Contents

Abstract......................................................................................................................................................2
Introduction...............................................................................................................................................3
1. Literature Review..............................................................................................................................4
1.1 Diversity in organizations...............................................................................................................4
1.2 Board Diversity................................................................................................................................5
1.3 Gender Diversity..............................................................................................................................5
1.4 Age, education, nationality and personality diversity:..................................................................6
1.4.1 Age.............................................................................................................................................6
1.4.2 Nationality.................................................................................................................................6
1.4.3 Education...................................................................................................................................6
1.4.4 Personalities..............................................................................................................................6
1.5 The positive influence of diversity on employees and organizations............................................6
H1........................................................................................................................................................7
1.3 The negative influence of diversity on employees and organizations...........................................8
H0........................................................................................................................................................9
References................................................................................................................................................11
 The influence of workforce diversity on the
organizational performance: in Jordanian
context

Abstract
Diversity is basically what people share as similarities or differences.

Workforce diversity is these actual differences and similarities among employees, starting from
the cultural background to the personal perspectives, opinions and thoughts. No person is alike
with others, thus no employee is with his companions, which makes the workplace have a
heterogeneous atmosphere. Nowadays, with the massive updates happening around the world, it
is becoming a key success factor and a reputational image for an organization to have a diverse
workforce (Saxena, 2014).

The researchers, after reviewing literature and looking at many resource papers, concluded that
having a diverse workforce is a point of strength for firms. On one hand, the well-managed,
open-minded and flexible diverse culture can improve the overall organizational performance.
On the other hand, some people might still stick to their points of view and thoughts, creating
conflicts and misunderstandings out of literally nothing, and consequently consider diversity a
severe major cause of problems in foundations.

This research paper aims to explore the relationship between workforce diversity and
organizations' performance, in the Jordanian context. This relationship is important due to the
recent high percentages of employees diversity in Jordanian companies and all around the world
as a trend for companies’ image. Also, this study analyzes thoroughly the impact that labor
diversity has on employees performance while considering their backgrounds differences. This
will be done through the qualitative approach of research, to pointedly sense and explore the
existent and possible implications of this relationship. It will examine employees’ personalized
experiences in the collective work-sphere of working with each other while having different
values and backgrounds at the same time.

This study fills the gaps in the literature about this topic in the Jordanian climate of staff
diversity in enterprises, as there is a lack in studies that are related to this field. This is to help
managers to better perceive and run the diverse workforces by putting employees in teams,
encouraging and empowering them, appreciating, recognizing and compensating their efforts,
supporting their novel ideas and perceptions and so many more ways that make employees in the
diverse workplace feel comfortable, welcomed and valued.

Introduction
The "Diversity Trend" started in the eighties, making itself an irreplaceable opportunity for firms
to gain and maintain a competitive advantage since that time (Kowo, Kadiri and Zekeri, 2020).
In particular, diversity is a representee of groups and teams, not individuals (DiTomaso et.
al,2007).

Workforce diversity presents similarities and differences between employees concerning their
age, gender, religion, race, cultural background, physical and mental abilities and disabilities and
sexual orientation (Saxena, 2014).

Diversity affects the workplace culture and performance outcomes in different positive and
negative ways at all companies, and due to the globalized market, this is a proven fact that
should be taken into consideration in all situations, everywhere. Along with that, it has been
claimed that if an organization does not employ diverse teams, it will not have the enough
competitiveness, because these diverse groups are thought to add a valuable touch to a
company’s outcomes. They also act as the most important asset of an organization, because they
provide several creative thoughts that could lead to innovative results and various opinions that
give the company a competitive advantage and help in an effective problem solving (Saxena,
2014), affecting the overall performance of the company.

However, it is crucial to mention that the way diversity can be impacting a workplace may be
encouraging or inhibiting to having higher performance, which makes the intended relationship
of this study have multiple theoretical and practical implications. In the literature, there are
dozens of studies that outlined this topic in order to explain and illustrate the effect that diversity
has at an individual and group level, yet, there is still a lack in the theoretical guidance and
empirical findings that address the relationship in the Jordanian firms society thoroughly (Kowo,
Kadiri and Zekeri, 2020).

