Equality, Diversity and Inclusion: An International Journal
Managing complexity: using ambivalence and contingency to support diversity in organizations Iris Koall

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Managing complexity: using ambivalence and contingency to support diversity in organizations

572

Iris Koall

Received May 2011
Revised June 2011
Accepted June 2011

Centre of Continuing Education, University of Wuppertal, Wuppertal, Germany
Abstract

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Purpose – The purpose of this paper is to describe and discuss complexity approaches of management theory, by focusing on their capacity to use efficiently contingence in organizations. As a theoretical framework the theory of social systems (Luhmann) is used, where a difference is made between complexity reduction and condensation. Complexity reduction is related to certain functional needs to control a hierarchical system. Complexity condensation redesigns communicative structures towards participative norm development, offering discursive connectivity, and decision making in networks. It is described how heterogeneous cultures in organizations have the chance to be successful by focusing their functional needs to include, to orient, and to motivate.
Design/methodology/approach – The paper opted for discussing theoretical frameworks to reconstruct management approaches to develop towards more diversity capacity in organizations.
Theory of social systems is employed as basic methodology.
Findings – The chosen research reconstructs management approaches to focus on functional imperatives of organizational systems as well as the development of functional equivalents. The logic figure of functional equivalents describes alternatives of exclusive organizational cultures.
Heterogeneity in organizations is based on the redesign of communicative procedures, structures and cultures.
Research limitations/implications – The aim of the paper is diversity theory development. It offers heuristic moments which might be useful in empirical research, too. Following the suggestion homogeneity is just an outcome of certain organizational decisions to deal with contingency and complexity, it might offer practical relevance by testing the capacity to change communication and interaction patterns. The culture-function matrix also might offer an opportunity to discuss the paradigms of organizational development towards more diversity.
Practical implications – There might be the possibility to enhance conditions of observing organizations, but the practical implications might be rather limited.
Originality/value – Using theory of social systems (Luhmann) as theory which focuses complexity traits is rather undeveloped. It could offer insights in the capacity to deal with contingency, and the attempts to suppress it. Complexity in social systems could offer a prerequisite to support the interdisciplinary research in diversity studies.
Keywords Heterogeneity in organizations, Theory of social systems, Managing diversity,
Organizational culture, Functional management
Paper type Research paper

Equality Diversity and Inclusion: An
International Journal
Vol. 30 No. 7, 2011 pp. 572-588 q Emerald Group Publishing Limited
2040-7149
DOI 10.1108/02610151111167034

Introduction
In this paper, we provide a system-based view of diversity in order to suggest that diversity can be fostered critically by encouraging organizations to regulate rather than reduce complexity, which is currently done in many organizations (Becker and
Haunschild, 2003; Mingers, 1995; Seidl and Becker, 2006). We relate our considerations to constructivist considerations and theory of social systems (Luhmann, 1984, 1996).
Organizations tend to avoid heterogeneity or getting “overwhelmed by ambivalent”

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distinctions (Seidl and Becker, 2006). The rhetoric of managing diversity can be viewed as a strategy which seems to be willing to cope with increasing subjectivity and complexity in organizations. The design of organizational structures affects the ways in which diversity is considered and managed (Janssens and Zanoni, 2005) and the use of discourses and language about diversity (Zanoni and Janssens, 2004).
We present homogeneity in organizations as part of the communicative culture and describe how heterogeneity might meet functional requirements by substituting exclusive communication and interaction. Through this approach we are able to apply political normative aspirations of the diversity approach – like participation and transparency – to functional conditions of organizational processing. In diversity discourses a normative political perspective is often utilizing and relating individual values and working practices (Alvesson and Willmott, 1996). In contrast, we intend to apply autopoietical, functional concepts of interaction and organizational communication. For the successful implementation of diversity management, awareness of the effects of rising complexity and the ability to deal with the often negative consequences of diversity for individuals in organizations (Cox, 2001) are crucial. This important issue arises because organizational structures and management procedures are much more related to the reproduction of homogeneity than to the regulation of heterogeneity (Koall, 2001; Tatli and Oezbilgin, 2007).
Supporting diversity management – what shall be done to overcome [. . .]?
Diversity implementation intends to displace organizational structures and procedures of exclusion – which are culturally homogeneous – by blocking communicative transparency and participation. Normative political approaches of managing diversity are connected with liberal concepts of economic emancipation as a prerequisite of participation, independent from social or religious background, skin color (race), life style, body conditions, sexual orientations. The gap between the rhetoric and reality of diversity management issues occurs through the assumption that complexity might only be reduced by power structures in organizations – and that vice versa diversity will be able to unfold by changing these power relations (Kirton and Greene, 2005, p. 242). These political normative approaches work with a binary distinction between exercise of and dependency on power. Aspects of communicative complexity, e.g. “blind spots” in observation, dependence on interpretation of cultural knowledge or latent emotional motives are undervalued. This lack of awareness of communicative complexity describes constructivist doubts about diversity management approaches, which refer to power relations for contingency regulation (Knoth, 2006, p. 139). To enlighten these blind spots, we would like to have a look at the assumptions on which the complexity reduction approach is based. These managerial ideals promote a rigid culture and foster path-dependent perceptions in management approaches. Rigid cultures deploy collective avoidance of reflection and critical perceptions, and strive for cultural conformity, and lack
¨
of flexibility, to secure normality (Steinmann and Schreyogg, 1993, pp. 599-600).
Hierarchical, mostly bureaucratic systems seldom show affection to analyze the impact of interaction and self-organization on their operative processes (Luhmann, 1964).
Social order is established by following hierarchical principles or by focusing on functional imperatives, which a system develops through interrelation with its environment (Luhmann, 1984). However, hierarchical communication – in connection with repeatable, standardized tasks – does not make efficient use of a heterogeneous

