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International Journal of Contemporary Hospitality Management Hotel managers' perceptions of the value of diversity training: an empirical investigation Dennis Reynolds Imran Rahman Stacey Bradetich
Article information: To cite this document: Dennis Reynolds Imran Rahman Stacey Bradetich , (2014),"Hotel managers' perceptions of the value of diversity training: an empirical investigation", International Journal of Contemporary Hospitality Management, Vol. 26 Iss 3 pp. 426 - 446 Permanent link to this document: http://dx.doi.org/10.1108/IJCHM-02-2013-0079
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Hotel managers’ perceptions of the value of diversity training:
an empirical investigation Dennis Reynolds, Imran Rahman and Stacey Bradetich
School of Hospitality Business Management, Washington State University, Pullman, Washington, USA
Abstract
Purpose – Recent research identifies several attributes that lead to the value proposition of a diversity-training program: corporate engagement in diversity training; participants’ perceptions of how such programs aid their peers; self-analysis of participants in training; and perceptions regarding the benefit of diversity training for subordinates. The aim of this paper is to test a corresponding four-antecedent model of the value of diversity training from the point of view of hotel managers.
Design/methodology/approach – A survey instrument was devised and sent to a random sample of hotel properties that asked managers questions related to the value of diversity training. Multiple regression analysis and t-tests were used as methods of data analyses.
Findings – Results from 242 responses returned by managers of 96 hotels indicated that managers perceive themselves and the corporate executives to significantly add value to the organization through diversity training. Furthermore, ethnic minority managers do not value diversity training significantly more highly than their non-minority counterparts do; similarly, little difference exists between genders on the four indicators of diversity-training efficacy.
Research limitations/implications – This study examined only one aspect of diversity management – diversity training. Among other limitations are the small sample and low response rates, which made it difficult to compare ethnic groups to one another.
Practical implications – Through this study, managers’ perceptions about which groups of employees add value following diversity training are presented. The findings are likely to help hospitality corporations to implement diversity training more efficiently.
Originality/value – This study indicates that hotel managers value diversity training and suggests the need for organizations to understand how to prioritize various organizational levels for such training.
Keywords Training, Diversity, Management, Values, Human resource development, Hotel manager
Paper type Research paper
Introduction Demographic diversity gives rise to creativity, innovation, and enhanced group problem solving, which in turn boosts the competitiveness of the organization (Konrad, 2003). Moreover, a diverse workforce can generate increased market share by better taking care of a diverse customer base (Konrad, 2003; Jayne and Dipboye, 2004). Yet diversity alone might not improve business performance ( Jayne and Dipboye, 2004). Organizations need to institute effective diversity management practices to reap the benefits of a diverse workforce. The value of diversity training should be measured by its capacity to harness diversity for organizational advantage.
In the US, the need for industries and firms to embrace diversity is underscored by the growing number of minority workers in the service sector, particularly in the
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Received 12 February 2013 Revised 12 June 2013 8 August 2013 Accepted 15 September 2013
International Journal of Contemporary Hospitality Management Vol. 26 No. 3, 2014 pp. 426-446 q Emerald Group Publishing Limited 0959-6119 DOI 10.1108/IJCHM-02-2013-0079
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hospitality industry in which minorities are typically heavily employed (Walker and Miller, 2010). As a result, many domestic hotel companies and restaurants have initiated diversity training targeted at enhancing employee empathy for diverse employees, guests, and customers. Diversity training is especially important in hospitality and other service industry segments, because restaurants and hotels employ women and minorities in great numbers. For instance, in the restaurant industry alone, 36 percent of employees are non-White and 54 percent are women (Multicultural Foodservice and Hospitality Alliance, 2007). In addition, the hospitality industry does business with customers from around the world, suggesting that success depends on understanding diverse customer sensibilities. Appropriate sensitivity to diversity-related issues seems likely to help hospitality firms provide enhanced customer service and higher levels of guest satisfaction.
There is an abundance of literature on diversity but very little empirical research regarding diversity management initiatives especially in the context of the hospitality industry (Holladay and Quiñones, 2008; Roberson et al., 2001; Wilborn and Weaver, 2002; Weaver et al., 2003; Madera et al., 2011). Empirical studies incorporating managerial perspectives on diversity training in regards to hotel firms, in particular, are very limited in the hospitality literature. This paper responds to this gap by examining diversity training in the lodging industry by surveying midlevel managers of hotels in the US. In particular, we explore several aspects of diversity training to determine its value and to measure whether perceptions of such training vary across populations in regards to ethnicity and gender. In addition, we investigate which employee groups – corporate level employees, managers, peers of managers, and subordinates of managers – in hotels should be prioritized as recipients of diversity training. Prior research has indicated managers’ attitudes to be the reason why diversity management fails in the hospitality workplace (Furunes and Mykletun, 2007). Thus, we carry out a detailed investigation of manager attitudes of diversity training regarding the value it creates. Our findings may help hotel corporations to implement diversity training initiatives more efficiently.
