The Big Three: Diversity, Equity, and Inclusion…
A diverse workplace is an inclusive environment that provides equal rights and opportunities for all workers, regardless of gender, color, age, ethnicity, physical ability, sexual orientation, or religious beliefs. Employee diversity also includes acquired traits such as areas of study, industry background, career path, and foreign work experience. Diversity is no longer an option but a necessity for leading a successful enterprise. In today’s fast-paced and changing world, the workforce is a company's most precious asset. Cultivating a workplace where diversity is celebrated and promoted increases the overall well-being of employees and positively impacts companies' profits. But concretely, what are the perks of having a diverse workforce? Let’s dive in!
Enhanced Decision-Making Process
Fueling Innovation
Elevating Employee's Engagement
A Magnet for Top Talents
Numerous studies, including research by McKinsey & Company, affirm the profound impact of diversity on business outcomes. Companies excelling in gender and ethnic diversity demonstrate a considerable advantage, with a 15% to 35% increased likelihood of outperforming their industry peers. The benefits, however, extend beyond statistical advantages; they manifest in tangible ways that significantly contribute to organizational success. (1)
1/ Enhanced Decision-Making Process
Diverse teams enhance cognitive action, decision-making, and task accomplishment. According to a study by Cloverpop (2), teams excelling in both inclusive decision-making and execution outperformed their average counterparts by an impressive 60%. Companies that have a homogeneous type of hires tend to give the illusion of a well-oiled machine. This illusion operates smoothly because everyone agrees with one another, and there is less space for debate and different perspectives. A company that has a diverse team can improve the overall performance by its team's ability to raise concerns and ask valid questions that may not have been identified otherwise. In an article from the Harvard Business Review titled "Diverse Teams Feel Less Comfortable – and That’s Why They Perform Better," the authors emphasize this perspective. (4) When delving into a study on decision-making involving participants solving a murder mystery, the authors elaborate that in a homogeneous team, collaboration feels smooth, and progress seems evident. However, contrary to intuition, when dealing with a problem where none of the team members knows the correct answer, adding an outsider doubles the chances of arriving at the correct solution. While the process may feel more challenging, the outcomes are significantly improved, with success rates increasing from 29% to 60% (4). Having diverse teams forces help to anticipate alternative viewpoints, which makes reaching a consensus more challenging but valuable.
2/ Fueling Innovation
The decision-making process takes into account the cultural awareness, which is improved and increased by a diverse workforce. Employees need to feel safe to share their opinions; otherwise, the omertà continues, which penalizes your company from performing better. It is important to underline that diversity goes hand in hand with inclusion. The decision-making process takes into account the level of creativity of the employees. So, the more there are differences in age, color, backgrounds, gender, and, the more bubbling will your company's ability to create novel ideas increase. DEI has been proven to have a positive impact on innovation. The Wall Street Journal's corporate ranking on diversity and inclusion among S&P 500 companies supports the idea of diverse groups being more innovative and productive (5). Employees from different background have different life experiences, career path, degrees and many other aspects of their life journey that influence the level of innovation a company is capable to have and cultivate. The innovation emanates from each employees and their collaboration, not from your company as an abstract idea. This is an important reminder for companies that are aiming to be more innovative in terms of product conception, internal process or marketing approach, for example.
3/ Elevating Employee's Engagement
The Institute for Employment Studies defines employee engagement as: ‘a positive attitude held by the employee towards the organization and its values. (6) An engaged employee is aware of the business context and works with colleagues to improve performance within the job for the benefit of the organization. The organization must work to develop and nurture engagement, which requires a two-way relationship between employer and employee.’ During the pandemic, companies had to double their efforts to keep their teams engaged. Remote work was a powerful component to accommodate their needs during that time and beyond. The quiet quitting wave is another phenomenon that companies have witnessed. So how can companies keep their teams engaged? Diversity, equity and inclusion are important factors. Diversity allows employees to work with people that represents society as a whole. A employee will much more engaged if they are part of an organization that not only promotes but hire disable employees, for example. This is a concrete action that will make employee feel more closeness to the company mission and vision. Another example, women will feel way more engaged when they see that their management is composed of 50% of women, for example. Gender equality drive women employees who can project themselves long term and feel inspired by the company DEI strategy. One last example would be the accommodations a company offer their employees. Accommodating parents with flexible hours so they can take care of their kids, accommodating disabled employee with appropriate equipments and schedule arrangements for medical appointments, are concrete actions that will benefit both employees and employers. Employees are more likely to feel grateful and more engaged when they are part of an organization that take care of their actual needs and see them as more than an expense.
4/ A Magnet for Top Talents
According to Glassdoor (3), 76% of job seekers consider the importance of a diverse workplace before deciding whether to consider an employer. Developing an Employer Branding promoting the DEI commitments of your company is a great way to attract talents. Additionally, there is a cost to keep disengaged employees in place. According to McKinsey (1), disengaged employees cost American companies an estimated $480-$600 billion every year in lost productivity. The same study pinpoints that disengaged employees have a negative effect on their colleagues which tends to decrease the whole team's productivity. Gender diversity is shown to drive results, with gender-balanced teams having higher return on equity and companies with women board members showing higher ROI and better growth. Organizations prioritizing diversity and inclusion outperform less diverse peers, making it a fiduciary duty for boards and senior leadership (5). Talents will trade a better work culture over a bigger salary. The work culture is dependent on who you hire, how you manage, how flexible your work environment and rules are, and who you promote as in the career perspective you have established as a model for all of your employees. All those factors give you an idea already about the status of your employer branding. Ask yourself is that something you agree with or you are willing to change to attract the best possible talents out there?
Conclusion
An inclusive workplace environment, that supports innovation, creativity, and fair employment practices, will propel your organization to new height and degrees of success. Each one of us bring a unique perspective to our work and it has to be valued and encouraged. Indeed, encouraging different profiles within your company opens new door that homogenous organization could only dream of. In conclusion, a deliberate focus on Diversity, Equity, and Inclusion is not just a moral imperative but a strategic necessity for businesses aiming to thrive in today's complex and competitive environment. Embracing diversity is an investment in success, fostering innovation, enhancing decision-making, nurturing employee engagement, and attracting the brightest talents to drive organizations forward.
Keep in mind that as much as it is good for business, a DEI strategy solely based on profit won't last long, so make sure you are being genuine about it. Authenticity is a major key to unlock all the benefits a diverse and inclusive workplace can do for your company.