The impact of cultural diversity on organizational performance and success.

Abstract

Global organisations are in the midst of cultural change and transformation. The global markets are demanding that organisations remain relevant, competitive and flexible to adequately react to changes in the market. Customer demands, new product developments, business mergers, investments and skills requirements are some of the driving forces behind why organisations are recruiting more skilled and experienced individuals, sometimes recruiting even outside their home base. While these aforementioned drivers are behind this change in South Africa, another important driver is the Employment Equity Programs. This has brought together a very culturally diverse workforce that’s expected to work together to achieve one goal. With cultural diversity comes sensitive issues that organisations need to understand and manage, in order for them to perform and be highly competitive. This study on South African organisation, Engen Refinery is focused on finding out if cultural diversity exists and if it requires the organisation’s response, if managing cultural diversity has an impact on performance and finally recommending strategies, methods and tools that this organisation can use to manage its diverse employees. This study was conducted using Quantitative Methodology, on a sample of 119 employees, using a Census Technique. Using a questionnaire to collect data, findings from this study showed that in this particular organisation employees don’t have an issue of communication between cultures, there are no official programs and systems to manage cultural diversity, and employees are able to interact and that directly influences how the perform their daily tasks. Recommendations from this study note the importance of starting team building activities and social gatherings to increase employee interactions, implementing cultural diversity programs and policies and restructuring work teams to become more multicultural. Key limitations of the study include the fact that the findings are unique to this particular organisation and thus cannot be applicable to other South African organisations, they are reflective of a section of the petroleum industry and lastly are reflective of a particular period of time and conditions and can change over time.