Literature review The “value” concept According to Bowman and Ambrosini (2000) there are two types of value at the organizational level: use value and exchange value. Use value refers to “the specific quality of a new job, task, product, or service as perceived by users in relation to their needs, such as the speed or quality of performance on a new task or the aesthetics or performance features of a new product or service” (Lepak et al., 2007, p. 2). On the other hand, exchange value, refers to “either the monetary amount realized at a certain point in time, when the exchange of the new task, good, service, or product takes place, or the amount paid by the user to the seller for the use value of the focal task, job, product, or service” (Lepak et al., 2007, pp. 2-3). Value creation depends on the relative amount of value that a target user, the focus of value of creation, subjectively realizes and this subjective value realization must at least translate into the user’s willingness to exchange a monetary amount for the value received (Lepak et al., 2007). This target user can be an individual, organization, or society (Lepak et al., 2007).
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The “value” of diversity Human capital serves as one of the most valuable resources of a firm. According to the resource based view of the firm, resources that are valuable, unique, and difficult to imitate can provide the basis for firms’ competitive advantages (Barney, 1991). In order for human capital to contribute to sustainable competitive advantage, it must create value, remain hard to imitate, and appear rare (Barney and Wright, 1998). Diversity in human capital can be a source of sustained competitive advantage because it can achieve these three criteria for a firm (Richard and Kirby, 1999). We would be discussing the many different benefits of employing a diverse workforce that helps the organization gain sustained competitive advantage, in the later sections. The important takeaway at this point is that in order to create value resources must be managed efficiently. This is where the importance of diversity management through effective diversity training initiatives comes in.
Understanding diversity management According to Thomas and Ely (1996), diversity refers to “any mixture of items characterized by differences and similarities.” More specifically, especially in an organizational context, diversity deals with issues of racism, sexism, heterosexism, classism, ableism, and other forms of discrimination at the individual, identity group, and system levels (Cross et al., 1994). Understanding these issues and the differences they create in an organizational context, especially realizing the wide range of perspectives these differences can bring in is a crucial aspect in managing a diverse workforce. As such, diversity management refers to understanding that there are differences among employees and that these differences, if properly managed, are an asset to work being done more efficiently and effectively (Bartz et al., 1990; Furunes and Mykletun, 2007). In other words, diversity management is the planning and implementation of organizational systems and practices to manage people so that the potential advantages of diversity are maximized while its potential disadvantages are minimized (Cox, 1993; Weaver et al., 2003).
Effective diversity management fully integrates members of minority social categories into the social, structural, and power relationships of an organization (Brewer et al., 1999; Pendry et al., 2007). The predominant objective is to create an organizational culture that is heterogeneous and utilizes maximum participation of all individuals to their full potential (Thomas, 1986; Bartz et al., 1990). In organizational settings, this objective is often achieved through the implementation of diversity management training programs which essentially train an employee in supervising and implementing employment practices that attempt to deal effectively with diversity within the workforce (Weaver et al., 2003). It is often stated that issues such as power and dominance, discrimination, and oppression are the domain of diversity training (Fowler, 2006). Power inequalities, especially, are central to diversity training (Fowler, 2006). As such, to truly value diversity means altering the power relations in an organization to minimize structural discrimination (Foster et al., 1988; Sue, 1991).
Diversity management in the workplace Discussing diversity in the workforce is complicated by the necessity to distinguish Affirmative Action (AA) or Equal Opportunity (EO) compliance from the broader issue of diversity management. Much diversity research shows that simple compliance with
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quotas or government regulations does not equate to effectively managed diversity (Groschl and Doherty, 1999; Swanson, 2002; Lattimer, 1998; Kidder et al., 2004). For example, a study by Richard and Kirby (1999) examined how the justification given by management or government of a diversity initiative affects employee perceptions of such a program. Their study suggested that employee perceptions are likely to be heavily influenced by the justification that a firm provides for implementing a diversity measure.
Kidder et al. (2004) examined backlash toward diversity initiatives and found that AA-oriented policies are generally viewed less positively than diversity training initiatives are, as subjects presented with a diversity program justification for diversity management reported more positive attitudes than did those who thought the program was implemented only to achieve an AA objective. In his study of diversity programs, Swanson (2002) found that diversity directors see diversity program evaluation as somewhat of a paradox. Corporate leadership looks for quantitative results, but diversity programs are often lengthy processes and are very difficult to test and examine, so quotas are introduced. Swanson’s subjects found this challenging because diversity directors “recognize that the quality of work life and satisfaction with peer relationships may be measured by retention rates [quotas], but... impact on productivity and quality decision making is very difficult to measure” (Swanson, 2002, p. 263). Thus, it is difficult to implement diversity training that is both effective and can be measured for success and profitability.
Because diversity training involves attitudes and perceptions, it is difficult to quantify its outcomes. Wentling and Palma-Rivas (2000) found in their study of diversity initiatives that the problem is not that there is too little evaluation. They found instead that the companies they studied evaluated their diversity initiatives with a wide variety of methods that are difficult to compare. Firm capacity to sponsor diversity measures effectively depends on several factors. Company size is important, for example, as larger or multinational companies are able to implement system-wide initiatives efficiently whereas smaller companies may lack the resources to do so at all (Rynes and Rosen, 1995). Additionally, the presence of a diversity manager, top management support, and a wide range of complementary diversity-related policies and practices makes it easier for firms to adopt diversity training. It may be helpful to study diversity training performance ratings using a so-called 360-degree approach that examines such ratings from multiple organizational levels: “ratings from different organizational levels provide different, relatively unique perspectives” (Borman, 1997, p. 312). Thus, examining the validity of training evaluations may be more effective when using a method that involves multiple supervisory and non-supervisory levels.
