THE IMPACT OF WORKFORCE DIVERSITY ON

ORGANIZATIONAL PERFORMANCE (THE CASE OF ELSEWEDY

CABLES ETHIOPIA PLC)

BY: BEZAYE ABERA

A THESIS SUBMITTED TO ADDIS ABABA UNIVERSITY COLLEGE OF BUSINESS AND

ECONOMICS THE SCHOOL OF COMMERCE IN PARTIAL FULFILLMENT OF THE
REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS IN BUSINESS
LEADERSHIP

ADDIS ABABA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS
SCHOOL OF COMMERCE

JUNE, 2022
ADDIS ABABA, ETHIOPIA
 Addis Ababa University
College of Business and Economics
School of Commerce

APPROVALS

The undersigned certify that they have read the Thesis submitted by Bezaye Abera, entitled
"The Impact of Workforce Diversity on Organization Performance (The Case of Elsewedy
Cables Ethiopia PLC)" and hereby recommend to Addis Ababa University to accept it in partial
fulfillment of the requirements for the award of the Masters in Business Leadership degree.

Approved by Board of Examiners

Name of Internal Examiner Signature _________Date________

Name of External Examiner Signature ________Date________

Name of Advisor Signature ________Date________

ii
 Letter of Certification

This is to confirm that Bezaye Abera completed her thesis work under my direction and
supervision on the topic "The Impact of Workforce Diversity on Organization Performance
(The Case of Elsewedy Cables Ethiopia PLC)." As a result, I can guarantee you that her work
is relevant and of sufficient quality to be considered for the Master of Arts in Business Leadership
award.

Name of Advisor………………………….………… Signature………………...Date……………

iii
 DECLARATIONS

I, Bezaye Abera, declare that this thesis is prepared in partial satisfaction of the requirements
for the Master of Arts in Human Resource Management degree "A Study on "The Impact of
Workforce Diversity on Organization Performance (The Case of Elsewedy Cables Ethiopia
PLC)." This thesis is my work and has not been submitted for a degree at any university. All
sources of information utilized in the thesis have been properly credited. With the help of my
advisor's advice and direction, I was able to complete it on my own.

Name: Bezaye Abera

_____________________

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 ACKNOWLEDGEMENT

Praise be to the Lord, Jesus Christ, for guiding me through life's difficulties while I pursued this
study. Please take the honor and all the glory.

Without the intellectual assistance of my project advisor, Dr. Seifu Mamo, I would not have been
able to accomplish this study. I'd like to thank my husband Solomon Tafesse, as well as my boys
Kenna and Milto, for their moral support and encouragement in helping me finish the research.
For their constant support throughout my studies, I thank my mother Hadra Hassen, father Abera
Furno, and sister Netsanet Abera. Thank you to the rest of my family and friends for your support
while I juggled many things while studying.

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 TABLE OF CONTENTS
APPROVALS....................................................................................................................ii
LETTER OF CERTIFICATION………………………………………………………...iii
DECLARATION...............................................................................................................iv
ACKNOWLEDGEMENTS ...............................................................................................v
LIST OF TABLES ...........................................................................................................viii
LIST OF FIGURES ...........................................................................................................ix
LIST OF ABBREVIATIONS ............................................................................................x
ABSTRACT...................................................................................................................... xi

CHAPTER ONE .................................................................................................................1

1.0 INTRODUCTION.........................................................................................................1
1.1 Background of the Problem .....................................................................................2
1.2 Statement of the Problem..........................................................................................3
1.3 Research Question………………………………………………………………….5
1.3 General Objective .....................................................................................................5
1.4 Specific Objectives ...................................................................................................5
1.5 Significance of the Study ..........................................................................................5
1.6 Scope of the Study ....................................................................................................7
1.7 Organization of the Study………………………………………………………….7
1.8 Definition of Terms....................................................................................................8

CHAPTER TWO .................................................................................................................10

2.0 LITERATURE REVIEW ..............................................................................................10
2.1 Introduction...............................................................................................................10
2.2 Age Diversity Impact on Organizational Performance.............................................10
2.3 Gender Diversity Impact on Organizational Performance........................................14
2.4 Ethnic Diversity Impact on Organizational Performance.........................................19

CHAPTER THREE .............................................................................................................29

3.0 RESEARCH METHODOLOGY ..................................................................................29
3.1 Introduction..............................................................................................................29
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 3.2 Research Design........................................................................................................29
3.3 Population and Sampling Design..............................................................................29
3.4 Data Collection Methods ..........................................................................................32
3.5 Research Procedures .................................................................................................32
3.6 Data Analysis Methods .............................................................................................33
3.7 Theoretical Framework…………………………………………………………….34

CHAPTER FOUR................................................................................................................35
4.0 RESULTS AND FINDINGS .........................................................................................35
4.1 Introduction...............................................................................................................35
4.2 Background Information...........................................................................................35
4.3 Age Diversity Impact on Organizational Performance..............................................38
4.4 Gender Diversity Impact on Organizational Performance..........................................43
4.5 Ethnic Diversity Impact on Organizational Performance ...........................................49
4.6 Dependent and Independent Variables Correlation Analysis.....................................54
4.7 Regression Analysis...................................................................................................55

CHAPTER FIVE ...................................................................................................................58

5.0 DISCUSSION, CONCLUSION, AND RECOMMENDATION....................................58
5.1 Introduction.................................................................................................................58
5.2 Summary of Findings..................................................................................................58
5.3 Discussions .................................................................................................................58
5.4 Conclusion ..................................................................................................................64
5.5 Recommendations.......................................................................................................65

REFERENCES.......................................................................................................................68

APPENDIX I: QUESTIONNAIRE........................................................................................73

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 LIST OF TABLES
Table 3.1: Grouping of ECE PLC’s Workforce ................................................................35
Table 4.1: Respondents’ Grouping by Age........................................................................35
Table 4.2: Respondents’ Categorization by Nationality. ....................................................36
Table 4.3: Respondents’ Categorization by Educational Qualification.............................37
Table 4.4: Level of Creativity and Innovativeness Perception in the Firm ........................39
Table 4.5: Decision-Making Ease within the Firm.............................................................40
Table 4.6: Age Diversity Impact on Decision-Making Process .........................................41
Table 4.7: Age Diversity Impact on Product and Service Quality Perception ….............42
Table 4.8: Age Diversity Impact on Communication within the Firm ..............................43
Table 4.9: Quality of Management Perception in the Firm ...............................................44
Table 4.10: Firm’s Competitiveness Perception …...........................................................45
Table 4.11: Job Satisfaction Perception.............................................................................46
Table 4.12: Firm Perception as Having a Distinctive Culture...........................................47
Table 4.13: Gender Diversity Impact on Organizational Culture .....................................48
Table 4.14: Firm’s Reputation Perception.........................................................................50
Table 4.15: Ethnic Diversity Impact on Team Performance Negative.............................50
Table 4.16: Ethnic Diversity Impact on Individual Employee Performance ....................51
Table 4.17: Ethnic Diversity Impact on Intra-Organization Communication ...................52
Table 4.18: Age Diversity Correlation with Firm’s Reputation........................................54
Table 4.19: Gender Diversity Correlation with Firm’s Performance................................54
Table 4.20: Ethnic Diversity Correlation with Firm’s Performance .................................55
Table 4.21: Organizational Performance Regression Model Summary ...........................55
Table 4.22: Organizational Performance ANOVA Analysis ............................................56
Table 4.23: Organizational Performance Regression Coefficient Analysis ….................56

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 LIST OF FIGURES
Figure 3.1: Theoretical framework………………………………………………………….34

Figure 4.1: Respondents’ Categorization by Sex …..............................................................36

Figure 4.2: Respondents’ Categorization by Ethnicity .........................................................37

Figure 4.3: Most Important Diversity Affecting Organizational Performance....................38

Figure 4.4: Most Important Features of Performance Affected by Age Diversity................39

Figure 4.5: Age Diversity Impact on Creativity and Innovativeness in the Firm ................41

Figure 4.6: Firm’s Products and Services Quality Perception..............................................41

Figure 4.7: Ease of Communication Perception within the Organization............................42

Figure 4.8: Age Diversity Impact on Problem Solving within the Firm...............................43

Figure 4.9: Most Important Features of Performance Affected by Gender Diversity..........44

Figure 4.10: Gender Diversity Impact on Quality of Management in the Firm ……............45

Figure 4.11: Gender Diversity Impact on Firm’s Competitiveness.......................................46

Figure 4.12: Gender Diversity Impact on Job Satisfaction ...................................................47

Figure 4.13: Gender Diversity Impact on Organizational Performance................................48

Figure 4.14: Most Important Features of Performance Affected by Ethnic Diversity ..........50

Figure 4.15: Ethnic Diversity Impact on Corporate Reputation of the Firm..........................50

Figure 4.16: Most Important Features of Ethnic Diversity affecting Team Performance........51

Figure 4.17: Satisfaction of Working in an Ethnically Diverse Firm ......................................52

Figure 4.18: Ethnic Diversity Suitability for Organizational Performance..............................51

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 LIST OF ABBREVIATIONS

ANOVA Analysis of Variance

ECE PLC Elsewedy Cables Ethiopia Private Limited Company

BSC Balanced Scorecard

MNC Multinational Corporation

SBU Specific Business Units

SPSS Statistical Package for Social Sciences

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 ABSTRACT
The overarching aim of the study was to examine the effects of workforce diversity on the
organizational performance of Elsewedy Cables Ethiopia PLC. The investigation of how age,
gender, and ethnic diversity impact the performance of Elsewedy Cables Ethiopia PLC was one
of the study's three main objectives. As a result, a descriptive research design was used since it
enabled the researcher to describe the effects of organizational performance and the three types
of diversity that were examined for the study. The researcher chose forty workers from different
levels of the company who she thought would be able to provide the data needed for the study.
According to the survey, "Educational Diversity" came out on top by a large margin, followed
by "Age Diversity" and "Gender Diversity." Also included as the second and third least
significant factors, respectively, were "Nationality Diversity" and "Ethnic Diversity." The study
found that there were moderately strong correlations between the dependent and independent
variables. Diversity in terms of age, gender, and ethnicity revealed moderately positive
correlations and strongly favorable correlations, respectively. According to the study's
regression analysis, the adjusted R square value of the model indicated that age, gender, and
ethnic differences could account for 44.6% of the model's variation. Because of the possible
effect age diversity may have on the company's creativity and innovation, the study urges
managers to regard it as a source of competitive advantage. It also indicates that managers must
value gender diversity and include it into their corporate strategy if they want their businesses
to prosper in today's gendered society. It also implies that companies should value ethnic
diversity as a resource for achieving objectives and enhancing employee job satisfaction. To
fully comprehend why, in theory, variation boosts performance, more study is necessary.

Key Words: Diversity, Workforce Diversity, Age Diversity, Gender Diversity, Ethnicity Diversity, Educational
Diversity, Organizational Performance

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 CHAPTER ONE

1.0 INTRODUCTION

No matter a person's race, gender, age, class, ethnicity, or ability, they accept, understand, and
value individual differences as a necessary component of diversity. There are other
considerations as well, such as sexual orientation and spirituality. While each person is unique,
Grobler (2002:46) says that they all share a range of environmental and biological
characteristics, which broadens this viewpoint.

Diversity exists on two levels. The first dimension, which includes factors like age, gender,
sexual orientation, and others, indicates the biggest differences between individuals. These
fundamental variations can be instantly observed and employed as filters through which people
understand the world, and they have the greatest impact on first impressions. Secondary
dimensions are characteristics that aren't readily obvious during the first meeting and may even
change over time, such as religion, education, geographic region, wealth, and so forth. Only
after numerous contacts between people are we able to identify these traits. As stated by Ashton
(2010). More interaction between people from various cultures and origins has occurred
recently than ever before as a result of globalization. People are becoming more tolerant in the
marketplace as a result of competition coming from almost every region of the continent.
Diversity can be both a problem and a solution for a business; it has advantages as well as
disadvantages and maybe both destructive and beneficial. Consequently, the challenge
becomes capturing the essence of variety and expertly managing it for the good of both
individuals and the business.

Most businesses include diversity in their workplace or organization to increase innovation and
change-response. Growing and enhancing workplace diversity has emerged as a significant
management challenge in recent years due to the popularity of how the workplace is changing.
Managers like to research the managerial abilities necessary in a highly multicultural workplace
and get ready to communicate the value of cultural diversity and the dignity of all employees
to people inside their businesses because managing diversity remains a challenge for
organizations. Even though diversity has no borders and transcends organizational boundaries,
some firm leaders and managers see it as a significant barrier.

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1.1 Background of the Problem
According to Christian, Porter & Moffit, the modern workforce is now more diversified in
terms of composition due to technological advancements, globalization, and international
immigration. As a result, workplace or organizational diversity has gained popularity in modern
enterprises and gained significant attention from organizations, analysts, and academics.
Deloitte (2014) also points out that it is especially crucial for businesses that want to
aggressively position themselves for growth and gain a competitive advantage.

In today's businesses, diversity is seen in the workforce's cultural, religious, linguistic,

gendered, racial, educational, and personality orientations. This could be a significant global
concern. The public sector in Europe is embracing diversity as a standard operating procedure.
According to Christiansen, Lin, Perreira, Topalova & Turk (2016), the European Commission
(EC) has suggested that member states secure a 30% and 40% female presence in publicly
traded enterprises by 2015 and 2016, respectively, as a result of Norway implementing a law
in 2003 mandating a 40% female representation in publicly traded firms.

In Europe, as in the rest of the world, this variety will be felt in terms of the age of the
workforce. According to reports, the European labor force is made up of persons aged 18 to 65,
with a fair balance of 50 percent of those over 50 and the rest under 50. (Bureau of Labor
Statistics, 2001). Gender diversity has also increased in other Western European countries such
as France, Italy, Spain, the United Kingdom, Sweden, and the Netherlands, as well as
Luxembourg (Christiansen, et al., 2016). While this initiative is aimed at expanding only one
type of diversity, gender diversity, it is symptomatic of a global embracing of diversity as well
as a feature of modern organizations.

Especially in the United States, Canada, and Mexico are becoming more diverse in terms of
race, ethnicity, gender, age, religion, educational attainment, and nationality in North America.
According to Parkin and Mendelsohn, ethnic diversity is essential to both Canadian and
American society (2003). This demonstrates that the workforce in these nations is diverse in
terms of race and nationality in addition to age and gender. According to Kamonjoh (2015),
during the past ten years, boardroom diversity in American businesses has increased
significantly.
2
The diversity of the workforce and acceptance of similar practices have changed as well in
Africa. Mwikali and Kyalo (2015) claim that Nigeria has seen a considerable change in the
variety of its labor force. They draw attention to the fact that Nigerian businesses use a
workforce that is diverse in terms of nationality, race, and age as well as gender and age.
According to Kochan et al. (2003), a large portion of the workforce in Egypt is multilingual,
speaking both Arabic and additional languages like German, French, and English.

