“What goals, if any, should they set for the effect of therestructuring on the composition of Shell’s managerial workforce?Justify your views.”
Royal Dutch Shell’s newly appointed CEO, Peter Voser, planned onadjusting the company’s business to adapt to altering economicconditions following an economic downturn. In doing so, Voser plannedan organizational restructuring. The restructuring was aimed atstreamlining Shell’s structure, minimizing expenditure andimproving the implementation of projects. However, Voser faced anumber of challenges in his plan to restructure. Shell was one of theearly players in the oil and gas industry to put into practicediversity and inclusion policies. The new CEO must decide whether tocontinue supporting the company’s diversity and inclusion policiesduring the restructuring on the managerial workforce composition.
Therefore, Shell must set goals for the effect of restructuring. Itmust ensure the reflection of its diversity as well as inclusionapproach during restructuring on its managerial staff composition.The goals include obtaining a diverse managerial workforce throughdifferent employment strategies and retaining managers that meettheir diversity and inclusion criteria, skills and knowledge.
It is anticipated that following the restructuring, the number ofShell’s managers will reduce drastically. Such a reduction makes itharder for the company to have a managerial workforce that meetsdiversity and inclusion targets. According to the case study, “Voserwondered whether the reorganization would be a step forward,backward, or a holding pattern for their diversity and inclusiongoals (Sucher & Corsi, 2012:1-2).” Thus, a reduction inpositions makes it harder to meet such targets due to the lack ofenough positions to ensure a diversified and inclusive workforce.Voser has made it clear on the requirement for an organizationalstructure that is flatter and comprises of minimal hierarchicalstages. Bearing in mind that a third of the managerial workforce isanticipated to leave following the restructuring, the remainingworkforce must be made up of managers that can effectively handle thechanges occurring at Shell.
Obtaining a diverse managerial workforce through differentemployment strategies – during the process of restructuring, thecompany should not merely focus on reducing a third of its managementstaff. Rather, it should be an opportunity to work towardsdiversifying management. By doing so, Shell works towards having themanagement structure it desires. According to Graan and Ukpere (2012:11918), any restructuring initiative by an organization shouldcomprise of actions that result in creation of the preferredorganizational structure. Such a diversified management structure canbe achieved through changes in staffing strategies. The employmentstrategies most applicable in this case study are ethnocentric andpolycentric staffing. Ethnocentric staffing means staffing managementpositions with staff from the organization’s home country (Drachal,2014:85). In polycentric staffing, an organization employs staff fromthe host nations (Drachal, 2014:86).
The goal is justified because through the employment strategiesShell’s managerial staff will comprise of a diversified andinclusive workforce. Diversity is defined as the mixture ofsimilarities and disparities, which involve for instance “individualand organizational characteristics, values, beliefs, experiences,backgrounds, preferences and behaviors (Talent Intelligence,2014:1).” It can either be visible or invisible. Visible diversitymight comprise of age, race and gender. Invisible diversity might bereligion, education and social status. On the other hand, inclusionrefers to attaining a work environment where all people are treatedwith respect and fairly, are able to access resources andopportunities evenly, and can contribute to the success of anorganization (Talent Intelligence, 2014:1).
Through ethnocentrism and polycentrism, Shell will combine thedifferent backgrounds of managers from its home country and those ofhost nations to work together. It ensures that management does notmerely comprise of staff from Shell’s home country or those of thehost. Since restructuring is aimed at reducing the number ofmanagers, Shell can use these employment strategies to reduce thenumber of managers from the organization’s home country working ina host nation. As a result, the company will retain only the requirednumber of home country managers to work with the host nation’smanagers. In the process, it creates a managerial workforce that isinclusive of locals and internationals, is diversified in terms ofrace, values and beliefs among other factors.
The other goal is to retain managers that meet diversity andinclusion criteria, skills and knowledge. According to Jordan(2015:1), the journey towards an organization becoming inclusivestarts with assessing organizational systems to validate the extentto which equal access is afforded to all. Jordan’s point issupported by the organizational development model to diversity. Themodel necessitates an initial evaluation of an organization’sposition in regard to diversity and the vision of where itanticipates being in future (Holvino, Ferdman & Merrill-Sands,2004:256). The evaluation makes it possible for the organization toidentify whether it has made progress or still needs to improve inits diversity and inclusion.
In reference to the goal of retaining managers during restructuring,as suggested by Jordan (2015:1) and Holvino et al. (2004:256), thecompany must first evaluate its managerial workforce. The goal isjustified because the evaluation involves identifying those managersthat depict Shell’s dedication towards being inclusive and diverseand ensure they are retained. This solves the challenge on how toadvance D&I while restructuring.
Drachal, K 2014, What do we know from EPRG model? Ecoforum,vol.3, no. 2, pp. 85-92.
Graan, J & Ukpere, WI 2012, An inclusive approach to structuraltransformation in organizational restructuring, African Journal ofBusiness Management, vol. 5, no. 50, pp. 11916-11922.
Holvino, EH, Ferdman, BM & Merrill-Sands, D 2004, Creating andsustaining diversity and inclusion in organizations: Strategies andapproaches, In MS Stockdale & FJ Crosby, The psychology andmanagement of workplace diversity, Malden, MA: Blackwell.
Jordan, TH 2015, Moving from diversity to inclusion, DiversityJournal. Available from:http://www.diversityjournal.com/1471-moving-from-diversity-to-inclusion/
Sucher, SJ & Corsi, E 2012,Global diversity and inclusion atRoyal Dutch Shell (A), Harvard Business School, pp. 1-23.
Talent Intelligence 2014, Inclusion and the benefits ofdiversity in the workplace. Available from:http://www.talentintelligence.com/blog/bid/377611/Inclusion-and-the-Benefits-of-Diversity-in-the-Workplace