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Annals of the Bhandarkar Oriental Research Institute THE ROLE OF

DIVERSITY AND INCLUSION IN MODERN MANAGEMENT

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Dhanashri Yuvraj Jadhav

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THE ROLE OF DIVERSITY AND INCLUSION IN

MODERN MANAGEMENT
Dr. Mrs. Dhanashri Y Jadhav
Assistant professor, Department Of Business Administration, Bharati Vidyapeeth (Deemed to
be University) Yashwantrao Mohite Institute of Management Karad, Satara, Karad,
Maharashtra
Dr. Vrushali R. Kadam
Assistant Professor, Department of Business Administration, Bharati Vidyapeeth (Deemed to
be University) Yashwantrao Mohite Institute of Management Karad, Satara, Karad,
Maharashtra

ABSTRACT
Management places considerable emphasis on diversity and inclusion to influence
organizational culture, enhance employee engagement, and improve financial performance.
In a globalized and competitive landscape, promoting inclusive leadership and developing a
diverse workforce are essential for fostering creativity, improving decision-making, and
boosting workplace efficiency. This study aims to explore the impact of diversity and
inclusion (D&I) strategies on contemporary management practices. It specifically examines
how these strategies have resulted in higher employee satisfaction, reduced workplace
discrimination, and strengthened interpersonal relationships among colleagues. The
subsequent section of the article addresses the challenges organizations encounter when
implementing diversity and inclusion initiatives, such as bias, resistance to change, and
insufficient leadership support. By analyzing best practices and case studies, this research
highlights the significance of D&I policies in creating a more equitable, innovative, and
economically sustainable workplace. The findings indicate that organizations that integrate
diversity and inclusion into their management strategies not only gain a competitive edge but
also contribute to fostering a more dynamic and ethical business environment.
Keywords: diversity and inclusion, management, corporate social responsibility,
INTRODUCTION
Modern management places a significant amount of focus on maximising the benefits of
diversity and inclusion, particularly with regard to the good influence that these factors have
on innovation, employee morale, and overall productivity within the workplace.
Organisations that recognise and appreciate the distinct viewpoints and experiences of their
workforce are in a better position to solve difficult problems and come up with inventive
solutions in a world that is becoming increasingly linked. Positive morale and increased
productivity are two outcomes that can result from an organization's efforts to ensure that
every member of the workforce feels included, appreciated, and empowered. Not only can
the successful management of diversity improve an organization's reputation, but it also
boosts the organization's potential to recruit bright personnel and a client base that is more
diverse.
Furthermore, diverse teams contribute to enhanced decision-making by incorporating a
variety of perspectives, reducing the likelihood of engaging in groupthink, and increasing the

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ability to adapt to shifting market circumstances. Employees are more likely to remain with
the organisation when they work in an environment that makes them feel welcome, which
leads to lower rates of employee turnover. In addition, the act of cultivating a culture that is
both inclusive and equitable is congruent with the principles of corporate social responsibility
(CSR) and ethical business practices, which may result in the achievement of sustainable
growth and development. The current environment makes it very necessary for managers to
make diversity in the workplace a top priority. This may be accomplished by instituting
policies that are inclusive, ensuring that career growth possibilities are equal, and ensuring
that recruiting procedures are transparent. It is possible for businesses to boost their
innovation, boost their competitiveness, and ensure their long-term success in a world that is
becoming increasingly linked if they include diversity and inclusion into their corporate
plans.
DIVERSITY AND INCLUSION'S SIGNIFICANCE IN MANAGEMENT
In today's world, diversity and inclusion are not only essential components of corporate social
responsibility programs, but also of current management theory and practice. Some of the
quantifiable benefits that accrue to organisations who make diversity and inclusion in the
workplace a priority when employing new workers include increased creativity, improved
problem-solving, and greater morale. These advantages are accrued by firms that hire new
employees. The study indicates that heterogeneous teams are less capable of tackling
complex business issues than those that are composed of members from the same department.
This occurs due to the fact that diverse teams bring fresh perspectives, ideas, and experiences
to the table. According to an investigation conducted by McKinsey on diversity in the
workplace, businesses that have a greater number of CEOs who are of different ethnicities
and women tend to have better financial results than their rivals.
A further advantage of having a workplace that is inclusive is that it contributes to the
creation of an environment in which everyone feels respected and heard. By cultivating
cultures that are inclusive, businesses are able to reduce employee attrition, increase
employee engagement, and increase production. When employees have the perception that
their company places a high priority on diversity and inclusion, they are more likely to
perform with dedication, enthusiasm, and creativity. As a result of the fact that customers see
progressive, ethical, and socially responsible businesses as role models, this contributes to an
increase in customer satisfaction as well as the reputation of the firm.
OBJECTIVE
1. Examine how diversity and inclusion affect management, performance, decision-
making, and engagement.
2. To research inclusive workplace concerns and effective practices.
METHOD
This qualitative study examines how diversity and inclusion (D&I) affects modern
management practices. Data is collected using case studies, literature reviews, and semi-
structured interviews with experts from various fields. The literature study establishes a
theoretical framework by reviewing workplace diversity and inclusion research and its
implications on organisational success. Case studies demonstrate effective D&I tactics, while
the literature study evaluates them. Semi-structured interviews with HR managers,