Racial and ethnic diversity changes have been noticed as a result of the most dramatic
development in US enterprises (Kamonjoh, 2015). Asian Americans, African Americans, and
Hispanics currently make up the majority of such boards, and they also serve as directors and
administrators of some of America's leading companies. Likewise, as Kamonjoh (2015) notes,
there has been a change in the age diversity of the boardroom in American corporations.
Boardroom diversity reportedly changed between 2008 and 2014 and now ranges in age from
30 to 70. There has been a paradigm shift away from male dominance of labor markets and
toward at least one that has recognized gender diversity in Asian nations, particularly Korea
and Japan. According to the authors, a National Statistical Office survey from 2003 found that,
at 48.9%, women's economic participation in Korea's working class was nearly equal to that of
men (Mwikali and Kyalo, 2015). According to the Ministry of Labor and Welfare, women
make up 48.3% of the workforce in Japan. In a study on boardroom diversity in Malaysian
businesses conducted by Abdullah (2013), it was found that the board members were diverse
in terms of gender, age, and ethnicity.

1.2 Statement of the Problem

Elsewedy Electric is a producer of electrical parts in Egypt. Since its founding 80 years ago,
Elsewedy Electric has grown into a major provider of infrastructure, technology, and energy
solutions with projected 2020 revenues of 46.4 billion Egyptian pounds. Wire and cable,
electrical product lines, engineering and construction, smart infrastructure, and infrastructure
investments are the five main business divisions of the corporation. The Cairo Stock Exchange
has listed it there since 2006. Throughout Africa, the Middle East, and Eastern Europe, green
energy and smart metering initiatives were established as part of the company's dedication to
sustainability. Its aim includes making sure that the communities it serves grow and prosper.
3
The company thinks that its success is a result of strong finances and a dedication to hiring.
Elsewedy Electric is a producer of electrical parts in Egypt. Since its founding 80 years ago,
Elsewedy Electric has grown into a major provider of infrastructure, technology, and energy
solutions with projected 2020 revenues of 46.4 billion Egyptian pounds. Wire and cable,
electrical product lines, engineering and construction, smart infrastructure, and infrastructure
investments are the five main business divisions of the corporation. The Cairo Stock Exchange
has listed it there since 2006. Throughout Africa, the Middle East, and Eastern Europe, green
energy and smart metering initiatives were established as part of the company's dedication to
sustainability. One of its goals is to ensure the communities it serves to develop and prosper.
In addition to being a significant contributor to the economies of Egypt, Africa, and the Middle
East as well as the development of businesses and communities, the company believes that its
success is the consequence of sound financial management and a commitment to hiring
excellent employees.

With affiliates in nations all over Africa, including Algeria, Kenya, Uganda, Ethiopia,
Morocco, Burkina Faso, Angola, Nigeria, Zambia, Ghana, Libya, and Tanzania, the
company has developed into a multinational corporation (MNC). Due to the significant
demand from the energy industries in Ethiopia and its neighbors, Elsewedy built a $50
million cable production facility in Dukem. The business manufactures a wide range of
cables for the regional market, all of which are made of 99.9% pure copper and are offered
at reasonable prices. It uses the most advanced isolation technology and can deliver local
distribution quickly to sites across Ethiopia. The company's staff has grown more varied as a
result of this expansion, including in terms of age, gender, ethnicity, nationality, race, religion,
and educational background. It's crucial to determine how much of this variation may be
credited for the company's expansion and progress. Interest in the subject has undoubtedly
increased as different industries have begun to recognize the potential advantages of worker
diversity.

Worker diversity has reportedly become a popular topic in firms, with academics concentrating
on its effects on organizational performance, according to Deloitte (2014). According to Agolla
(2007), managing worker diversity is a crucial strategy for businesses to become more efficient.

4
Diversity is a crucial tool for creating competitive advantage and the best organizational
performance, according to Moore (2011), partner and head of Crowe Clar Whitehall in London.

Even though there is a wealth of literature on the subject of diversity and organizational
performance, little research has been done on how demographic diversity influences
organizational performance. Furthermore, the few studies that have looked at the impact of
demographic diversity on organizational success haven't looked at the non-financial aspects of
growth (Darwin, 2014). As a result, it's still difficult to figure out how diversity affects things
like creativity and innovation, decision-making, service and product quality, intra-
organizational communication and information flow, management and leadership, corporate
culture and reputation, team performance, employee productivity, and job satisfaction, as well
as a competitive advantage.

1.3 Research Question

The research questions of this study:

1. How Age Diversity affects the performance of Elsewedy Cables Ethiopia PLC?
2. How Gender Diversity affects the performance of Elsewedy Cables Ethiopia PLC?
3. How Ethnic Diversity affects the performance of Elsewedy Cables Ethiopia PLC?

1.4 General Objective

Investigating how workplace diversity affects the organizational performance of Elsewedy
Cables Ethiopia PLC is the general purpose of the study.

1.5 Specific Objectives

1) To examine how Elsewedy Cables Ethiopia PLC's performance is impacted by ethnic
diversity,
2) To ascertain how the age diversity of the company's workforce affects performance,
3) To ascertain how the gender diversity of the company’s workforce impacts performance.

1.6 Significance of the Study

Any business interested in learning more about the effects of age, gender, and ethnic diversity
on overall performance may find the study's findings useful.

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1.6.1 ECE PLC Management

The Elsewedy Cables Ethiopia PLC executives are the study's main beneficiaries (ECE PLC).
The study helps management understand the importance of employee diversity in gaining a
competitive edge and enhancing organizational performance. The study demonstrates to ECE
PLC management how gaining insight from employees' varied points of view can enhance
certain performance characteristics, like problem-solving, higher cognitive process, employee
happiness, and morale, among others. Additionally, it enables ECE PLC to appreciate the value
of age, gender, and ethnic diversity in the workforce. The study increased understanding of the
significance of diversity to ECE PLC's strategic goals and offered guidance on how the Group's
management may use diversity to attain peak performance and enhance organizational
procedures.

1.6.2 ECE PLC Employees

The study is crucial for both the management of ECE PLC and the workforce. This educates
workers about the importance of their variety in terms of age, gender, and ethnicity in enhancing
business success. Therefore, it aids in encouraging employees to embrace diversity and
recognize the importance of the varied perspectives, ideas, experiences, and information that
diversity delivers. It might help workers recognize and value their differences to advance the
goals of the company.

1.6.3 Other Organizations

The research will also be advantageous to other groups. The study's findings might help other
companies gauge or analyze how well their diversity contributes to the achievement of their
objectives. The study will therefore be a useful resource for learning how to strategically employ
diversity to increase competitiveness in the cutthroat corporate environment of today. By
rethinking their diversity strategy and exposing their businesses to a wide range of opinions,
experiences, and information, these companies may be able to gain a competitive advantage
from the study.

1.6.4 Researchers and Academicians

The study's results contributed to the body of knowledge regarding how diversity affects
organizational performance and served as a good guide for further study. The study encourages
6
further research on the topic and makes future research on the topic easier by concentrating on
the internal drivers of diversity, notably the demographic components. The study's findings,
which show that diversity negatively affects organizational performance, are likely to spur more
investigation into the subject, maybe resulting in a better comprehension of the connection.

1.7 Scope of the Study

The main subject of the study was how organizational diversity impacts productivity. It looks
into how age, gender, and ethnicity discrepancies impact organizational effectiveness. As a
result, rather than non-functional diversity, the study concentrates on functional diversity, which
affects organizational performance. Additionally, the research included both primary and
secondary sources.

The main part involved collecting primary data by employing semi-structured questionnaires to
elicit responses to the study challenge. Elsewedy Cables Ethiopia PLC employees will be
surveyed to gather data. Data sources with a strong educational focus were included in the
second dimension. Studying peer-reviewed journal publications, books, relevant organization
press announcements, and electronic sources led to the acquisition of secondary data. The
majority of secondary sources will be those created to make sure the material is current or
published within the last ten years.

1.8 Organization of the Study

The study's context and the issue that served as inspiration are both highlighted in Chapter 1 of
the report. The chapter has further highlighted the study's main goal and laid out the goals it is
trying to accomplish. The significance of the study has already been discussed in Chapter One,
along with the populations that will profit from it and how. Along with defining some of the
major terms and concepts that will be used in the investigation, the chapter also offered the
study's boundaries and scope. Overall, Chapter One has outlined the goals of the study and
offered the framework for doing so. The overview of prior literature is presented in Chapter 2.
The examined literature discusses prior research, theories, and concepts relating to how age,
gender, and ethnic diversity relate to key organizational performance components. The literature
review aims to determine whether there is agreement among researchers about the three
characteristics of diversity and organizational performance and what prior studies, concepts, and

7
theories have to say about it. But more crucially, the review also seeks to ascertain whether there
is an agreement between the earlier findings and any potential gaps in the body of prior research.
The study's research technique is provided or presented in Chapter 3. The chapter identifies and
defines the population of the study as well as the research design that will be used in it. The
sampling plan for the study and the estimated sample size will also be defined and explained in
this chapter. Chapter 3, it is further explained how the study's data will be collected, how the
research will be conducted, and how the data will be analyzed.

1.9 Definition of Terms

The following is a collection of definitions for key terms and concepts used in the study.

1.9.1 Age Diversity

The values and attitudes associated with each generation, as well as the generational differences
between people or employees (Backes-Gellner & Veen, 2009).

1.9.2 Innovation and Creativity

While creativity refers to the emergence of original ideas that are both useful and suitable,
innovation is the deliberate introduction of unique ideas, methodologies, and new processes
inside a work team (Rietzchel & Zacher, 2015).

1.9.3 Diversity

The presence of a workforce with members from different socio-cultural and religious
backgrounds is referred to as diversity (Raza, Ishtiaqi, Butt & Newaz, 2013).

1.9.4 Ethnic Diversity

In terms of maternal faith, languages, cultures, and races, ethnic diversity refers to the range of
a company's workforce (Hoogendoorn & van Praag, 2012).

1.9.5 Gender Diversity

Psychological distinctions and experiences that are socially or culturally connected with being
a man or a woman are referred to as gender diversity in the workplace (Ali, Kulik &
Metz,2011).

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1.9.6 Heterogeneity

The level or amount of fundamental human distinctions in a population, such as a gender, race,
ethnicity, social class, and religion, is referred to as heterogeneity (Zaidi, Saif & Zaheer, 2010).

1.8.7 Team

A team is any number of individuals who each work independently but together bear
responsibility for the final result or its effects. in 2013 (Raza and associates).

9
 CHAPTER TWO

LITERATURE REVIEW

2.0 LITERATURE REVIEW

2.1 Introduction

The goal is to see if there is agreement among academics about the influence of the three
differences on organizational performance. The available literature on diversity and
organizational success is reviewed in this chapter. The chapter reviews the available literature
to assess prior study findings on how various components of diversity, particularly age, gender,
and ethnic diversity, affect various elements or performance indicators.

2.2 Age Diversity Effect on Organizational Performance

2.2.1 Creativity and Innovation

In the face of competition, age diversity has been discovered to be a critical and strategic
capability that adds value to the organization (Darwin, 2014). One way that age diversity adds
value to a company and boosts its overall performance is by encouraging creativity and
innovation. According to Rietzchel & Zacher (2015), creativity relates to the development of
fresh ideas that are both valuable and suitable, whereas innovation refers to the deliberate
introduction of unique ideas, techniques, and processes into a workgroup.

Despite an increase in empirical studies on age and work, Rietzchel and Zacher (2015) argue
that studies concentrating on the link between age and creativity or innovation have not been
limited. Nonetheless, some research on the subject has discovered a beneficial relationship
between age diversity and creativity and innovativeness in ideas, procedures, and processes in
the workplace (Rietzchel & Zacher, 2015; Darwin & Palanisamy, 2015). Other research has
linked age diversity to improved creative performance. Diversity, according to Simons and
Rowland (2011), creates varied viewpoints, knowledge, and abilities that improve creativity and
innovation while reducing compliance with previous and existing standards.

10
The values that people of different ages hold complement each other, which boosts the
innovativeness and creativity of age-diverse workforces compared to a more homogeneous one,
However, due to frequent preconceptions around the issue of age, age diversity may not
necessarily provide favorable results on organizational performance (Gupta, 2013). Old workers,
according to misconceptions, are more prone to health problems, are unable to adapt to
contemporary technological demands and organizational changes, and provide poor returns on
investment (Tolbize, 2008). Several studies have discovered that greater age diversity has a much
lower impact on a company's total productivity.

According to Darwing (2014), stereotypes prevent companies from realizing the full potential of
both their old and young personnel. On the other hand, several researchers have found no
significant link between age diversity and company performance, as Darwin and Palanisamy
(2015) point out. Ng and Felman (2013) found a similar result when they conducted a bivariate
analysis on the relationship between age and innovation (creativity), focusing on creativity (idea
generation),' selling' of ideas to customers (idea dissemination), and idea implementation, and
found no linear or non-linear relationship. However, Darwin (2014) discovered a negative
correlation between employee performance and age diversity. Employee performance may be
influenced by other factors such as the nature of work, the firm's business strategy, and human
resource policies. The dearth of research on the subject could explain the existing literature's
discrepancies on the link between age diversity and innovativeness and creativity.

2.2.2 Decision-Making and Problem-Solving

a set of actively executed cognitive tasks that include the assessment of environmental factors
in a given context and time is defined as Decision-making according to Cardelle-Elawar, et al.,
2003). It is the fulcrum of the firm's operation and thus a vital part of organizational success.
Making a decision also entails a conversation between the person solving the problem and the
problem that needs to be solved in a certain situation. According to Zaidi et al. (2010), age
diversity is an essential asset in modern organizations. He goes on to say that elder employees
bring a valuable set of experiences and intuition that aid in decision-making due to their intuition
and experience. Young employees, according to Darwin (2014), are equally important in
decision-making in modern organizations since they are better versed in the information and

11
technology aspects of the modern corporate environment. As a result, it may be claimed that a
generational mix of older and younger employees is an important source of important and novel
decisions and issue resolution. According to Glass (2007), today's top executives and managers
make use of the firm's age diversity. As a result of this, they are capable of making a variety of
potentially beneficial decisions based on the perspectives supplied by such a diverse staff.
Furthermore, according to Zaidi et al. (2010), age variability in a workforce boosts the amount
of originality in ideas from which a company's top management can define and implement
creative solutions in advance of or in response to issues. As a result, age-heterogeneous group
collaboration can make quality decisions.

Within a diverse workgroup, reaching a consensus in response to an issue or disagreement is

also feasible (Tolbize, 2008). Age diversity, according to Dezo and Ross (2013), does not always
contribute to better decision-making or problem-solving. They warn that if such differences and
the preconceptions that surround them are not successfully addressed, they can become a
significant source of conflict. Simons and Rowland (2011) agree, citing the social attraction
paradigm, which holds that a more homogeneous group is better able to solve problems and
make decisions. According to Darwin, 2014; Tolbize, 2008, the risk of communication problems
among a group of people of varying ages is extremely significant, as differences in beliefs,
viewpoints, experiences, and possibly abilities become a flashpoint for intergroup
communication.