McKay et al. (2007) studied retention rate as an indicator of diversity perceptions in the workplace. They found that, among all groups, diversity climate perceptions were significantly and positively related to retention rates across racial groups. This shows that if managers feel committed to a company that values diversity, they are more likely to value diversity themselves and are more likely to stay with their current companies longer. In a study of minority executives in journalism, Rivas-Rodriguez et al. (2004) studied the perceived value of promoting such minorities to executive positions. They found that minority journalists, regardless of ethnicity, occupation, or years in the business, believe that having minorities in executive positions provides several key value points. Minority journalists cite racial sensitivity on the part of
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minority managers and the ways in which minorities in a company are generally portrayed and viewed as areas where minority executives could have a positive influence on company culture, according to other minority journalists.
These studies suggest that managers in today’s culture value diversity. We see in the McKay et al. (2007) study that managers remain with companies that emphasize diversity. The study concluded that a company culture that values diversity makes managers feel more comfortable in their positions and subsequently keeps them with the company longer. Additionally, Brown et al. (2006) illustrates that new applicants are attracted to companies that project diversity as an important value. We can then draw a connection between these results and say that, not only do managers remain with companies that value diversity, they also seek out such companies when looking for new positions. There is very little research on the value managers attribute to diversity training, but it can be inferred that, if diversity benefits a company, and if managers themselves seek it in the companies they work for, then managers value diversity training, which would ideally increase the amount and appreciation of diversity in a company. Additionally, Iverson (2000) studied the state of diversity effectiveness, specifically in hospitality fields. Iverson found that “managers must respect the cultural beliefs and needs of employees and truly value diversity in the workforce. Strategies that can lead to a diversity-literate management staff include diversity-awareness, training, and the hiring of managers and top executives who reflect variety in gender, race, and ethnicity” (Iverson, 2000, p. 38).
Importance and benefits of diversity management Diversity management is an important issue. Statistics show that women currently comprise 46.8 percent of the US workforce (US Department of Labor, 2009) and of the 23.8 million service workers, 57.3 percent are women (US Bureau of Labor Statistics, 2006). According to a 2004 report from the Readership Institute, minorities account for around 29 percent of the workforce. These statistics altogether imply a huge need for quality diversity management, especially in service industries such as hospitality, which has a reputation for broad diversity. Moreover, these statistics take into account only race and gender as opposed to other demographics such as sexual orientation, age, and disability. Furthermore, US population trends point inevitably to greater ethnic and other forms of diversity in the future. It is predicted that the total number of minorities will outnumber non-minorities in the US by 2042 (CNN US, 2008). It seems therefore imperative that hospitality managers seek to improve service offerings to guests from a diversity of backgrounds if they hope to remain competitive.
Evidence suggests that diversity management initiatives should account for more than racial or gender/sexuality diversity. It should include culture, education, lifestyle, and experiences as well (Lattimer, 1998). Diversity provides a wide range of benefits, such as a greater capacity to meet customer needs, improved decision making, cost reduction associated with turnover and lawsuits, increased productivity, quality improvements, enhanced creativity, and innovation (Groschl and Doherty, 1999). Among others, Research has revealed work group diversity produces a greater multiplicity of ideas (Kim, 2006), generates more effective solutions to problems (Cox, 2001), and creates an enhanced marketing strategy for the organization (Kim, 2006). Indeed, diversity leads to better organizational performance (Desvaux et al., 2007; McMahon, 2011). Desvaux et al. (2007) found that higher female representation in top
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management decision making bodies leads to better economic performances of their organizations.
Diversity training has a proven record of benefiting firms but only if it is suited to the needs of an organization. Broadly speaking, diversity training enhances a company’s moral standing and provides value to all its personnel (Peceri, 1994; Thomas, 1986). In addition to increasing market share, enhancing competitiveness, policies, and organizational structure, and bolstering recruitment and retention of employees, diversity training can contribute to the personal development of employees and improve their interpersonal communication (Nemetz and Christensen, 1996), while also enhancing their managerial competencies (Rice, 1994). In particular, diversity training is found to improve employees’ organizational attitudes and their individual organizational performances (McKay et al., 2009; Madera, 2013). In short, diversity training creates value for an organization.
Effective dispute resolution and promotion of fairness and equality can also result from diligent diversity training, which is especially important for managers, their peers, and their subordinates in the workplace (Overmyer-Day, 1995). Additionally, bias reduction (Dovidio, 1993) and a sense of appreciation of cultural differences (Brady, 1996) are also very important in dealing with both staff and customers. In the context of a hotel, diversity training is important for both managerial and non-managerial workers. For example, diversity training can establish and maintain a hospitable work environment for non-managerial employees (Noe and Ford, 1992), which is especially important for an organization such as a hotel that employs a diverse workforce and deals with a diverse customer base on a regular basis. Thus, diversity training for workers who deal with customers, such as front desk clerks, concierges, and guest services representatives, can improve customer service.