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work force. In hierarchical organizations the costs of coordinating heterogeneous personnel (like conflict solving, identity construction) are over exceeding the gains of diversity (like creativity and system flexibility) (Williams and O’Reilly, 1998). Diversity management on the other hand intends to use and appreciate diverse personnel potential instead of discriminating differences in lifestyles, milieus and personal traits (Koall,
2001, 2003; Krell, 1996, 2003, 2008). Workplace diversity criticizes dominance and the construction of homogeneity at the meso level of organizations (Konrad et al., 2006a, b).
As a management concept it initiates processes to change hierarchical organizational
¨
cultures by implementing and using instruments of personnel management (Hoher and
¨
Hoher, 2007; Krell, 2008). Focusing on subjective characteristics and skills of the work force helps to raise the complexity of work relations and employment patterns.
Managing diversity intends to regulate complex modes of work and production according to business requirements as well as to employees’ individual needs, e.g. with regard to work-family balance or phases of word-life. These different work styles and work cultures need to be included into functional operations and environmental challenges. Managing Diversity strives for organizations which are re-built to change towards heterogeneous cultures which reflect our diverse reality (Koall, 2007).
Complexity reduction in organizations
According to Kieser (1999, p. 170) general principles are not suitable to guide practical organization. Therefore, several different environmental and internal conditions are related to a wide range of recommendations for organizational design. These contingency approaches describe complex management procedures. They measure the interdependence of environmental influences and internal procedures/structures by defining organizational context variables. These contingency approaches combine different managerial moments, like organizational psychology (e.g. Pugh, 1981), considerations about how functions are a result of organizational structures (Blau and
Schoenherr, 1971), and the description of internal organizational diversification
(Lawrence and Lorsch, 1969). Here, considerations about the limited efficiency of hierarchical organizations in turbulent environments are of special relevance for diversity (Burns and Stalker, 1961).
Simon (1949/1979) describes another aspect which is relevant to the complexity discussion. His concept of “bounded rationality” of an agent is constitutive for organizations. This suggests an agent is contradicting linearity and rationality of an organization by limited perception and action. In this perspective, organizations need to regulate internal and external complexity by organizational structures, e.g. to simplify decisions by standardized programs (e.g. division of labor, control and hierarchy, communication, social technologies). Simon’s binary distinction between
“rational communication” and “personal irrational interaction” is relevant for organizational processes. In complex environments, individual agents are limited and focused by the use of strategies of organizational rationality (premises for value, causality, power, restriction of perception, selective perception to absorb insecurity).
Furthermore, an organization’s capacity to adapt to complex environments is reduced by structural inertia, or tendencies to foster internal homogeneity. There seem to be forces which keep the organization stable and to protect it against the complex external environment. Organizational ecology (Hannan and Freeman, 1977, 1989) is based on the premise about organizational internal stabilizing factors (like capital

