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Why creating an inclusive culture will make your business fly
Have you ever stopped to wonder whether diversity makes a difference to your business and its profitability? Well, it’s definitely worth careful contemplation.
Management consulting firm McKinsey has been examining diversity in the workplace for many years and recently produced a report entitled Diversity Matters. It found that:
- Companies in the top quartile for racial and ethnic diversity are 35 per cent more likely to have financial returns above their respective national industry averages.
- Companies in the top quartile for gender diversity are 15 per cent more likely to have financial returns above their respective national industry averages.
- In the UK, greater gender diversity on the senior-executive team corresponded to the highest performance uplift; for every 10% increase in gender diversity, EBIT (Earnings Before Interest and Taxes) rose by 3.5 per cent.
Therefore, its clear that every business should strive for a culture of diversity, understanding, and inclusion. Unfortunately, many may find it hard to implement practices and process that support this.
In this article, we look at the results of an experiment carried out by five leaders of the communications industry, in association with Tesco, that demonstrated when you bring more than 100 diverse individuals together to work on solving the problem, amazing ideas are generated.
Strength lies in differences, not in similarities
Three reasons why diversity works
The Great British Diversity Experiment was founded in July 2015 with the ambition to “prove that diversity leads to better solutions, experiences and ultimately a better world.”
In January 2016, 140 diverse people were recruited to the experiment, divided into 20 teams, and briefed on a challenge by Tesco to solve food wastage in the home. Here’s what it concluded:
- The authentic self – In order for someone to fulfil their creative potential and attain true job satisfaction, they need to feel their authentic self. Without diversity, people often feel like a token representation of their background rather than themselves.
- New connections, new solutions – Diversity gives individuals more raw materials to work with. Fresh collisions of personal experiences, references points, and cultural knowledge can fuel creativity. In short, diversity is the lifeblood of creativity.
- Meritocracy, not cultural consensus – With a diverse group, the things that seem right to one person will seem wrong to another. In this scenario, ideas win because they’re genuinely good, not because they appeal to one ‘type’ of person.
This quote from prominent educator, businessman, and author Stephen Convey says it all:
“Strength lies in differences, not in similarities.”
The Challenges of Diversity
In spite of the advantages that diversity can afford, it also presents a number of challenges. For the Great British Diversity Experiment, 32 per cent of participants expected a tougher time agreeing on things, while 39 per cent expected more arguments.
In many respects, these predictions turned out to be true. But in the end, the effort to overcome such obstacles is well worthwhile.
- Consensus is elusive – Shared cultural codes that groups may rely upon to find quick consensus are not as apparent when teams are more diverse. This is the flip side of meritocracy, which requires more time and more rigorous modes of consensus.
- Tokenism does not work – If people feel tokenistic gestures, they end up playing to a type or closing up. As a result, the power of having that individual there is gone. It’s about establishing a culture of ‘we are here because we are creative individuals who want to succeed.’
- The leadership challenge – On the surface, giving the floor to team members is empowering and democratic. However, leaders who hold back can also be the reason for problems, particularly when it comes to consensus building. The best leaders practice clear enablement, stepping in at the right time.
Conclusion – Diversity works for both the individual and the business
It is fair to say that diversity breeds better ideas, can improve performance, and leads to an enhanced culture. At the same time, diversity also makes your business more attractive from the outside in, which helps with hiring, and the inside out, resulting in highly engaged teams and longer tenures.
Food for thought
If you find it hard identifying a starting point for diversity, think of it in terms of creating an inclusive culture. Talent Heroes has many other articles that can point you in the right direction.
Talent Heroes is a people business. We’re contracted by clients to work in-house, attracting and hiring an unlimited number of staff, for an all inclusive monthly fee.