Traditional stakeholder theory suggests that the purpose of a business is to create as much value as possible for its stakeholders (Freeman, 1984). The theory implies that managers should make decisions so as to take account of the interests of all stakeholders in a firm including not only financial claimants, but also employees, customers, communities, governmental officials, etc. ( Jensen, 2002). Applying this theory, it becomes apparent that hotel managers would prefer themselves, their peers, their subordinates, and the corporate executives to undergo diversity training because of the benefits it brings and the value it creates for the organization.
However, the exorbitant cost of diversity training can prevent hospitality organizations from making it readily available to all employees. As far back as 19 years ago an average diversity trainer cost $2,000 per day, with expert and high-in-demand consultants earning four to five times more (MacDonald, 1993). Either directly or indirectly, about 10 billion dollars per year has been spent on preparing firms for multicultural staffs or marketplaces (Lubove, 1997). More precisely, it has been estimated that organizations spend $8 billion annually on diversity training (Hansen, 2003). Because of the enormous cost associated with diversity training, many organizations often offer it only on a voluntary basis (Bezrukova et al., 2012).
According to Dutton and Ashford (1993), top management perceptions are critical determinants of organizational policies and practices. In particular, it appears that only corporate executives can initiate diversity training successfully. In this regard, corporate-level workers should undertake diversity training themselves so that they understand its implications for and benefits to their organizations. Similarly,
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mandatory attendance by top managers is important so that they can appropriately model the desired training outcomes and reinforce them when exhibited by others (Wiggenhorn, 1990). Research has suggested top management commitment to diversity to be a strong predictor of diversity training success (Bezrukova et al., 2012). Human capital theory bolsters the point why managers would like to get diversity trained. The theory suggests that education or training raises the productivity of workers by passing on useful knowledge and skills, hence raising workers’ future income by increasing their lifetime earnings (Schultz, 1961; Becker, 1964). Stakeholder theory provides the rationale why managers would prefer other employees in the organization to undergo diversity training as we mentioned earlier. In hindsight, everyone at all levels in hospitality organizations, from entry-level employees to senior managers, should manage diversity consistently (Kim, 2006). As such, it is suggested that hotels implement their diversity-oriented approach at all organizational levels (Groschl and Doherty, 1999). Especially, managers would want the top-level employees to undergo diversity training because it would have a strong influence on the organization right from the top.
In essence, organizations have limited resources and few can afford to spend profligately on diversity training. This suggests that analyzing the perceived importance of diversity training on the part of functionally distinct organizational constituencies in creating value for a hotel merits empirical study. This would help organizations to prioritize the recipients of diversity training. In that respect, it is important to understand the perceptions of managers regarding which groups (managers, peers, subordinates, or corporate executives) contribute significant value to an organization following diversity training. Although we anticipate that managers would perceive all the four groups of stakeholders to create value to the organization through diversity training, we feel the effects are stronger for themselves and their superiors. We therefore propose the following hypotheses:
H1. Managers significantly perceive themselves as creating value for their organizations following diversity training.
H2. Managers significantly perceive their peers as creating value for their organizations following diversity training.
H3. Managers significantly perceive their subordinates as creating value for their organizations following diversity training.
H4. Managers significantly perceive corporate-level workers as creating value for their organizations following diversity training.
Value of diversity training: minorities vs non-minorities Discrimination is a phenomenon hard to ignore. For instance, a recent study by Broyles and Fenner (2010) shows that in the US minority chemists receive lower wages than their White counterparts and for Asian and Black chemists, discrimination largely accounts for the wage differential. Effective diversity training, with its many benefits that we discussed in the earlier sections, is supposed to diminish these differences by improving organization wide attitudes towards diversity that likely will promote fairness and equity on these grounds.
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Sawyerr et al. (2005) examined individual value structure and diversity attitudes as well as the moderating factors of age, gender, race, and religiosity and found that these moderators influence a company’s diversity value structure. They used the Schwartz Value Survey, which measures four correlated attributes: openness to change versus conservation, and self-transcendence versus self-enhancement. In the case of White versus non-White participants, they found that White participants who ranked highly in self-enhancement (hedonism, self-interest) were associated with lower universal diversity orientation and lesser comfort with difference. On the other hand, non-Whites’ self-enhancement scores were not associated with a difference in universal diversity orientation but were associated, albeit less significantly, with lesser comfort with difference. As such, they postulated that “It may be that non-whites who score high on self-enhancement exhibit more positive universal diversity orientation attitudes overall than their white counterparts, while feeling uncomfortable with difference, similar to their white counterparts” (Sawyerr et al., 2005, p. 515).
Additionally, the McKay et al. (2007) retention rate study illustrates that there are differences among racial group perceptions of organizational commitment and thus retention rate. Especially for Black managers, diversity climate appears twice as likely to correlate with retention, compared with the perceptions of White managers (McKay et al., 2007). Interestingly, they found that Hispanic managers had a slightly lower variance compared with that of White managers. However, minorities more generally exhibited higher variance in turnover intentions than non-minorities did.
