Driving Business Impact through Diversity, Equity & Inclusion
By seeking out people of different races, ethnicities, genders, ages, religions, abilities, sexual orientations and more, organisations and teams have an opportunity to capture a richness of thought and experience, which quite simply leads to a raft of top and bottom line business (and human) benefits.
Show me an organisation that wouldn’t want to harness the value of that in today’s chaotic world!
Diversity brings higher value collective intelligence, of which the most compelling outcomes are better decision making, organic and out-of-the-box innovation and more. It’s no wonder Diversity is such a focus for organisations wanting to renew and reinvent their business.
Instead of two or three approaches to any problem, a diverse organisation or team is endowed with many solutions including, as Harvard Business Review found, being 70% more likely to capture new markets.
Embracing Diversity and Practising Inclusion offers endless potential and opportunity – but you need both elements to optimise it.
Diversity and Inclusion rarely occur by accident, they are the product of a considered strategy and conscious execution, which, when well-executed, create material business dividends, that positive intentions alone simply don’t deliver.
Some Compelling Business Impacts
For those looking to convince your Executive Team of the business impact of a robust D, E & I strategy, you may wish to consider the following, which are just the tip of the iceberg:
The Workplace Gender Equality Agency report (2020) found that profitability, performance and productivity increase under female leadership, and female top-tier managers add 6.6% to the market value of ASX-listed companies (worth the equivalent of AUD$104.7 million).
The Diversity Council recently confirmed a raft of compelling business outcomes are the result of Inclusive Workplaces; including increases in: innovation (10x); customer connection (6x); retention (4x), employee engagement (10x) and wellbeing (4x).
McKinsey’s Diversity Matters report found companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective national industry medians.
Forbes reports that inclusive teams make better business decisions up to 87% of the time.
Market and Workforce Expectations are Changing
Investors increasingly expect to see disclosures around environmental, social and corporate governance (ESG) measures, with allocation of capital increasingly informed by these measures. If your organisation isn’t serious about diversity and inclusion – or you lack metrics to support your commitments, you are increasingly likely to miss out on future investment.
Promoting diversity and banishing unconscious bias is a no-brainer.
Diversity at an Organisation level
The first hurdle many managers and leaders face is quantifying (and qualifying) the extent of bias within their organisation. Workplace diversity encompasses a wide range of experiences, educational backgrounds, skillsets, beliefs, operating styles and personalities. Further, some organisations are starting to harness the unique talents and contributions of neurodiverse thinkers.
Sometimes a lack of diversity is obvious, for instance, not a single female CEO was appointed to ASX 200 companies in the past financial year. A lack of data on the demographics of your people can make it difficult to articulate the nature and extent of the challenge.
Surveys and Diagnostics can be helpful, however, at both an organisation and team level. Employee Engagement data analysed by diversity demographics, commonly tells a story of diminishing engagement and belonging for under-represented groups.
Structuring for Equity
To ensure Diversity is ‘hard coded’ into your organisation, it needs to be structured for equity.
Equity can be a challenging concept to understand, however we know under-represented talent face an array of unseen barriers in the workplace. The goal of equity is to create a level playing field which enables equal outcomes for everyone equally. This graphic paints the picture perfectly!
Essentially there are 2 approaches to creating equity across the full suite of employee lifecycle practices including: recruitment; hiring; promotion; remuneration; development, physical and psychological safety etc..
Putting systems and structures in place to enable a level playing field for under-represented groups, or
Removing Barriers which places everyone on a level footing.
A common example of systems and structures which support equity, are pay audits to ensure everyone is paid equitably, whilst an example of removing barriers is Workplace Flexibility (“all roles flex”) policies which enable everyone equally to access and contribute to the workplace.
With Australia facing a chronic skills shortage and the potential for what’s become known as The Great Resignation due to a re-evaluation of personal and professional priorities, any organisation or manager that broadens their recruitment and promotion net to capture a bigger pool of potential talent, will likely boost their organisation’s diversity and enjoy a competitive advantage to boot.
Diversity in Teams
A lack of diversity and inclusion in teams can be harder to spot and is less commonly measured, for example Diversity of Thought and the Practice of Inclusion.
Behavioural or cultural profiling tools code behaviour and personal traits, offering a powerful way for leaders and teams to identify and leverage a breadth of thinking, communication styles and life experiences.
Teams which have a mature approach to leveraging diversity, consciously decide to spot the genius in everyone equally, and leverage it to enhance decision making and outcomes in their team.
I’ve worked with sales teams for example, which have increased their intelligence gathering efforts by consciously placing assertive ‘masculine’ style communicators with flexible nuanced problem solvers.
The Value of a “Culture Add” Approach
What these teams consciously decide to do is avoid one of the biggest traps we tend to fall into, ie. living by the traditional concept of “Culture Fit”. The Diversity enabler of “Culture Add” offers tremendous opportunity to add assets we would have previously (unconsciously) counted out.
It requires a mindset ‘flip’ – but once your eyes are open to the potential value someone’s unique assets offer, you become aware of a world of opportunity you’ve previously failed to recognise.
Diversity in the Boardroom is an outstanding example of Culture Add.
Boards of Directors commonly use a ‘skills matrix, to ensure each board member is selected based on a specific, required contribution. Effectively it’s a jigsaw puzzle, with the goal being to complete the whole puzzle.
One person may have accounting qualifications, while another brings industry experience. This means everyone at the discussion and decision making table is acutely aware that each director is bringing something of value, and all opinions are respected accordingly.
It’s also common practice for the Chair to ask for every individual’s perspective on a topic. It’s an approach any team, at any level, can find value in.
The Importance of Psychological Safety
It’s important to keep in mind not all our talents and strengths are in the public domain, so the more psychologically safe the environment is, the more likely you are to tap into the deepest insights and “you-unique” perspectives individuals can offer.
Equally, in a multicultural society like Australia, just because someone looks different doesn’t mean they have the life experiences an overseas national from the same culture may offer. It’s not to say their experience is any less valuable, however, it will be different.
Harnessing Diversity, Equity and Inclusion for the Future
Leveraging diversity in your team or organisation is not something you want to miss out on - it’s not just what today’s workforce crave, it’s a powerful business strategy which delivers meaningful quantums of financial (and human) impact.
Taking a data driven approach to understanding what robust Diversity and Inclusion strategies are, together with validated diagnostics to help you obtain some robust analysis of your organisation and team’s strengths and opportunities, will go a long way to realising the Industry Leading results unique to Diverse and Inclusive Organisation and Teams.
At I LEAD Consulting we enable diverse teams, Inclusive Leaders and Collective Cultures to achieve the highest degree of performance and impact.
PRACTICE INCLUSION | EMBRACE DIVERSITY | ACTIVATE ALLIES
Elements of this article were initially published by Institute of Managers and Leaders
