in the elimination of overlapping or duplicate activities and save costs.

 The organization has a better chance of utilizing the potential of its outstanding employees.

 It offers a better control over the activities of the organization by ensuring consistency

in operations and uniformity in decision-making.

Advantages of Decentralization

 Faster decision-making and better quality of decisions

 Improves the effectivity of managers.

 Offers a democratic environment where employees can have a say in their governance.
  Provides good exposure to mid and lower-level managers and creates a pool of promotable
manpower with managerial skills.

 Since managers can see the results of their own actions, they are more driven and have
improved morales.

Both centralization and decentralization have their own advantages and disadvantages. Even if an
organization is working in a decentralized manner, some functions are usually centralized. Next, let’s
look at the factors that determine the degree of decentralization.
 Management Principles of Organizing

Work Specialization

Also called division of labor, work specialization is the degree to which organizational tasks are
divided into separate jobs. Each employee is trained to perform specific tasks related to their
specialized function.

Specialization is extensive, for example running a particular machine in a factory assembly line. The
groups are structured based on similar skills. Activities or jobs tend to be small, but workers can
perform them efficiently as they are specialized in it.

In spite of the obvious benefits of specialization, many organizations are moving away from this
principle as too much specialization isolates employees and narrows down their skills to perform
routine tasks.
Also it makes the organization people dependent. Hence organizations are creating and expanding
job processes to reduce dependency on particular skills in employees and are facilitating job rotation
among them.

Authority

Authority is the legitimate power assigned to a manager to make decisions, issue orders, and
allocate resources on behalf of the organization to achieve organizational objectives.

Authority is within the framework of the organization structure and is an essential part of the
manager’s job role. Authority follows a top-down hierarchy. Roles or positions at the top of the
hierarchy are vested with more formal authority than are positions at the bottom.

The extent and level of authority is defined by the job role of the manager. Subordinates comply
with the manager’s authority as it is a formal and legitimate right to issue orders.

Chain of Command

The chain of command is an important concept to build a robust organization structure. It is the
unbroken line of authority that ultimately links each individual with the top organizational position
through a managerial position at each successive layer in between.

It is an effective business tool to maintain order and assign accountability even in the most casual
working environments. A chain of command is established so that everyone knows whom they
should report to and what responsibilities are expected at their level. A chain of command enforces
responsibility and accountability. It is based on the two principles of Unity of command and Scalar
Principle.

Unity of command states that an employee should have one and only one manager or supervisor or
reporting authority to whom he is directly accountable to. This is done to ensure that the employee
does not receive conflicting demands or priorities from several supervisors at once, placing him in a
confused situation.

However, there are exceptions to the chain of command under special circumstances for specific
tasks if required. But for the most part organizations to a large extent should adhere to this principle
for effective outcomes.

Scalar principle states that there should exist a clear line of authority from the position of ultimate
authority at the top to every individual in the organization, linking all the managers at all the levels.
It involves a concept called a gang plank using which a subordinate may contact a superior or his
superior in case of an emergency, defying the hierarchy of control. However, the immediate
superiors must be informed about the matter.

Delegation

Another important concept closely related to authority is delegation. It is the practice of turning over
work-related tasks and/or authority to employees or subordinates. Without delegation, managers do
all the work themselves and underutilize their workers. The ability to delegate is crucial to
managerial success.
Authority is said to be delegated when discretion is vested in a subordinate by a superior. Delegation
is the downward transfer of authority from a manager to a subordinate. Superiors or managers
cannot delegate authority they do not have, however, high they may be in the organizational
hierarchy.

Delegation as a process involves establishment of expected outcomes, task assignment, delegation

of authority for accomplishing these tasks, and exaction of responsibility for their accomplishment.
Delegation leads to empowerment, as employees have the freedom to contribute ideas and do their
jobs in the best possible ways.

Span of Control

Span of control (also referred to as Span of Management) refers to the number of employees who
report to one manager. It is the number of direct reportees that a manager has and whose results he
is accountable for.

Span of control is critical in understanding organizational design and the group dynamics operating
within an organization. Span of control may change from one department to another within the
same organization.

The span may be wide or narrow. A wide span of control exists when a manager has a large number
of employees reporting to him. Such a structure provides more autonomy. A narrow span of control
exists when the number of direct reportees that a manager has is small. Narrow spans allow
managers to have more time with direct reports, and they tend to spark professional growth and
advancement.
Organizational Structure

An organization is a social unit of individuals that is designed and managed to achieve collective
goals. As such organizations are open systems that are greatly affected by the environment they
operate in. Every organization has its own typical management structure that defines and governs
the relationships between the various employees, the tasks that they perform, and the roles,
responsibilities and authority provided to carry out different tasks.