In a study of performance feedback perceptions, Geddes and Konrad (2003) researched the effects of demographic similarity and dissimilarity. They examined how employees reacted to feedback from White, non-White, male, and female supervisors. The results were that employees reacted more favorably to feedback from White managers, implying that employees perceive White managers to have enhanced credibility. They also found that men react more negatively when they receive negative feedback from women than when it comes from men. Interestingly, they also found that a same-race bias might be occurring, as employees from the same race responded more negatively to lower-than expected or negative ratings from members of their own race than when such ratings came from members of another race. This suggests that there is a need for diversity training and understanding even within demographic groups. Geddes and Konrad (2003) cite the need for in-group acceptance as a potential cause of this finding, and they cite status characteristic theory as a possible source of more positive interactions with White managers.
Intuitively, most of us would expect minority and non-minority managers to perceive the value of diversity measures differently. As we have seen in the research from Sawyerr et al. (2005), these two groups do not share the same attitudes regarding diversity. Additionally, Geddes and Konrad (2003) suggested that employees react differentially to performance evaluations of and from people from other backgrounds. Iverson’s (2000) study focused on minority managers’ perceptions of diversity climates. She found that minority managers often feel that they must work harder than majority managers must to achieve the same rewards, but that they still are not compensated equally. Doherty (2004) explored diversity management in the hospitality industry and reported that female managers’ fail to progress from middle management to top management in adequate numbers due to inflexible working practices and the long hours work culture. The effects of diversity training on minority and majority
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managers can be different as well. For instance, Waight and Madera (2011) found that diversity training in a hospitality organization had a significant positive effect for ethnic minorities’ job satisfaction, perceived workplace discrimination, and turnover intentions, but this effect was not visible for majority-member participants.
According to the social identity theory a basic need for positive self-esteem stimulate people to favor their in-groups in most comparisons with out-groups (Tajfel and Turner, 1986). Self-categorization theory posits that “self-categories tend to be evaluated positively” (Turner et al., 1987, p. 57). Based on these theories it can be asserted that in-group members in comparison to their out-group counterparts are generally apportioned more rewards and are more likely to be aided (Piliavin et al., 1981). Applying this viewpoint in the context of this study, it can be implied that minority managers perceive diversity training as more valuable than their non-minority counterparts because diversity training is supposed to directly benefit the minority employees (their in-group) in terms of being treated uniformly in the workplace. We have seen, then, that minority and majority employees rarely share the same perceptions of interactions at work and minorities often feel that they lack access to the same resources and opportunities as their white counterparts enjoy. Similar findings pertain to female and male managers. Therefore, we posit the following two hypotheses:
H5. Ethnic minority managers significantly perceive diversity training to be more valuable than non-ethnic minority managers do.
H6. Gender minority managers significantly perceive diversity training to be more valuable than non-gender minority managers do.
Methodology This study employed a survey-based methodology. Questions were focused to call forth responses at two levels of granularity: value judgments about diversity training in general (industry-level items, as in “Diversity is a top issue for the hospitality industry today”) and evaluations of diversity training as experienced and indicated by performance or profitability (firm-level items, as in “Job performance overall improved after my employees experienced diversity training”). We sorted the survey questions into five sub-sections: corporate-level analysis (perception of how a respondent’s corporate level employees feel about diversity training), peer-level analysis (perception of how a respondent’s peers reacted to diversity training), self-analysis (perception of how a respondent reacted to diversity training), subordinate analysis (perception of how a respondent’s subordinates reacted to diversity training), and value-judgment analysis (perception of a respondent’s feelings toward diversity training in general).
The survey was piloted in two undergraduate classes at a university in the northwestern US to test for validity and reliability. The original survey contained 38 questions in addition to the demographic questions. After the pilot test, 12 questions were removed to improve survey reliability. In addition, it should be noted that 6 of the 26 questions (part 1) on the final survey were reverse coded. The final list of items is shown in Table I.
Although reliability was measured through the pilot test, validity cannot be assured due to the previously untested nature of the survey. The guidelines by Churchill (1979) and DeVellis (1991) for developing the survey instrument were followed. Originally, a
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collection of items from the literature and from discussions with hotel executives and hospitality educators were gathered. Subsequently, a few faculty members and graduate students assessed the content validity of the identified items based on which the items were modified to improve their clarity, readability, and content validity. The feedback we received from the pilot test helped us to reduce and modify the items even further. In addition, we followed Borman (1997) in taking a 360-degree approach in testing for corporate, peer, self-, and subordinate effects, as well as eliciting value judgments about diversity perspectives. Furthermore, the Rynes and Rosen (1995)
Category Items Alpha
Corporate 1. As a result of diversity training, the company manages diversity well 2. The diversity training at my corporation emphasized the importance of
serving a diverse customer base 3. I noticed positive effects for the corporate employees after diversity
training occurred 4. I noticed negative effects for the corporate employees after diversity
training occurred 5. Customer service improved as a result of diversity training to corporate
employees 6. As a result of diversity training of the corporate employees, my
company employs a diverse workforce 7. The diversity training provided to corporate employees emphasized the
importance of having a diverse workforce 8. Customer service worsened as a result of diversity training to corporate
employees
0.859
Peer 1. I noticed a change in my peers attitudes after they experienced diversity training
2. Job performance among my peers improved after they experienced diversity training
3. My peers are better managers due to diversity training
0.789
Self 1. My job performance improved after I experienced diversity training 2. I noticed a change in my own attitudes after I experienced diversity
training 3. In general, the diversity training that I received made me a better
manager
0.857
Subordinate 1. I noticed a change in my subordinates attitudes after they experienced diversity training
2. Job performance overall improved after my employees experienced diversity training
3. In general, the diversity training that my subordinates experienced, improved the way they serve the guests
0.865
Value 1. My time is well spent working on diversity issues at work 2. As a result of diversity training, the guests at my hotel are better served 3. Diversity training is ineffective in improving overall guest satisfaction 4. In general, I see diversity training as being beneficial 5. Diversity training was unnecessary in improving workforce diversity 6. Diversity training was unnecessary in improving guest satisfaction 7. Diversity should be a top issue for the hospitality industry today 8. Diversity is a top issue for the hospitality industry today 9. Workforce diversity is unnecessary in general
0.876
Table I. Reliability statistics
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method of subjective and holistic questions was used as indicated, for example, by items such as “In general, I see diversity training as being beneficial.”