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executives, and workers were used to understand D&I's pros and cons. Thematically
analysing the data reveals trends, patterns, and best practices, revealing how D&I affects
management strategy and organisational culture.
The study uses qualitative data from primary and secondary sources to examine diversity and
inclusion (D&I) in modern management. Semi-structured interviews with human resource
experts, managers, and employees about D&I projects across sectors provide primary data.
Diversity policy accomplishments and problems may be assessed using non-participatory
workplace observations. Secondary data sources include government papers, company case
studies, academic articles, and industry assessments to contextualise findings.
MANAGING DIVERSITY AND INCLUSION IN THE WORKPLACE
As a consequence of globalisation, the significance of diversity management in successfully
satisfying the requirements of stakeholders located all over the globe has been brought to
light. As a result of the liberalisation, privatisation, and globalisation policies that were
implemented in India's markets in the early 1990s, many managers were exposed to a new
trend during this time period: a varied workforce. According to the findings of specialists
who study companies, in the not-too-distant future, the workforce composition of
organisations will consist of ninety percent women and members of minority groups. The fact
that migrants would make up a significant component of this workforce might potentially
create difficulties in terms of communication. In addition, the activities of the organisation
will entail participation from a comprehensive range of different ethnic groups. There is a
broad variety of approaches to managing a diverse workforce; nevertheless, businesses who
see the need of investing in the growth and development of their people are responding to this
trend.
The term "diversity" was defined in a number of different ways across a number of different
research studies. There is no definition of diversity that can be derived from traditional
categories such as race, gender, or disability. The phrase "the many ways in which
individuals differ from one another" is included in her definition. It takes into account, in a
more general sense, all of the following: racial or ethnic background, national or national
origin, age, religious orientation, personality, language, education, physical appearance,
lifestyle, marital status, beliefs, geographic origin, length of service to employer or
organisation, and economic position. Diversity may be broken down into four distinct
categories: racial, sexual, and ethnic harmony; cross-cultural understanding; respect for
varied cultural values; and complete inclusion are the four components that comprise
diversity. Due to the presence of variation, primary and secondary features collaborate with
one another. The primary features of diversity are unchangeable; they are responsible for
moulding an individual's perspective of themselves in connection to the world and other
people. The data shown in Table 1 demonstrates that secondary dimensions may be
influenced by a variety of factors, such as a person's location, level of education, duration of
work, and job title, among others.
Diversification is difficult to classify due to the fact that it is wide, ever-changing, and
evolutionary in nature. It also has far-reaching repercussions for both individuals and
corporations. Diversity has been defined in such a manner that it embraces all facets of a
community and its members, with the intention of cultivating an environment in which all
individuals are made to feel loved and accepted. The scope of the notion was broadened from
"some" to "all" in an attempt to emphasise the significance of diversity in the