An organization that is well structured achieves effective coordination, as the structure delineates
formal communication channels, and describes how separate actions of individuals are linked
together.

Organizational structure defines the manner in which the roles, power, authority, and
responsibilities are assigned and governed, and depicts how information flows between the different
levels of hierarchy in an organization.

The structure an organization designs depends greatly on its objectives and the strategy it adopts in
achieving those objectives.

An organizational chart is the visual representation of this vertical structure. It is therefore very
important for an organization to take utmost care while creating the organizational structure. The
structure should clearly determine the reporting relationships and the flow of authority as this will
support good communication – resulting in efficient and effective work process flow.

Common Organization Structures

Managements need to seriously consider how they wish to structure the organization. Some of the
critical factors that need to be considered are −

 The size of the organization

 Nature of the business

 The objectives and the business strategy to achieve them

 The organization environment

Functional Organization Structure

The functional structure is the most common model found in most organizations. Organizations with
such a structure are divided into smaller groups based on specialized functional areas, such as
operations, finance, marketing, Human Resources, IT, etc.
The organization’s top management team consists of several functional heads (such as the VP
Operations, VP Sales/Marketing). Communication generally occurs within each functional
department and is communicated across departments through the department heads.

This structure provides greater operational efficiency as employees are functionally grouped based
on expertise and shared functions performed. It allows increased specialization as each group of
specialists can operate independently.

In spite of the above benefits there are some issues that arise with this structure. When different
functional areas turn into silos they focus only on their area of responsibility and do not support
other functional departments. Also expertise is limited to a single functional area allowing limited
scope for learning and growth.

Product/Divisional Organizational Structure

This is another commonly used structure, where organizations are organized by a specific product
type. Each product category is considered a separate unit and falls within the reporting structure of
an executive who oversees everything related to that particular product line. For example, in a retail
business the structure would be grouped according to product lines.
Organization structured by product category facilitates autonomy by creating completely separate
processes from other product lines within the organization. It promotes depth of understanding
within a particular product area and also promotes innovation. It enables clear focus with
accountability for program results.

As with every model, this model also has a few downsides like requirement of strong skills
specializing in the particular product. It could lead to functional duplication and potential loss of
control; each product group becomes a heterogeneous unit in itself.

Geographic Organizational Structure

Organizations that cover a span of geographic regions structure the company according to the
geographic regions they operate in. This is typically found in organizations that go beyond a city or
state limit and may have customers all across the country or across the world.
It brings together employees from different functional specialties and allows geographical division.
The organization responds more quickly and efficiently to market needs, and focuses efforts solely
on the objectives of each business unit, increasing results.

Though this structure increases efficiency within each business unit, it reduces the overall efficiency
of the organization, since geographical divisions duplicate both activities and infrastructure. Another
main challenge with this model is that it tends to be resource intensive as it is spread across and also
leads to duplication of processes and efforts.

Matrix Organizational Structure

A matrix structure is organized to manage multiple dimensions. It provides for reporting levels both
horizontally as well as vertically and uses cross-functional teams to contribute to functional
expertise. As such employees may belong to a particular functional group but may contribute to a
team that supports another program.

This type of structure brings together employees and managers across departments to work toward
accomplishing common organizational objectives. It leads to efficient information exchange and flow
as departments work closely together and communicate with each other frequently to solve issues.

This structure promotes motivation among employees and encourages a democratic management
style where inputs from team members are sought before managers make decisions.

However, the matrix structure often increases the internal complexity in organizations. As reporting
is not limited to a single supervisor, employees tend to get confused as to who their direct
supervisor is and whose direction to follow. Such dual authority and communication leads to
communication gaps, and division among employees and managers.
Organizational Process

Organizing, like planning, must be a carefully worked out and applied process. This process involves
determining what work is needed to accomplish the goal, assigning those tasks to individuals, and
arranging those individuals in a decision‐making framework (organizational structure).

The Organization Process Chart

Following is a representation of organization process chart.

A well-defined organizing process leads to improved communication, transparency and efficiency in
the organization.

What is departmentalization?

Departmentalization is an organizational structure that separates people into groups, or

departments, based on a particular set of criteria. These departments have their own leadership and
work together to complete tasks. With large or complicated projects, multiple departments may
work together.

Here are the primary objectives of businesses that choose to implement departmentalization:

 Maintaining control

 Simplifying operational processes

 Grouping specialized activities together

 Increasing overall efficiency

 Ensuring responsibility and accountability

What are the benefits of departmentalization?

Organizations use departmentalization for several reasons. First, it's a good way to organize a large
number of people. It can also simplify training, increase the ease of evaluating performance and
allow for quick growth or expansion. Finally, departmentalization effectively integrates work,
allowing people to communicate with and learn from their departments easily.
Types of departmentalization

Here are the common types of departmentalization:

Function

Organizations that form departments by function separate employees based on the type or subject
of work they perform. This allows professionals with similar areas of expertise to communicate and
collaborate with each other. Three common types of function departments are production,
marketing and finance.