All the surveys were paper based. Packets, each containing seven surveys, were mailed to 2,000 US hotels that were randomly selected from the American Hotel and Lodging Association directory. The survey packets were addressed to general managers of the properties and arrived with instructions to distribute each of the seven surveys to department heads. Respondents were asked to consider any formal training within their organizations that pertained to diversity management. A five-point Likert scale was used to measure respondents’ reactions to 26 items pertaining to their experiences with diversity training and diversity management. Responses were scaled from “strongly disagree” to “strongly agree,” with a “non-applicable” option. Additionally, a demographic section elicited information regarding ethnicity and gender.
Responses were grouped in accordance with the five sub-sections and group scores were summated by category. Responses were also coded into four categories: White men, White women, non-White men, and non-White women. Multiple regression analysis and t-tests were employed as data analysis methods using SPSS version 18.
Results A total of 242 responses were received from 96 hotels, yielding a response rate of 4.8 percent. While the response rate was low, this was likely due to the complexity of the survey distribution within properties. Moreover, subsequent tests for non-response bias (executed through random calls to non-respondents) suggested no basis or concern that respondents were not representative. Out of 234 respondents who indicated their gender, 135 (57.7 percent) were male, and 99 (42.3 percent) were female. Of the respondents who indicated their ethnicity, 191 (78.9 percent) were White, and 51 (21.1 percent) were non-White. In terms of reliability, all subsets produced acceptable alpha values, which ranged from 0.789 to 0.876. Please see Table I for details.
To test H1-H4 as well as the suggested model, we performed multiple regression on the data. The results are summarized in Table II.
Only the Corporate and Self- categories were perceived to contribute significantly to value. Thus, hospitality managers appear to perceive that corporate-level employees, as well as themselves, contribute significantly in creating value for their organizations through diversity training. Thus, H1 and H4 are supported.
Regarding H5, which posits that ethnic minority managers perceive diversity training to be more valuable than do their non-minority counterparts, t-test results
Variable B S.E. B
Corporate 0.197 0.083 0.335 *
Self 0.316 0.148 0.205 *
Peer 0.104 0.243 0.065 Subordinate 0.221 0.211 0.142
Note: R 2 ¼ 0.514; *p , 0.05
Table II. Managers perceptions of work group’s value creation through diversity training
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yielded higher means for minority (non-White) hospitality managers but none of the differences in means is statistically significant (see Table III). Therefore, H5 is rejected.
The second t-test, carried out to compare means between male and female hospitality managers, is presented in Table IV. Results yielded higher means for female managers than for male managers in four of the five categories: corporate, self-, subordinate, and peer. On the other hand, responses of male hospitality managers show higher means only for the value category. However, as in the ethnic minority t-test results, none of the differences in means is statistically significant. Thus, H6 is not supported, as it cannot be concluded that female managers value diversity more than their male counterparts do.
Discussion Multiple regression analysis showed that hospitality managers perceive corporate-level employees as contributing significantly to value creation in their organizations through diversity training. Corporate-level employees operate, of course, at the top of their organizational charts. They initiate diversity training in their organizations. Often corporate executives can foresee how much diversity training their organizations need, and they are likely to know how much funding is available to be allocated to diversity training. In this regard, it is apparent that hospitality managers realize the importance of training corporate-level employees to address diversity-related issues. Hospitality managers work under corporate-level employees, which makes diversity training an important benchmark by which managers can gauge how they are treated by their superiors, especially insofar as a firm’s effectiveness in addressing diversity-related issues affects a manager’s ability to
Gender Male Female
Mean SD Mean SD t df
Corporate 24.25 12.974 26.56 11.285 21.447 225.262 Self 8.81 4.974 9.34 4.315 20.880 225.474 Peer 8.29 4.871 8.89 4.138 21.016 226.973 Subordinate 7.97 4.982 8.69 4.107 21.204 228.779 Value 32.59 7.206 32.37 7.122 0.223 232
Note: *p , 0.05
Table IV. Comparing means
between male and female
Ethnicity White Non-white
Mean SD Mean SD t df
Corporate 24.93 12.203 26.12 12.636 20.612 240 Self 8.88 4.665 9.37 4.830 20.764 240 Peer 8.37 4.489 9.37 4.699 20.749 76.147 Subordinate 8.16 4.647 8.63 4.695 20.637 78.180 Value 32.23 7.125 33.04 7.686 20.708 240
Note: *p , 0.05
Table III. Comparing means
between Whites and non-Whites
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manage personnel and customer relations. Hospitality managers are therefore likely to benefit most from diversity training that is adopted by corporate-level employees. Moreover, hotel companies often manage several hotel properties, and corporate-level employees oversee all those properties and decide which ones need diversity training. Corporate-level employees who receive diversity training are therefore better able to bring harmony throughout an organization, across its several properties. These factors help to explain why H4 was supported by the data.
