Employee diversity can improve organizational functioning by stimulating:
- Greater Creativity
- Better Problem Solving
- Greater System Flexibility
1. Greater Creativity
Employee diversity can stimulate consideration of less obvious alternatives. Take the example of a Hispanic man and a white woman advising the CEO on a planned organizational downsizing. They suggested reduction in salary, unpaid vacation, early retirement option, 5% reduction in salary in return for stock in the firm. There plan was unanimously welcomed.
2. Better Problem Solving
Homogeneous groups are prone to a phenomenon called “groupthink”, in which all members quickly converge on a mistaken solution because they share the same mindset and view the problem through the lens of conformity.
In a heterogeneous group with a broader and richer reservoir of experiences and cultural perspectives, the potential for “groupthink” shrinks.