Process

Process departmentalization groups people by where in the production process their work usually
occurs. For example, a toy company may have a department for ordering the raw materials, one for
building toys and a third department for transporting them. Process departmentalization is common
among production companies.

Product

Some companies with more than one product may sort their departments by the item that teams
work on. For example, an ice cream company may have separate departments for their popsicles, ice
cream sandwiches and take-home ice cream cartons. Larger companies often have more products,
so they're more likely to use this type of departmentalization.

Market

Market departmentalization is when an organization forms its departments based on what market
it's targeting. Markets are large groups of customers that may have unique needs. For example, a life
insurance company may have departments for insuring large companies, nonprofit organizations
and individuals.

Customer

If a company has a particular customer that gives them a lot of business, they can create a
department specifically for that customer. For example, if a canned beans production company sells
to five major grocery stores, they may have a department for each store. This is a common type of
organizational structure for contracting and some production companies.

Location

Location departmentalization creates groups based on a general geographical area. This area can
either be the location of the company or of their clients. For example, a telemarketing company can
make departments depending on which state their telemarketers target.

 Matrix departmentalization

Matrix departmentalization attempts to combine functional and task force (project)

departmentalization designs to improve the synchronization of multiple components for a single
activity (i.e., a moon launch), to improve the economics of scale, and to better serve the customer
and company.

Planning Task Force (project)

The planning task force is most often formed when the organization requires addressing special
circumstances. It is more preferable, and efficient than maintaining a different planning staff or
department.

Organisational Culture

 Organisational Culture is a vital contributor behind corporate success because it has a far-
reaching influence on the behaviours and actions of the employees.

 Simply a culture means how people are different in a particular situation. This is who we
are. This is what we do. This is what we stand for.

 Culture is actually the unique identity of the organisation. According to handy, culture

means the way we do things around here.

Culture = belief + knowledge + attitudes + norms + customs 

Organisational Iceberg: The idea of hidden elements in culture is often referred to as the

organisational iceberg. (Think of titanic). The iceberg describes two levels at which culture operates:

1. Formal aspects: These aspects are visible, i.e., above the water. These include goals,
technology, procedures, structure, and skills.

2. Behavioural aspects: These aspects are hidden, i.e., below the water. These include
attitudes, style, communication patterns, values, feelings, beliefs.

Advantages of having a strong culture

 Ensure smooth communication in the organisation

 Better coordination within the organisation

 Provide a framework of social individuality and a sense of belonging

 Shrink differences amongst the members of the organisation

 Strengthen the dominant values and attitudes

 Standardise behaviour and norms among the members of the organisation

 Diminish some of the perceptual differences among the people within the organisation

 Reflect the philosophy and values of the organisation’s founder or group

  Affect the organisation’s strategy and capability to change

Disadvantages of having a strong culture

 Strong cultures are difficult to change, beliefs which underpin culture can be deep-rooted

 Strong cultures may have constrained view which could affect the organisation’s ability or
desire to learn new skills

 A strong culture which is positive can enhance the performance of the organisation, but a
strong culture which is negative can have the opposite effect

 Conflicts may arise, when two strong cultures come into contact, eg. In a merger

 A strong culture may not always be suitable for the environment

Influences on culture

 Size

 Technology

 Diversity

 History

 Ownership

 The degree of individual initiative

 The degree of risk tolerance

 Clarity of direction

 The degree of integration between groups

 The reward system

 Conflict tolerance

 Communication patterns

 The kind of people employed

Cultural Diversity in the Workplace:

More and more companies in today’s business world are ramping up their efforts around diversity,
equity, and inclusion. And those businesses that aren’t are quickly falling behind. Establishing
cultural diversity within the workplace is a consistent process. You never stop creating a safer and
more accepting environment where your employees can thrive.
What is cultural diversity in the workplace?

Cultural diversity refers to the variety of cultural and ethnic groups that exist in our society. These
groups can be based on people’s age, gender, ethnicity, or religion, among many other
characteristics.

In the workplace, cultural diversity involves employees from different backgrounds working together
in an inclusive environment.

At present, most companies have their own form of Diversity, Equity, and Inclusion (DEI)
programs for employees. As they should. There remains so much work to do to make organizations
more equitable, more diverse, and more inclusive. It is a continual process. 

Types of cultural diversity in the workplace

Culture comes in many forms. The people you work with can vary greatly in terms of background,
beliefs, and behavior.

Familiarity with your employees’ cultures can guide you on how to promote diversity and inclusion
in the workplace.

