Multicultural workforces are now the reality for a growing number of managers. Changes in the workforce demographics resulting from globalization have resulted in a practical concern about the management of multicultural teams (Hoerr, 2005).
The workforces in many nations of the world are increasingly more diverse along such dimensions as gender, race, and nationality (Fullerton, 1987; Johnston, 1991). For example, in the UK 25% of workers were born overseas, with just over half of this number originating from non-English speaking countries (UK National Statistics). The UK is increasingly turning to overseas workers to ameliorate a growing skills shortage in key industries, a recent example being the appointment of Mark Carney, a Canadian, as the new governor of the Bank of England. There is an increased focus on how organizations can best manage cultural diversity among their employees.
As organizations become more international in terms of their operations, and the world itself becomes much fluid in the movement of workers, the issue of diversity within the workplace becomes increasingly important (Malhorta 2009). Even where an organization does not have international operations, it is highly likely that there will be cultural issues arising as part of its local supply chain. Furthermore, technological advances mean communication on an international level is much quicker and much more efficient, requiring all individuals to be much more wary of cultural issues that may arise.
Initially, it is helpful to consider what is meant exactly by cultural diversity and why it may be relevant to business performance. Cultural diversity tends to be broadly defined but one suggested definition is that cultural diversity is “the otherness”, or those human qualities that are different from our own and outside the groups in which we belong (University of Southern California,