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accomplishment of both personal and professional goals. Workgroups and organisational

units that are inclusive have "a collective judgement or perception of belongingness or valued
and welcome member," as stated by Hayes and Major (2003). In other words, they have
welcomed and valued members. In addition, inclusion is defined as the degree to which
individuals recognise the significance of their role within the business. Based on the findings
of research, it has been determined that establishing diversity and inclusion policies in the
workplace will result in employees who are more committed and productive. It is hard to
ignore these demographic trends, and they will undoubtedly affect changes in the future. This
is true regardless of whether one considers diversity and inclusion to be a personal, societal,
or organisational problem. In addition to laying the groundwork for effectively managing and
appreciating diversity in the workplace, these shifts have also shown many organisations how
to study the commercial ramifications of diversity in the workplace.
Table 1. Dimensions of diversity management
Primary Dimensions Secondary Dimensions Other Dimensions
• Race • Religion • Beliefs
• Ethnicity • Culture • Assumptions
• Sex • Sexual orientation • Perceptions
• Age • Political orientation • Attitudes
• Disability • Geographical origin • Values
• Family status • Feelings
• Lifestyle • Norms
• Education
• Experience
• Nationality
• Language
• Thinking ability
It has been shown by researchers in the field of organisational behaviour that the most
effective method for fostering an inclusive and diverse workplace is to give workers greater
discretionary authority. Policies and abilities in management are crucial for achieving
personal as well as organisational objectives, and it is of the utmost importance to modify
standard operating procedures (SOPs) in order to suit the ideal work cultures of various
groups. From a philosophical point of view, it proposes complete solutions that may be used
to integrate all of the components. There are a number of benefits that come with having a
workforce that is diverse and inclusive, including personal, social, legal, and financial
benefits. Global business continues to place a significant emphasis on management and
understanding of diversity. There is a significant amount of pressure placed on multinational
organisations to develop programs and policies that will aid them in recruiting, engaging, and
retaining personnel that are representative of the population they are trying to attract. The
disciplines of religion, diplomacy, and volunteer organisations are very important when it
comes to the documentation of effective methods for managing teams that are culturally
diverse, as well as the creation of inclusive diversity practices and the first implementation of
these practices.
BUSINESS CASE FOR MANAGING DIVERSITY AND INCLUSION
The strategy that Walmart takes to diversity and inclusion is to think globally while serving
locally by providing services. In addition to actively seeking out and hiring individuals from

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a wide range of backgrounds, this international retailer is committed to fostering an

environment that is diverse and inclusive in the workplace. In accordance with the Walmart -
Diversity & Inclusion report (2015), women constituted 57% of the workforce and 41% of
managerial positions for the company. Among the workforce, people of colour made up forty
percent, thirty percent of managers, and twenty-two percent of corporate affairs. Walmart has
successfully adopted a number of programs, such as the Veterans' Welcome Home
Commitment, the Career Link Mentoring Program, and the Global Women's Development
Series, in order to incorporate diversity and inclusion across the whole company and achieve
outstanding commercial results. It is crucial to foster a culture of trust and inclusion in order
to ensure that all workers have the sense that they are respected and supported.
At Apple, we believe that in order to be the most imaginative organisation, it is necessary to
be the most diverse company. In order to experience the new ideas that are the core of each
company's success narrative, one sure technique is to look at things from a variety of various
angles. Among its claimed objectives is the elimination of technical obstacles that have
existed in the past and the incorporation of cultures that are under-represented (Inclusion and
Diversity). As a consequence of this, the number of women who have been employed has
climbed from 31% to 37% around the globe, the percentage of minorities who have been
hired in the United States has increased to 54%, and attempts have been made to eradicate
compensation differences despite equivalent work and experience. Apple has made a
commitment to assisting and resolving unconscious racial and gender discrimination in the
workplace. This commitment is made despite the fact that establishing an inclusive work
culture is more difficult and requires the devotion and effort of both employees and
management. The promotion of LGBTQ equality, the assistance of veterans and their
families, the investigation of creative methods to accommodate workers with impairments,
and the prioritisation of the development of diverse leadership and technological talent are all
significant priorities.
People from every corner of the globe are familiar with and enthusiastic about the Starbucks
brand. According to Starbucks (2011), business ethics and compliance helps to cultivate an
inclusive environment that recognises diversity as a source of competitive advantage and
actively promotes the distinctive abilities, strengths, and differences that are possessed by all
cultures.
The introduction of cultural competence should start at the top levels of management at
Starbucks since it is a crucial component of the company's operations. The manner in which
managers and staff carry out their duties within the organisation will be impacted as a result
of this. Workers at Starbucks have been given the option to put in additional hours during the
week in order to reduce the length of their workdays with the approval of the senior
management. Employers have also made it easier for persons with disabilities to apply for
employment by providing flexible working hours and encouraging them to do so. This allows
workers to better satisfy the requirements of their partners. When interacting with both
customers and employees, employees of Starbucks should also keep ethical ideals and
practices in mind. It is the responsibility of senior management to ensure that their managers
and staff have the necessary training in order to effectively interact with stakeholders who
come from a diverse range of cultural backgrounds.
By integrating best practices such as an open communication system, a flexible environment,
a range of training programs, bias-free interviews, research on worker demographics, and
gender diversity, Starbucks was able to achieve a great deal of success. The conservative