As a result, these difficulties may undermine the ability of age variety to contribute positively to
decision-making and problem-solving, resulting in ongoing disagreement and slow or bad
decision-making. "Quality issue resolution is the product of a varied environment within
enterprises," Zaidi et al. (2010, p.5) assert.

12
2.2.3 Quality of Services and Products

Earlier studies have found a link between age variety and aspects of organizational
performance such as quality decision-making, creativity, and innovation. As a result, age
diversity should have an impact on the quality of services and goods produced by a company.
While commenting on firm succession planning, Mutunga and Gachunga (2013) argue that
worker age variety supports the upward (reverse mentoring) and downward (mentoring)
exchange of information across generational groups’ ideas.

The result of these interactions is the modification or maintenance of a company's service or

product quality. Indeed, as Darwin and Palanisamy (2015) point out, the diverse perspectives,
knowledge, and experiences that people of all ages contribute to product or service creation can
lead to significant improvements in the quality of the final product or service. Parrotta, Pozzoli,
and Pytlikova (2011) investigated the influence of age diversity in the workplace and discovered
that a varied workforce produces higher-quality products and services. They believe that younger
people will contribute their knowledge of information technology (IT), while older employees
will bring their greater awareness of market dynamics that capture the target market, resulting
in high-quality products and services. As a result of age diversity, generational skills, knowledge,
and experience are harnessed in the manufacturing process, resulting in the production of good
and quality products. Alesina and La Ferrara (2005) agree, claiming that a diverse workforce
fosters greater creativity and productivity, which leads to improved goods and services as well
as increased business productivity.

2.2.4 Intra-Organizational Communication

The majority of research that has looked into the impact of age diversity on intra-organizational
communications has found little evidence that it is beneficial (Gupta, 2013; Simons, et al., 2011;
Ali, et al., 2011). Rietzchel and Zacher (2015) discovered that age is a key flashpoint for
communication within a company. This body of study, according to Darwin (2014), suggests
that age diversity makes communication difficult and infrequent, which can lead to
communication breakdown inside the firm. Furthermore, variations in the values and tastes of
young and senior personnel may cause communication difficulties. The variations in verbal and
nonverbal communication seen in encounters across generational groups, according to Marx,

13
Pons, and Suri (2015), were a hindrance to the exchange of knowledge and communication inside
various establishments.

Although some research implies that intra-organizational communication suffers as a result of

a firm's age diversity, some scholars disagree. According to Darwin (2014), multiple earlier
studies have found empirical evidence that increased worker age diversity improves intra-
organizational communication. Reinhard and Warglien (2007) looked at the conditions that
allow teammates to build a shared language. People that work together become more cohesive,
understand each other and can comprehend each other's communication signs as a result of this.
This does not detract from intra-organizational communication; rather, it enhances and
improves it.

2.3 Gender Diversity Impact on Organizational Performance

2.3.1 Organizational Management and Leadership Quality

The impact of gender diversity in top-level management and organizational leadership on overall
performance is a hot topic of discussion. According to Chin (2013), a study indicated that
companies with substantial gender diversity in their top leadership experienced significant
anomalous returns. While most top leadership and management in most organizations are
dominated by men, including women in such teams not only makes them more diverse but also
improves the quality of leadership and top-level management (Van Knippenberg, De Dreu, and
Homan2014).

In senior management teams, gender diversity has grown owing to three major factors.
According to the Research Institute (2012), they include a rise in government intervention, a
shift in discussions on gender as an issue of equality and fairness to one of superior performance,
and a shift in debates on gender as an issue of equality and fairness to one of superior
performance. Gender diversity, according to Van Knippenberg, et al., (2014), increases the
quality of organizational leadership and management by enhancing managerial information
processing and decision making, resulting in better strategy formulation and decision-making
essential processes. Due to a combination of gender-based perspectives expressed by both men
and females in the managerial teams, Nakagwa (2015) discovered that gender diversity, in
addition to other types of diversity in the workforce, resulted in more innovative and higher-
14
quality solutions. Gender diversity, in other words, provides a range of perspectives on critical
strategic leadership and managerial decisions, boosting the quality and possible effectiveness of
such judgments for the firm. According to Dezo and Ross (2012), varied groups (in terms of gender)
present different perspectives and bring distinct viewpoints and experiences to leadership and
managerial roles, resulting in high-quality decisions. The authors go on to say that simply having a
woman present and having consistent information on the subject at hand can lead to a broader and
more in-depth discussion of alternatives among the senior management team.

In terms of leadership styles, organizational leadership may also benefit. According to research,
there are differences between men and women in their managerial behavioral proclivities (Van
Knippenberg, et al., 2014). According to Dezo and Ross (2012), women choose more interactive
leadership that emphasizes inclusion, participation, and power-sharing, whereas males prefer a
less interactive leadership style that emphasizes goal attainment with limited engagement. As a
result, moderate to high gender diversity may have a favorable impact on the leadership style
adopted by the business, which may be a hybrid of male and female management behavioral and
leadership propensities. Despite these findings, it's worth noting that the impact of gender
diversity on business leadership is a hotly debated topic among academics. According to certain
studies, such as Tolbize (2008), male-dominated top-level management teams frequently neglect
the viewpoints of their female colleagues.

2.3.2 Competitive Advantage

The resource-based perspective asserts, according to Ali, Metz, and Kulik (2007, p. 3), that a
corporation can gain sustained competitive advantage (C.A) by using "valuable, rare, inimitable,
and non-sustainable (VRIN) resources." Gender diversity is linked to VRIN resources that can
assist the company in achieving a C.A. These resources, according to Ali et al. (2007), include
creativity and invention, increased problem-solving, and market insight. As a result, a varied
workforce has the potential to improve the team's overall market knowledge, as well as creativity
and innovation. Darwin and Palanisamy (2015) suggest that a diverse workgroup brings varied
experiences, skill sets, and insights to the table, enhancing overall team performance and thereby
the organization's performance.

15
According to research, diversity is a strategic source for gaining a competitive edge. For
example, Raza et al. (2013) discovered that diversity in gender, education, culture, and age has
a favorable impact on organizational competitive advantage. Some research has revealed that
mixed-gender groups perform better than same-gender groups, according to Darwin and
Palanisamy (2015). In this sense, it is conceivable that companies with a more diversified
gender makeup of their staff have a competitive advantage over companies with a more
homogeneous gender workforce.

Ali, et al., (2007) look at gender diversity and decision-making and argue that gender diversity
improves a company's C.A by making it easier to make good decisions. An organization's
strategic goals can be based on a spectrum of viewpoints, abilities, and expertise that a more
gender-diverse workforce brings to the table (Ali, et al., 2013). When it comes to market analysis
and creating a workable company plan, such a range of perspectives is essential when it comes
to decision-making, and the quality and informed decisions that arise provide the firm with a
competitive advantage. There is a positive relationship between gender and competitive
advantages such as market share, profitability, and corporate image According to Zaidi et al.
(2010).

The VRIN resources that gender diversity delivers to the firm, according to Ali et al., (2007),
are distinctive because they cannot be reproduced or accomplished by homogenous groups.
According to Nakagawa (2015), some studies have even suggested that gender parity in the
workplace, with women accounting for 50% of the workforce, will result in the firm's best
performance. However, there is a body of research that suggests that gender diversity hurts
organizational performance. According to Ali, et al., (2011); Simons & Rowland, (2011). these
findings support the self-categorization theory, which claims that people are prone to
categorizing themselves into psychological and social identity groups

16
2.3.3 Job Satisfaction

According to Zaidi, et al. (2010), Job satisfaction can be defined as the degree to which staffs
at a company are happy with their jobs. It also relates to how much people feel like they belong
to the company and how much they believe in its core ideals. Workforce diversity, particularly
gender diversity, has been proven to be favorably connected with job satisfaction, according
to Zaid et al. (2010). They discovered that a more gender-divided workforce was associated
with lower job satisfaction, as men and women like to collaborate. Fatima, Iqbal, Akhwand,
Suleman, and Ibrahim (2015) discovered that gender has a substantial influence on job
satisfaction. Despite the advances, customary preconceptions still make it difficult for women
to advance to higher or senior positions of leadership in most businesses.

Several research has identified a link between gender differences and job satisfaction, according
to Fatima, et al., (2015). According to Sania, Kalpina, and Javed (2015), diversity in the
workplace modifies the nature of working relationships, which can contribute to greater job
satisfaction and employee morale.

According to Raza et al. (2013), workplace gender diversity can enhance the exchange of
information, skills, and experiences, as well as foster cohesion and attachments among
employees of different genders, positively influencing their overall perceptions of the job.
Nakagawa (2015) investigated the association between gender diversity and several dimensions
of organizational performance in Japanese companies. One of his main results was that a more
gender-diverse workforce gave employees, particularly female employees, a sense of inclusion
and belonging to the company, which resulted in improved job satisfaction.

However, they warn that if gender diversity isn't effectively handled, it can lead to employee
stress and a strained working relationship. The social identity, attraction, and social
categorization theories all support this viewpoint, claiming that gender variation can lead to
persons being grouped into social cocoons with others who share biological or social similarities
(Raza, et al., 2013).

Furthermore, the findings showing gender diversity leads to employee happiness are undermined
by gender preconceptions. For example, Nakagawa (2015) discovered that Japanese executives
17
viewed female employees as significantly handicapped and expected women to leave the
company sooner to raise children. He claims that this view caused a sense of job insecurity in
female workers that was greater than in male workers, resulting in increased job unhappiness
among women. Mwikali and Kyalo (2015) argue that diversity may lead to minority employees
becoming dissatisfied with their jobs. As a result, if women or men are in the minority, a lack of
gender diversity may cause them to be dissatisfied with their jobs.

2.3.4 Organizational Culture

Culture, according to Abu-Jarad, Yusof, and Ninkin (2010), can be defined as "new ideas,
distinctive practices, particular abilities, and specific means of operation of individuals or a
corporation manifested in both internal and external activities." The terms organizational culture
and corporate culture are often used interchangeably. The concept of organizational culture is
linked to corporate image, even if they are implicitly different. Business or corporate reputation,
according to Adeosun and Ganiyu (2013), is the general view of the firm by the firm's internal
and external stakeholders, which is informed by the firm's current activities and probable future
behaviors.

A company's reputation could include things like maintaining gender equity in its workforce,
producing or offering high-quality products or services, and so on (Caruana & Chircop, 2000).
Corporate reputation is of fundamental importance to any corporation, large or small. It
influences organizational performance as well as the perception of the firm by external and
internal stakeholders, which may shape employee satisfaction with the firm, as well as
internally (their motivation and morale for duty execution) or externally (customer loyalty and
market share).

While the election of a woman to a powerful and influential position on a firm's committee two
decades ago would have given the company an image of board incompetence, today's firms with
a gender-balanced boardroom culture are viewed as both highly competent and efficient, as
Carter, D'Souza, Simkins, and Simpson (2010) argue. There is a positive association between
organizational culture and performance, according to Abu-Jarad, Yusof, and Ninkin (2010).
High-performance organizations, according to Achua and Lussier (2013), have distinct and
unmistakable characteristics that set them apart from their competitors and performance. They
18
go on to argue that such a profile encapsulates the distinct features and aspects that characterize
company culture.

Gender diversity has an impact on a company's culture since it shapes the company's corporate
philosophy, beliefs, and business techniques, as well as intra- and extra-organizational
interactions (Ebtesham, Muhammad & Muhammad, 2011). Gender diversity in the workplace
has been shown to provide diverse perspectives in decision-making, different modes of
communication, and different ways of analyzing the corporate environment and the market
(Zaidi, et al., 2010; Ali, et al., 2007; Darwin and Palanisamy (2015). Hofstede (1980) presents a
detailed account of organizational culture, even though he published it a long time ago. He
defines culture as the mental process that separates members of one group from members of
another and argues that culture is the foundation of organizational success. A firm's corporate
culture can be characterized in terms of gender diversity as the extent to which it accepts both
men and women, thereby defining itself as a gender-diverse corporation.

2.4 Ethnic Diversity Effect on Firm Performance

2.4.1 Employee Productivity

Productivity is crucial for the long-term profitability and competitiveness of virtually all
enterprises (Muchiti & Gachunga, 2015). The assessment or quantification of how effectively
resources are deployed inside a firm and used to fulfill a set of organizational goals is known as
productivity (Ofoegbu, Olawepo & Ibojo, 2013). Productivity, in general, refers to the
relationship between the resources used in production and the result of such production. To put it
another way, it's the input-to-output ratio (Muchiti & Gachunga, 2015). Ofoegbu, et al., 2013
discovered that the higher the ratio, the higher the productivity; the lower the ratio, the lower the
productivity. Productivity is a difficult phrase to define and quantify when it comes to people.

According to Muchiti and Gachunga (2015), four characteristics can be used as indicators of
employee productivity. Among them include increased efficiency, employee motivation, job
satisfaction, and product/service quality. Nnabuife (2009) defines motivation as "both an
external and internal driving factor that generates the desire to accomplish a task to its
conclusion." Employee motivation is described as an employee's willingness to devote their
whole attention to a task to assist the business in achieving a goal that is predetermined.
19
The effectiveness of a process or action that results in the full and comprehensive attainment of
a planned aim is defined by Darwin and Palanisamy (2015). Job satisfaction refers to an
employee's happiness with his or her job and how successfully he or she executes the tasks
assigned to him or her. Product or service quality refers to a product's or service's ability to meet
or exceed consumer expectations. Ethnic diversity, according to Rasul and Rogger (2015),
influences productivity by impacting how people feel about their jobs, company efficiency,
employee happiness, and the quality of products and services supplied.

According to Hoogendoorn & van Praag, ethnic diversity is one of the most relevant and salient
aspects of labor heterogeneity (2012). The variance in (mother) or primary languages, races,
faiths, and cultures measured in terms of a person's country of birth, parents, or culture is referred
to as ethnic diversity. A range of data sources, norms, aptitude levels, and expertise support it
(Morgan & Vardy, 2009). As a result, ethnic diversity has the power to influence how people
feel about their jobs, the efficiency of the company, employee satisfaction, and the quality of the
products and services it offers. Because of the inherent diversity of information, skills, attitudes,
and experiences, this is the case.

According to Darwin (2014), ethnic diversity has a positive impact on organizational

performance because it offers a pool of competencies and learning opportunities that the
company may tap into for better results. The goal is for ethnic diversity to enable or enable the
organization to match employees from varied ethnic or cultural origins to tasks and assignments
where they excel (Rasul & Rogger, 2015). Ethnic diversity, according to Gupta (2013), has a
similar impact on organizational performance. Ostergaard, Timmermans, and Kristinsson (2011)
discovered that increasing ethnic diversity in the firm enhances creativity and innovation through
broadening the firm's ideas and viewpoints. According to several studies, a more ethnically
varied workforce is more creative and innovative than one that is more ethnically homogeneous
(Darwin & Palanisamy, 2015). This is most likely due to the opportunities for learning, views,
and complementarities that ethnic diversity brings to the company.

