Organizational Culture and Workforce Diversity - Introduction To Business - ثاني ثانوي

4.3 Organizational Culture and Workforce Diversity Link to digital lesson www.ien.edu.sa Learning Outcomes Once you have completed this lesson, you should be able to: 4.3.1 Recognize factors that contribute to an effective organizational culture. 4.3.2 Describe the benefits of diversity to an organization, individuals, and society. Key Terms Organizational Culture Work Environment Work Committee Diversity Focus on REAL LIFE Three years of related employment experience required. Ibrahim, a recent graduate, reads this line in a job description and decides he is not qualified even though he has all the skills the job requires. Ibrahim doesn't think the employer will recognize the skills he has developed through leadership activities and community service. Must be energetic and eager. Mariam, who is 58, sees this phrase as she views job postings on a career website. She doesn't bother to apply for the job because she believes the employer must be looking for young people. Can employment advertisements intentionally or unintentionally discourage otherwise well-qualified people from applying? To build the best workforce, job recruitment should focus on the skills and abilities needed to do the work, not on the type of person the manager believes would be best for the job. LO 4.3.1 DEVELOPING AN EFFECTIVE CULTURE The ways businesses are organized and operated have changed a great deal in the past few decades. Some of the changes are obvious. Technology has reduced the need for low-skilled employees and demanded that current workers have much greater skills. The Internet has changed the way consumers and businesses communicate, share information, and buy and sell. Globalization of business has resulted in greater competition. It has also resulted in more opportunities for every business to reach many new customers. Other changes are just as important but not as clear. The workforce is more diverse, with growth among both younger and older workers. Jobs are changing, with a larger temporary and part-time workforce and a rise in the number of successful small businesses. Jobs are being shifted to other countries in an effort by businesses to cut costs. The number of manufacturing jobs is declining while service jobs are growing at a rapid pace. Some of the service jobs require little skill. Others are complex jobs requiring technical knowledge, creativity, and decision-making skills. Businesses have to respond to all of the changes and maintain a positive organizational culture. An organizational culture is the environment in which people work, made up of the atmosphere, behaviors, beliefs, and relationships. An organizational culture shows people how they will be treated and how they are expected to treat others in the work environment and field of work. It identifies what is acceptable behavior 4.3 Organizational Culture and Workforce Diversity | 129 وزارة التعليم Ministry of Education 2024-1446 GE44.PATHWAYS.G02.ITB.SB.PP1.indb 129 08/05/2024 09:13

and what is not. If a company has a positive organizational culture, employees enjoy going to work. They have positive working relations with co-workers and managers. They believe the organization values them and their work. They are motivated to do a good job for the company. Work Environment The work environment is the physical conditions and the psychological atmosphere in which employees work. The physical conditions are the work area, offices, break rooms, and all other spaces where employees spend time while at work. Tools and equipment, lighting, temperature, and air quality are also a part of the physical work environment. The physical conditions must be safe and healthy. That is certainly a legal requirement of businesses. A business with a reputation for safety and health problems will have difficulty attracting and keeping employees. In addition to the physical conditions, companies need to provide a positive psychological atmosphere. It is important in assuring employees that the company has their interests at heart. Employees do not want to work in a place where they feel they are mistreated or where their work and ideas are not valued. An atmosphere of mistrust or fear is likely to result in low employee morale and poor performance. Not all jobs can be physically comfortable. Some require people to work outside in very hot or cold conditions. Other jobs require a great deal of physical effort or can be quite hazardous. Even in those jobs, the business needs to find ways to provide as much physical comfort and safety as possible. The business should offer protective clothing and equipment, allow needed breaks, and ensure that every employee receives adequate safety training. Offering a positive psychological environment means that managers are trained in effective communications and interpersonal skills. They are honest, fair, and ethical in their treatment of each employee. Employees get important information from their managers rather than from Would you rather work inside or outside? Alone or in a group? rumors through unofficial channels. They believe their work is important and valued. They are recognized and rewarded for their contributions to the company. Work-Life Relationships Around the world, people seem to be working more days and longer days. Some people hold two or more jobs. There are many two-career families. Balancing work and personal life is a very important issue for most employees. Work-life surveys generally find that a majority of people would give up additional income from overtime work to be able to spend more time with their families. A positive organizational culture is one that respects the pressures on employees from outside of the job. It offers ways for employees to meet those demands while also fulfilling the requirements of the job. Some of those ways include personal time, flextime, job sharing, and flexplace. Many companies now offer personal time for employees to complete nonjob activities that can only be done during work time. It is hard to schedule a dental or medical appointment, visit a child's school, or renew a driver's license while working. Personal time is a few hours each month that can be scheduled for nonjob activities. Some companies even offer paid time for 130 Chapter 4 | Human Resources, Culture, and Diversity Ministry of Education 2024-1446

