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Albert Einstein said:
“The significant problems we face cannot be solved at the same level of thinking we were at when we created them.”
In many ways, this quote sums up why diversity matters. Today, due the the increasing pace of change, new challenges and problems emerge faster than ever before. Those businesses that fail to solve them will fall behind and eventually fail.
So with so much at stake, how can organisations become better at problem solving? One thing is for sure. The answer doesn’t lie in building teams of people from similar backgrounds who all think in the same way. An inability to see a situation from a variety of perspectives often results in repeated attempts to force square pegs into a round holes.
Diversity is critical to an organisation’s ability to adapt to a fast changing environment. In Darwinian terms, diversity makes an organisation much “fitter”. Diversity breeds innovation and innovation breeds success. This isn’t conjecture. The proof is in the numbers.
You can Deliver Growth Through Diversity
A 2015 Mckinsey report found that companies in the top quartile for gender or racial and ethnic diversity were more likely to have financial returns above industry mediums. Companies in the bottom quartile were statistically less likely to achieve above average returns.
The authors of the report also highlight that diversity is probably a competitive differentiator that shifts market share toward more diverse companies over time. More diverse companies are better able to win top talent and improve their customer orientation, employee satisfaction, and decision making. All that leads to a virtuous cycle of increasing returns.
The findings of the Mckinsey report and other similar studies are driving widespread change in attitudes around diversity. Previously seen as a ‘nice to have’, diversity is fast becoming essential. While this is indeed a welcome change, it sometimes has an unfortunate consequence: the relegation of diversity to a mere box ticking exercise.
Diverse Companies Deliver Increased Revenue
We live in an interconnected world where diversity, shaped by globalisation and tech advancement, forms the very fabric of our world.
Businesses have the right balance of transformative power and empowerment to make a massive difference here. Another great bit of news is that revenue uplift is a natural bi-product of investing in diversity.
A recent study by the Boston Consulting Group (BCG) has found that diversity increases the bottom line for companies. The study found that “increasing the diversity of leadership teams leads to more and better innovation and improved financial performance.”
It looked at 1700 different companies across 8 different countries, with varying industries and company sizes. They have found that increasing diversity has a direct effect on the bottom line. Companies that have more diverse management teams have 19% higher revenue due to innovation.
These are the facts and they’re massive for tech companies and start ups everywhere where growth is of massive importance.
Diversity Won’t Undermine Talent
As with any new trend, many organisations are ‘jumping on the bandwagon’. Some diversity and inclusion initiatives are driven by a desire to ‘look tolerant’ without putting in all the necessary research and thought. When diversity becomes a box-ticking exercise, it takes the soul and meaning out of inclusivity. It’s simply being diverse for the sake of it. Usually all this does is give rise to an entirely new set of problems e.g. quotas and positive discrimination.
Nobody wants to feel as if they only got a particular job because of their race or gender. While there are great benefits to be gained through encouraging more diversity, it is paramount that the principle of hiring on merit is not compromised. Otherwise it undermines people’s talent. Diversity is about organisations being more open-minded in what they want, but still getting the best person for the job.
Diversity Acquires New Talent
We look for something more than just a good benefits package these days. In fact, the range of different criteria for how we rate a new employer is massive. However, we know that diversity is high on that list.
The 2018 Deloitte Millennial Survey shows that 74% of these individuals believe their organization is more innovative when it has a culture of inclusion. If businesses are looking to hire and sustain a millennial workforce, diversity must be a key part of the company culture. This 2016 survey shows that 47% of millennials are actively looking for diversity and inclusion when sizing up potential employers.
And when the global workforce will be 75% Millennials by 2025, it’s now or never.
Creating a culture that values diversity
As an IT recruitment agency we are afforded a unique insight into the ever-simmering discussion around diversity in tech – it’s no secret that the gender ratio in tech skews heavily male. So diversity is an issue we encounter on an almost daily basis.
However, through our engagements with tech leaders and HR professionals, one thing is becoming increasingly clear: people are more bought in and committed to diversity than ever before. Below we’ve outlined how many organisations are changing their processes to create a culture that values diversity and inclusion.
In order to fully embrace diversity, leaders need to create diversity policies that cover all aspects of the organisations functions. It’s important that these policies are directly connected to business strategy. In order to succeed, diversity needs to be defined within the scope of the businesses mission and be fully aligned with its objectives. One-size-fits-all policies should be avoided as they need to meet the diverse and changing needs of employees and customers.
Having a diverse workforce begins with recruiting diverse talent. This is best done via a range of different strategies. Organisations that are committed to building a diverse workforce tend to rely on a variety of approaches:
- Getting involved in community development opportunities e.g. learn to code camps and junior hackathons.
- Build partnerships with diverse organisations e.g. Tech Talent Charter, Code First: Girls
- Provide robust training for recruiters and talent management employees on the needs and potential of different demographics.
For global companies different cultures also impact recruitment strategies. For example, the same company with offices in three different countries may have very different priorities on talent acquisition from location to location. Cultural norms and geography play a large role in the success of a diverse recruiting and talent strategy. It’s also important to note that recruitment doesn’t stop once candidates are hired. Diverse employees also need to be engaged and retained.
Once you have diversity initiatives in place, you need accountable and committed leadership to engage employees in new practices – and get them to engage with one another. One way to do this is through better communication. Design on-going communication systems which place an emphasis on why diversity is important and what it means to the organisation. These systems should encourage peer to peer learning and knowledge sharing with the aim of increasing awareness around issues related to diversity. Training is another important aspect of achieving diversity goals. This could include things like cross cultural mentoring programmes and employee led learning sessions.
Organisations with leaders who are actively involved in implementing diversity initiatives affect the wider culture by acting as role models for employees. Committed leaders can champion diversity by infusing it into all organisational processes. They recognise diversity as an important goal, and position the responsibility for meeting that goal not merely with HR departments or diversity offices, but with top-level executives – and themselves.