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investment, informational deficits, lack of proactive actions, social persistence networking) and the limited ability of organizations to cope with the need to evolve within an irritating environment. Organizations tend to secure expectations by formulating and institutionalizing rules. Observing the other organizations in the environment might result in a tendency to copy putatively successful structures and processes (DiMaggio and Powell, 1983). Organizational isomorphism fosters structural identity of development and the loss of organizational uniqueness. In this situation organizational actors are unable to describe whether their interactions and reactions are restricted to and adapted as “taken for granted” expectations (Suess, 2007).
By connecting bounded rationality and isomorphistic evolutionary principles Sachs and Ruehli (2000) describe cultural memic organizations as rejecting internal cultural changes. To copy rather than to reflect cultural presentations in organizations can be described as “memic” attitude. Communication patterns are mimetically replicated if they are easy to communicate, learnable and have a higher level of transferability.
Memic attitudes also explain the resistance against diversity issues as lack of interactional and communicative ability to change organizations towards greater heterogeneity. In this case:
.
individual bounded rationality is considered to be influenced by memic replication of communicative patterns, especially business key variables;
.
meme might be the moving or retarding force for changing identity of an organization; and
.
memic core business processes which reject to consider variances constitute path dependency. Contingency approaches consider organizations to be predictable entities within a calculable environment. Therefore, it seems to be possible to forecast an incorporate in plans new market demands (if any), methods and technology. Contingency approaches are willing to reduce the external complexity by more or less repressive methods of internal homogenizing adaptation. Homogeneous or heterogeneous assumptions determine the success of diversity implementation in organizations (Koall, 2001). In the next chapter, we will suggest supplementary moments, which help to observe complexity and offer frames to understand it.
Conditions of complexity regulation
The ideology of rational planning has been criticized on several levels. A representative style of planning is constituted by a mechanistic view of organizations by achieving predefined goals (Morgan, 1997). Conflicts or problems are perceived as deficient cogs in the machine. Diversity issues – which challenge rationality – are perceived as interruption or as a consequence of inefficiency or insufficient organizational regulation.
It is likely that this style of planning will hamper any innovation effort in diversity management, or will be “hijacked” to become a way of making an organization more productive ( Janssens and Zanoni, 2005). The theoretical approaches described here may attract practitioners who are willing to regulate complexity by more or less repressive modes of internal homogenization (Koall, 2001). Management chooses opportunities by following or rejecting complexity drivers or complexity simplifiers. Complexity drivers are characterized by flux, ambivalence and interdependence, while complexity simplifiers are used as cultural homogenization, corporate identity, common goals,

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and standardization of core processes (Nedopil et al., 2011, pp. 3-22). Still, contingency is handled as a kind of threat, not a chance to attain a more complex perspective on internal processes and conscious ability to decide on environmental reference.
However, it is also possible to describe contingency in a more approving way. In this case contingency is an unavoidable part of communication, events, action or interaction and is defined by Luhmann (1996, p. 156) as being cogently indispensible but principal possible. Using contingency in managerial decisions in organizations allows for the iterative change of social order (power and material artefacts) or for emergent self-referential processes (Ortmann et al., 1997). This strengthens the capacity to communicate about observations and to focus on the non-conventional experience.
This cultural perspective of organizational research describes how experiences of alternative decisions and actions are stored in manifest or latent structures of organizational cultures. Organizations are then perceived as cultures (Smircich, 1983,
p. 347). They are a mindset for contemporary or future decisions, and are useful to legitimize future actions (Koall, 2001; Luhmann, 1997). Culture can be perceived as memory of organizations for interpretation and constructing sense in communication
(Luhmann, 1997, p. 589, pp. 881-882, 2000, pp. 243-244). Latent knowledge can be actualized to support system evolvement (Kuehl, 2002, p. 114). In the last part of this paper, we will have a look at this concept.
There is still the need to enrich these approaches with the observation of contingences in organizational communication. Complexity is differentiated and moderated by reflecting individual skills in organizations. Individual complexity promotes learning in organizations but depends on the personal ability to differentiate, reflect, communicate and coordinate individual as well as organizational motives and interests (Argyris and
¨
¨
¨
Schon, 1996). Referring to Argyris and Schon (1996) and Schreyogg and Noss (1997) generate different stages of reflecting normality or rise of complexity awareness as basic assumptions in organizations. This reflection process about the personal conditions of reality construction is a requirement for dealing with diverse motives, perceptions and assumptions in organizations (Bruchhagen and Koall, 2002; Knoth, 2006).
The efficiency and quality of technologically mediated communication is depending on the quality of face to face interactions (Knoblauch, 1996, pp. 355-356). In this case, interaction is a part of formal relations. We have to distinguish communication from interaction. Communication occurs on the level of organizations and cannot be attributed to individuals. But interaction of individuals – constituted as conscious information processing and mindful systems – is necessary to process communication
(Luhmann, 2002, p. 171). This distinction between communication and personal interaction adverts to different modes of gaining knowledge or information in organizations. Communication gains structural relevance, in the sense of getting connected to organizational structures or decisions. Personal interaction as
“microdiversity” is much more connected to processes of self-organization than to organizational programs and premises of decisions (Luhmann, 2000, p. 255). This vivid, non-regulated, informal interaction of microdiversity is always part of organizational programs, which are containing and processing procedures of organizational decisions, purposes, and communicative paths and processes. Communication paths contain both formal and informal communication.
In this pattern of interaction and communication the processes of self-organization and organizational programs are connected. Technological instruments support