In regard to the criticality of diversity presence in organizations and the promises that it brings
up, this research paper explores the role that employee diversity plays in influencing the
economic performance of organizations from several angles, as research on diversity and
organizational performance in the Jordanian context is kind of limited, therefore this study will
help in addressing this gap and add it to the literature. This will be done by employing the
qualitative research approach to meet the aim through interviews with employees who work in
different corporations. They will be conducted and asked deep and thorough questions to get
their views and perceptions on how they benefit from or dislike dealing with employees from
different nationalities and backgrounds and whether it affects the overall performance of the
organization in their opinions. By doing so, it is possible to interpret how that relation actually
works in the Jordanian companies.

1. Literature Review
1.1 Diversity in organizations

In business corporations, diversity does not merely mean languages, different races, attitudes,
thoughts differences.. etc. still and all also business professional functional skills, work-related
knowledge and industrial experience variations. In most scenarios, labor diversity is extremely
necessary for organizational development, the economic and productive enterprise growth and
the pleasing existence of the company in the market and in the eyes of the public.

Following that, sharing knowledge/information, creative ideas and experiences is an important

aspect that works on improving the organizational productivity and consequently the overall
performance (Dreachslina, WeechMaldonadob and Dansky, 2004 as cited in Saxena, 2014).

Theoretically, heterogeneous group members do much better than homogeneous ones. This
board heterogeneity is a prerequisite for company creativity and thus innovation, because they
attract resources based on their different social network, skills, backgrounds and prior
experiences (Issa, Yousef, Bakry, Hanaysha and Sahyouni, 2021).

A theory, resource dependence theory, suggests that diversity increases the resources, insights
and percpectives that employees provide to companies. Therefore, diverse employees and
directors (through age, gender and ethnicity) increase creativity and innovation (Ibrahim and
Hanefah, 2016). Individuals’ different cumulative stocks, like their education level and
experiences, play a significant role in fostering cognition and productivity capabilities of the
organization (Issa, Yousef, Bakry, Hanaysha and Sahyouni, 2021).

Discussed by Hamdani and Buckley (2011) and cited in Saxena (2014), staff diversity should be
managed strategically to be beneficial, which requires experienced HR managers who pretty
much have occupational management and leadership skills, to able to communicate and interact
with their employees in a way that lifts their morale up and encourages them to be productive,
innovative and hyped-up.

Moreover, at a research conducted in a similar context of research, Al-Jenaibi (2011) studied the
impacts of workforce diversity on companies in the UAE. Most employees acknowledged that
working with culturally different people is more than welcomed to them because they learn to
cope with the cultural, mental and skills differences with big hearts and understand each other’s
 perspectives respectfully through sharing experiences and stories of whether successes or failures
when they be working together. Similarly, it is expected to be the same case for the Jordanian
firms.

Figure 1 below represents this relationship.

Figure 1: A graph showing the sequence of the relationship between diversity and performance

PRODUCTIVITY
WORKFORCE Affects: Which affects:
EMPLOYEES’ WORKING AND
DIVERSITY
PERFORMANCE

1.2 Board Diversity

Board diversity is a “varied combination of attributes, characteristics and expertise contributed

by individual board members in relation to board process and decision making”- Walt and Ingley
(2003).

Most countries nowadays work to improve their boards gender balance, this is because board
diversity, particularly gender diversity, has a noticeable importance in decision making, as it is
an attribute that increases board levels of control, monitoring of the decision making process,
improveing performance effectiveness. It is more and more becoming an advantage to firms, for
its effect on the leadership effectiveness and the deeper understanding of the local and
international marketplace.

1.3 Gender Diversity

2.7% was the average female membership on the boards in Jordanian companies in 2018.
Women directors on the board may have different new skills, thoughts, experiences, prestige and
are less self-interest oriented when compared to their male fellow directors, which improves and
enhances the board productivity effectiveness (Aribi, Alqatamin and Arun, 2018).
Studies in several Jordanian companies concluded that companies who have higher proportions
of board diversity are more likely to have a higher levels of performance efficiency (Ibrahim and
Hanefah, 2016). Additionally, a regression analysis made in Jordan found that having female
directors on Jordanian corporate boards improve the board awareness on CSR practices, and
consequently, performance (Al Fadli, Sands, Jones, Beattie and Pensiero, 2019).