Regression analysis also revealed that hospitality managers do not perceive their peers as significantly contributing to value creation following diversity training, even though they think that diversity training enables the managers themselves to do so. While we cannot explain this apparently self-centered bias, it is possible that it prevents them from perceiving value in diversity training for people at their organizational level while judging it valuable for their superiors and subordinates. In the literature review, we discussed the importance of diversity to the functioning of work groups. As such, since managers perceive there to be generally beneficial consequences of diversity training at the corporate level, there is an opportunity for human resource departments to train managers to appreciate peer reactions to diversity training.
Setting aside the asymmetry in virtue of which managers perceive their organizations as benefiting from their own diversity training but not from diversity training provided to their peers, let us focus on the finding that hospitality managers perceive that when they undergo diversity training they are able to create value for their organizations. If managers have experienced positive results through diversity training, and have recognized the importance of diversity training for themselves for the betterment of their organizations, it is safe to conclude that diversity training is perceived as a significant success factor by managers in the hospitality workplace. It is interesting to note that respondents reacted most positively when asked whether diversity training made them better managers and least positively when asked whether their own job performance improved after diversity training. This finding provides an interesting paradox because these are very similar questions, implying that being a “better manager” encompasses more than simply job performance. It may also indicate that diversity is not a significant factor in job performance evaluations. It is also noteworthy that 43 of the 234 respondents in this category designated all questions as “non-applicable.” This indicates that as many as 18.38 percent of respondents had not received diversity training that would have contributed to their skills as managers.
In the Subordinate category, respondents provided the most positive responses to the item linking employees’ diversity training to improving guest satisfaction. They provided the least positive responses to the item linking diversity training to improvement in employee job performance. Perhaps managers see themselves as managing diversity well while faulting their subordinates for not implementing diversity initiatives effectively or properly. Such apparent in-group bias may explain why managers rate themselves, and their peer members at the same supervisory power-level, more highly than they rate their subordinates. Regression analysis revealed that hospitality managers do not perceive their subordinates as adding value to their organizations through diversity training. As previously mentioned, the decision to undergo diversity training involves considerable expense, which might be
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reflected in the managers’ perceptions. Moreover, subordinates are seldom charged with managing other workers and in many cases they do not even manage any workers, and in these regards it might be argued that diversity training is not as important for subordinates as it is for managers and corporate-level employees. It is also worthy to note that effective management of organizational power dynamics is critical for diversity training endorsement (Weithoff, 2004). If managers feel threatened by a diversity initiative, they may be unlikely to show its support to their subordinates or peers (Frost, 1999).
High turnover rate in the hospitality industry may also explain why H3 was not supported. A survey of 4,000 companies across the US by Compdata Surveys shows that hospitality industry has the highest employee turnover rate of 37.9 percent compared to an all industry average of 15.9 percent (Compansation Force, 2010). Because of this high turnover rate, training employees especially at the bottom of the organizational hierarchy might not be worth the time, effort, and cost. However, subordinates in hospitality organizations interact with customers more often and more intimately than other employees do, suggesting that managers have little concern with the benefits of diversity training regarding interactions with a diverse customer base.
The exorbitant cost of diversity training programs implies that managers have to prioritize the recipients of diversity training in their organizations. The hospitality industry typically operates with a meager 3-4 percent annual profit margin (Gustafson, 2002) which also makes it hard for most hospitality firms to invest heavily in diversity related training programs. According to Bartz et al. (1990) the first step in effective diversity management is to recognize it as an issue, accept the concept as an organizational goal and commit to effectively utilizing it. This must be achieved by top management and communicated to all employees in the organization (Bartz et al., 1990). As such it is important that the corporate level employees and the unit level top managers undergo diversity training in a lodging company.
Reflecting stakeholder theory, managers should make decisions taking account of the interests of all the stakeholders in a firm. However, due to the high costs of diversity training programs and other reasons mentioned in the preceding sections, it is not always possible for managers to make decisions based on the welfare of all of its stakeholders. This is one of the main criticisms of traditional stakeholder theory ( Jensen, 2002). As such, the objective of organizations is not only to create value through diversity training but also to maximize value by efficiently utilizing its resources. Jensen’s (2002) enlightened value maximization supports the findings of our study and is more applicable for this line of research. This theory utilizes much of the structure of stakeholder theory but accepts maximization of the long-run value of the firm as the criterion for making the requisite tradeoffs among its stakeholders, and specifies long-term value maximization or value seeking as the firm’s objective. Applying this theory, managers have to make the best possible trade-off in regards to the recipients of diversity training in an organization. Thus, for hotels, managers feel that diversity training would be valuable if it is offered to them and their superiors as our finding suggests.
Results also showed that neither minority managers nor female managers value diversity training more highly than non-minority or male managers do. Most of the respondents who completed this survey had received some form of diversity training.