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this connection and diffusion of interaction and communication and form compositions of possibilities or “compossibilities” (Murphy, 1998) of microdiversity. The implementation and use of technology in organizations depends on interactive and communicative possibilities and competencies in almost the same manner (Orlikowski, 2000).
Communication technologies (CT) enable organizations to gain flexibility and force them to become more “boundary-less” by decreasing CT-costs and increasing
CT-efficiency (Picot et al., 1996). There is a diversity relevant tendency in the use of CT by:
.
using virtual cooperation instead of hierarchies, and therefore reducing the replication of social distinctions in formal hierarchies, which are not useful for diversity issues (Brewer, 1995);
.
reintroducing organizational slacks (offering more space for individual choices to follow organizational goals) and building redundant structures to allow interdependent programs and procedures to grow and use the creativity of heterogeneous teams; and
.
facilitating loosely coupled systems with enriched spaces between organizational sectors, making variations of autonomous working and collaboration possible and enforcing symbiotic cooperation and functional dependency. This eliminates formal boundaries between socially differentiated groups and reduces social stereotyping (Jehn et al., 1999).
These inherent technological capacities might raise the chances to support nonhierarchical cooperation, communication and interaction. However, technological structures and processes tend to adapt to a present communication culture.
Communication – whether technically mediated or not – is related to
(non-)discriminatory managerial processes. The bottle neck factor is the capacity of using and transferring knowledge into – organizationally relevant – functions and actions. Analyzing the complexity of organizational knowledge production, Capurro (1998), referring to Nonaka and Takeuchi (1995) focuses on the transfer of implicit (ik) into explicit knowledge (ek) in organizations. Knowledge transfer occurs on different levels: as socialization (ik to ik), as externalization (ik to ek), as combination (ek to ek) and as internalization (ek to ik). Most interesting for Nonaka and Takeuchi (1995) is to deal with the process of externalization, as far as implicit, tacit knowledge is assumed to be a bottle neck factor in creating the valuable, unique assets. It is the unique combination of human resources, as Penrose (1953, 1980, p. 75) describes it: “It is the heterogeneity, and not the homogeneity, of productive services available or potentially available from its resources that gives each firm its unique character.” Nonaka and Takeuchi (1995) describe this transfer as a complex process loaded with ambiguity and diversity.
Oppositions or binary distinctions are resolved, so the focus is on individual and on group levels, actions are inspired by globalization, but need to be incorporated into local habits and procedures, and Nonaka and Takeuchi suggest to contextualize experiences with all senses, not only on a strategic or rational level. This seems to be a qualitative difference in dealing with the complexity of knowledge.
This concept of knowledge generation in organizations is no longer postulating complexity reduction but complexity condensation. Condensation of meaning occurs by transferring sense into different contexts and by not losing but using the validity of former sense (Luhmann, 1997). Condensation of knowledge seems to be a valuable procedure for

