Why Diversity is Key to Productivity and Innovation
April 6, 2021
By: Katie Marchetti
BluWave has worked with hundreds of companies across a variety of industries ranging from manufacturing and consumer goods to information technology and healthcare. Despite the differences that exist between them, one thing remains constant: for today’s companies, innovation and diversity are inseparable. There is no bigger obstacle to the introduction and refinement of new ideas than groupthink, which is why the most creative companies are the ones that encourage robust discussion and debate from multiple perspectives. Diversity is not just a matter of recruiting employees with different backgrounds – it is an ethos that your company should seek to cultivate at every level.
How Diversity Can Be An Engine Of Productivity
Diversity is not just a goal companies should pursue for its own sake – it is a way to pressure test ideas and come up with novel and effective solutions to problems. This is why it should come as no surprise that diverse and inclusive work environments often lead to higher performance. For example, a 2018 Boston Consulting Group study found that “increasing the diversity of leadership teams leads to more and better innovation and improved financial performance.” Meanwhile, according to Deloitte, companies with inclusive cultures are twice as likely to meet or exceed financial targets.
Certain forms of diversity can lead to a reduction in negative outcomes for companies as well – a report from MSCI ESG Research found “fewer instances of governance-related controversies such as cases of bribery, corruption, fraud and shareholder battles” with boards that included women. However, while eliminating bias and increasing representation are essential to the health of a company, these are ways to address a more fundamental issue: diversity of thought.
When companies prioritize diversity of thought, they do not just become more innovative – they are also better able to identify and hedge against risk. Companies that value diversity of thought have access to a broader range of viewpoints and insights, and they make employees feel like stakeholders whose contributions are welcomed and appreciated. In turn, these employees are empowered to offer their perspectives without reservation and speak freely to managers about problems that need to be addressed.
Challenges To Diversity & Inclusion
A commitment to diversity and inclusion begins with equitable hiring practices, but this is an area that has always been rife with bias and discrimination. For example, studies in Sex Roles and the Proceedings of the National Academy of Sciences have found that female, black, and LatinX candidates were viewed as less competent and hirable than their peers. There is also evidence that women think they need to be more qualified than men do when applying for the same positions.
There are many ways to address these inequities in the hiring process. First, determine exactly what you are looking for in a candidate and consistently measure potential hires against a specific set of criteria. This can reduce the bias associated with subjective in-person interviews and identify a larger pool of qualified applicants. Second, develop lists of pre-vetted candidates (this is what BluWave provides to our clients) so you know everyone under consideration already meets your requirements, regardless of race, gender, etc. And third, consider hiring employees on a project-to-project basis (what I call the agile workforce). This will naturally bring a broader range of perspectives to the company because it means new employees are being hired on a regular basis.
Diversity in all its forms is becoming a top priority for companies in many different industries. To compete, the first step is building your hiring strategy around the discovery and recruitment of candidates who meet your needs and bring unique skills and experience to the table.
Promoting Diversity In All Its Forms
Companies are increasingly prioritizing diversity across a broad range of categories. As we discussed above, this does not just mean increasing demographic representation – it also means creating an inclusive culture that facilitates open dialogue and cooperation at every level of the company. Real diversity and inclusion require companies to listen to employees, take their contributions seriously, and amplify the widest range of voices possible. There are many forms of diversity – from racial to geographic to socioeconomic – and companies should celebrate and learn from all of them.
According to Gallup, one of the reasons one-third of employees feel disengaged at work is the perception that their viewpoints and concerns are not taken seriously. The survey found that just 30 percent of American employees strongly agree that their opinions seem to count at work. This should be a disconcerting fact to any company that values the diversity of thought – the majority of employees feel like their contributions are being dismissed, which will make them less inclined to offer suggestions and point out problems when they arise.
This is the opposite of inclusion, but companies can change course by actively seeking feedback via the voice of the employee platforms (which can highlight instances of bias or discrimination), encouraging managers to be receptive to all points of view, and breaking down silos that can separate departments and teams from one another.
Diversity is a word that pops up on corporate websites and in training handbooks often, but company leaders often have a superficial commitment to making their workplaces more diverse. But this status quo is rapidly changing as companies increasingly recognize that an emphasis on diversity does not just make the world a fairer place – it also leads to happier, more innovative, and more productive workforces that will have a greater economic impact.
The original version of this article appeared in People Talk.