20
According to Darwin & Palanisamy (2015), ethnic diversity is associated with a wide range of
data sets, norms, abilities, and knowledge that aid in not only business decision-making but also
problem-solving. Ethnic diversity, according to Ostergaard et al. (2011), is both directly and
intrinsically linked to team and organizational innovative performance. According to Gupta
(2013), however, more ethnic diversity hurts communication and problem-solving. Despite
strong efforts to minimize racial inequities that are inherent in an ethnically diverse workforce,
the problem is entrenched, according to Kellough and Naff (2004). Based on the ethnic identity
hypothesis, they say that people have a predisposition to form ethnic identities and associate
with their ethnic group members.

Self-categorization and social identity theories related to this, claim that people who have ethnic,
gender, and age similarities want to form homogeneous groups and perceive those who are
different as outcasts (Simons, et al., 2011; Ali, et al., 2011). Gupta, 2013; Simons, et al., 2011;
Ali, et al., 2011, claims the establishment of ethnic identities and the creation of a perception of
in-groups vs out-groups, can influence employee job satisfaction and morale and result in poor
overall organizational performance, is one of the key destabilizing elements in ethnically diverse
workforces.

2.4.2 Team Performance

According to Raza et al. (2013), a team is "a group or collection of individuals who are
autonomous in their work but share responsibility for the overall output or consequences." To
achieve a certain organizational goal, employees form functional groups or are grouped into
work categories, which is referred to as collaboration (Delarue, Van Hootegem, Procter &
Burridge, 2008). Hoogendoorn & van Praag 2012) states a high-performance team is a group of
people with specialized tasks and complementary skills and abilities that are committed to and
aligned with a common purpose, consistently display high levels of collaboration and innovation,
and consistently produce superior outcomes.

Team performance is divided into three subcategories by Mathieu, Maynard, Rapp, and Gilson
(2008): organizational-level performance; (ii) team performance behaviors and results; and (iii)
role-based performance. In the first case, there is a one-to-one relationship between
organizational outcomes and team qualities at the organizational level. The relationship between

21
team performance and cohesion is investigated in terms of team performance behaviors and
outcomes. The level to which team members demonstrate the essential competencies required to
do their tasks is captured by role-based results (Mathieu, et al.,2008).

The latter is critical for the present analysis of ethnic diversity's impact on team performance
and, eventually, organizational performance. In most businesses throughout the world, there
appears to be a paradigm shift from more person or team-based structures to more team-based
structures, especially for completing difficult tasks and meeting deadlines (Raza, et al., 2013).
Firms have become more ethnically diverse as a result of increased globalization. Multinational
corporations, in particular, now employ workers from both local and foreign communities
(Hoogendoorn & van Praag, 2012).

A team’s strategy is thought to give businesses a competitive advantage over competitors that
still rely on individual-based organizations. Ethnic diversity correlates with knowledge sets,
talents, and skill sets that affect the formation and performance of teams in modern businesses,
according to Gupta (2013), Hoogendoorn, and van Praag (2012). In other words, it has been
discovered that ethnic diversity improves organizational performance by forming more
productive teams. Delarue et al. (2008) claim that ethnically diverse teams can improve team
and organizational performance by encouraging self-leadership, empowerment, employee job
commitment, and individual employee incentive to work harder. Because of the learning
opportunities and complementarities that people from different ethnic or cultural backgrounds
bring to the team, an ethnically diverse workforce improves team performance and eventually
organizational performance (Hoogendoorn & van Praag, 2012). According to Gupta (2013), the
positive relationship between team performance and ethnic diversity is only valid if team
members are more ethnically varied.

Lee and Nathan (2011) discovered a correlation between ethnic diversity in teams and higher levels
of creativity and innovation in those teams. Ethnically varied teams, according to Hoogendoorn and
van Praag (2012), are associated with higher innovation and creativity due to chances for learning
and complementarities. According to Kellough & Naff (2004), due to an additional diverse pool of
information and abilities that leads to complementarity and mutual learning, ethnic diversity would
benefit team performance.

22
Gupta (2013), on the other hand, is suspicious of the positive link between ethnic diversity and team
performance, claiming that moderate ethnic diversity has no influence on team performance and
thus has no impact on overall organizational success. According to Gupta (2013), mild ethnicity
has no bearing on business outcomes such as profit, market share, or sales. Some researchers have
revealed that team ethnic diversity is a possible and even an unavoidable source of conflict in
companies, according to Kellough and Naff (2004), Gupta (2013), and Simons, et al. (2011).

Indeed, the diversity of perspectives, value dimensions, and experiences that people of various
ethnic backgrounds bring to a team can lead to a flare-up of emotions and conflicting interpretations
of issues (Hoogendoorn & van Praag, 2012). Conclusions on the impact of cultural or ethnic
diversity on organizational performance are conflicting. According to Parrotta et al. (2011), an
ethnically diverse workforce can offer different perspectives, ideas, and experiences to the
workplace, which can either benefit the business or cause friction across workforce groups,
compromising team and firm performance.

According to Marx et al., (2015), people have preexisting overt and implicit preferences for who
they want to work with, and so growing ethnic diversity may result in workplace division and
lack of cohesion. They point out that this is especially true in firms that work in nations where
ethnicity is a source of strong emotions. Hjort (2014) investigated the impact of ethnic diversity
on the flower industry's output in Kenya. His studies showed that as ethnic diversity develops,
so does conflict across ethnically varied performing groups, resulting in a fall in output.

According to a previous study on workplace diversity, diversity can be either beneficial or

harmful to worker performance. For example, in organizations, diversity is positively associated
with problem-solving abilities and innovation, whereas it is negatively connected with
collaboration and cohesiveness (Erasmus, 2007). The population of this study is all middle-level
managers employed at the head offices of Kenya's 43 commercial banks. Expertise, education
level, ethnic diversity, training, gender diversity, and competency all have a favorable impact on
worker performance, according to the study. However, there is a weak and insignificant link
between age and performance. According to the findings, management of workforce diversity
brings together work experience and new capabilities, such as technology, to boost employee
performance.

23
Carrell (2006) investigated the relationship between workforce diversity and performance in
Kenya's banking sector, defining staff diversity as "individual differences in performance that can
affect a duty or affiliation within an organization, such as age, religion, language, ethos, gender,
and learning." Using pooled data from the bank's 4000 workers. Choose three branches from the
Nairobi district's 25 branches for sampling. The findings reveal that every organization that
handles workforce diversity has more inventive decision-making, a better working environment,
and better-finished products since all employees are interacted with and encouraged to work
expressively. Trade unions and the ministry industry should conduct more research in this area to
ensure that employees' dignity and organizational effectiveness are not jeopardized.

Another study looked into how businesses manage worker diversity and its importance to their
presence, as well as how they deal with problems that may appear to be a problem but can be a
solution. It has its challenges, but it also has its rewards. It is hazardous, but it is also productive
(Devoe, Deborah 1999).

Daily data from five enterprises in Ghana and Finland, two of which are large and three of which
are tiny, over the period 2013 as a sample. The outcome discusses and debates the extent to which
an organization's opinion diversity in the workplace, as well as the causes for diversity in
regulating diversity in large and small businesses. Managers must be prepared to change a few
aspects of their company's processes if the diversity management techniques in place aren't
functioning; but, before doing so, the vision for the change must have been communicated
effectively.

Hasan, Muhammad, and Imran (2009) did another study to look at the stressing theory of worker
diversity and how it links to organizational performance. This study has a sample size of 20
companies from various industries. Following this research, some well-known points emerged
addressing the relationship between workforce diversity, needs, motivation, and organizational
performance difficulties. The results of this study suggest that workforce diversity and
organizational goals are important factors that tie into employees' engagement, resulting in
increased commitment. In a diverse workforce, management tools should be utilized to teach
everyone about diversity and its difficulties, as well as laws and rules. Because most offices are
made up of people with a wide range of values, businesses must learn to adapt to be effective.

24
Another survey revealed that researchers and professionals believe that leadership diversity is
crucial to a company's financial performance (McCuiston, Wooldridge & Pierce, 2004). The
importance of corporate leadership and a diversity realization strategy as a competitive advantage
(Richard, 2000). Organizations' capabilities, strategic adoptions, and positions in organizational
areas can all be evaluated and estimated using business reputes (Rindova et al).

The link between company performance and diversity may emerge as a result of an organization's
diversity reputation; it may also emerge as a result of changes at various managerial levels
(Dwyer, Richard & Chadwick, 2003). As a sample, longitudinal data for 100 organizations in the
United States from 1998 to 2003 were used. The findings revealed an upbeat association between
book-to-market equity and diversity reputation, as well as a curved U-shaped relationship
between revenues and diversity of leadership. According to studies, the financial benefits of
diversity reputation are most likely to come from capital markets rather than product markets.

Milliken and Martins (1996) conducted another study that found that workplace transformation
has a different twin effect on organizational efficiency. Furthermore, in the pursuit of
organizational goals, business societies are gradually implementing the practice of workgroups
as a strategy-structure blend. (West & Anderson, 1996; Mumford & Licuanan, 2004). A total of
120 worker teams were selected from a total of 248 teams in the Lagos area of Nigeria between
2007 and 2009. According to the study's conclusions, a shift in the workforce can help firms
operate better. According to the findings, there is a link between worker diversity and
organizational effectiveness. According to the findings, company executives are unlikely to see
a direct link between worker transformation and organizational efficiency. Things are more likely
to be resolved by a company's tactics and how managers and employees respond to and manage
change.

25
Years of research on the effects of diversity in small groups and teams have revealed that it can
be influenced both positively and negatively in some cases. (Jackson et al., 1995; Millikin &
Martins, 1996; Williams & O'Reilly, 1998; Williams & O'Reilly, 1999). From 1999 to 2003, a
study group called "Diversity Research Network" conducted research on worker diversity and
organizational performance in four multinational companies. According to the evidence, diversity
can lead to increased innovation and development as well as increased conflict and employee
turnover (Jehn et al., 1999; cf. Williams & O'Reilly, 1998). The research yielded a mixed result.
One is that diversity fosters significant innovation in the banking business, whereas the other is
that diversity fosters a higher rate of turnover among banking executives.

The association between workforce diversity and two additional criteria, on the other hand, is
frequently related to organizational performance, job satisfaction, and organizational goals. The
"degree to which aims let explanatory scope, or scope in how an individual interacts, interprets
and perceives the aims" has been defined as organizational goal uncertainty (Chun and Rainey
2005a; Feldman 1989, 5-7).

Job satisfaction has a direct and indirect impact on organizational outputs and critical individuals;
it includes staff motivation, productivity commitment, and turnover (Mobley et al. 1979). From
2006 to 2008, the target population was 260 federal government agencies in Los Angeles.
Although having a diverse workforce produces positive effects for businesses, it is not necessary
to treat organizational changes as generic qualities. Future research on organizational diversity
could be fruitful if it looks into how various diversity practices affect the execution and analysis
of organizational objectives, as well as how they relate to personal conflict.

The link between worker diversity and organizational performance is complex, and different
characteristics have varied effects. Age has a negative association with performance, but culture
has a good relationship with productivity, sales, inventions, and market shares. Gender, on the
other hand, has either a positive or negative relationship with performance (Richa Gupta 2013).
From 2010 to 2013, data from 29 Jammu enterprises were combined. To create a work
environment that supports cohesiveness, coordination, and contribution, a focused and effective
diversity strategy must address organizational ethos variation.

26
Understanding the effects of diversity on organizational outcomes such as employee satisfaction,
revenue, and performance has become critical (Sungjoo and Rainey, 2010). Age, sexuality,
culture, working style, language, and educational background of employees were all crucial
aspects of workforce diversity. The Malaysian airline industry, Malaysian Airlines, and Air Asia
were the study's target groups. Based on the findings, and inclusive influence of workforce
diversity on worker performance in a business (airline industry) is critical in the highest of
traditions.

In Nigeria, many corporate groups fail since rallying diverse employees to work as a team has
shown to be ineffective in terms of training, experience, strategy, and approach to specific and
general aims (Wilfred I. Ukpere 2014). This study was conducted to determine whether workforce
diversity has a positive impact on customer-related issues and the effectiveness of education as a
tool. A group of 300 students, both undergraduates, and graduates, gathered data. Diversity has a
favorable impact on customer-related problems in an organization, according to the findings.

Diversity, according to (Chattopadhyay, et al, 2004), is concerned with collective features rather
than individual qualities. The features of groups or organizations are referred to as diversity
perception. This demonstrates the extent to which organizations and groups have undergone
subjective and objective transformations. From 2008 to 2012, a sample of 85 KEMRI workforces,
including 55 scholars and 30 supervisors, was selected. Personality has an important role in
predicting job performance and satisfaction. The study recommends that KEMRI include
personality testing as a method of selection and recruiting.

Hofstede (1980) has shown that ethnic and national backgrounds are consistently associated with
good values and attitudes in over 40 national studies. There are variances in attitude orientations
along four dimensions: authoritative distance, patience for ambiguity, masculinity-femininity,
and individualism-collectivism. To collect data, 137 graduate and undergraduate students from
Midwestern University were chosen. The findings revealed that the quantity of unique ideas
generated by the two types of groups is the same; the reason for this is that there may be a
difference in the unique ideas generated by both groups.

27
Workers will enjoy all progressive benefits, such as knowledge and skill transfer, motivation,
creativity, and improved decision making, when an organization has a favorable environment to
practice workforce diversity, (Amaram, 2007). This will be a facilitator for the organization's
growth. 316 middle-level Singaporean bank managers' data was aggregated. According to the
findings, workforce diversity has no substantial impact on worker performance. Employees in
Singapore, it is found, neither condemn nor admire workforce diversity as a blessing to them as
a white elephant, and present a neutral view of workforce diversity.

According to the most recent study (McKay et al., 2008), a more precise explanation abstracts a
varied workforce with dedicated work contexts as the level to which a firm implements fair HR
practices. From 2011 to 2013, data was collected from 286 employees in the corporate sector of
Islamabad, Pakistan. According to the findings, dedicated work environments and a varied staff
can be viewed as a collaborative approach to creating company promise and employee attitudinal
outcomes. Further research should look into the integrative effects of CSR on other employee
attitudes, such as organizational citizenship performance.

Diversity in an organization leads to rivalry among employees, according to (Bassett-Jones, N.

2005). Everyone in business should learn from others and improve their working talents,
according to (Bassett-Jones, N. 2005). The sample size for this study was 150, and data was
collected from five Pakistani metropolises. Performance and workforce diversity can help a lot
when it comes to finding the perfect person for the right position or any organization. Many
workers, even within bounds, have little idea what true diversity is, let alone whether or not their
company is diverse. Many private-sector companies have well-planned diversity programs, while
public-sector companies are still lagging. As a result, public-sector companies are already
enhancing their employee diversity practices.