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dealing with diverse knowledge resources in organizations. Management structures are needed to secure condensation processes (see below). Practical knowledge also occurs in organizational change processes. It refers not only to the individual but to personnel roles in organizations, to reflect and reframe organizational meaning in communication. But this very demanding requirement presupposes the willingness to change normality constructions in “small steps” (Flechter et al., 2006). Although routines are “noise” and allow defense mechanisms against the necessity for change, which can stay alive in the routines, they have a certain role in change processes towards more complexity.
Standardizations and routines to a certain degree offer security to the organizational members if they feel that complexity might be not observable and impossible to handle. In this theoretical perspective, hierarchy and standardization are described by the use of utilitarian, microeconomic, behavioristic management paradigms, which, however, are not the only way to describe securing structures, as might be seen below.
Weick (1985) links the ability to use complexity to the management of ambivalence.
The decision process under uncertainty causes problems but is more influenced by ambivalence than by the deficit of information. Management has to follow the explicit demand to limit ambivalence and lack of clarity in the decision-making process.
Ambivalence is hard to bear and might cause conflict in interaction under pressure.
Insecurity in organizational situations is the norm, but is accompanied by the wish to reduce ambivalence. Within traditional or contingency management approaches, there is a notion that stability and balanced states for organizations are possible, and that all destabilizing tendencies are deviant or evil and have to be repaired.
There have been valuable contributions of post-structuralist organizational theories, which are willing to deconstruct the basic assumptions of rationality and linearity to show the emergence of ambivalence. Boje et al. (1996) have allowed theoretical development by revealing the latency of organizational meaning. For example, the symbolic presentation in an organization is accentuating a certain reality perception and rejecting heterogeneous components of meaning and reality construction. By uncoverring rationality as an attempt to produce certainty, these deconstructive perspectives see, detect and use the ambivalence of microdiverse interaction. In the following the post-structuralist thinking will be related to organizational functions and structures, which are responsible for the regulation of the internal complexity increase in social systems. Ambiguity and contingency, which are vivid and inherent in organizational decisions (March and Olsen,
1994), are mostly situated in interactional processes. Interaction is unfolding its autopoietical abilities by becoming part of the official, manifest communication.
Organizational functioning is then related to environmental perception and inclusion of their self-referential observations, communication and microdiversity of interaction (Hejl and Stahl, 2000). This vivid, non-regulated, informal interaction of microdiversity has the relevant latent function to evolve organizational communication.
Complexity in social systems
In the following, the ambivalent modes of managing complexity (Weick, 1985) are connected to complexity management and organizational development (Stacey, 2001;
Stacey et al., 2000). Self-organizing capacities are transforming the “microdiversity” of interaction into structures and communication, but strategies need to be developed to use these diversity resources. If complexity is perceived as a responsive process (Stacey et al.,
2000; Stacey, 2001), social systems use homogeneity as well as heterogeneity to regulate

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themselves. Instead of a linear prediction of organizational processes and effects of action, Stacey et al. (2000) support the idea that these are mainly processes which are designed by perturbation (chaos, disturbance and penetration). They assume that the construction of reality in an organization is based on social complexity, and they emphasize that complexity in organizations always produces paradoxes. These are inherent and actual issues in social systems and are perceived as significant limits to the predictability of effects – despite the individual attempts to perceive decisions in a cause-effect manner. Self-organizing processes relate subjects to each other on the level of power, politics and conflicts of everyday life. This – and not organizational strategic planning – is the focus of cooperation and competition.
Meaning is produced by microdiversity and has an intrinsic capacity to force the evolution of systems on the level of continuity and change. For Stacey et al. (2000), it is not necessary to distinguish between individual interaction and social communication.
In this perspective, creativity and destruction, plan and chaos, result from self-referential patterns of interaction. This takes place within a common shared interpretative scheme. They focus significantly on the “wild side of the organization” and certain topics or a common interpretative framework allow for interaction.
Knowledge creation relies on the change of these connections by their adaptation to other networks. In this perception, the formal distinction between system and environment is purely theoretical, but not vivid. Organizational aims are not generated by environmental forces but emerge by internal interaction. These approaches suggest that there is more ambivalence than equilibrium or planned rationality in social systems.
Organizations are perceived and managed as flexible entities, which produce their functional elements (structures, programs, media) by observing their internal communication and decisions. Decisions convert problems into processable events.
They produce normality as a suggestion to order uncertainty and contingency by – posterior – legitimization and sense construction. The transformation of external communication into internal operations is organizationally successful if useful and connectable meaning can be produced (Luhmann, 2000, p. 10). Organizations therefore need discursive formats – like diversity discourses – to transform the insecurity and contingency into transitory certainty.
However, the development of complex meaning and security in organizations is forcing the capacity to deal with ambivalence. The focus on microdiversity – like personal interaction – enables the organization to deal with complexity requirements like ambivalence/ambiguity (Nedopil et al., 2011) to use contingency and produce security. Individuals – who are interactionally embedded in different and diverse social and cultural entities – are able to support the capacity for dealing with diversity.
It is situated on an interactional level by individual affective and cognitive differences.
Diversity “consists of four formal frameworks:
(1) Diverse Perspectives, ways of representing situations and problems.
(2) Diverse Interpretations: ways of categorizing or portioning perspectives.
(3) Diverse Heuristics: ways of generating solutions to problems.
(4) Diverse Predictive Models: was of interfering cause and effect” (Page, 2007, p. 7).
In this analysis Page (2007) is not relating to demographic differences. It is therefore offering a non-essentialist, non-stereotyping description of interactional diversity. However, it offers

