Project - Rough Draft

Topic Selection and Purpose Statement

Description of the organization

The National Banking Service is a financial institution with branches across the country.

The services offered range from loans, mortgages, financial advice services, investment, and saving schemes. It has over 3000 employees that are from different cultural orientations. This includes religion, nationality and race. This level of diversity has made it one of the most competitive monetary institutions across the country. Diversity in any organization may benefit the organization by providing solutions to its challenges or pose even more challenge to the organization. National Banking Service is an organization that recognizes the benefits of diversification because it brings in multitalented individuals within the organization thus increasing the productivity and competitiveness in the field. Diversity also improves the exposure of the employees to new activities brought in by colleagues. With such high numbers of diversity within an organization, one should always expect internal challenges but expect even better productivity in the end.

What challenges come from diversity?

There are various challenges that arise from diversity in an organization. They range from political challenges, cultural or even social challenges (Filson and Olfati, 2014). This can further be broken down to language barrier, cultural resistance, increased costs and discrimination among employees and their employers. National Banking Services faces most if not all of these challenges. However, one of the most prominent of them all is the increased cost that comes from cultural diversity. The organization has continued to incur more cost in trying to streamline its diversity and to ensure that the employees work as a team. The cost of training new employees and to get them absorbed into the system has continued to increase. This challenge also extends to when there are new employees from out of town or even out of the country. It is upon the organization to manage their transport as well as housing which increases the expenditures.

Why is this problem?

Excessive expenditure possess great danger to an organization ranging from reducing the income of the organization (registering low profits) or even lead to bankruptcy of an organization. It is a problem because it directly affects the organization as well as the market it serves. This runs down to affecting the wellbeing of the employees as well as the quality of production and competitiveness of the organization in the market. Money and time are therefore the most important assets of any organization that require wise spending. It is important to have clear budgeting and goals that the organization should attain them at the end of a specific period. As long as any organization spends more of its income in non-profitable activities, there is always a danger of falling into a crisis.

What challenges does it pose to the employees?

These challenges in some way will end up affecting the employees. In cases where organizations have undergone challenges that result from financial difficulties, they may resort to retrenchment. This includes reducing the number of employees in the organization or even reducing salaries and allowances of the employees (Al-Khasawneh, 2014). Reduction of salaries and other incomes to employees means that they also have to alter their budgets. Spending within their means is always the option. In some cases this employees can opt to take loans to sustain their budgets if they cannot adjust their expenditure, leading to even bigger financial burdens. This may also force the organization to stop future employments, denying jobs to other potential employees. In cases where organizations undergo extreme financial crisis and bankruptcy the usually opt to the winding up of the organization. This does not only affect some but all the employees within the organization. This leads to joblessness even more trouble to them.

What are some of the potential ramifications?

Increased cost has a direct impact on the organization’s income and profits. The return on investment may decline significantly and the attention of the organization turned to focus on the employees rather than the investment. Continuous focus on the employees can distract the organization from its main purpose. This as a problem because at the end of the day, the organization may undergo some loses. They may result to altering the budget and the target of the organization may not be achieved. Resources diverted to less productive projects rather than the main obligation of the organization and more time spent in events such as training new staff from diversified cultures impact negatively to the productivity of the organization if not well planned. It is therefore important to have a god planning system within the organization. This starts by having well informed and experienced personnel within the administration.

References

Filson, D., & Olfati, S. (2014). The impacts of Gramm–Leach–Bliley bank diversification on value and risk. Journal of Banking & Finance, 41, 209-221.

Al-Khasawneh, A. L. (2014). The Role of Knowledge Resource Diversification Strategy Management in Improving Organizational Learning among Employees at the Commercial Islamic Banks in Jordan. International Business and Management, 8(2), 101-111.