28
 CHAPTER THREE
RESEARCH METHODOLOGY

3.1 Introduction

The study's research methodology is presented in this chapter. The study's research design is
highlighted in this chapter, which also identifies and characterizes the study's population. The
sampling design for the study is defined and explained in this chapter, as well as the sample size
for the investigation. This chapter goes into the study's data collection instrument, research
protocol, and data analysis methodologies in more detail.

3.2 Research Design

The research design is the overall technique used by the research to integrate many aspects of
the research into a coherent and logical whole (Blanche, Durrheim & Painter, 2006). The
research was designed in such a way that the problem that the study sought to investigate was
effectively addressed. As a result, a research design can be thought of as the study's blueprint,
showcasing the data gathering method, data inspection, and data measurement.

According to Thornhill and Saudnders (2000), the research design that a researcher picks for a
study should be determined by the problem that the study will address. As a result, the research
problem determines the research design that will be utilized to operationalize or explore the
problem. The study would produce meaningless results if there was no connection between the
research problem under inquiry and the research methodology employed.

A descriptive research design was adopted in this study. A descriptive design is required in
investigations that seek to determine 'how' events or phenomena are related, according to Blance
et al. (2006). According to Bless, Higson-Smith, and Kagee (2006, p.48), the researcher can
study and characterize the link between variables while also testing the "factual hypothesis." As
a result, a descriptive research design allowed the researcher to gather information about the
situation and characterize the relationship between organizational performance and age, gender,
and ethnic diversity, which is the study's main focus.

29
3.3 Population and Sampling Design

3.3.1 Population

The population is the wider pool of people, events, and stuff from which the researcher selects
elements, individuals, and instances for sampling (Blanche, et al., 2006 & Bless, et al., 2006).
The population is also taken into account when the research results are extrapolated. However,
according to Bartlett, Kotrilk, and Higgins (2001), such a population should be homogeneous in
that it must possess and display the information that the researcher is interested in. According to
Bartlett, et al. (2001), the research is valid if the findings are closely related to the population's
opinions, characteristics, and attributes. Employees of Elsewedy Cables Ethiopia PLC will make
up the study's population. Personnel from the cable manufacturing in Dukem, Oromia, as well
as employees from the company's headquarters in Addis Ababa, made up the population.

3.3.2 Sampling Design

A large number of people were chosen from the population to produce a meaningful sample for
consideration and participation in the study. According to Thornhill and Saunders (2000), a
researcher usually obtains and infers information from this group. As a result, the validity of the
study's findings is dependent on the sampling design's adequacy (Blanche, et al, 2006). The
sampling frame, sampling procedure, and sample size will all be part of the sampling design.

3.3.2.1 Sampling Frame

The sampling frame is a list or registry of individuals, instances, and events from which the
researcher takes the sample (Blanche, et al, 2006). The sampling frame, according to Robson
(2002), refers to the source of the appropriate or right population from which the survey sample
is obtained. ECE PLC Human Resource Department is located in Addis Ababa, and ECE PLC
Factory is located at Dukem, where the researcher received the study's sampling frame.
According to the study's objectives, the population might be divided into three groups based on
job title.

30
 Number of
Position in Firm
Employees

1. Top Level Management 5

2. Middle-Level Staff 15
3. Junior Staff 20
Total 40

Table 3.1 Grouping ECE PLC’s Workforce.

3.3.2.2 Sampling Technique and Sampling Size

According to Robinson (2002), the process for obtaining samples for inclusion in the study is
determined by the study objectives. Blanche, et al., (2006) go on to say that the sampling method
is not random but rather directed by the study's scope and parameters, as well as the population and
objectives. The current study used a survey sampling method. According to Nachmias, D., and
Nachmias, C. (1987), this sample design gives information about specific characteristics of a finite
population.

The sample size refers to the number of people that are chosen to take part in the study (Thornhill
& Saunders, 2000). The study draws sample from all employees of the selected branche of the
organization, the formula below is used to calculate the sample size:

Sample Size = [z2 * p*q] / e2 / 1 + [[z2 * p*q] / e2 * N]

• N = population size
• z = z-score
• e = margin of error
• p = standard of deviation
• q = 1-p

Thus,
Sample size = [1.652*0.5*0.5]/0.052 / 1+[[1.652*0.5*0.5] / 0.052*48]
= 272.25/6.67
Therefore, the sample size is 40.

31
3.4 Data Collection Methods

Data collection, according to Blanche et al. (2006) and Bless et al. (2006), is the process or strategy
for acquiring or aggregating information from respondents. Data collection refers to the technique
by which the researcher collects information, such as questionnaires, interview schedules, face-to-
face or telephone interviews, or participation and observation (Thornhill & Saunders, 2000). The
researcher employed structured questionnaires with a combination of Likert scale questions to
collect data from the respondents for this study. The questionnaire was divided into four sections,
each with its own set of questions aimed at eliciting pertinent responses. The questionnaire has a
total of 35 questions. The first section of the questionnaire consisted of five questions targeted at
acquiring the respondents' biographical data or background information. The second section
consisted of ten questions designed to gather data on the organizational performance impact of
age diversity.

The last but not least section of the instrument consisted of a series of ten additional questions
aimed at eliciting data on the impact of gender diversity on organizational performance.
Questions about the impact of ethnic diversity on organizational performance can be found in
the fourth and final sections of the questionnaire. Each respondent spent between 20 and 30
minutes completing the questionnaire and effectively answering all of the study's questions. The
questions were kept brief and specific to avoid respondent fatigue and to guarantee that all of the
questions were understood by the respondents.

3.5 Research Procedures

Research procedures, according to Bless, et al., (2006), are the processes and actions that the
researcher engages in when collecting data. In the study, the following actions will be carried
out. Following the development of the questionnaire, a formal introduction letter is sent to the
appropriate ECE PLC leadership, requesting permission to survey the company's personnel.

The researcher did a pilot research or a pre-test of the questionnaire and the feasibility of the
study after getting authorization for the study, and then adopted the questionnaire and the
activities accordingly to assure the success of the data collection process. The questionnaires
were given to the possible respondent so that they may fill them out. While the response time is
expected to be between 20 and 30 minutes, the researcher had the option of leaving the

32
questionnaires with possible responders who had hectic schedules so they may fill them out at
their leisure. The researcher, on the other hand, made arrangements with responders who were
unable to complete the surveys promptly to come and pick them up at a mutually agreed upon
date and time. The researcher waited and collected surveys from individuals who were able to
complete them in 20–30 minutes.

3.6 Data Analysis Methods

The most common type of data analysis employed was descriptive, and the analysis was done in
such a way that each issue identified in the study was addressed. Completed surveys are the most
important contributions. SPSS, comprehensive statistical software and a sophisticated tool for
using and interpreting survey data, was utilized for data analysis. All of the surveys are evaluated
and data editing is undertaken to ensure that they are of the required quality. Finally, a conclusion
and recommendation are developed based on the available data from the analysis part, taking
into account the most important aspects related to the study's goals and challenges.

Statistical Technique Used:

This study was carried out using a combination of correlation and regression statistical
techniques. The Likert Scale was utilized to obtain the results in this study. The responses on the
Likert Scale were as follows: Strongly Agree, Agree, Neutral, Disagree, and Strongly Disagree.
The most common type of data analysis employed was descriptive, and the analysis was done in
such a way that each issue identified in the study was addressed. Data analysis software utilized
is SPSS, comprehensive statistical software and a sophisticated tool that organizes and interprets
survey data.

3.7 Theoretical Framework

The below figure shows the study’s theoretical framework.

Figure 3.1: Theoretical framework

33
34
 CHAPTER FOUR

RESULTS AND FINDINGS

4.1 Introduction

The study results are presented in Chapter 4 for each item on the questionnaire. Descriptive
statistics, such as bar graphs, pie charts, and frequency tables, are used. The findings of several
inferential statistics performed on the data, such as cross-tabulations, regression, and
correlation, are also shown in this chapter. The study had a 77.5% response rate (having
obtained 31 responses from a possible 40). Spearman's Rho is used to understand the strength
of the relationship between two variables. Because variables of interest are ordinal and have a
monotonic relationship (as the value of one variable increases, so does the value of the other
variable, or as the value of one variable increases, the other variable value decreases).

4.2 Background Information

This section of the report includes the study's findings regarding the respondents' backgrounds.

4.2.1 Respondents Age Grouping

The below table displays the results when the respondents were gathered according to age. 17
respondents (54.8%) were aged between 20 and 30 years, 11 (35.5%) between 30 and 40 years,
2 (6.5%) between 40 and 50 years, and 1 (3.2%) were over 50 years.

Frequency (n) Percentage (%)

20-30 Years 17 54.8%
30-40 Years 11 35.5%
40-50 Years 2 6.5%
over 50 Years 1 3.2%
Total 31 54.8%

Table 4.1: Respondent’s Age Grouping

35
 4.2.2 Respondents’ Categorization by Sex
Females made up 35.5 percent (n = 11), while males made up 64.5 percent (n = 20) shows the
classification of respondents based on gender.

35.5% 65.5%

Figure 4.1: Respondents’ Categorization by Gender

4.2.3 Respondents’ Categorization by Nationality

28 respondents (90.32%) were Ethiopian, 2 (6.45%) were Egyptian and one (3.23%) was Indian
as the respondent’s nationality categorization is shown in the below table.

Frequency (n) Percentage (%)

Ethiopian 28 90.32%
Egyptian 2 6.45%
Indian 1 3.23%
Total 31 100%

Table 4.2: Respondents’ Categorization by Nationality

4.2.4 Respondents’ Categorization by Ethnicity

As seen in Figure 4.4, respondents were asked to declare their ethnicity. 14 respondents (45.2
percent) identified as "Oromo," 8 (25.8 percent) as "Amhara," 2 (6.5 percent) as "Tigre," 2 (6.5
percent) as "Gurage," another 2 (6.5 percent) as "Egyptian," and 1 respondent (3.2 percent) as
"Hindi." In addition, two respondents (6.5 percent) did not specify their ethnicity. As a result,
we may conclude that ethnicity is distributed evenly at ECE PLC, implying that a good number
of ethnicities are represented, indicating non-discrimination in terms of employment in the
Group.

36
 Ethnicity

50 45.2

40

30 25.8

20 14
6.5 8 6.5 6.5 6.5
10 2 2 2 1 3.2 2
0
Missing Amhara Egyptian Gurage Hindi Oromo Tigre

Frequency(n) Percentage (%)

Figure 4.2: Respondents’ Categorization by Ethnicity

4.2.4 Respondents’ Categorization by Educational Qualification

As shown below respondents (32.3%) earned a "certificate/diploma," 17 (54.8%) have a

"Bachelor's Degree," and 4 (12.9%) earned a "Master's Degree." A higher percentage of these
findings demonstrate that the majority of employees have a Bachelor's degree.

Frequency(n) Percentage (%)

Certificate/Diploma 10 32.3%
Bachelor's Degree 17 54.8%
Master's Degree 4 12.9%
Total 31 100%

Table 4.3: Respondents’ Categorization by Educational Qualification

4.2.5 Most Important Diversity Affecting Organizational Performance

The respondents were asked to score a particular set of diversity on a scale of 1 to 5, with 1
being the least important and 5 being the most significant. According to Figure 4.3,
"Educational Diversity" had the highest percentage mean ranking of 84.5 percent, followed by
"Age Diversity" with a rating of 72.9 percent, and "Gender Diversity" with a rating of 70.3
percent.

37
 "Nationality Diversity" and "Ethnic Diversity" were listed as the second and third least
important, respectively. As a result, we can conclude that education is vital since it has a direct
relationship with accomplishing the company’s objectives and the overall success of the
company.

90.0%
80.0% 84.5%
70.0%
72.9% 70.3%
60.0%
50.0% 57.4%

40.0%
30.0%
20.0% 25.2%
10.0%
0.0%
Age Diversity Gender Diversity Nationality Diversity Educational Ethnic Diversity
Diversity

Figure 4.3: Most Important Diversity Affecting Organizational Performance

4.3 Age Diversity Effect on Organizational Performance

One of the research objectives was to investigate the impact of age diversity on organizational
performance. This section summarizes the study's findings.

4.3.1 Most Important Features of Performance Affected by Age Diversity

Respondents are asked to rate, from least important to most important, characteristics of
organizational performance affected by age diversity on a scale of 1 to 5 (with 1 being the least
important and 5 being the most important). According to Figure 4.4, "Creativity and Innovation"
earned the highest ranking with a percentage mean rating of 85.2%, followed by "Decision-
Making" with a percentage mean rating of 83.2%. "Product and Service Quality" and "Intra-
Organizational Communication" were considered second and third least important, with
percentage mean ratings of 54.8% and 52.3%, respectively.

38
90.0%

80.0% 85.2% 83.2%

70.0%

60.0%

50.0% 54.8%
52.3%
40.0%

30.0%

20.0%

10.0%

0.0%
Creativity and innovation Decision-making Product and service Intra-organizational
quality communication

Figure 4.4: Most Important Feature of Performance Affected by Age Diversity

4.3.2 Level of Creativity and Innovativeness Perception in the Firm

Firms’ creativeness and innovativeness judgment of the respondents as shown below: 5

(16.1%) was “Not Sure”, 17 (54.8%) thought their firm was “Somewhat innovative”, 6 (19.7%)
replied that their firm was “quite creative and innovative”, 3 (9.7%) thought that their firm was
“Very creative and innovative”.

Frequency(n) Percentage (%)

Not sure 5 16.1
Somewhat creative and innovative 17 54.8
Quite creative and innovative 6 19.4
Very creative and innovative 3 9.7
Total 31 100.0

Table 4.4: Level of Creativity and Innovativeness Perception in the Firm

4.3.3 Age Diversity Effect on Creativity and Innovativeness in the Firm

For the question of whether age diversity had affected creativity and innovativeness in the
organization, the respondents replied as shown in the figure below, 3.2% of the respondents
said it had “No Effect”, 9.7% thought the effect was “Mostly Negative”, 19.4% supposed the
effect was “Negative”, 58.1% believed it was “Positive” and 9.7% showed that the effect was
“Mostly positive”.

39
 70.0

60.0
58.1
50.0

40.0

30.0

20.0
19.4
10.0
3.2 9.7 9.7
0.0
No effect Mostly Negative Negative Positive Mostly Positive

Figure 4.5: Age Diversity Effect on Creativity and Innovativeness in the Firm

4.3.4 Decision-Making Ease within the Organization

Results found when the respondents were asked how easy decision-making was in their firm is
Two respondents (6.5%) replied “No Effect”, and “Very Hard”, However, 9 (29.0%) “Hard”,
12 (38.7%) answered “Easy” and 6 respondents (19.4%) believed it was “Very Easy” to make
decisions.