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another blind spot: in the discussion of interactional competencies in organization, it is important to focus on the interdependence of body expression, intellectual interpretation and perception and affective/emotional foundation (Ciompi, 1988). There is no mental expression without feeling or body presence or vice versa every mental perception is bounded to body expression and emotional exceptions. Also, following Butler’s (1993) inscription of discriminatory discourses into the body or its representation as symbolic order in the habitus (Bourdieu, 1977) of certain social milieus or groupings, we might add another relevant issue to the analysis of organizational communication and interaction.
Interpersonal interaction in organizations has to be related to this interconnectedness of expression, perception and often stereotyped expectation – which occurs as representation or visible and/or ascribed “demographic” traits to styles of thinking.
Since individuals are only taking part in membership or personnel roles in organizations, their individuality is merely operating as environment (Seidl and Becker,
2006). Still, they can irritate (Luhmann, 1993) the social order of systems (for instance by provoking unexpected communication) and vice versa (i.e. individuals are either responding to or challenging changes triggered by system communications). A system can only recognize an amount of individual diversity, which is communicatively connectable, and decide whether it is functional acceptable, negligible or irritating.
However, transferring interactive diversity into organizational communication requires the use of generalized communicative media, which can be described for the economic system as meaning, money, power, and trust. Here, the use of generalized media of communication helps to translate interaction into internal references and to render connectivity to diverse structural expectations (Luhmann, 1997, pp. 370-374). Interaction needs to use such generalized communication media to become structurally relevant or recognizable. Otherwise interaction is perceived as surrounding, undistinguishable
“white noise”.
Describing diversity management to open up excluding organizational cultures towards individualized working habits and lifestyles (Cox, 2001) makes it necessary to connect interactional heterogeneity to organizational communication procedures and structures. These change processes have to be related to the functionality of contemporary system configuration to allow a social system to evolve and to give personnel the chance to develop positive attitudes towards diversity (Thomas and Ely, 1996 [2002]). In the next step, a functional-structural framework of organizations is described, which might be capable to use diversity resources. In the following a framework is introduced to show how organizational communication can be initiated by elements of self-organization, and uses the creative effects of interactional participation and transparency.
Functions and functional equivalents to homogeneity as heterogeneous communication cultures
Kreikebaum et al. (2004) describe how organizations need to be adjusted to requirements of the environment by forcing heterogeneity and ambiguity to become operative. This process means a change towards team orientation and modularized processes instead of relating to hierarchies and hegemonic social standards.
Organizations need to get more heterogeneous or diverse to cope with contemporary challenges. To support this tendency, it is suggested that management systems alternate the functions of homogeneity, which are a stabilizing part of the system.