employees to volunteer at schools or other community organizations. Flextime allows employees some choice in how their work days and work hours are arranged. Some employees may start and end their work day earlier or later than normal. They may be able to work a longer day and Life-Span Plan How important do you believe flextime or job sharing would be to you in choosing a career? Explain why work-life relationships are important when people set their life-span goals. thereby work fewer days each week. Job sharing offers one job to two people. Each person works a part-time schedule. They share the work space and duties of the job. Flexplace means that some employees can complete part or all of their work away from the business site. Telecommuting is becoming increasingly popular. Employees who primarily use computers and other personal technologies may be able to work from home. They communicate with managers, co-workers, and customers using the Internet, telephone, and other technologies. The Saudi Telework Program encourages teleworking, especially in light of the opportunities it offers for women and disabled members of the workforce. Some of the strategies for improving work-life relationships cost companies very little. Others do have a cost but often result in reduced absenteeism, lower employee turnover, and happier and more productive employees. Employer-Employee Relations Which work-life program might allow a parent to take time off to take a child to a medical appointment in the middle of the day? NET KNOWLEDGE Both managers and employees want their business to succeed. Unprofitable businesses have to reduce the number of employees they hire. They must limit salary and benefit increases. Working together to make the business successful should benefit everyone. Managers and employees do not always have the same immediate goals. Managers must make sure that a company makes a profit. They try to get more work done at a lower cost. Employees are more concerned about compensation, working conditions, job security, and nonwork issues. Many years ago, a boss made all of the important decisions and told employees what to do. Employees had little input as to what they did or how they did it. Each person was assigned a specific job. They often had little interaction with other employees while they worked. Q In Saudi Arabia, employer-employee relations are governed by the Labor Law, which was established by Royal Decree M/51 on 23 Sha'ban 1426/September 27 2005. The Labor Law relates to wages and salaries, benefits, employment contracts, health and safety, and many other issues. Locate the Saudi Labor Law on the Internet and identify three different employment laws that would apply specifically to you and your classmates if you held a part-time job. Prepare a brief description of each law and what an employee or employer must do to comply with the law. That approach often left employees thinking that their ideas were not welcomed or appreciated. They believed they knew a great deal about their jobs and the business and could offer suggestions to improve the way work was done. Those differences led to disagreements and conflicts between many employers and their employees. ⚫⚫Even though there are differences between management and employees, there may be more things that are alike than different between the two groups. When managers and employees work وزارة التعليم Ministry of Education 2024-1446 4.3 Organizational Culture and Workforce Diversity | 131

together, they often can find ways to accomplish the goals of both the organization and the individuals who work for it. Managers who involve employees in decision making find that better decisions can result. Employees are more likely to support those decisions. Employees discover that when they cooperate with management, managers have a better understanding of their needs and expectations. Both groups, as well as the organization, benefit through cooperation. What are the benefits of involving employees in decision making? Work Committees In Saudi Arabia, where a company employs more than 100 Saudi workers, they can establish work committees that look after the interests of all employees in the company. The role of the work committee is to act as a link between management and workers. The aim of such committees is to improve working conditions for workers and to deal with concerns like health and safety issues. The work committees bring opportunities for building good relationships between management and workers, and for boosting employee morale. Companies and work committees work together on issues that affect the success of the business and the work life of employees. Examples include job training to keep employee skills up to date, employee assistance if a business site closes, and improving product quality to make businesses more competitive. CHECKPOINT What are some ways that companies help employees meet personal demands outside the job? LO 4.3.2 WORKFORCE DIVERSITY Imagine a world where everyone looked, thought, and acted alike. The world is diverse, and that diversity continues to grow. But business don't reflect diversity. Even in companies with a diverse workforce, diversity is not always reflected in various job categories or in management positions. A business that has a diverse workforce will be much more attractive to prospective employees and customers. When people with diverse backgrounds and characteristics are promoted into leadership and management positions, it will offer encouragement to others like them. Benefits of Diversity "Workplace diversity" has many definitions. The basic definition of diversity, as it applies to the workplace, is the comprehensive inclusion of people with differences in personal characteristics and attributes. Some important characteristics, for example, diversity in age, race, etc., are recognized in equal employment legislation for many countries around the world (see Figure 4-4 on page 133). Today, businesses working to build a diverse workforce use a much broader view of diversity. They try to build a broad workforce that reflects the communities in which they operate and the markets they want to serve. Diversity also includes hiring a workforce with diverse socio-economic status, culture, religion, and even personal interests, abilities, and values. When people in an organization are more alike than different, there is often reduced creativity and innovation. There will be limited understanding of people who are different. Their attitudes, experiences, and needs won't be considered. It will be difficult to recognize and plan for those differences when developing products and services for customers who are different from the 132 Chapter 4 | Human Resources, Culture, and Diversity Ministry of Education 2024-1446