Frequency(n) Percentage (%)

No Effect 2 6.5
Very hard 2 6.5
Hard 9 29.0
Easy 12 38.7
Very easy 6 19.4
Total 31 100

Table 4.5: Decision-Making Ease within the Firm

40
4.3.5 Age Diversity Effect on Decision-Making Process

As shown in the below figure, 5 respondents (16.1%) thought it had “No Effect”, 2 respondents
(6.5%) thought it made it “Very hard”, 8 (25.8%) thought it made it “hard”, 13 (41.9%) thought
that it made it “Easy” while another 3 respondents (9.7%) answered that age diversity made
decision- making “very easy” were the results attained when the respondents asked whether age
diversity had made decision-making easier or hard within the firm.

Frequency(n) Percentage (%)

No Effect 5 16.1
Makes it very hard 2 6.5
Makes it hard 8 25.8
Makes it easy 13 41.9
Makes it very easy 3 9.7
Total 31 100

Table 4.6: Age Diversity Impact on the Decision-Making Process

4.3.6 Firm’s Products and Services Quality Perception

The respondents were required to remark on the quality of their firm’s products and services.
Accordingly, 16.1% of the respondents answered “Not Sure”, 12.9% “somewhat quality
products and services”, 51.6% “good or quality products and services” and 19.4% thought
their firms had “very high-quality products and services”.

60.0

50.0

40.0

30.0
51.6
20.0

10.0 19.4
16.1 12.9
0.0
Not sure Somewhat quality Good quality Very high-quality
products/services products/services products/services

Figure 4.6: Quality of Firm’s Products and Services Perception

41
4.3.7 Age Diversity Effect Perception on Product and Service Quality
The respondents were asked to show their opinion about whether age diversity in their firm
affected product and service quality. So, 6 respondents (19.4%) were “Not Sure”, 2 (6.5%)
thought it had a “Negative effect”, 16 (51.6%) thought it had a “Positive effect”, and 7
(22.6%) thought that the effect was “Mostly positive effect”.

Frequency(n) Percentage (%)

No Effect 6 19.4
Negative effect 2 6.5
Positive effect 16 51.6
Mostly positive effect 7 22.6
Total 31 100.0

Table 4.7: Impact of Age Diversity Perception on Product and Service Quality

4.3.8 Communication Ease Perception within the Organization

The researcher asked the responders asked to specify their view on whether communication
within their firm was easy, 18 respondents (31.6%) “Strongly” agreed, 35 (61.4%) agreed
while 4 (7.0%) disagreed.

60.0

50.0

40.0

30.0
54.8
20.0
29.0
10.0
9.7 6.5
0.0
Not Sure Disagree Agree Strongly Agree

Figure 4.7: Ease of Communication Perception within the Organization

4.3.9 Age Diversity Effect on Communication within the Firm

The respondent’s answers when asked whether they considered age diversity had a positive or
negative impact on communication inside the organization were 13 (22.8%) believed it had "No

42
 Effect," 6 (10.5%) thought it had "Negative" 24 (42.1%) thought it had "Positive" and 14
(24.6%) thought it had "Mostly Positive".

Frequency(n) Percentage (%)

No effect 5 16.1
Negative 2 6.5
Positive 18 58.1
Mostly Positive 6 19.4
Total 31 100.0

Table 4.8: Age Diversity Effect on Communication within the Firm

4.3.10 Age Diversity Effect on Problem Solving within the Firm

Respondents’ view on the Impact of age diversity on problem-solving inside the organization
was 5 respondents (16.1 percent) said it had "No Effect," 2 respondents (6.5%) said it made it
"Very hard," 9 (29.0%) said it made it "Hard," 14 (45.2 %) said it made it "Easy," and 1 (3.2%)
said it made it “Very easy”.

50.0
45.0
40.0
35.0
30.0
25.0
45.2
20.0
15.0 29.0
10.0
16.1
5.0
6.5 3.2
0.0
No Effect Very hard Hard Easy Very easy

Figure 4.8: Age Diversity Effect on Problem Solving within the Firm

4.4 Gender Diversity Effect on Firm Performance

For the second specific research purpose, the researcher posed questions to the respondents about
the impact of gender diversity on organizational performance. The findings of the investigation are
presented in this section.

43
4.4.1 Most Important Features of Performance Affected by Gender Diversity

Respondents were asked to rate from least important to most important, areas of organizational
performance affected by gender diversity on a scale of 1 to 5 (with 1 being the least important
and 5 being the most important). According to Figure 4.9, "competitive advantage" received
the greatest percentage mean rating of 87.7%, followed by "Management and Leadership
Quality" with a percentage mean rating of 81.9%. With percentage mean ratings of 55.5% and
52.3%, respectively, "job satisfaction" and "organizational culture" were regarded as the second
and third least important.

100.0%
90.0%
80.0%
70.0%
60.0%
50.0%
81.9% 87.7%
40.0%
30.0% 55.5% 52.3%
20.0%
10.0%
0.0%
Quality of management Organization’s Job Satisfaction Organizational culture
and leadership competitive advantage

Figure 4.9: Most Important Features of Performance Affected by Gender Diversity

4.4.2 Quality of Management Perception in the Organization

The findings on respondents' perceptions of the quality of management in their company were
that 5 respondents (16.7 percent) thought it was "Not sure," 11 (35.5 percent) thought it was
"Poor," 12 (38.7 percent) thought it was "Good," and 3 (9.7 percent) thought it was "Very
good."
Frequency(n) Percentage (%)
Not sure 5 16.1
Poor 11 35.5
Good 12 38.7
Very Good 3 9.7
Total 31 100

Table 4.9: Quality of Management Perception in the Firm

44
4.4.3 Gender Diversity Effect on Quality of Management in the Firm

When respondents expressed their thoughts on the impact of gender diversity on the firm's
management quality, 3.2% said they were "Not sure," 9.7 percent said it was "Very poor," 19.4
percent said it was "Poor," 58.1 percent said it was "Good," and another 9.7 percent said it was
"Very Good."
70.0

60.0

50.0

40.0

30.0 58.1

20.0

10.0 19.4
9.7 9.7
0.0 3.2
Not sure Very Poor Poor Good Very Good

Figure 4.10: Gender Diversity Effect on Quality of Management in the Firm

4.4.4 Organization’s Competitiveness Perception

Respondents were asked whether they agreed or disagreed that their organization was
competitive: 2 (6.5 percent) responded "Not sure," 13 respondents (41.9 percent) disagreed, 14
respondents (45.2 percent) agreed, and two other respondents (6.5 percent) "strongly" agreed.

Frequency (n) Percentage (%)

Not Sure 2 6.5
Disagree 13 41.9
Agree 14 45.2
Strongly Agree 2 6.5
Total 31 100

Table 4.10: Organization’s Competitiveness Perception

45
4.4.5 Gender Diversity Effect on Organization’s Competitiveness

The respondents answered an inquiry to describe the nature of the influence of gender diversity
on the competitiveness of their organization as 9.7% of respondents said the effect was "Mostly
positive," 61.3% said it was "Positive," 16.1% said it was "Negative," 3.2% said it was "Mostly
negative," and 9.7% said it had "No effect".

70.0

60.0

50.0

40.0

30.0 61.3

20.0

10.0
16.1
9.7 9.7
0.0 3.2
No effect Mostly Negative Negative Positive Mostly Positive

Figure 4.11: Gender Diversity Effect on Firm’s Competitiveness

4.4.6 Job Satisfaction Perception

Two respondents (6.5%) were "Not Sure" whether he/she was content with his/her job, another
(38.7%) "strongly" disagreed, 12 (8.8%) "disagreed", 14 (45.2%) agreed, and 3 (9.7%)
"strongly" agreed on job satisfaction perception of their firm.

Frequency(n) Percentage (%)

Not Sure 2 6.5
Disagree 12 38.7
Agree 14 45.2
Strongly Agree 3 9.7
Total 31 100

Table 4.11: Job Satisfaction Perception

46
4.4.7 Gender Diversity Effect on Job Satisfaction

The respondents were asked to rate the impact of gender diversity on job satisfaction. The figure
below shows that 3 respondents (9.7%) were "Not sure," 14 (45.2%) disagreed, 12 (38.7 %)
agreed, and 2 (6.5%) strongly agreed.

50
45
40 45.2
35 38.7
30
25
20
15
10 14
12
5 9.7
3 2 6.5
0
Not Sure Disagree Agree Strongly Agree

Series1 Series2

Figure 4.12: Gender Diversity Impact on Job Satisfaction

4.4.8 Organization Perception as Having a Distinctive Culture

When respondents were asked if their company had a unique organizational culture, 4
respondents (12.9%) were "Not Sure," five (16.1%) disagreed, sixteen (51.6%) agreed, and six
(19.4%) "strongly" agreed.
Frequency(n) Percentage (%)
Not Sure 4 12.9
Disagree 5 16.1
Agree 16 51.6
Strongly Agree 6 19.4
Total 31 100

Table 4.12: Firm Perception as Having a Distinctive Culture

4.9 Gender Diversity Effect on Organizational Culture

When respondents were asked what they thought about the degree of the effect of gender
diversity on organizational culture, 4 respondents (12.9 percent) were "Not Sure," 1 (3.2%)

47
 believed it was "to a minimal extent," 2 (6.5%) "not at all," 17 (54.8%) "to some extent," and 7
(22.6%) thought it was "to a big extent."

Frequency(n) Percentage (%)

Not Sure 4 12.9
to a minimal extent 1 3.2
not at all 2 6.5
to some extent 17 54.8
to a great extent 7 22.6
Total 31 100
Table 4.13: Gender Diversity Effect on Organizational Culture

4.4.10 Gender Diversity Effect on Organizational Performance

For a question to reflect thoughts on the overall impact of gender diversity on organizational
performance, the results were, 3 respondents (9.7%) felt it was "Not sure," seven (22.6%)
thought it was "Disagree," 18 (58.1%) thought it was "Agree," and three (9.7%) thought it was
"Strongly agree" as shown in below chart.

70
60
50 58.1

40
30
20
22.6
10 18
3 9.7 7 3 9.7
0
Not Sure Disagree Agree Strongly Agree

Frequency(n) Percentage (%)

Figure 4.13: Gender Diversity Effect on Organizational Performance

4.5 Ethnic Diversity Effect on Organizational Performance

The third research objective was to investigate the impact of ethnicity on organizational
performance. This section of the chapter presents the study's findings in this regard.

48
4.5.1 Most Important Features of Performance Affected by Ethnic Diversity

The respondents were asked to evaluate characteristics of organizational performance impacted

by ethnic diversity on a scale of 1 to 5 (with 1 being the least important and 5 being the most
essential). Accordingly, "corporate diversity" received the top ranking with a percentage mean
rating of 85.8%, followed by "employee productivity" with a percentage mean rating of 85.2%.
"Team performance" and "Job satisfaction" were considered second and the least important, with
percentage mean scores of 53.5% and 48.4%, respectively.
100.0%
90.0%
80.0%
70.0%
60.0%
50.0%
40.0% 85.2% 85.8%
30.0%
53.5% 48.4%
20.0%
10.0%
0.0%
Corporate reputation Team performance Employee productivity Job satisfaction

Figure 4.14: Most Important Features of Performance Affected by Ethnic Diversity

4.5.2 Organization’s Reputation Perception

Results of respondent's opinion of their firm's reputation were, that 3 respondents (9.7 percent)
believed it had "No effect," 1 respondent (3.2 percent) thought it was "mostly negative," 4 (12.9
%) thought it was "Negative," 17 (54.8 %) thought it was "Positive," and 6 (19.4 %) thought it
was "Mostly Positive."

Frequency(n) Percentage (%)

No effect 3 9.7
Mostly Negative 1 3.2
Negative 4 12.9
Positive 17 54.8
Mostly Positive 6 19.4
Total 31 100

Table 4.14: Firm’s Perception Reputation

49
5.3 Ethnic Diversity Effect on Corporate Reputation of the Firm

Rating of respondents to the impact of ethnic diversity on their firm's reputation. 12.9% of
respondents said they were "Not Sure," 6.5% said the impact was "not at all," 67.7% said it
affected "to some extent," and 12.9% said it affected "to a great amount." The findings of the
investigation are depicted in Figure 4.15.

80.0
70.0
60.0 67.7
50.0
40.0
30.0
20.0
10.0
12.9 6.5 12.9
0.0
Not Sure not at all to some extent to a great extent

Percentage (%)

Figure 4.15: Ethnic Diversity Effect on Corporate Reputation of the Firm

4.5.4 T h e Negative Ethnic Diversity Effect on Team Performance

Results of respondents view whether they believed ethnic diversity had a detrimental impact on
team performance. Three respondents (9.7%) said they were "Not Sure," one (3.2%) "Strongly"
disagreed, five (16.1%) disagreed, 18 (58.1%) agreed, and four (12.9%) "Strongly" agreed.

Frequency(n) Percentage (%)

Not Sure 3 9.7
Strongly Disagree 1 3.2
Disagree 5 16.1
Agree 18 58.1
Strongly Agree 4 12.9
Total 31 100

Table 4.15: Ethnic Diversity Effect on Team Performance is Negative

50
4.5.5 Most Important Feature of Ethnic Diversity affecting Team Performance
Features of ethnic diversity that affect team performance on a scale of 1 to 5 (with 1 being the
least important and 5 being the most essential) the respondents answered as "Multiplicity of
information and experiences" had the maximum percentage mean rating of 71%, followed by
"Different skill-set for problem-solving and task performance" with a percentage mean rating
of 67.1%. "Job satisfaction" and "Different viewpoints in problem-solving and task
performance" were regarded as the second and third least important, respectively, with
percentage mean scores of 53.5% and 51.6%.

80.0%
70.0%
60.0%
50.0%
40.0%
67.1% 71.0%
30.0%
51.6% 53.5%
20.0%
10.0%
0.0%
Different perspectives in a Different skills-set Multiplicity of knowledge Job satisfaction
problem/task regarding a problem/task and experiences.

Figure 4.16: Most Important Feature of Ethnic Diversity affecting Team Performance

4.4.6 Ethnic Diversity Effect on Individual Employee Performance

The respondents were asked if ethnic diversity affects the performance of individual employees
and 4 (12.9%) were "Not Sure", 8 (25.8%) "Strongly" disagreed, 11 (35.5%) disagreed, 7
(22.6%) agreed, and 1 (3.2%) "Strongly" agreed.
Frequency(n) Percentage (%)
Not Sure 4 12.9
Strongly Disagree 8 25.8
Disagree 11 35.5
Agree 7 22.6
Strongly Agree 1 3.2
Total 31 100

Table 4.16: Ethnic Diversity Effect on Individual Employee Performance

51
 4.5.7 Satisfaction of Working in an Ethnically Diverse Organization

When the respondents were asked if they were satisfied working with people of different ethnic
backgrounds, 3 respondents (9.7%) stated they felt nothing different, 1 (3.6%) said that they
were "Dissatisfied," 22 (71.0%) have said they are "Satisfied," and 5 (16.1%) said they were
"Very Satisfied."

