How Managing Cultural Diversity Can Provide Competitive Advantage

ravinder tulsiani Management Consultant
ravinder tulsiani Training and Development Pro
ravinder tulsiani Training Manager

How Managing Cultural Diversity Can Provide Competitive Advantage

1. Cost
As organizations become more diverse, the cost of a poor job in integrating workers will increase.
Those who handle this well will thus create cost advantages over those who don’t.

2. Resource Acquisition
Companies develop reputations on favorability as prospective employers for women and minorities.
Those with the best reputations for managing diversity will be the most attractive employers for women and minority groups.
An important edge in a tight labor market.

3. Marketing
The insight and cultural sensitivity that members with roots in other countries bring to the marketing effort should improve these efforts in important ways.

4. Creativity
Diversity of perspectives and less emphasis on conformity to norms of the past should improve the level of creativity.

5. Problem-Solving
Heterogeneity in decisions and problem-solving groups potentially produces better decisions through a wider range of perspectives and more through critical analysis of issues.

6. System Flexibility
An implication of the multicultural model for managing diversity is that the system will become less determinant, less standardized, and therefore more fluid.
The increased fluidity should create greater flexibility to react to environmental changes (i.e., reactions should be faster and cost less).