Race

Employees of color frequently face systemic challenges at work and have for decades. Your company
needs to ensure that equal hiring, compensation, and promotion opportunities are given to
employees regardless of race or ethnic background. 

Religion 

Religion affects employees’ attire, diet, and even their requests for time off. Designated praying
areas and respect for religious practices are great ways of promoting this type of diversity.

Age

A diverse workforce involves employees coming from a wide range of ages and generations, which
means employee experience cannot be one-size-fits-all. For example, some younger employees may
prefer a flexible work culture, while tenured staff may prefer traditional schedules and working in
the office. Different age groups also diverge in what kind of benefits and perks are more important
to them. 

Sexual orientation 

Sexual orientation is an especially important aspect of an employee’s identity. Survey data reveals
that one in ten LGBTQIA+ workers has experienced discrimination at work.
It’s best to establish a no-tolerance policy for workplace bullying, discrimination, and harassment
based on sexual orientation.

Education 

No two workers will have the same set of skills, knowledge, and experiences. Collaboration and
learning opportunities can help bridge the gap between employees’ differences in education and
offer more perspectives that contribute to the company.

Gender 

Gender is a social construct that refers to the roles and behaviors typically associated with a man,
woman, or other gender identities. It remains a huge source of discrimination as 42% of women
have experienced gender discrimination at work. Thus, creating an environment of safety, mutual
respect, and boundaries among your gender-diverse staff is of the utmost importance. Incidents of
harassment and abuse should be promptly investigated and dealt with appropriately.

Language and Ethnicity 

Some companies have programs dedicated to overcoming language and cultural barriers. These
programs aim to improve communication and prevent misunderstandings among employees with
different primary languages. 

Disability

Some of your employees might be experiencing difficulties in seeing, hearing, or

moving. Adjustments to office facilities can help them perform their duties more conveniently.

Why is cultural diversity important in the workplace?

You might think that cultural diversity at work impacts employees only. On the contrary, it can shape
the future of your company, product line, and customer base as well.

Here are several reasons why cultural diversity is extremely valuable in the workplace:

Productivity

Bringing together a team of diverse individuals can sound like a complex challenge. It takes time,
investment, and resources dedicated to making strides and improvements. Among the litany of
benefits of building a more diverse, equitable, and inclusive workplace can largely boost your
company’s productivity.

Respondents in a research conducted by Forbes claimed that they experienced more productivity as

a result of a diverse workforce. Diverse employees bring with them a range of problem-solving skills,
viewpoints, and working habits. This wealth of expertise can help your company create better
solutions, improve workflow, and level up performance.

Growth

Working in diverse teams exposes your employees to unique perspectives that help them grow both
personally and professionally.

Cultural diversity also broadens your company’s network locally and overseas. If you open your
doors to workplace diversity, your contacts and connections in the business world will grow, too.

Additionally, an inclusive environment is welcoming to all. It sends out a message not only to
employees but also to clients and other diverse companies that you’re committed to collaborating
without barriers or biases.

Creativity

There’s no limit to creativity in a culturally diverse workplace. Research shows that exposure to a
culturally diverse workforce enhances a person’s creativity. Fresh ideas, new perspectives, improved
products, and upgraded services are often the result of diverse and brilliant minds coming together.

Additionally, multicultural teams bring unique perspectives about their respective local markets.
Their understanding of native languages and area trends can introduce your company to new
audiences and create even more demand.

Recruitment

Cultural diversity opens up your talent pool to global job markets. Keep this in mind if you want to
attract the best talent and expertise to your organization.

A recent study revealed that job hunters are drawn to companies with diverse workforces. Having an
inclusive culture makes your company stand out to prospective employees from around the world.
Diversity initiatives also improve your company’s overall reputation. As a result, more applicants will
recognize your organization as a good place to work.

Retention

Promoting cultural diversity makes workers feel like their uniqueness is celebrated, not just
tolerated. A study from Deloitte discovered that inclusive working environments led to higher
retention rates.

What’s more, inclusivity increases long-term job satisfaction and loyalty, which also leads to better
retention. If employees feel at home and accepted in the workplace, they won’t feel the need to go
elsewhere.

How to promote cultural diversity in the workplace

Nurturing cultural diversity is no easy task, especially in large organizations. To be effective, your
advocacy needs to reach and influence multiple employee levels, departments, and teams. 

The benefits of having a truly diverse workforce will be well worth your time and effort. 

There are several steps you can take to make your workplace a more inclusive one. Check out
these simple yet effective ways:

1. Encourage the expression of opinions and beliefs

2. Respect cultural traditions and celebrations

3. Organize team-building activities

4. Establish inclusive leadership

5. Develop inclusive policies

6. Create cultural communities

PRAVASH JENA
Assistant Professor
Department Of MBA
TACT
8249898445