80
70
71.0
60
50
40
30
20
22
10 16.1
3 9.7 1 3.2 5
0
No different Dissatisfied Satisfied Very Satisfied

Frequency Percent

Figure 4.17: Satisfaction Working in an Ethnically Diverse Firm

4.5.8 Ethnic Diversity Impact on Intra-Organization Communication

Respondents were asked whether ethnic diversity had a positive or bad influence on intra-
organization communication, 11 respondents (35.5%) responded "No Effect," 1 (3.2%) said
"Negative," 16 (51.6%) said "Positive," and 3 (9.7%) stated "Mostly Positive."

Frequency(n) Percentage (%)

No effect 11 35.5
Negative 1 3.2
Positive 16 51.6
Mostly Positive 3 9.7
Total 31 100.0

Table 4.17: Ethnic Diversity Impact on Intra-Organization Communication

52
4.5.9 Ethnic Diversity Suitability for Firm Performance

The respondents were asked about how much they believed ethnic diversity influenced
organizational effectiveness. Accordingly, 9.7 percent of respondents thought it had "no
effect," 16.1% thought it had "to some extent," 35.5% thought it had "to a great extent," and
38.7% thought it had "extensive influence."

45
40
35 38.7
35.5
30
25
20
15
16.1
10
11 12
5 9.7
3 5
0
not at all to some extent to a great extent extensively

Frequency(n) Percentage (%)

Figure 4.18: Ethnic Diversity Suitability for Organizational Performance

4.6 Dependent and Independent Variables Correlation Analysis

To infer and comprehend the nature of the link, a correlation analysis was performed between
the dependent and independent variables of the study. Correlation analyses were performed
between age diversity and firm performance, gender diversity, and organizational performance,
and ethnic diversity and organizational performance.

4.6.1 Correlation of Age Diversity with Organization’s Performance

The relationship between age diversity and company success was looked and Spearman's rho
correlation value obtained was moderately positive, r =.555, p<.001. This value suggests that the
link between age diversity and firm performance is positive, implying that increasing age
diversity will lead to an improvement in organizational performance.

53
 Correlations
Organization
Age Diversity Performance
Spearman's Age Diversity Correlation Coefficient 1.000 .555**
rho Sig. (2-tailed) . .001
N 31 31
Organization Correlation Coefficient .555** 1.000
Performance Sig. (2-tailed) .001 .
N 31 31
**. Correlation is significant at the 0.01 level (2-tailed).

Table 4.18: Age Diversity Correlation with Organization Performance

4.6.2 Gender Diversity Correlation with Firm’s Performance

The relationship between gender diversity and corporate success was examined by the
researcher. Accordingly, Spearman's rho correlation value obtained was moderately positive,
r=.367, p<.05. This correlation value implies that as gender diversity increases, company
performance improves moderately.
Correlations
Gender Organization
Diversity Performance
Spearman's rho Gender Diversity Correlation Coefficient 1.000 .367*
Sig. (2-tailed) . .042
N 31 31
Organization Performance Correlation Coefficient .367* 1.000
Sig. (2-tailed) .042 .
N 31 31
*. Correlation is significant at the 0.05 level (2-tailed).

Table 4.19: Gender Diversity Correlation with Firm’s Performance

4.6.3 Ethnic Diversity Correlation with Firm’s Performance

The researcher examined the relationship between ethnic diversity and corporate performance.
And below tables shows that Spearman's rho correlation value found was a strong positive value,

54
r=.689, p<.01. The positive correlation value indicates that increasing the firm's ethnic diversity
improves organizational effectiveness.
Correlations
Organization
Ethnic Diversity Performance
Spearman's rho Ethnic Diversity Correlation Coefficient 1.000 .689**
Sig. (2-tailed) . .000
N 31 31
Organization Performance Correlation Coefficient .689** 1.000
Sig. (2-tailed) .000 .
N 31 31
**. Correlation is significant at the 0.01 level (2-tailed).

Table 4.20: Ethnic Diversity Correlation with Firm’s Performance

4.7 Regression Analysis

To examine the effect of diversity on performance, the researcher used regression analysis. The
results of the regression analysis model for age diversity, gender diversity, and ethnic diversity
are shown in Table 4.21. The dependent variable (organization performance) was used, whereas
the independent variables were age, gender, and ethnicity.

4.7.1 Regression Model Summary for Organizational Performance

The model's R Square value revealed that age, gender, and ethnic differences might account
for 44.6% of the model's change or variance.
Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .668a .446 .385 .39010
a. Predictors: (Constant), Ethnic Diversity, Age Diversity, Gender Diversity

Table 4.21: Organizational Performance Regression Model Summary

4.7.2 ANOVA Analysis for Organizational Performance

Organizational performance (the dependent variable) is predicted by the independent variables

(age, gender, and ethnicity), and F (3, 27) = 7.247 indicates that the model has explanatory power

55
as shown in Table 4.22. This means that the independent variables (age, gender, and ethnic
diversity) help predict organizational effectiveness (the dependent variable). As a result, the
model is significant, with a positive significance of p<0.001.

ANOVAa
Model Sum of Squares df Mean Square F Sig.
1 Regression 3.309 3 1.103 7.247 .001b
Residual 4.109 27 .152
Total 7.417 30
a. Dependent Variable: Firm Performance
b. Predictors: (Constant), Ethnic Diversity, Age Diversity, Gender Diversity

Table 4.22: Organizational Performance ANOVA Analysis

4.7.3 Regression Coefficient Analysis for Organizational Performance

The researcher used several regression analyses to establish the type of relationship that existed
between the independent and dependent variables. The results obtained are shown in Table 4.24.
Coefficientsa
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.374 .451 3.048 .005
Age Diversity -.013 .146 -.021 -.090 .929
Gender Diversity .452 .195 .541 2.320 .028
Ethnic Diversity .152 .095 .251 1.596 .122
a. Dependent Variable: Firm Performance

Table 4.23: Organizational Performance Regression Coefficient Analysis

The effect of age, gender, and ethnic diversity on organizational performance overall equation
for predicting is as follows: Y = 1.374 -.013Age + .452Gender + .152Ethnicity

According to the aforementioned equation, the coefficient for age diversity is -.013, implying that
for each more age diversity, a modest loss in performance of the organization of an average of -
.013 can be predicted (other factors held constant). Furthermore, the equation shows that the
gender coefficient is .452, implying that an increase in organizational performance of .452 should

56
be predicted with each additional gender diversity. Finally, the equation shows that the ethnicity
coefficient is .152, implying that for every extra increase in ethnic diversity, an average rise of.152
in organizational performance should be predicted as long as all other parameters remain constant.
Only gender diversity was significant in the study, with a p = 0.028. Age diversity has a negative
coefficient of -.013 and ethnic diversity has a positive coefficient of .152, both of which have a
negligible effect on organizational performance (p= 0.929 and 0.122, respectively).

57
 CHAPTER FIVE

DISCUSSION, CONCLUSION, AND RECOMMENDATION

5.1 Introduction

Chapter 5, the study's last chapter, summarizes the study's goal and research questions, as well
as the study's significant conclusions. The chapter concludes with a discussion of the study's
primary findings, as well as some recommendations for further research and progress.

5.2 Summary of Findings

The study's overall goal was to investigate the influence of workplace diversity on Elsewedy
Cables Ethiopia PLC's organizational performance (ECE PLC). The study aimed to achieve
three specific goals: to investigate how age diversity affects Elsewedy Cables Ethiopia PLC's
performance, to investigate how gender diversity affects Elsewedy Cables Ethiopia PLC's
performance, and to assess the impact of ethnic diversity on Elsewedy Cables Ethiopia PLC's
performance.

The research design used is a descriptive research approach, which was found appropriate since
it allowed the researcher to characterize the relationship between organizational performance
and the three forms of diversity examined. Employees of Elsewedy Cables Ethiopia PLC
working in Addis Ababa (HQ) and Dukem were included in this study (Factory). This group
consisted of 40 people from various levels of the organization who were deemed to have the
necessary information for the study by the researcher. It sampled the 40 employees or
respondents who agreed to participate in the study using convenient purposive sampling.

The bulk of the respondents (90.3%) were between the ages of 20 and 40, while 9.7% were over
the age of 40, according to the survey. The research also found that men (64.5 percent) and
women (64.5 percent) made up the majority of the respondents (35.5%). The study discovered
that Ethiopians made up 90.32% of responses, Egyptians 6.45%, and Indians 3.23%. In terms of
ethnic variety, the study found that the majority of respondents were Oromo (45.2%), followed
by Amhara (25.3%), and Tigre (6.5%). The majority of respondents (54.8%) had a bachelor's
degree, followed by diploma holders (32.26%).

58
Results were found to show that "Educational Diversity" had the highest percentage mean rating
of 84.5%, followed by "Age Diversity" (72.9%) and "Gender Diversity" (70.3%). The second
and third least important factors were "ethnic diversity" and "religious diversity," respectively.
According to the survey, 83.9 percent of respondents thought their company was creative and
inventive, and 67.7% thought age diversity had a positive impact on the company's creativity and
innovation. The majority of respondents (58.1%) believed that decision-making inside the
organization was simple, and 51.6% believed that age diversity aided decision-making. The
majority of respondents (83.9%) believed their company produced high-quality goods and
services, with 74.2% believing that age diversity improved the quality of their company's
goods and services. According to the findings, the majority of respondents (61.3 %) said
communication within the company was simple, and 77.4% thought age diversity made
communication simple. According to the study, 48.4% of respondents said problem-solving
within their company was not difficult.

In terms of the impact of gender diversity, the study found that competitive advantage was ranked
highest among aspects of performance affected by gender diversity, with a percentage mean
rating of 87.7%, followed by "Management and Leadership Quality," which received an 81.9%
percentage mean rating. With percentage mean ratings of 55.5% and 52.3%, respectively, "job
satisfaction" and "organizational culture" were listed as the second and third least important
factors. According to the study, 48.4% of respondents considered their company's management
was of high quality, and 67.7% said gender diversity had a favorable impact on management
quality. In terms of competitiveness, 51.6% of respondents believed their company was
competitive. According to the study, 71% of respondents considered that age diversity had a
beneficial impact on competitive advantage. Gender diversity had an impact on job satisfaction,
according to the report, but just 54.8% of the population thought so, while the impact on
corporate culture said was 77.4%.

According to the survey, "Employee productivity" ranked first among the areas of performance
affected by ethnic diversity, with a percentage mean rating of 85.8%, followed by "Corporate
diversity" with a percentage mean rating of 85.2%. With percentage mean ratings of 53.5% and
48.4%, "team performance" and "job satisfaction" were listed as the second and third least
important factors, respectively.

59
The connection between the dependent and independent variables revealed moderately strong
links between the dependent and independent variables, according to the study. Age diversity
and the organizational performance had a moderate positive correlation value of r =.555, p<.001,
gender diversity and the organizational performance had a moderate positive correlation value
of r=.367, p<.05, and ethnic diversity and the organizational performance had a good strong
positive correlation value of r =.689, p<.01. Age, gender, and ethnic differences accounted for
44.6% of the change or variance in the model, according to the study's R Square value.

5.3 Discussions

5.3.1 Age Diversity Impact on Organizational Performance

The survey also discovered that, in terms of % the mean rating, the degree of education was the
greatest, followed by "Age Diversity" and "Gender Diversity." Also, "Ethnic Diversity" and
"Religious Diversity" were placed as the second and third least important factors, respectively.
This finding is similar to Darwin's (2014) suggestion that educational variety and age are major
determinants of organizational effectiveness. Age diversity is seen to provide value to a company
and improve its overall performance by facilitating creativity, innovation, and decision-making.

Other research has linked age diversity to improved creative performance. Diversity creates
varied viewpoints, knowledge, and abilities, according to Simons and Rowland (2011), which
improves creativity and innovation while reducing compliance with previous and existing
standards.

The findings of the study on the impact of age diversity on decision-making support Gupta's
(2013) argument that values held by people of different ages complement each other, increasing
the innovativeness and creativity of age-heterogeneous workforces compared to more
homogeneous ones. It also refutes Zaidi, et al., (2010) assertion that senior employees provide a
valuable set of experiences and intuition to decision-making due to their intuition experience.
Age variety, according to Dezo and Ross (2013), does not always lead to more informed
decision-making or easier problem-solving. They warn that if such differences and the
preconceptions that surround them are not successfully addressed, they can become a significant
source of conflict.

60
The study also found that 83.9% of respondents believed their company offered high-quality
products and services. In doing so, the study backs up Mutunga and Gachunga's (2013) claim
that having a diverse workforce facilitates the upward (reverse mentoring) and downward
(mentoring) exchange of information and ideas between generations. According to Darwin and
Palanisamy (2015), age diversity leads to higher product and service quality because different
age groups bring different perspectives, knowledge, and experiences to the product or service
development process. This can result in a significant improvement in the quality of the product
or service that the firm eventually produces.

5.3.2 Gender Diversity Impact on Organizational Performance

When it came to the impact of gender diversity on different dimensions of performance, the study
discovered that competitive advantage was the most important, followed by "Management and
Leadership Quality." The second and third least important factors, respectively, were
"organizational culture" and "work satisfaction." This conclusion backs up Darwin and
Palanisamy's (2015) claim that a diverse workgroup brings a variety of experiences, skill sets,
and perspectives to the table, enhancing overall team performance and thereby the organization's
success. When asked how gender diversity affects competitive advantage, 71% said it has a
favorable influence.

Furthermore, Raza et al. (2013) discovered that differences in gender, education, culture, and age
had a favorable impact on the competitive advantage of a business. When Ali, et al., (2007) looked
at the link between gender diversity and decision-making, they discovered that the former also
helped companies gain a competitive edge by allowing them to make better decisions. They stated
that a more gender-diverse workforce provides a range of viewpoints, skills, and expertise to the
workplace, which an organization can tap into and use to help it achieve its strategic goals (Ali,
et al., 2013).

61
According to the study, 67.7% of respondents believe that gender diversity has a significant
impact on leadership and management quality. This finding backs up previous findings by Van
Knippenberg, et al., (2014), who found that gender diversity improves organizational leadership
and management by stating that gender diversity improves managerial information processing
and decision making, resulting in effective strategy formulation and decision-making key
processes. It also supports the findings of Nakagwa (2015), who found that gender diversity, in
addition to other types of diversity in the workforce, resulted in more inventive and high-quality
solutions due to a mix of gender-based perspectives expressed by both males and females in
management teams. Some experts, such as Tolbize (2008), disagree with the findings, claiming
that gender diversity harmed management and leadership quality since organizations with male-
dominated boardrooms frequently ignored the viewpoints of their female counterparts.

According to the findings, 45.2% of respondents disagree that gender diversity contributes to job
happiness. This contradicts the findings of Zaid et al. (2010), who showed that workforce
diversity, particularly gender diversity, was positively related to job satisfaction. It also refutes
Sania, et al., (2015) claim that diversity in the workplace modifies the nature of employee
relationships, resulting in higher job satisfaction and morale. As well Raza, et al., (2013) argue
that workplace gender diversity can enhance information, skill, and experience exchanges, as
well as lead to the establishment of cohesion and attachments among employees of different
genders, and positively influence their overall perceptions of the job.

