In recent years, attitude towards diversity have shifted to one of inclusion.
Many corporations have embraced diversity and inclusion as a company mandate, ensuring that their workplaces are equal opportunity and accepting of all creeds, colours and ages across the spectrum.
Why the sudden change?
With the advent of the world wide web leading to increasingly globalized and interconnected markets, corporations and work spaces have had to adapt, especially if they want to remain competitive in the global marketplace.
To put it simply; you can’t attract and retain the best talent if you close yourself off to an entire subset of the population, especially when you’re conducting business internationally.
But asides from increasing the hiring pool and becoming more politically correct, are there any tangible benefits from having a diverse workplace?
There are plenty, and here’s what we’ll go over:
4 Reasons How Diversity Increases Your Bottom Line
- More equipped to deal with challenges
- Greater innovation and creativity
- Lower employee turnover
- Boosts company image
1. More Equipped To Deal With Challenges
Companies with diverse leadership teams have reported 19 percent higher revenues compared to those without diversity in their workplaces.
A diverse management team is simply better equipped to bring a variety of solutions and answers to a problem. Diversity in the workplace means diversity of minds, ideas and solutions.
Having a plurality of experiences and knowledge to draw from, a diverse team is more readily able to respond with a diverse set of solutions, reducing the time it takes a business to clear roadblocks to productivity.
Additionally, a culturally and linguistically diverse team may provide important insights into foreign markets, help recognize foreign business opportunities and provide valuable product design knowledge that’ll help it sell in other countries.
2. Diversity Encourages Greater Innovation And Creativity
Going off of our previous point on how diverse workplaces can make employees feel more comfortable and safe, diversity in the workplace can also serve to increase innovation and motivation.
Equality in the workplace tells employees that they are always on equal footing with one another; that no one employee stands above another.
This safe environment can encourage workers to more confidently execute on their ideas and take risks that they might otherwise not have taken in a homogeneous environment.
Data supports this – Harvard Business Review has found that cognitively dissimilar teams solve problems faster than their cognitively similar counterparts.
In today’s globalized business environment, people want to be included, accepted and involved in their team – perhaps more than ever before.
A diverse workplace is so important that 6 percent, or a whole 2/3rds of active and passive job seekers say that it’s a necessity when considering job offers.
3. It’s Much Easier To Hire And Retain Talent
Workplace diversity is something that many talented people actively seek out in their job search.
For starters, having a diverse and inclusive workplace will not only make you attractive to 67 percent of job seekers on the market today. It will also aid in retaining those talented people.
A study published by the University of Wisconsin has found a direct relationship between diversity and retention rates.
The consensus seems to be that when people enjoy what they do, feel included, heard and respected within the work culture and get fulfillment from working in a supportive team, they’re more inclined to stay.
What’s especially poignant is that these fulfilled employees feel a sense of purpose and community – 2 things that diversity in the workplace can foster.
4. Boost Your Company Image
In today’s sociopolitical climate, the worst thing any public corporation or firm can do is be openly anti-inclusive and discriminatory.
In 2015, the United States Supreme court ruled in the favour of a Muslim woman claiming the company discriminated against her religious beliefs and attire.
Since the landmark ruling, the fast fashion retailer has seen their sales fall dramatically and their discriminatory policies and practices come under scrutiny.
There has been a growing public awareness of companies diversity and inclusion (or lack of them) in the last couple of years. This thinking extends beyond employment seekers.
A study done by PwC in 2017 found that of the people they surveyed, 54 percent of women and 45 percent of men had researched whether or not a company had diversity policies in place. That is, they researched this before deciding on accepting a position from them.
Whether you’re a leader or an employee, this is certainly something to think about.
Today, some corporations still struggle with implementing a diverse and inclusive workplace, but there are also some who have gone above and beyond in making sure their employees feel accepted and included.
Here are a few:
Recognized as one of Canada’s best diversity employers of 2019, Accenture has been making huge strides in cultivating a diverse workplace.
The company has a formalized strategy to achieve diversity and inclusion goals as well as company training on unconscious bias, disability in the workplace and a global LGBT Ally training program.
Another one of Canada’s best diversity employers, international software development corporation IBM has a Chief Diversity Officer to formally oversee diversity and inclusion initiatives.
The firm also offers training on leading without bias, micro-inequities and an LGBT+ Ally program. Recently, they published an industry whitepaper on gender diversity in the global workforce.
On top of that they’ve hosted multicultural women’s leadership workshops across their various office locations.
Envisioning a global non-discrimination policy and publishing an annual diversity and inclusion report, Nielsen is recognzied by Forbes as one of America’s best employers for diversity.
Nielson developed 3 External Advisory Councils that represent the African-American, Hispanic/Latino and Asian PAcific-American communities.
The company has been attempting to better recruit and retain a diverse pool of minority talent throughout its offices and the public are taking notice.
It is always best to learn and gather insights from leaders who have implemented diversity and inclusion programs within their companies.
Melissa Obleada, Hubspot’s Diversity & Inclusion Program Manager
Melissa Obleada has stated that she gets better arguments and ideas when she works with teams with diverse points of view. She acknowledges that creating a company with diverse teams inspires more creative ideas, but more importantly, it creates a corporate culture where people aren’t scared of speaking their minds and sharing their ideas.
Allen Lau, CEO and Founder, Wattpad
Allen Lau believes their company success as a start-up came from his ability to a global market through a team comprising of diverse employees from different backgrounds.
He and his co-founder Ivan deliberately decided to support additional languages on their app as they worked with people living in those countries. This contributed to the company’s success as those employees who later on provide insights that they required to strengthen their products and services.
There has been several research initiatives and scientific papers developed on workplace diversity and below are a couple of them.
Published in 2009 by the University of Illinois, a sociology paper made a case for diversity in the workplace in clear financial terms.
The paper illustrates that a workforce that was composed of both genders from varying racial backgrounds resulted in positive business outcomes.
His study showed companies who reported the highest levels of diversity in the workplace achieved, on average, 15 times more sales revenue compared to those companies with the lowest levels of racial diversity.
That’s not all – he also found that diversity accounted for a difference of $599.1 million in average sales revenue. And those with the lowest rates of gender diversity had $45.2 million in average sales.
Another paper published by Harvard Business School conducted a study comprising of 1069 companies, across 35 countries and 24 industries.
It showed that gender diversity-related more to productive companies, as measured by market value and revenue.
This only applied to those regions where gender diversity was viewed as ‘normal’ referring to a widespread cultural belief that gender diversity was important.
Key Takeaways For Diversity In The Workplace
For many years, corporate culture had previously shoehorned workplace culture through a very narrow range of differences.
Fortunately, times have changed as many employers have begun to awaken to the fact diverse work forces have the potential to scale up their businesses and positively contribute to their bottom line.
Here’s our list of key takeaways on why diversity pays off:
- Diversity leads to more revenue: A diverse management team has diverse ideas and won’t be as quick to shutdown radical or unorthodox solutions to existing problems.
- Diversity leads to increased productivity: Diverse workplaces also are also more comfortable and desirable, attracting impressive talent. Cognitively dissimilar teams also solve problems faster than their homogeneous equivalent.
- Diversity leads to a better public image: Whether you’re looking for a job or a consumer, diversity is desirable. Implementing a formal Diversity and Inclusion strategy will not only increase your company’s productivity and revenue, but boost your public image as well.