If the Value of Cultural Diversity outweighs Gender Diversity, why does it remain so elusive in senior teams?
As we reflect on the national and international events which brought the #Black Lives Matter movement front and centre, consciously tapping into our Cultural Diversity offers the opportunity to achieve a significant “Diversity Dividend” for business, whilst increasing social cohesion and contribution.
Whilst there has been significant focus and attention on the value of women in leadership in increasing business performance, there has been much less discussion and focus on the value of Cultural Diversity. (R. Alembakis quoting L. Annese)
This would appear to be a missed opportunity for business (and of course individuals), as Cultural Diversity in leadership has a higher degree of impact, and rate of return than some other types of diversity.
Please note: we’ve also written blogs on how to create Cultural Safety in the workplace focussed on organisational systems and policies, Interpersonal Cultural Appreciation, the impact of Cultural Identity on Wellbeing, and Belonging and the importance of Language. The common core of wellbeing for all minority groups is a helpful guide to creating psychologically safe and psychosocially safe workplaces.
The Value of Difference
McKinsey has consistently found Ethnic (Cultural) diversity in leadership offers between 10% – 12% higher likelihood of financial out-performance than Gender Diversity, whilst BCG confirms National Origin (Culture) has a higher statistical significance in achieving innovation revenues than Gender Diversity.
Whilst Lorenzo & Reeves, using the same data set, highlighted the cumulative effect of multiple types of diversity, the discussion is less about valuing one type of diversity over another, and more about highlighting the missed opportunity our diverse multicultural society and workforce offers, in achieving what is known as the “Diversity Dividend”.
Given the substantial dividends on offer, why have we failed to capitalise on the opportunity Cultural Diversity offers?
The “Diversity Discomfort Zone”, accounts for much of the explanation and occurs when there are significant differences between individuals’ approaches in decision making and interpersonal interactions.
As anyone who has travelled internationally knows, the more you need to “flex” your natural style, the more pronounced the discomfort becomes.
Diversity Discomfort isn’t just limited to different countries and cultures, it can be experienced in any context where there is material discomfort as a result of difference. For example, discomfort can occur between different departments in organisations, due to significant variations in thinking style and operating modes.
Whilst it’s human nature to shy away from difference and discomfort, it is that very difference which is the reason diverse teams consistently solve complex problems more effectively than homogenous teams. (S. Page).
Diverse teams have an inherently wider range of operating styles and interpersonal approaches and are less prone to becoming “stuck in thinking ruts” (patterns) to the same extent like-minded, homogenous teams do.
Diverse teams have an inherent “Diversity Advantage” which enables them to explore a wider range of potential solutions and outcomes.
Diverse teams which overcome discomfort and consciously leverage their inherent advantage, consistently out-perform their peers and realise a “Diversity Dividend”.
Does the Presence of Diversity Guarantee the Diversity Dividend?
The clear answer is No.
McKinsey and BCG identified 2 common factors which need to be present in top performing organisations, in addition to diversity:
systemic organisation factors such as a conscious diversity strategy which is supported by systems and processes
specific types of interpersonal interactions modelled by leaders and practiced by teams.
Drawing on Academic and Industry Research (Page; Edmondson; Google & Pentland), below are 5 proven practices both leaders and teams, can utilise to realise their inherent Diversity Advantage. And the good news, this approach in any team, not just diverse teams.
Leaders who consciously and consistently “set the stage” by giving teams explicit permission to embrace their Diversity Discomfort, will be more likely to leverage their inherent natural advantage.
Teams which enable roughly equal (formal and informal) interpersonal interactions between team members, will expose everyone’s unique perspectives and knowledge, creating a wider field of view.
Teams willing and trained to ask authentic and humble questions in the spirit of goodwill, will uncover previously unknown and unseen information, enabling creative new solutions and outcomes.
Teams willing to explore, fail and learn from each other, and are willing to be vulnerable in front of one another when they don’t know the ‘correct answer’, are more successful in developing an organic approach to creating new and improved processes and products.
Lastly, leaders who create an environment in which it is safe to speak up and challenge traditional thinking, is one where innovation can surface and thrive.
Cultural Inclusion IQ™ offers Leaders and teams a way to overcome their natural “Diversity Discomfort” and achieve “Diversity Dividends” in the form of top quartile innovation and business performance.