It verifies, however, Nakagwa's (2015) study of Japanese enterprises, which indicated that gender
diversity impacted job happiness for women by creating a sense of job insecurity among female
employees, resulting in higher job discontent among women. Mwikali and Kyalo (2015) argue
that diversity may lead to minority group members becoming dissatisfied with their jobs. As a
result, if women or men are in the minority, a lack of gender diversity may cause them to be
dissatisfied with their jobs.

62
5.3.3 Ethnic Diversity Impact on Organizational Performance

According to the study, "company reputation" ranked first among the dimensions of performance
affected by ethnic diversity, followed by "employee productivity" in terms of % the mean rating.
The least important factors were "team performance" and "job happiness." This research backs
up Darwin's (2014) claim that ethnic diversity improves organizational performance by creating
a pool of abilities and learning opportunities that the company can tap into for better results.
Indeed, 80.6% of those polled thought that ethnic diversity boosted a company's reputation. This
is most likely because, in a multi-ethnic society, a company's reputation can be enhanced by
employing people of many ethnic backgrounds.

Employee productivity is the second most important factor of performance affected by

employee performance, according to the study. Timmermans and Kristinsson (2011) found that
ethnic diversity in the workplace enhances creativity and innovation through broadening
perspectives and viewpoints. According to several studies, a more ethnically varied workforce
is more creative and innovative than one that is more ethnically homogeneous (Darwin &
Palanisamy, 2015).

Ethnic diversity correlates with knowledge sets, competencies, and skill sets that affect the
formation and performance of teams in modern businesses, according to Gupta (2013),
Hoogendoorn, and van Praag (2012). In other words, it has been discovered that ethnic diversity
improves organizational performance by forming more productive teams. The study discovered
that team performance is the element of performance that is least affected by gender diversity.
This goes against the findings of several earlier research. For example, Gupta (2013) discovered
that the favorable relationship between team performance and ethnic diversity exists only when
team members are more ethnically varied. Lee and Nathan (2011) discovered a correlation
between ethnic diversity in teams and higher levels of creativity and innovation in those teams.
Gupta (2013), on the other hand, is suspicious of the positive link between ethnic diversity and
team performance, claiming that moderate ethnic diversity has no influence on team performance
and thus has no impact on overall organizational success. According to Gupta (2013), ethnicity
has little bearing on factors of business outcomes such as profit, market share, or sales.

63
According to Parrotta et al. (2011), an ethnically diverse workforce can bring different
perspectives, ideas, and experiences to the table, which can either benefit organizational
processes or cause friction among workforce groups, undermining team and company
performance. According to Marx et al., (2015), workers have preexisting overt and implicit
preferences for who they want to work with, and so growing ethnic diversity may result in
workplace division and lack of cohesion.

5.4 Conclusion

5.4.1 Age Diversity Impact on Organizational Performance

Companies that want to keep their employees for a long time need to have a diverse workforce.
Since younger employees are available for training on business structure, age diversity in most
firms aids the establishment of a leadership pipeline inside the company. By allowing the
building of a leadership pipeline, age diversity not only supports the development of a pool of
qualified individuals but also helps the firm to maintain its style of doing business, which
includes "best practices." Furthermore, the organization's age diversity allows newer employees
with digital abilities to share their knowledge with the older generation. On the other hand, the
older staff passes down corporate standards and operating procedures to the younger employees,
which helps the company's productivity and performance. Age variety also stimulates creativity
and invention, which leads to product and service advancements, which is beneficial to firms
aiming to obtain or keep a competitive advantage.

5.4.2 Gender Diversity Impact on Organizational Performance

Gender equality boosts organizational performance. this is often because it possesses both
internal and external values that benefit the organization's performance. Gender diversity is vital
not simply because it's the proper thing to try and do in a society where gender equality may be
a major issue, but also because it's the potential of constructing internal and external company
goals simpler to attain. Gender diversity is significant for intra-organizational issue resolution
and decision-making, in line with several studies. Gender diversity on corporate boards improves
decision-making and therefore the development of long-term business plans. Many studies have
demonstrated the importance of gender diversity within the workplace for creativity and
innovation, management quality, services, and goods. Involvement of men and ladies during a

64
firm's boardroom and management has been found to enhance company image and job
satisfaction, both of which are vital for overall corporate performance.

5.4.3 Ethnic Diversity Impact on Organizational Performance

Organizational performance has been proven to be influenced by ethnic diversity. this is often
very true in multi-ethnic cultures where businesses operate. The good thing about ethnic diversity
to corporations is measured in terms of decision-making, skill pool, creativity and innovation,
problem-solving, service and product quality, and a way of belonging, among other essential
components of organizational success. People from different ethnic backgrounds provide a wider
perspective of considering and conceiving a situation, which can end in more informed corporate
decisions or finding proper and effective solutions to problems. In firms operating in ethically
heterogeneous societies, boardroom ethnic diversity is an important internal resource for
problem-solving, as people from different ethnic backgrounds provide a wider perspective of
considering and conceiving a situation, which can lead to more informed corporate decisions or
finding proper and effective solutions to problems. As a result, ethnic diversity not only helps
the corporate gain a competitive advantage over companies with a more ethnically homogeneous
workforce but also improves employee satisfaction as employees learn to figure with and
appreciate people and different perspectives on their assigned tasks.

5.5 Recommendations

Based on the findings of the investigation, the study recommends the following
recommendations for improvement and additional research.

5.5.1 Recommendations for Improvement

5.5.1.1 Age Diversity Impact on Organizational Performance

Age diversity should be viewed by managers as a source of competitive advantage inside the
company. They should value age variety because of the potential impact it has on the company's
creativity and innovation. Managers should recognize that while older generations provide
expertise and abilities to the company, younger generations bring fresh ideas and new
perspectives, and that age diversity can help the company's business plan. Furthermore, managers

65
must recognize the usefulness of age variety in problem-solving and decision-making, and regard
it as a viable and important internal resource for improving product and service quality.

5.5.1.2 Gender Diversity Impact on Organizational Performance

Organizations that want to succeed in today's gendered society must recognize and incorporate
gender diversity into their corporate strategy. Gender diversity is becoming increasingly
important in today's enterprises and society, and management must recognize this. As a result,
creating gender balance in the workplace must be considered a long-term strategy for not only
gaining a competitive edge but also for establishing a distinct organizational culture and
reputation, which benefits the company's external image. To achieve marketing and sales
strategy, management should also consider gender diversity as an internal resource. Additionally,
businesses and managers should work to establish gender diversity inside their organizations, as
this improves other aspects of performance such as creativity and innovation, as well as quality
decision-making. Additional managers should value boardroom gender diversity as a vital
approach for achieving quality in decision-making and problem-solving in the company's
strategy.

5.5.1.3 Ethnic Diversity Impact on Organizational Performance

Ethnic diversity, like gender, educational, and age diversity, is a valuable resource for attaining
marketing and sales goals, as well as employee work satisfaction. In addition, management should
recognize the value of ethnic diversity in boardrooms in terms of problem-solving. Furthermore,
enterprises, particularly those operating in ethnically diverse nations like Ethiopia, must-see ethnic
diversity as critical to achieving internal harmony and contributing to the creation of a stable
external social context in which the firm must operate. Managers of firms should not overlook the
importance of ethnic diversity for employee productivity, team performance, creativity, and
innovation.

66
5.5.2 Additional Study

More research is needed by academics to determine the impact of various aspects of diversity on
organizational success. More research is needed to understand why, in theory, diversity leads to
better performance. Future research should concentrate on determining the nature of the
relationship between a single component of organizational performance and a single type of
diversity to gain complete knowledge of the relationship. More research is needed to determine
whether the numerous diversities have a unique effect on performance or if their effects are
combined and mutually reinforcing. Future studies should also aim to develop a model for
managers to follow to capitalize on the benefits of diversity for organizational productivity.

67
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 PPENDIX 2: QUESTIONNAIRE
THE IMPACT OF WORKFORCE DIVERSITY ON ORGANIZATIONAL
PERFORMANCE: THE CASE OF ELSEWEDY CABLES ETHIOPIA PLC
Date:

The study's overall objective is to ascertain the influence of workplace diversity on

organizational performance at Elsewedy Cables Ethiopia PLC. The study will strive to achieve
three particular goals: to investigate how age, gender diversity, and ethnic diversity affected the
performance of Elsewedy Cables Ethiopia PLC.

Please read each query carefully and respond to it to the best of your ability, mrk [√] the boxes
supplied where necessary. There are no correct or incorrect answers; your replies are critical to
the study. All responses to this survey are 100% private. Any identifying information will be
removed during data entry and analysis; nonetheless, you are encouraged to respond
anonymously. The questionnaire will take approximately 20 minutes to complete.
Thank you for taking part in this research.

PART 1: BIOGRAPHICAL INFORMATION

1. Please indicate your age.

2. Kindly indicate your gender.

[ ] Male [ ] Female

3. Please specify your ethnicity & nationality

4. Kindly show your educational level.

[ ] Bachelor’s Degree
[ ] Postgraduate Diploma
[ ] Master’s Degree
[ ] PhD

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5. Some of the most visible differences in your organization that affect organizational performance
are listed in the Table. Please prioritize in order of importance (with 1 being least important and
5 being most important)
Least Important to Most Important
Types of Diversities
1 2 3 4 5
1. Age Diversity
2. Gender Diversity
3. Ethnic Diversity
4. Educational Diversity
5. Religious Diversity

PART II: IMPACT OF AGE DIVERSITY ON ORGANIZATIONAL

PERFORMANCE

6. The Table shows some of the dimensions of organizational effectiveness that are influenced by
age diversity. Please indicate the one you believe is most affected by age diversity in order of
importance.
Features of firm Performance Least Important to Most Important
affected by Gender Diversity
1 2 3 4 5
1. Creativity and innovation
2. Intra-organizational
communication
3. Product and service quality
4. Decision-making

7. Indicate your company's level of creativity and innovation on a scale of 1 to 5.

[ ] Not sure [ ] least creative and innovative

[ ] Somewhat creative and innovative [ ] Quite creative and innovative

[ ] Very creative and innovative

8. Do you believe that age diversity has had a beneficial or bad impact on creativity and
innovation in your company?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

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9. Is it easier or more difficult to make decisions at your company?

[ ] No Effect [ ] Very hard

[ ] Hard [ ] Easy
[ ] Very Easy

10. Do you think age diversity makes decision-making in your company more difficult or
easier?
[ ] No Effect [ ] Makes it very hard
[ ] Makes it hard [ ] Makes it easy
[ ] Makes it very easy

11. Indicate the quality of your firm's products and services on a scale of 1 to 5.

[ ] Not sure [ ] poor quality products/services

[ ] Somewhat quality products/services [ ] Good quality products/services
[ ] Very high-quality products/services

12. Do you think that age diversity improves product and service quality because of the
diversity of ideas and knowledge?

[ ] No Effect [ ] Mostly negative effect

[ ] Negative effect [ ] Positive effect
[ ] Mostly positive effect

13. Do you think it's easy to communicate among your company's employees?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

14. Has the age variety in your business made communication simpler or more difficult?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

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15. How has age diversity influenced problem-solving in your organization? Has it made
things easier or more difficult?

[ ] No Effect [ ] Very hard

[ ] Hard [ ] Easy
[ ] Very Easy

PART III: IMPACT OF GENDER DIVERSITY ON ORGANIZATIONAL

PERFORMANCE

16. The Table shows some of the dimensions of organizational effectiveness that are influenced by
gender diversity. Please rank the one you believe is most affected by gender diversity in order of
significance.
Features of organizational Least Important to Most Important
Performance affected by Gender
Diversity 1 2 3 4 5

1. Job Satisfaction

2. Quality of management and

leadership
3. Organizational culture
4. Organization’s competitive
advantage

17. How would you rank your company's management and leadership?

[ ] Not Sure [ ] Very poor

[ ] Poor [ ] Good
[ ] Very good

18. How would you rank the influence of gender diversity on the quality of management and
leadership in your organization?

[ ] Not Sure [ ] Very poor

[ ] Poor [ ] High
[ ] Very high

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 19. Do you believe your company is extremely competitive in comparison to competitors?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

20. What, in your opinion, is the nature of the influence of gender diversity on your company's
competitive advantage?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

21. Are you happy with your job?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

22. Do you think the gender diversity in your company influences your present job
satisfaction?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

23. Do you think the gender diversity in your company influences your
present job satisfaction?
[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

24. To what extent does your company's gender diversity influence its organizational culture?

[ ] Not Sure [ ] to a minimal extent

[ ] not at all [ ] to some extent
[ ] to a great extent

77
25. In general, what impact do you believe gender diversity has on your organization's
performance?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

78
 PART III: IMPACT OF ETHNIC DIVERSITY ON ORGANIZATIONAL
PERFORMANCE

1. The Table shows some of the dimensions of organizational effectiveness that are
influenced by ethnic diversity. Please rank the one you believe is most affected by ethnic
diversity in order of significance.
Features of organizational Least Important to Most Important
Performance affected by Gender
Diversity 1 2 3 4 5

1. Corporate reputation
2. Employee productivity
3. Team performance
4. Job satisfaction

2. How would you rate your company's reputation?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

3. To what extent do you believe ethnic diversity has influenced your firm's reputation?

[ ] Not Sure [ ] to a minimal extent

[ ] not at all [ ] to some extent

[ ] to a great extent

4. Do you believe that ethnic diversity improves team effectiveness in your company?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

79
5. Some of the factors of ethnic diversity that influence team performance are listed in the Table.
Please list the factors that you believe have the greatest impact on team performance in the order
of priority.
Least Important to Most Important
Features of ethnic Diversity that
affect team performance 1 2 3 4 5
1. Different viewpoints in a
problem/task
2. Variety of knowledge and
experiences.
3. Diverse skills-set regarding a
problem/task
4. Job satisfaction

6. Do you think working with colleagues of different ethnicities has affected your
productivity?

[ ] Not Sure [ ] Strongly Disagree

[ ] Disagree [ ] Agree
[ ] Strongly Agree

7. About your response above (in question 31), how would you describe the impact of this
impact on your level of productivity as an employee?

[ ] No Effect [ ] Mostly negative

[ ] Negative [ ] Positive
[ ] Mostly positive

8. Do you like your job because you get to work with people from different ethnic
backgrounds?

[ ] No different [ ] Very dissatisfied

[ ] Dissatisfied [ ] Satisfied
[ ] Very Satisfied

9. What impact do you believe ethnic diversity has on communication and information
exchange in the workplace?
[ ] No Effect [ ] Mostly negative
[ ] Negative [ ] Positive
[ ] Mostly positive

80
10. Is ethnic diversity beneficial to your company's performance?

[ ] None at all [ ] to a little extent

[ ] to a great Extent [ ] extensively

------END--------

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