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business procedures that Starbucks employs have a cumulative effect on the company's
performance and reputation over time. It spends a significant amount of money on examining
the proportion of women and members of under-represented groups who hold important
positions and on diversifying its workforce. Furthermore, as a result of this, Starbucks has
developed into a highly sought-after employer among job prospects, a recognised and
socially aware corporation among its partners, and a model of inspiring leadership among its
competitors.
BEST PRACTICES FOR MANAGING DIVERSITY AND INCLUSION
A significant number of businesses have, over the course of the last two decades, come to the
realisation that the traditional methods of thinking about diversity in the workplace are not
actually applicable to the contemporary business environment. Among the most significant
diversity initiatives, the Conference Board's study of 166 leading companies identified the
following: first, activities related to career planning and development; second, initiatives
related to culture change, performance, and accountability; third, employee involvement;
fourth, communication; and fifth, initiatives related to learning and development.
Furthermore, Gottfredson (1992) categorised three gender and ethnicity-related diversity
concerns. These challenges include the following: how to accept immigrants; how to produce
career outcomes; and how to remove sex and ethnicity difficulties during changes in the
organisational environment. Two sorts of individual variations that contribute to diversity
difficulties are differences in approach to suit local conditions and variations in personality
among workers. Both of these types of variations are examples of these types of variations. In
another study conducted by The Conference Board, which included participation from 69
diversity managers, researchers, and consultants, seven creative diversity inclusion strategies
were found. The establishment of diversity action plans, the incorporation of diversity into
mission statements, the holding of workers responsible, the involvement of employees in all
activities, career development, community outreach, and long-term cultural change were all
included in these programs.
Along the same lines, research has discovered a multitude of approaches to managing
diversity and inclusion in the workplace. In Louw (1995), the process of managing diversity
is a five-step procedure that starts with an in-depth requirements analysis and continues with
the creation of a strategy, the formulation of a unique intervention and initiative, the
execution of the plan, and the continuous assessment and monitoring of its effectiveness. In
addition, Griggs (1995) stressed that in order to successfully manage the challenging
workplace, it is vital to adopt diversity techniques that accept and educate workers about
differences, identify distinctions within workgroups, and respect and appreciate those
differences while they are on the job. In addition to this, Loden and Rosener (1991)
discovered that forward-thinking businesses use a broad range of creative strategies for
diversity. There are a few key practices that they all have in common, including the
following: setting strategic goals, continuously monitoring all HR systems, creating a positive
work environment, prioritising training and retraining, rewarding and improving benefits
based on performance, and aligning hiring and promotion processes with the goals of the
organisation.
EMPLOYEE ENGAGEMENT IN DIVERSITY AND INCLUSION
According to scholarly research, employee engagement (EE) represents a paradigm change in
the workplace. On the other hand, a significant number of the publications that were

