Researching the Effect of Cultural Diversity on Group Work Outcomes :: Racial Diversity, Ethnic Diversity

ABSTRACT This paper analyses the relationship between cultural diversity and workgroup outcomes (satisfaction with workgroup, and workgroup performance) in multicultural organizations, in the presence of moderating variables of intragroup conflicts (task, relationship and process conflicts). Literature review suggests that cultural diversity negatively affects workgroup outcomes and triggers conflicts. Analysis of empirical data collected from employees of multicultural organizations produces results in line with the literature and suggests that there is negative relationship between cultural diversity and workgroup outcomes, while intragroup conflicts have a strong moderating effect on the relationship between the two. Although the research implies that culturally homogenous groups have better outcomes, it is often impossible to assemble such groups in current corporate scenario. Therefore, targeted cross-cultural training programs may help individuals function well in culturally diverse gr oups by reducing conflicts and generating favorable group outcomes. INTRODUCTION Organizations often rely on culturally diverse groups to coordinate operations across countries, decrease redundant functions, reduce product development time and bring together a diverse pool of expertise. Culturally diverse groups, however, may not live up to these expectations. Individual differences give rise to intra-group conflicts which hinder the group’s performance as well as the group members’ satisfaction with the group. The fact that homogenous groups hardly exist and heterogeneous workgroups are the need of today’s organizations, it is pertinent to analyze the element of conflict among members of a group and its effect on the group’s performance outcomes. Pakistan, with its strategic geographical location and multicultural society, has been an interesting target for various international organizations that invest in this market and set up operations. These multinational organizations are bound to practice multicultural managements for effective operations (Islam, 2004). Local employees in such organizations are expected to work with people belonging to diverse nationalities who bring with them to the workplace, distinct cultures that effect outcomes of their workgroups. Another perspective of multiculturalism in Pakistani organizations is the presence of ethnic, gender based, religious, sectarian and geographical differences that affect relationships among people working in the same organization. It may be explained by the fact that women tend to face differential treatment at workplaces. People from different provinces in Pakistan generally differ in their attitudes and behaviors. Muslims tend to have a biased attitude towards non-Mu slims, and sectarian differences cause major conflicts of interests (Zubair, 2006). The current study tends to focus on such cross-cultural conflicts that affect workgroup outcomes at workplaces. The study is conducted in Pakistani setting upon national and international organizations.