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Making Specific Use of Diversity within a Company

Steinbeis team gets involved in a research project on diversity management

It’s not just demographic or societal changes that are forcing German companies to rethink things, many companies are also actively involved in integrating jobseekers from around Europe or refugees from non-European countries. Diversity management is becoming increasingly important as a tool for specifically dealing with diversity within companies in a way that makes sense in commercial terms. It can no longer be reduced to buzzwords like equal opportunity and political correctness. As part of a project funded by the Federal Ministry for Research, the Steinbeis Transfer Institute zeb/business.school (based at Steinbeis University Berlin) partnered up with teams from the University of Oldenburg and the Frankfurt School of Finance & Management to investigate how companies are dealing with diversity – and which kinds of diversity management promote business success.

The research conducted by the Steinbeis experts and the many examples of companies that have been successful show how significant differences can be

The correlation between types of diversity management, grouping innovation success with overall success (Low 25% and Top 25% of companies)

recognized and used profitably. They also show that companies don’t automatically become more creative or more innovative

just because there is “more diversity.” Rather, businesses with a company culture geared to creativity and innovation are more adept at integrating and making use of skills and competences than less agile organizations.

In a first step, the project team carried out in-depth interviews with employees from six companies and supervised innovation projects over the course of several months. The results were used to design structured surveys and interviews. More than 600 people were then interviewed. All participating companies were asked to estimate their innovation and business success compared to their own set goals and compared to the competition. An index was calculated based on this, once for overall success and once for innovation success.

The companies surveyed implemented diversity management in one of three ways:

  1. Anti-discrimination: diversity management attempted to avoid discrimination (e.g., through quota legislation) as outlined in the General Equal Treatment Act.
  2. Market orientation: diversity management leveraged diversity and the cultural backgrounds of employees as a way of attracting customers and applicants.
  3. Learning and effectiveness: diversity management was used to pinpoint development opportunities within the company for a wide variety of differences (e.g., age, gender, but also skills).

Diversity management only contributes to the success of a company if the company actively taps into diversity, not when its efforts are simply based on avoiding discrimination. Highlighting minorities suffering from discrimination of categorizing people as belonging to the dominant majority often leads to a whole host of individual measures being introduced that companies and their employees deem ineffective or even condescending. Programs designed to promote specific women in leadership roles and the IT 50+ campaign are classic examples of this. Inclusion presupposes that there will be many minorities and majorities, and that this has to create an organization which offers advantages for everyone. Part-time managers as part of a job sharing arrangement promotes women but also benefits many men, and teams spanning different age groups in software development lead to faster development and more marketable products.

Lawmakers do provide a framework through things like the General Equal Treatment Act, but it’s not a guideline for drafting lists of actions in order to succeed in management. Of course no one should be discriminated against based on their gender, age, potential disability, religion, or sexual orientation. But a company can really only make use of differences in culture, experience, and skills if it recognizes them and develops them in a way that they can be put to good use. Examples of this include integrating language courses into the work day, establishing tandem teams with various levels of experience for learning, and creating image campaigns that highlight differences.

Diversity management should not be reduced to fixed characteristics, but should be used to identify and develop as many differences as possible: hobbies, language skills, experience with family life and care options, and the physical abilities of its employees can be very useful for a company. In this way, diversity management becomes an important part of knowledge and competence management within a company.