people in the company. Companies that build a diverse workforce see several benefits. The benefits can be classified as organizational, individual, and societal. Organizational Benefits Prospective employees and managers are drawn from the broadest possible employment pool. The greatest increase in the labor force in the future will be women and older workers. If people from those groups are not considered, the company will have a much smaller pool from which to choose. By following the diversity approach, the company will have a broader base of knowledge and understanding when making decisions. People with different backgrounds, experiences, and even ways of thinking and planning will be How might human resources managers help increase diversity in the workplace? a part of the organization. They will bring new ideas on how to design processes, plan products, work and communicate with others, and provide leadership. Prospective customers will have a more positive image of the company. Customers with diverse characteristics will see a company that values diversity. They will have a greater level of respect and trust for the company and its products. They will see their own views and interests represented within the company. The company will be better at serving diverse markets. The company will understand similarities and differences in needs, decision-making processes, and communication strategies among diverse customer groups. Traditional stereotypes that may have upset consumers in the past will no longer be used. • EQUALITY AND DISCRIMINATION LAWS IN SAUDI ARABIA Article 3 Labor Law: All citizens have an Global business strategies will improve. Saudi Arabia has a very diverse workforce across most sectors, with foreign workers numbering around 11 million and coming from over 100 different countries in 2021. Saudi Vision 2030 aims for the country to be strong, prosperous, and accommodating to all. It aims to attract talented creative minds and entrepreneurs from everywhere. This offers Saudi businesses a unique advantage to recognize and understand global needs and differences. They have an advantage over companies from countries with limited diversity. At the same time, the government requires that all businesses in the private sector follow the Nitaqat (Saudi nationalization scheme) to employ a certain number of Saudi nationals according to the company's category. Individual Benefits All employees will have the opportunity to develop to their full ability. This will lead to increased creativity and productivity. Businesses that value diversity work to remove obstacles so everyone has an opportunity to advance based on ability and performance. Saudi Vision 2030 aims to provide more opportunities for Saudi women and has a target of increasing the number of women in the Saudi workforce from 22% to 30%. Individuals will feel they are respected and supported despite their differences. Employees who are different from the typical employee وزارة التعليم • • equal right to work without discrimination. Ministerial Decision 2370/1: Men and women should not be discriminated in wages for work of equal value. Article 28 Labor Law: If an employer has 25 people in their workforce, and if the work is suitable for disabled people to perform, they must ensure at least 4% of their workforce consists of disabled people. Source: https://hrsd.gov.sa/en/policies/labor-law-0, 2005; https://www.my.gov.sa/, 2010 FIGURE 4-4 How have these laws increased employment opportunities for all Saudis? 4.3 Organizational Culture and Workforce Diversity | 133 Ministry of Education 2024-1446

tit Work as a TEAM Many companies and organizations have developed diversity statements. As a team, use the Internet to identify and study examples of those statements from several companies. Select one that your team agrees is the best statement. Justify your choice. do not have to hide those differences. They will feel like they matter despite their difference. Individual differences will be expected and viewed as a valuable part of the organization. Employees can comfortably represent their uniqueness when participating in planning and decision making. Societal Benefits Prejudice and discrimination will be reduced as a societal problem. People involved in diverse organizations increasingly recognize and value diversity. This is true for neighborhoods, schools, and businesses alike. They lose their stereotypes and recognize the benefits that come from the acceptance and participation of every person. The country has a more talented, experienced, economically successful workforce. Diversity opens more job opportunities for everyone. It allows people to develop and use all of their abilities. It increases access to higher-paying jobs for more people. Diversity in business leads to greater opportunities in society. DIVERSITY How does a new business benefit from the diversity and inclusivity of its human resources? Developing a Diverse Organization An organization's culture develops over many years. Employees and managers often become comfortable with the way things have always been done. It may be hard to recognize all of the ways that an organization makes it difficult for people from diverse backgrounds to be successful in the organization. The whole organization needs to be committed to diversity in order for the necessary changes to occur. The following steps have been used successfully in a number of businesses and other organizations to increase diversity. P134 Chapter 4 | Human Resources, Culture, and Diversity Ministry of Education 2024-1446