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produced by consultants and practitioners provided extensive instructions on how to construct

and use EE. As a whole, employee engagement (EE) is considered as a method in the
literature as a technique to measure the emotional commitment that employees have in their
job and firm. In the early stages of the creation of EE, Kahn (1990), who is sometimes
referred to as the "father of EE," played essential roles. The idea of "personal engagement
and personal disengagement" originated from the "intrinsic motivation theory" that served as
the basis for the theory. In contrast to "personal disengagement," which is defined as "the
employees differ in levels of connecting selves physically, emotionally, and cognitively with
the work roles," "personal engagement" refers to the degree to which an individual is invested
in their job. "Personal disengagement" is defined as "the act of disconnecting one's own
presence from the functions of the work." In addition, Kahn (1990) used a qualitative study
approach in order to investigate the significance of collaboration with a group of sixteen
summer camp counsellors and sixteen architects affiliated with a variety of businesses. An
open-ended questionnaire was used in the first of these qualitative studies, whereas in-depth
interviews were utilised in the second of these investigations. According to the findings of the
research, there are three psychological characteristics that have been identified: availability,
psychological confidence, and psychological significance.
How Inclusion and Diversity Increase Employee Engagement
There is no denying the strong correlation between an engaged workforce and organisational
success, as shown by many studies. A poll found that 96% of C-suite executives believe that
a diverse and inclusive workforce improves engagement and organisational effectiveness.
Companies who fail to include diversity and inclusion into their business strategies, on the
other hand, tend to have employees that are not invested in their job. Workers are less
invested in their job and more likely to consider quitting a company if they and their
management have different racial backgrounds, according to research by Jones and Harter
(2005). Employees' intents to remain with the company and the level of engagement they
exhibit are both affected by how well upper management manages these disparities
strategically and provides the best organisational environment. Companies with a diverse
workforce and high levels of employee engagement tend to do better financially, according to
research by Badal and Harter (2013).
Gallup found that engaged workers are more likely to say that their employer appreciates
different perspectives and addresses discrimination complaints, hence the two concepts are
seen to be strongly connected. Meanwhile, only 3% of an engaged workforce feels the same
way about the claims mentioned before. According to an EE study carried out by Sodexo,
diversity and inclusion programs were shown to be the top two drivers of employee
engagement, leading to higher engagement levels. Researchers and consultants have pointed
out a number of benefits to diversity and inclusion management in the workplace, but many
companies and their upper management still don't know how to apply it effectively. The
advantages it provides on an individual, social, and organisational level go unnoticed by
them.
Diversity, Inclusion, and Engagement Framework
Fernando, Pedro, and Gonzalo (2013) state that one of the most important criteria for any
workforce management framework is that it should be able to be applied to a broad variety of
scenarios. In addition, the framework should have the objective of enhancing performance at
the individual, group, and organisational levels. The author makes use of the assumptions that

