I recently read an intriguing article in Forbes on “Why Diversity Can Be Bad for Business.”
I’m always looking to explore opposing points of view, so I just had to read it. As a long-time proponent of diversity, it may surprise you to know that I actually agreed with the article.
Let me explain.
In 2010, I was a founding member of the steering committee of the 30% Club. Our intention was to engage chairs of the FTSE 100 to increase the gender balance on their boards. Research had shown that 30% is a tipping point at which diversity can begin to disrupt groupthink and stimulate innovative thinking, so we asked these chairs to commit to having their boards include at least 30% women.
Since that time, the needle has moved from 12.5% women on those boards to 28.4%, not quite 30% but very close to it.
There are plenty of success stories I could quote from companies who saw benefits from increasing board diversity, but there are others for whom those benefits have failed to materialise. What is the difference between the two?
Quite simply, the missing ingredient is inclusion. When diversity is treated as a box-ticking exercise, rather than as part of the culture of inclusion, it becomes simple window-dressing – bright, new items paraded around to show you that the displayer has something different. Getting past the window, you see the objects inside are the same stale merchandise that hasn’t changed in years. Companies that do nothing more than tick the box have done themselves no favours. Diversity without inclusion doesn’t work.
In an inclusive workplace, all people are encouraged to contribute fully and effectively; they are respected and valued for their ideas and opinions. Inclusion is more than a mere representation of diversity – such as a certain percentage of women or minorities. Inclusion involves accessing cognitive differences and acting on them.
Inclusion is not easy to measure. By comparison, the compilation of diversity statistics is straightforward and quantitative. But you can’t set a target for inclusion; you can’t publish your inclusion stats in your annual report; and you can’t point to a job role that can fulfil the requirements for inclusion. You can’t name “inclusion” as an objective for any individual, and you can’t necessarily incentivise it in the usual ways. So how do you make it happen? And more importantly, WHY make it happen?
Inclusion starts from the top and permeates the entire organisation, and it forms the basis – the very foundation in my view – for the culture of a business or a company.
As all of us are starting to employ millennials in our workplaces, we are learning that these young people are themselves “different.” Critically, if we are to recruit the best and brightest from this age group, we have to understand how to include them in a significant way – how to make them feel valued, how to appreciate their opinions and creative ideas, and how to respect their personal needs for a working life.
Unlike their parents’ generation, these young people have skipped right over the lower levels of Maslow’s hierarchy of needs – physiological needs such as food, shelter, and safety – and gone straight for the upper third: belonging, self-esteem, and self-actualisation.
Belonging is first. Without inclusion, millennials can’t feel they “belong.” This very important characteristic of company culture has to be conveyed through actions and words coming from individuals, not a company brochure. Millennials are motivated by knowing that they can add value to an organisation and that they are encouraged to take the lead in doing so.
Self-esteem follows. Most research shows us that millennials have high opinions of themselves and trust their instincts – rather than any predefined conventional wisdom – to help them make decisions, evaluate risk, and generate new ideas. This is probably where their greatest value to our organisations lies; they aren’t afraid to “think outside the box”; if we listen to what they are saying, and we VALUE their ideas, we will be the beneficiaries of their self-esteem and self-actualisation.
Inclusion is critically important not only to the recruitment of millennials but also to the process of creating engaged employees. Today’s workers are more independent, more self-assured, and more resistant to entrenched methodologies than those of any other period of history. We can’t simply tell them what to do – and we don’t want to, because that would reduce their engagement and stifle the disruption and innovation that we as progressive leaders are seeking.
According to a survey by Towers Watson, employees with the highest level of engagement are 87% less likely to leave the organization. A study by the Hay Group found that engaged employees were as much as 43% more productive. These numbers are significant, as productivity and employee turnover are both major factors in the profitability of our companies.
If we are to effectively engage our employees and our new, young recruits, we need to shift from diversity as a programme to inclusion as a business strategy. Diversity recognises all the ways we are different; inclusion creates a culture that values those differences equally, harnessing the richness of diverse ideas, backgrounds, and perspectives to ensure that all workers feel engaged and vital to the business.
The challenge for us is to figure out how to create that culture of inclusion, that working environment that represents the best of what each employee has to offer. Certainly, it falls to us as leaders, as culture is driven from the top.
Oh, a final admission: that Forbes article had a subtitle: “(And Inclusion Is The Answer)”, so I suppose it’s no real surprise that I agreed with it!
Tamara Box is the Managing Partner, Europe & Middle East for international law firm Reed Smith LLP.
It’s a persistent myth: if a company recruits enough employees from underrepresented racial and ethnic groups, a sufficient number will, over time, rise through the organization to create a diverse culture at all levels. But that is not happening.
The script at BIO this year could not have been more clear: Progress on diversity is being made, but more work needs to be done. Yet still, an undercurrent of biotech’s all-boys brand-of-old tugged at the heels of efforts to bolster those long-excluded from positions of authority.
Another vital antidote to the labor shortage is fixing the care economy, made up of people who provide paid and unpaid care. (See “Overview of the Care Economy.”) Within the care economy, two related and somewhat hidden issues are crucial to the long-term health of the US labor market.