1. Develop a written commitment to diversity. Prepare a mission statement that clearly communicates the company's values. 2. Have the full support of top executives. The top managers in the business must make diversity a priority in their written and oral communications and in their actions. 3. Review evidence of diversity in the company. Gather data on the diverse characteristics of all employees, managers, and customers. If any part of the organization does not reflect the diversity expectations, determine what is standing in the way and develop ways to make changes. 4. Update policies and procedures. Make sure that recruiting, hiring, performance evaluation, and promotion practices encourage diversity. 5. Provide continuing diversity education. Managers and employees benefit from increased understanding of inclusion and diversity. Participating in classes and workshops prepares employees to work more effectively in a diverse organization. 6. Recognize and celebrate diversity. Make diversity a part of the organization's culture. Have visible evidence of the variety of languages, art, and customs of employees and customers. CHECKPOINT Identify several organizational, individual, and societal benefits of diversity. 4.3 ASSESSMENT Key Concepts Determine the best answer. 1. True or False. There are greater numbers of both younger and older employees in the workforce today than there were in the past. 2. A work committee is a. a type of recruitment company b. a group that represents the interests of employees c. a club for retired workers d. another name for the senior management team 3. Which of the following is not typically viewed as a benefit of diversity? a. increased creativity and productivity b. wider pool of talent to draw from c. positive company image d. less work for employees to complete وزارة التعليم Ministry of Education 2024-1446 4.3 Organizational Culture and Workforce Diversity | 135

Make Academic Connections 4. Social Studies Use the Internet to identify data that describe the changing characteristics of the Saudi population. Develop a written report of your findings. Include at least three tables and charts to support your written report. 5. Art Working with other students in your class, create a bulletin board, exhibit, or display that illustrates the diversity in your school and community. 6. Journalism Select a business in your community and contact a company manager to schedule an interview. Prepare several questions on the steps the company has taken to increase diversity and the results of those steps. Record your interview. Use the information to prepare a 500-750 word feature for an online news service or business blog site. 136 Chapter 4 | Human Resources, Culture, and Diversity Ministry of Education 2024-1446

BUSINESS IMPROVING SOCIETY COFFEE AND A CONSCIENCE Drinking coffee, or qahwa, is ingrained in Saudi Arabian culture, bringing with it associations with good hospitality and time-honored customs. It can be enjoyed in a variety of ways, often brewed with spices such as cardamom or saffron, and with local preferences from region to region. There is now an increasingly wide range of stylish coffee shops dotted across Saudi Arabia, catering for all tastes from traditional to contemporary international style blends. Popular cafés in cities including Riyadh and Jeddah attract many customers who enjoy a quality brew with an ethical stance. For example, some coffee houses insist on serving coffee that supports the farmers and communities who produce the coffee, through Fair Trade practices. Green Mountain Coffee is an example of an international business with a belief that a company can be profitable and still have a social conscience. The company demonstrates a concern for the environment, for the people who grow and supply the coffee, and for the local and global community. Green Mountain Coffee is a partner and advocate in Businesses for Social Responsibility and the Fair Trade Partners. How do coffee companies benefit from paying small coffee growers a fair maximum price for their coffee beans? Most coffee growers worldwide are small family farmers who are at the mercy of large coffee companies. Those companies had pushed the price paid for coffee beans to less than 70 cents a pound. The result was a drop in the income of small farmers to a level that didn't allow them to maintain their families' nutrition, health care, or education. Fair Trade Partners guarantee a fair price when they purchase a farmer's coffee beans. In return, they ask the farmers to use farming practices that result in high-quality products and that protect the environment. Another program supported by Green Mountain is Coffee Kids, a nonprofit international organization. It is committed to improving the lives of children and families in the small mountain towns of coffee-growing regions around the world. The organization offers health care, nutrition training, educational scholarships, and money for local schools to improve the lives of children living in poverty. Through the Community Action For Employees (CAFE) program, Green Mountain encourages employees to perform volunteer work while on company time. Every employee is allowed up to 52 hours each year in paid time off to volunteer for nonprofit organizations in their communities. Think Critically 1. Why would a coffee company be willing to pay almost twice as much for their coffee beans than the large coffee companies pay? 2. How do you believe social programs affect customers' views of the company? Do you believe it affects the sales of their products? Why or why not? وزارة التعليم Ministry of Education 2024-1446 4.3 Organizational Culture and Workforce Diversity | 137