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were discussed earlier in order to choose a number of diversity and inclusion strategies from
the systematic literature review. These strategies are applicable to any organisation and may
be used in order to increase participation levels. It has been stated by McCain (1996:) and
Koonce (2001:), in addition to Morais et al. (2014) and Starbucks (2014), that intercultural
training and practices for open communication are essential. Strong senior leadership teams,
flexible workplaces, rules that promote a healthy balance between work and personal life, fair
rewards and recognition, participatory performance evaluation, and strong management are
all essential diversity and inclusion tools for the framework. The presence of contingency
variables has the potential to cause disruptions in the stability of the relationships that exist
between workforce policy and performance indicators. According to Delery and Doty (1996),
this disparity gives rise to the possibility that the diversity-inclusion tools that have been
revealed above—tools that have the potential to contribute to improved performance in any
environment—may potentially be in conflict with one another. Kossek and Lobel (1996)
were the first to explore the beneficial benefits of combining diversity-inclusion programs
with internal organisational features. At the same time, they were the ones who presented a
new way of thinking about diversity management theory. According to the findings of earlier
studies, the factors that are considered to be significant modifiers include organisational
strategy (Richard & Johnson 1999, 2001; Richard et al. 2006), organisational climate
(Richard et al. 2006), and worker characteristics (Benschop 2001, page 1167). According to
González and DeNisi (2009), these internal factors represent a "collection of organisational
strategies, structure, and values." The phrase "diversity climate" was used to refer to these
aspects within the organisation. Similarly, the unpredictability of the environment (Richard et
al., 2006), cultural difficulties (Sippola & Smale, 2007), and sector (Fernando, Pedro, &
Gonzalo 2013) were not highlighted by a significant number of European specialists. In
addition, research has presented a variety of hypotheses about the manner in which national
diversity-inclusion management strategies develop in response to developments in the
political, cultural, institutional, and sectoral environments.
FUTURE RESEARCH DIRECTIONS
Approaches that prioritise diversity and inclusion are vital, regardless of whether we are
discussing the levels of financial success and sustainability at the national, institutional,
commercial, or personal level. In light of the constantly shifting global trends in workforce
management, organisations need to refine their strategies in order to remain competitive. As a
consequence of this, this section discusses the several significant developments that will help
drive diversity-inclusion policies in the years to come.

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The Equal Employment Opportunity Act and other acts that are comparable to it are
examples of federal laws that try to prohibit discrimination against different workers.
However, businesses should take into consideration more than just these federal regulations.
The goal of efforts aimed at female economic growth should be to increase the number of
women who serve on boards of directors, remove prejudice in the advancement of leadership
positions, and ensure that women get equal pay for equal labour. There are a number of
economies throughout the globe that are concerned about the impact of an ageing workforce,
which slows down economic progress and boosts expenses for healthcare and pensions.
Therefore, the government ought to raise the retirement age in accordance with a variety of
variables, including a person's employment, their current state of health, and other
comparable circumstances. Work-from-anywhere and other types of flexible work
arrangements should be encouraged by businesses in order to assist in the management of
their workforces that are becoming more senior and female. Parents who are responsible for
the care of young children should also be eligible for health benefits and a stipend from the
government.
During the global crisis, the idea of rebalancing economies has become very popular among
countries all over the globe. Companies strive to improve their financial standing on a global
scale by expanding their presence into every sector, geographical location, and market on the
world. Furthermore, a large number of multinational firms have strict requirements, which
include a change in migration patterns towards workers with higher levels of qualification
and the capacity to swiftly adjust to new conditions. Businesses are keen to recruit migrants
because they believe that doing so would allow them to attract outstanding talent and fulfil
the conditions outlined above. Taking all of these considerations into account, in order for
companies and the workforces they employ to be successful, all of the individuals involved
need to be willing to learn from one another. It is possible for a company to become more
competitive if it has an educated leadership team that places an emphasis on performance
rather than differences in age, gender, ethnicity, or sexual orientation. It is the responsibility
of leadership to devise diversity programs in a way that not only promotes and supports equal

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treatment of all workers, but also acts as an example of how to make the workplace a better
place for everyone.
CONCLUSION
In the modern management system, diversity and inclusion are seen as being of utmost
importance for the achievement of success, innovation, and long-term sustainability in
businesses. When businesses make an effort to build an inclusive culture and recruit a diverse
team, they experience advantages in areas such as creativity, decision-making, employee
satisfaction, and bottom-line performance. Unfortunately, challenges such as discrimination,
a lack of readiness, and a reluctance to change may be roadblocks that prevent progress from
being made. Establishing comprehensive diversity and inclusion programs, investing in
training, and securing leadership commitment are some of the ways in which organisations
may develop workplaces that empower individuals, inspire creativity, and promote social
responsibility. It is necessary for effective and forward-thinking management in today's
changing business climate to adopt a staff that is both diverse and inclusive.
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Volume-CII, Issue-1, 2025 (UGC Care Listed Group-I Journal) 11

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