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Homogenization fulfills several functions at different levels. At the organizational level, homogenization allows focusing on a certain – dominantly selected – social reality.
Homogenization supports the idea of producing certainty and enabling communication to trickle down the hierarchical order. The management intention – supposed there is a distinguished leadership capacity – is enforceable by relating to the following functions.
Homogeneous structures – based on binary distinctions – fulfill the functional needs of organizations to:
.
build on social categories which form hierarchies to control people and processes;
.
evaluate performance and decisions based on binary distinctions; and
.
make hierarchical information channels reliable (Koall, 2001, pp. 175-80).
¨
Diversity initiatives require inclusive organizational cultures (Ozbilgin and Tatli, 2008), but agents who intend to start a process to change from a rather homogeneous to a more heterogeneous social system have to be able to observe the status, goals, process of the internal (decided) distinctions and differentiations. Since organizational interaction is capable of acting and being transferred into communication – despite or within the subjective motives of members – interactions are (transported as communication and) oriented towards organizational tasks or functions. These functional orientations select all environmental influences and internal communications and distinguish or
“differentiate” as to whether they contribute to functional success and meaning or not. These functions form the structure of the organization (Luhmann, 1984).
Discrimination in organizations is connected to the socially acquired functionality of structures – produced by the history of the system through its own assessment and evaluation and is prevented, stored and preserved as its organizational culture. On the cultural level of the organization, the structuring of reality has the function of creating certainty or plausibility of normalcy. To change homogeneity, we have to understand the functions of culture in organizations (and later their functional alternatives) to regulate complexity. Organizational cultures as defined by May (1997) have the functions to:
.
integrate and reduce the costs of transfer of communication in the organization and the costs of interactions between the members by offering forms of integration; . coordinate, regulate and direct action on the level of recognition by programs and norms; and
.
motivate by the socialization act of defining the cultivated desired attitudes of the person with the goal of transferring action into expected behavior.
The following heuristic in Table I enables us to understand how the functions of organizational culture – whether it is homogeneous or not – are related to the functions of organizational structuring. This cross-functional matrix enables us to perceive the inertia and the relevant focus in diversity change processes.
In search for alternatives to homogeneous communication culture we need to introduce a logical figure, which is called “a functional equivalent” (FEQ) (Luhmann,
1970, pp. 15-35). Within the theory of social systems, this logical figure describes the possibility of a system’s evolution. FEQs rely on the theoretical ability of a system or organization to find new solutions or to deal with challenges. FEQs make it possible

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Table I.
Cross-functional relation of homogeneous culture and structures

Culture
Function

Coordination asks how?
Integration asks what?
Reference is: form, forms to Reference is: program codes to do normative do communication and programming forming interaction

Organization
Evaluation Find binary norms, secure them on a formal base and to produce keep them connected to quality social action and communication Regulate connotation,
Control to meaning and symbolic generate representation on a binary meaning normative level
Transfer of decision to mark relevance

Dominate hierarchical communication structures and forms

Keep binary norms ready for sanctions but keep them contextually variable – by and for the use of power

Motivation asks who? reference is: person, person as medium for the personal inclusion
Produce homogeneous personnel norms for socialisation and to make them reliable

Expect loyalty and commitment and produce reliability by mixing personal with professional norms Reflect and direct conditions To make decisions of action and performance relevant and comprehensible by using according to elitist criteria which transport standards the “illusion of justice”
Match goals with task to keep a hierarchical and exclusive level of performance Source: Koall (2001, p. 196)

to act “contra factual” to expectations. The activity is system conform by referring to the autopoietical necessary functional orientation. FEQs stimulate evolution by forming a new way of defining a problem or a challenge. FEQs are formatted:
.
As a problem which has to be described and focused in such a way that possible solutions are presented as comparable alternatives.
.
In such a way that the focus of the presented alternative solutions can be truly defined by the problem and not by assumptions about cause and effect which might be logically pre-defined before defining problems, solutions and alternatives. .
In such a way that the problems are defined by functional relations and solutions and are made comparable, including the social background and conditions used to describe the problems.
.
Depending on systems operation which is oriented towards functional rather than normative and hierarchical argumentation.
The FEQ to homogeneity can be a heterogeneous setting. In this case, we would define the problem as alternative organizational function, which has to be fulfilled to keep the system going. The organizational functions which were fulfilled by homogeneity are as stated above: normative evaluation of performance and personnel, hierarchical control of contingency, and the ability to control processes according to rational decisions. In this case, complexity is reduced by performing within an exclusive culture of control and discrimination on the basis of domination and subordination
(Koall, 2001).