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Perhaps managers who did not complete diversity training were not interested in taking the survey. Even if some of these had taken the survey, they would likely have chosen N/A responses since most of the questions would have seemed irrelevant to them. Managers who had experienced diversity training appear to appreciate the importance of such training. In addition, hospitality workplaces, especially hotels, are hugely diverse work environments, where not only owners and workers but also guests represent a broad spectrum of ethnic, gender-identity, cultural, and other characteristics (Gregory and Hughes, 1996). Large hotels in many western cities typically employ an ethnically diverse workforce at middle to low levels of the organization (Baum, 1996). Managers in such environments, regardless of their orientation, might tend to appreciate diversity because of their increased level of interactions with diverse populations. Studies in the past have shown that minority managers value diversity more than non-minority managers do, but as shown in this study, when measured in the context of hotels, the difference between these perceptions of value is statistically insignificant.
Another interesting observation emerged that deserves reporting. In terms of value, respondents answered the reverse-coded question suggesting that workforce diversity is unnecessary most positively, while responding least positively to the suggestion that time spent working on diversity issues is worth the effort. The theme linking these questions was examining general opinions hospitality managers held regarding diversity. As these value items were rated more highly than were items in categories regarding actual job performance and experience, it would seem that managers find the subject of diversity to be important but are dissatisfied with how companies are currently addressing it. Thus, a gap is seen between the perceived value and the perceived effectiveness of diversity training. This should be encouraging to human resource departments who are looking to improve their diversity training. Managers already value diversity, so firms should concentrate their diversity-related efforts to creating diversity programs and initiatives that improve how managers and employees alike work together in diverse organizations.
At the same time, it is important to acknowledge that training might not result in improved behavior. When it comes to diversity training, time and contact are necessary but are insufficient to ensure its success (Gaertner et al., 1994). Organizations might supplement training with incentive programs such as monetary rewards in a bid to improve the effectiveness of their initiatives. However, incentive programs such as competitive or individualistic task designs, reward structures, performance appraisal practices, and compensation systems create barriers to cooperative interaction and may prevent realization of the benefits of diversity (Chatman et al., 1998; Jayne and Dipboye, 2004). Monetary rewards expand the individual expectancies in detriment of the in-group performance, promoting competition, dishonesty, and individualism in the process (Korstanje, 2012). Monetary rewards, in hindsight, can elicit any pre-existing conflict or prejudice in the organization and reduce the confidence one party has on the other. It is no wonder that preconceived economic benefit is identified as the primary reason of inter-ethnic conflict (Nyaupane et al., 2008). Thus, it is essential that organizations safeguard themselves from situations where diversity training backfires and creates conflict among the employees. Task and reward structures in the organization must foster cooperation and motivate employees to form collegial, mutually helpful relationships (Brickson, 2000; Jayne and Dipboye, 2004).
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Consequently, organizational and team membership may likely become more salient than any extant demographic differences among individuals ( Jayne and Dipboye, 2004).
Limitations and future research directions This study examined only one aspect – diversity training – of the perceived value of diversity management in the hospitality industry. Further research is needed to understand not just diversity training, but diversity initiatives in general. Wentling and Palma-Rivas (2000) included such measures as domestic diversity initiatives, leadership and management, education and training, community relations, communications, performance and accountability, work-life balance, career development and planning, international diversity initiatives, international diversity initiatives at the implementation stage, and international diversity initiatives at the planning stage in their analysis of diversity initiatives. All of these criteria apply to the hospitality industry and performing a similar study of that industry would help to clarify the effectiveness of diversity initiatives.
Another limitation of this study that indicates a need for related work is the small sample and low response rates, which made it difficult to compare ethnic groups to one another. It is especially difficult to attain a high response rate in this type of research, and that the response rate, though ostensibly low, is comparable to other studies of this type (Gamio and Sneed, 1992; Gregory and Hughes, 1996; Weaver et al., 2003). Credibility could be added to findings such as ours by expanding the current survey or adding another measure. Moreover, the survey mechanism used might have evoked bias in the form of acquiescence, social desirability, or centering tendencies due to the Likert-scale method used, which can encourage overly positive answers or answers that tend towards the central value of 3.0. Therefore, additional studies that control for such biases more effectively is needed. For example, future studies could apply more complex demographic comparisons, focusing on, for example, differences between Asian American and African American perceptions of diversity measures or differences by region. Future research might also attempt to link resource allocations to the perceived value of training to evaluate the efficiency of a company’s diversity budget allocations more effectively.
Conclusion Discrimination in the workplace will remain a major issue as long as self-interest and in-group biases exist and firms who fail to eliminate it face legal action. Diversity training seems to offer several advantages as well as some disadvantages. To be effective, diversity training should target the right people at the right time and be provided with sufficient resources to achieve its objectives. Because of the enormous cost associated with diversity training, it is almost impossible for organizations to implement diversity training for all employees. The present study indicates that hotel managers value diversity training and suggests the need for organizations to understand how to prioritize various organizational levels for such training. Successful diversity training seems to depend on recognizing the needs of an organization, planning effectively, and allocating resources appropriately.
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Further reading
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Corresponding author Dennis Reynolds can be contacted at: der@wsu.edu
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