Unfortunately, unlike countries like Norway, there is no governmental policy that has been
adopted in Jordan to appoint the must to employ women in boards.

1.4 Age, education, nationality and personality diversity:

1.4.1 Age
Age diversity can be seen as an important asset to the board of a company and a part of the
human capital, because different age groups reflect various experiences. However, in most firms,
majority of the board members are old. Younger board members are more likely to have higher
abilities to process new ideas.

1.4.2 Nationality
Foreign directors usually bring diverse perspectives to companies, such as cultures, behaviours
and norms of their region, which in turn, enhances performance in a way or another (Ibrahim and
Hanefah, 2016). Moreover, foreign directors from different cultures bring novel thinking styles
and perspectives, so they may have a positive influence on corporate performance by linking the
firm to the external international market.

1.4.3 Education
Highly educated directors with high levels of knowledge and expertise possess a larger blend of
ideas that can affect the performance of the company (Issa, Yousef, Bakry, Hanaysha and
Sahyouni, 2021).

1.4.4 Personalities
Different employees may have low self-esteem that is not enough for exchanging discussions
with others, or may keep themselves totally isolated to avoid being embarrassed. Whilst, once
the veteran management supports them, provides recognition, worthiness and equity, they will
feel engaged and involved with the workplace network and hence start working with a positive
mentality and an ambitious mind to expand the horizons of their and the business's performance
(Kowo, Kadiri, Zekeri, 2020), this proves that this relationship between the wise management
who accept and embrace the diverse workforce is crucially important for the continuous
improvement.
1.5 The positive influence of diversity on employees and organizations

After reviewing several research articles that consider this topic, we hypothesize our first
hypothesis:
H1: Employee diversity has a positive impact on the overall performance of the company.

Accordingly, the following points represent the positive influence of labor diversity on the
performance of organizations:

 Workforce diversity might result in a higher quality of production or production of unique

novel products due to the multi-new-knowledge exchange that happens in such a culture
(Barrington, Troske, 2001).
 A widely-managed diverse workforce results in cognitive outcomes, which is an increase in
creativity because through diversity people interact with various other different people,
urging them to come up with creative fresh ideas that boost organizational productivity
innovatively (Saxena (2014), Green, Lopez, Whsocki and Kepner (2002), Rockson, Annan
and Muntaka (2017), Parrotta, Pozzoli and Pytlikova (2010), Kowo, Kadiri and Zekeri
(2020).
 When the workforce is a diverse one, members respecting other members’ differences will
definitely improve performance by creating a competitive edge for the company among other
competing companies in the market (Green, López, Wysocki and Kepner, 2011).
 Each employee has a unique individual way of thought, and all employees together
collectively, they can solve minor and major matters with the presence of the diversified
perspectives, that might be very thoughtful, as they have several life experiences, which is
too beneficial for the general outcomes of the company (Martin, 2014).
 The “diverse workforce” sounds like an ethical strategic method for organizations to be
socially responsible for different societal values such as equality and respectfulness for
people (Rockson, Annan and Muntaka, 2017).
 Welbourne (2000) as stated in Barrington and Troske (2001) reported that having a diverse
management team as well results in a higher stock price than that for the “homogeneous
teams” that have people all from the same background with similar thoughts and
perspectives. Accordingly, the stock market sees that the net financial benefits is for the more
diversity based firms (Barrington, Troske, 2001).

 Saxena (2014) mentioned that:

1. A diverse organizational workforce is a signal of equality (whether in gender, age groups,
different backgrounded employees.. etc), due to that, employees would feel more
comfortable that the corporation will accept them as it accepts others because they are not
the only different ones. This makes them surely feel closer to the firm itself.
 2. Diversity is profitable for both parties (employees and employers). In spite of the fact that
in most cases fellows in a workplace should be interdependent, but respecting individual
differences away from the interdependency that they have still increases the economic
performance of the firm.
3. Various advantages result from the diverse staff of the firm, like an improved problem
solving process and flexible adaptation and acceptance of any imposed changes, leading
to having competitive advantages.

