Diversity And Inclusion Essential For Better Business
Diversity and inclusion (D&I) is neither just a “nice to have” agenda nor a “number game” any more. Unlike good old days, D&I shouldn't be merely treated as one of those so-called “politically correct” initiatives. There have been number of studies conducted so far to ascertain the benefits of diversity in driving business results. A recent study carried out by McKinsey shows companies in the top quartile for diversity are 35 percent more likely to have financial returns above their respective national industry medians. Another study done by Deloitte, one of the “big four” professional services companies, revealed that diverse companies had 2.3 times higher cash flow per employee over a three-year period than non-diverse companies did.
There are many research findings which suggest inclusive decision-making has a direct link with better business performances. One such study was conducted by famous business magazine Forbes that considered roughly 600 business decisions taken by 200 different teams in wide variety of companies over two years.
The findings were eye openers with regards to the enormous benefits D&I can bring to the businesses: up to 87 percent of the time, inclusive team makes better decisions; they also take faster decisions than non-inclusive teams; and decisions taken and executed by diverse teams delivered 60 percent better results.
Generally, diversity refers to differences. Quite often we limit ourselves only to race, ethnicity and gender to describe diversity. In today's context, diversity has a wider and deeper perspective. The world has changed quite a bit in recent times courtesy of more open-door policy, unprecedented technological advancement, liberalised trade systems, etc. As a result, nations are getting closer facilitating strong socio-economic and cultural exchanges. Overall, of late there has been a dramatic shift in the psychology and thought process of human beings.
Naturally, businesses have to adapt to these changes for their sustainability. Given the present circumstances, diversity in work place should also include religious, political, socio-economic and even sexual orientational differences that exist out there in the society.
Inclusion, on the other hand, refers to creating an environment where employees feel engaged and valued and they are part of the decision-making process and be able to unleash their potentials.
Let's now focus on how D&I brings positive impacts to business:
Innovations: Employees having diverse background naturally have different ways of doing things, different habits, unique thought process, etc. When these diversities are embraced in the work place, new ideas emerge more frequently as opposed to the place where diversity is absent. In an inclusive organisation new ideas are valued, and people are appreciated for their efforts. In such cases employees also feel proud and get motivated to drive innovations.
Better customer service: An organisation normally has to deal with diverse set of customers. Diverse workforce increases the flexibility and chances to serve customers better.
Greater access to talents: Diversity obviously enables an organisation to get access to a wide range of talents as the organisation doesn't restrict itself to a specific group.
Reduce employee turnover: Talents are scarce resources and retaining them is often a great challenge for organisations. In an inclusive organisation employees feel valued and appreciated, thus they tend to stay longer.
Enhance productivity: Employees with high morale are exceedingly productive. Research shows that the morale of the employees of the organisations which nurture the culture of diversity is higher. People get encouraged and motivated to continuously raise the bar of their performances.
Nowadays, many organisations are talking about diversity, but very few companies function in a way that truly welcome diversity. It is, of course, easier said than done. So, the next critical question comes up: what needs to be done to transform an organisation to genuinely foster diversity? Experts have come up with some suggestions:
Buy-in from the policy-makers: It all starts from the board and senior executives of an organisation. D&I represents a paradigm shift therefore, it requires strong commitment from the people at the top. To get the buy-in from the people who pull the strings, a strong business case highlighting the enormous value that this initiative brings to the organisation needs to be presented.
Dealing with unconscious bias: In most of the cases, knowingly or unknowingly, organisations promote people with whom they are comfortable with and who are just like them. This mindset is also known as “unconscious bias”. An organisation has to first acknowledge that this is a reality which is deeply rooted. Providing extensive training on diversity and inclusion, conscious efforts to identify and eliminate biased language used in work place, allowing underrepresented collegues to raise their voices and creating equal opportunities for everyone are important cornerstones to build a bias-free, diverse and inclusive environment.
Set targets and have accountability for changes: To drive D&I agenda strongly, management should have a defined target and they should be held accountable to meet the target. Progress should be monitored regularly as well.
Aligning company policies: To accommodate employees from diverse group, company policies need to be aligned. In country like Bangladesh flexible working hours, work from home, progressive maternity leave, etc. will specifically allow and encourage women employees to move ahead with their professional life.
Achieving diversity and inclusion is certainly not easy. It's a daunting task. Antonio Lucio, chief marketing officer of tech giant HP Inc., who is also responsible for making diversity a top priority for the company and its partners, once said, “It's damn hard.”
Any initiative gets successful if it answers the basic questions: “Why should I do this?” or “What is in it for me?” Management must clearly articulate and communicate the answers to these questions to the entire organisation to make D&I successful.
Steven Covey, one of the highly respected management gurus, rightfully said, “Strength lies in differences, not in similarities.”
The author is chairman and managing director of BASF Bangladesh Ltd. The views expressed here are personal.