Diversity and inclusion (D&I) in the workplace is a hot button issue. While there is no set way to increase the diversity of a company, there is growing evidence to suggest that there are many benefits for doing so.
An Indicator of Company Success
A growing body of research is showing that the success of a company can be predicted by the diversity of its workforce. Forbes.com cites:
“McKinsey’s research shows that gender-diverse companies are 15% more likely to outperform their peers and ethnically-diverse companies are 35% more likely to do the same.”
“Catalyst research shows that companies with more women on the board statistically outperform their peers over a long period of time.”
“Deloitte Australia research shows that inclusive teams outperform their peers by 80% in team-based assessments.”
The Bersin Study
Bersin by Deloitte conducted an extensive two year study to analyze how different talent practices affected the success of a business. The study examined 128 business practices in over 450 companies around the globe. Talent practices such as how well companies assess candidates for job and culture fit, how fair their performance management practices are, their culture of learning, and their level of maturity in leadership development were statistically analyzed against business performance in such areas as financial and talent outcomes, cash flow, profitability, innovation and growth.
So what did the study find? As Bersin states, “The results were amazing.”
Companies who were labeled as “inclusive” and “managed” are:
2.3 times higher cash cash flow per employee over a three year period
The smaller companies had 13 times higher cash flow from operations
1.8 times more likely to be change-ready and 1.7 times more likely to be innovation leaders in their market
3.8 times more likely to be able to coach people for improved performance, 3.6 times more able to deal with personnel performance problems, and 2.9 times more likely to identify and build leaders
“It’s striking to me that D&I rated the highest impact of all,” says Bersin. “It points out that in today’s working world, your ability to attract and retain people of all ages, cultures, backgrounds, and types is paramount to your businesses success.”
Diversity is Essential to Innovation
One of the greatest benefits of diversity and inclusion to a company is innovation. In any organization the sharing of ideas is critical for innovation and innovation, in turn, is key to the success of the company.
Teams with diverse backgrounds and cultures means the employees are exposed to ideas and concepts that are literally and figuratively foreign to them. Problems can be approached from different angles and a broader range of perspectives.
The Harvard Business Review states, “New research provides compelling evidence that diversity unlocks innovation and drives market growth – a finding that should intensify efforts to ensure that executive ranks both embody and embrace the power of differences.”
Diversity is Good for Client Relationships
A culture of diversity, inclusion, and acceptance can have an impact on the productivity of your business, but it is also good for client relationships. This doesn’t mean that you should tout your D&I initiatives as a marketing ploy, but when you create a culture of diversity and inclusion it fosters a more positive brand, which clients notice. A higher brand profile is good for attracting new clients, as well as capturing the attention of new skilled talent.
The benefits of having a more diverse workforce are well documented. A clearly defined diversity and inclusion plan has many positive impacts on your business, from increased productivity to higher employee morale. If you are ready to boost the diversity and inclusion of your workforce, contact the experts in growing your staff!