 Parrotta, Pozzoli and Pytlikova (2010) have said:

1. Diversity enhances employees’ desires of achievement and accomplishment. Thanks to
the competitive soul that people have and should use wisely when exposed to situations
that has diverse people, they will want to work on themselves and on fulfilling their ego.
2. It creates unprecedented ideas, views, knowledge and learnings, encouraging knowledge
sharing and communication if employees can got along well.

 Green, López, Wysocki and Kepner (2002) have stated these benefits:
1. Diversity can drive to reducing lawsuits, raise constantly renewed marketing
opportunities and achieve progress in the business image, this is on account of the
varied perspectives that could provide guidance in several cases depending on the
different backgrounds.
2. Diversity is highly crucial for organizational flexibility and creativity which are keys
for competitiveness and innovativeness to improve the overall performance.

 Kowo, Kadiri and Zekeri (2020) have pointed out that:

1. Cultural diversity can influence innovativeness and effectiveness of processes when it
comes to the implementation of technology inside business productions.
2. The organization that accepts cultural diversity usually benefits effectively and
efficiently from having their employees retained (employee retention due to loyalty
and in some cases engagement), have high market shares, higher sales and
productivity, less absenteeism and professional satisfactory customer services and
feedbacks.

1.3 The negative influence of diversity on employees and organizations

However, Barrington and Troske (2001) have mentioned that the question that first came up to
their minds regarding this relationship was “Why should there be a relationship?” and continued
by that employees’ performance outcomes are only measured by the managers’ evaluation of
employees performance, not by any other measure of the organizational output, which shows a
contrast between their sayings and results and other authors' theories about the strong
relationship that exists between diversity and the organizational outturns. In a like manner,
Barrington and Troske (2001) have said that according to their readings and researches, there is a
lack of evidence about the existence of this relationship (diversity-economic performance),
which is a point that also should be thought about meticulously.

Based on that, we hypothesize:

H0: Employee diversity can be an inhibitor to improving organizational performance.

The following points are the negative influence of diversity on employees’ productivity and
accordingly the overall performance of organizations:

 Employees often have sundry reasons to create a conflict with each other, including the very
serious and literally frivolous things. Whatever their reason might be, it usually costs the
company a loss in productivity and a development of negativity and discomfort amongst
employees, which is ruinous to firm’s coherence and correspondingly performance (Martin
(2014), Saxena (2014) ).

 Employees may have lower satisfaction levels because they usually prefer to interact with
similar people who have identical minds and behaviors with them in their daily life basis
(Saxena, 2014).

 Managers may also face losses in staff members number and a decrease in productivity due
to biased behavior and discrimination. (Green, 2002)

 Aggressive attitudes, expressions, offenses and behaviors in the workplace may cause legal
litigation (Green, 2002).

 When different members are put together to perform in one team, their different opinions and
cultural backgrounds can block or prohibit the growth of the unity and teamwork soul that
leads to fruitful outcomes (Martin, 2014).

 It can affect performance negatively due to the bad communication and cooperation that
might be there and the lower levels of trust between the culturally different people (Parrotta,
Pozzoli and Pytlikova, 2010).

 Because of that the organization may be focusing only on having a diverse workforce and
make it work between these different people, they might lose their foundation vision. Instead,
they should work on figuring out their strength and improving it to walk towards that vision.
Moreover, as a company, they may feel that they are obliged to pay attention to their labor
diversity existence and success rather than concentrating only the gaining revenues and
improving performance, which might make them to not be fully capable of managing their
 assets effectively (the diverse workforce, time, intellectual properties..etc.) (Rockson, Annan
and Muntaka, 2017).

 Holzer and Neumark (2000) and Osborne (2000) as cited in Barrington and Troske (2001)
have discussed that even if hiring a diverse person may create a higher economic
performance for the company, there still is a probability of losses and costs that are
associated offsetting profits, revenues, market performance, products development, strategies
formation, planning and other work related process that should be improving rather than
restraining performance and competitiveness. This can be clearly represented in the cases of
getting heterogeneous people to work together and its costs that, as a consequence, create
even more harsh conflicts of opinions and behaviors.
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