To put it bluntly: workplace diversity is a crucial component to a successful business. This piece will explore the benefits of workplace diversity and how it can help improve a company’s culture.
The “What”: Four Layers of Workplace Diversity
Diversity and inclusion are pivotal economic and business imperatives, yet that understanding alone is not enough to implement them in the workplace. Dr. Edward E. Hubbard, author of Measuring Diversity Results and How to Calculate Diversity Return on Investment, believes that there are four layers of diversity:
(*) Workforce diversity – Group and situational identities (race, gender, ethnicity)
(*) Behavioral diversity – Work, thinking, and learning styles (including beliefs and values)
(*) Structural diversity – Combining different cultures, communities, and hierarchies
(*) Business diversity – Markets, processes, creativity, and project management styles
The “Why”: Create Healthy, Compliant, and Inclusive Workplaces
We live in a diverse world, but that is not always reflected in our workplaces. To be diverse is to be inclusive, and to be inclusive is to create a healthy, compliant, and accepting environment for employees. Incidentally, research gathered for a Deloitte University Press report on diversity and inclusivity reveals that companies are beginning to shift their focus from diversity as a compliance obligation to treating diversity and inclusion as a business strategy. However, nearly one-third of companies surveyed globally claimed to be unprepared in that area.
Promoting diversity in the workplace is not the same as successfully executing it and all of the benefits it can offer. Consider diversity in the workplace the way you would workplace safety – fundamental to the betterment of a company and its employees.
At face value, diversity is an attractive feature for a workplace to have when scouting new talent and maintaining a reputation in the workforce. However, diversity goes beyond what employees and clients can see – it must be experienced and felt. Perhaps this is why only one in five companies that were surveyed for the Deloitte University report believe their company is fully “ready” to address the issue of workplace diversity. If most companies are still treating workplace diversity as a compliance obligation, it’s no wonder only 20% are ready.
Here are some diversity benefits 80% of companies surveyed may be missing out on:
(*) Connecting with customers
(*) Employee motivation
(*) Employee recruitment and retention
(*) Continuous quality improvement
(*) Driving performance and innovation
(*) Acquiring talent
A diverse workplace is profitable. In an article published on the American Bar Association website, statistics showed that business that deters women and minorities from exhibiting their full potential “not only expose themselves to liability, they prevent themselves from potentially multiplying their customer base and earning greatly increased profits.”
According to research cited by Cedric Herring in a 2009 article published in the American Sociological Review, the most racially diverse companies bring in nearly 15 times more revenue than the least racially diverse. Additionally, Herring found racial diversity to be a better determinant of sales revenue and the amount of customers than company size, age, or the number of employees.
The findings for the advantages of women in the workplace are equally impressive. According to a 2011 research report conducted by Nancy M. Carter and Harvey M. Wagner, companies that have three or more women on the board “outperform companies with all-male boards by 60 percent in return on invested capital, 84 percent in return on sales, and 60 percent in return on equity. These numbers suggest that diversity and inclusion are not just profitable; they have a synergistic impact on profits.”
According to Hubbard, the presence of diversity impacts individuals, teams, organizations, customer markets, and communities at large. Consequently, the presence and promotion of diversity do not automatically eliminate the existence of harassment and discrimination in the workplace–but it can over time if properly implemented and executed. As stated in a workplace diversity study published on the University of Florida website,”Managing diversity is more than simply acknowledging differences in people. It involves recognizing the value of differences, combating discrimination, and promoting inclusiveness.”
In and out of the workplace, harassment and discrimination are abundant. It’s not illegal outside of the workplace to lead with one’s prejudices and biases, but inside the workplace, those attitudes can be challenged by policies, the Employee Handbook, and Code of Conduct. Measures can be taken in the workplace to ensure harassment and discrimination are met with consequences, and the presence and implementation of creating diversity among personnel can help to eliminate those behaviors.
For example, earlier this year an employee who identifies as a woman was discriminated against when her employer told her that she must”dress in ways that express [her] biological sex,” which is male. The employee refused to follow her company’s restrictive dress code and was ultimately terminated for violating it. Because of this discrimination, the employee was on the receiving end of her employer’s bias and was unable to reach her full potential while working for the company. Had diversity been enforced by the employer, the employee may have felt more accepted and motivated.
The “How”: Transition From Workplace Diversity as a Compliance Obligation
Deloitte University published an article discussing their report. In it, they explore what they believe to be the two major themes that can help companies transition from diversity as a compliance obligation to “building an inclusive workplace that inspires employees to perform at their highest level.” These themes are making diversity of thinking a business imperative and focusing on inclusion as well as on diversity itself.
Forbes magazine suggests the following be done in order to achieve a diverse workplace:
(*) Remove unconscious bias – Tinna C. Neilsen, founder of Move the Elephant for Inclusiveness, said that “The core of inclusion is all about leveraging diversity of thoughtÂŠÃ¤ÂŒÃŽ_ a tough thing for a lot of people because sometimes they don’t know enough about group dynamics like group conformityÂŠÃ¤ÂŒÃŽ_. You can have as much diversity and as many different kinds of people in a team, but if you allow group conformity to dominate, then you’re not going to leverage any of it anyway.”
(*) Make change happen – Identify what needs to change, figure out how to change it, and make the change.
(*) Replace antiquated practices – Dr. Patti Fletcher, Strategic and Solution Marketing at SAP SuccessFactors, states that “The processes, practices, and architecture we have in place right now are antiquated. Nothing is going to change unless those things change . . . People don’t change because you tell them to. They change when you enable them to . . . we need to use choice architecture, meaning putting tools in front of somebody to enable them to do something totally different without them even realizing it. For example, blinding a resume where you don’t see a name or an address, and therefore not having that unconscious bias be able to kick in.”
By broadening the scope of workplace diversity from race, age, gender, and physical ability to also include diversity of thinking, companies can better understand their employees and discover additional ways to solve problems. Employees want not only to be heard but truly listened to. In order to achieve that, a company must listen to every voice, to everyone who chooses to participate.
LawRoom offers online compliance training in managing bias, which aims to educate users about unconscious preferences and generalizations that often arise in the workplace. These biases may result in unfairly limiting career opportunities for existing and potential employees. We also offer training in anti-discrimination, harassment, and ethics–all of which promote prosocial behaviors that comply with the law and can help to make the workplace a better place.