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Heterogeneity will be functionally equivalent in form, program, and person if:
.
Norms of evaluation are discussed in group settings instead of being defined in
“intimate” face to face situations. The chance to deconstruct elitist and dominant standards of evaluation might arise in public by connecting norms to the context of their cultural, social or gender-biased emergence.
.
Contingency, ambiguity, uncertainty and arbitrariness can be perceived as essential parts in social interaction and can be communicated instead of being repressed.
.
Management is no longer an issue of controlling heterogeneity but of moderating complexity by accepting the failure of rationality. This might allow a management procedure for learning from mistakes, failure, and misunderstanding and for trying to adjust the system within this learning. Diversity in the construction of meaning in a management situation arises if there is more than one exceptional way to react – by bridging binary or contradictory positions and building meaningful discursive connections and interrelatedness.
.
Hierarchies are not perceived as the one and only form of regulating communication and competence according to assumed performance and abilities.
This will be mostly the case if skills, competences and abilities are not regulated by accepted social hierarchies but might change from task to task and from project to project. This expects a lot of social (upward and downward) mobility and a non-hierarchical perception of competency. Work schedules and roles are almost ambivalent, as well as an idea of justice in the evaluation of individual performance. It is mirrored in further, current, or future positions and tasks.
The following Table II shows the alternative description of communication patterns, which allows performing heterogeneity as diversity. It is the connection of self-organizing, participative patterns of communication with functional needs. Heterogeneity or diversity management is connected with the task of the organization to transform environmental complexity into organizational forms, programs and personal relations.
We prefer to put emphasis on contingency, variability, ambiguity of social situations on the one hand and the need to increase conceptuality and relatedness of personnel in organizations on the other hand (Koall, 2001).
Closing remarks
Diversity in organizations needs to be applied to a supportive communicative structure, which allows an interactive quality. The organizational system is able to support transparency in the area of management, e.g. personnel management: by offering an information system to observe vacant jobs, requirements, extended vocational training, evaluation of required skills. There is the opportunity to disclose standards of evaluation and relate cultural norms to the context of their cultural, social or gender-biased emergence., e.g. on the level of performance appraisal: to uncover merits of teamwork by using wiki to describe the interconnectedness of excellence with teamwork, creativity and uniqueness with well-managed diversity, e.g. as an information system where management decisions are comprehensible and interaction is organized top down as well as bottom up.
Second, interaction needs to become structurally relevant by being connected to communicative media of form, program and person. It can be used to support

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Culture
Function

Organization
Not evaluation, but: making norms participative, negotiable and context-related Integration asks what?
Reference is: form, regulating interaction and communication in collective settings

Coordination asks how?
Reference is: program, allowing ambiguity and supporting collaborative programmes Using and performing consulting in interaction process

Strengthening of team structures instead of rivalry and
“individualisation”

Not control, but managing contingency by rise of discursive connectedness Table II.
Cross-functional relation of heterogeneous culture and structures

Motivation asks who?
Reference is: person personal ambiguity and context bounded subjectivity Keeping discourse and symbols inclusive and relaxed Not hierarchical transfer of decision, but: non-hierarchical competency-based ambiguity-tolerant decision process

Generating knowledge ambiguity and variations Deconstruction of the illusion of equality as a basis of justice by showing the conditions of power-related justification Deconstruction of the
Puzzled and ramified authoritarian performance of tasks competence in solving but keeping up problems by the structural relatedness emergence of and reciprocity synergetic, collective networking production of knowledge
Deconstruction of the
Variations of the conditions and paths of illusion of social identity by the decisions possibility of changing, altering or switching attitudes, personal traits according to situations Source: Koall (2001, p. 197)

the perspective on contingency, ambiguity, uncertainty and arbitrariness. Here, transparency in the use of norms to evaluate competences, making decisions and supporting personnel is the key issue. Thereby, heterogeneous perspectives are perceived as being essential to problem solving. Like in highly reliable organizations
(Weick and Sutcliffe, 2003) every failure or puzzle is needed to be transparently communicated to adjust the system. Organizational communication has the chance to become officially moderated instead of getting repressed to the mostly informal interactional space. A culture of trust seems to be necessary which regulates the complexity of the system (Luhmann, 1973). If management does not relate to rational decisions but to complexity moderation, there is no single best way to find solutions, but a good way to moderate the process of diversity creation. Creativity and participation are conditions to build up a system which learns from contingency. Interactive support to allow for such learning from incidents and ambivalence will increase the capacity of the whole organization to use the latent knowledge.
But – as mentioned on several levels of this discussion – new capacities also bring about an increase of complexity. Most contemporary management approaches depend on reduction (Kreikebaum et al., 2004) instead of regulation of complexity
(Nonaka and Takeuchi, 1995). Managing diversity allows the organization to meet

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this demand and to obtain heterogeneity by reorganizing organizational functions, which are relevant for internal communication and for coping with new requirements.
Handling diversity is an evident precondition of interaction on a personal level. And it is evident for the success of virtual teams because it promotes an open culture and
¨
¨ openness for cultural differences (Konradt and Koppel, 2008; Koppel, 2007) as well as trust and commitment which are fundamental for successful cooperation in international and more and more virtual working teams.
With this functional-equivalent approach we hope to describe how a design might work which allows for diversity interaction in the communicative structures and processes of organizations.
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Corresponding author
Iris Koall can be contacted at: koall@uni-wuppertal.de

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