Blog Entry # 2: Managing Diversity

Inclusion Puzzle (Clorox 2017)

“A lot of different flowers make a bouquet.” – Islamic Proverb

In today’s fiercely competitive global business landscape, managing diversity is the key to survival. Organizations nowadays are heavily reliant on highly diverse group of people in terms of age, gender, geography, and culture. However, plainly mixing together different people does not guarantee success (Bourke and Titus 2019). Diversity and inclusion are interrelated, albeit different concepts.

“Diversity is being invited to the party. Inclusion is being asked to dance.” – Verna Myers

Diversity focuses on the who and the what – the composition of an organization. Inclusion is about the how – the behaviours, perspectives, and processes that promotes diversity (Brown 2016). An organization that have a mix of different genders, races, nationalities, and etc. but only values the opinions and perspectives of certain groups can be considered diverse, but not inclusive (Great Place To Work 2020). Companies seeking global significance must incorporate diversity within its business model, policies, and corporate culture and it starts with an inclusive leadership (Llopis 2011).

The Case for Diversity and Inclusion

Innovation and Creativity. Having a workforce with diverse backgrounds, talents, and experiences can enable a company to increase its creativity and innovation. The varying traits and qualities of such diverse workforce allows incorporation of broader perspectives and knowledges especially during problem solving and generating new ideas (Cole 2020).

Employee Engagement. Research indicates that inclusive companies have more engaged employees and are happier (Leonard 2012, Cole 2020). This engagement translates to enhanced company productivity, which ultimately leads to higher business performance. Moreover, engaged and happy employees results in lesser employee turnover as they feel more comfortable and have a sense of belonging. Research also shows that job seekers consider diversity as an important aspect when considering job offers (Rewardian 2020).

Customer Engagement. In addition to internal business benefits, having a diverse and inclusive workforce also benefits the customers. Companies with such diverse workforce will be able to understand and effectively promote the business to potential customers of different backgrounds, thus expanding its market reach (Cole 2020). Research also shows that diverse companies are 70% more likely to acquire new markets (Hewlett, Marshall, and Sherbin 2013).

Diversity Equals Profitability. The increase in innovation, productivity, and customer engagement can all translate into increased business performance, higher revenues, and ultimately, higher profits. A study by McKinsey’s study in 2018 indicates that companies with gender-diverse leaderships have 21% higher EBIT (earnings before interest and taxes) and 35% higher EBIT with racially diverse teams (Myers 2020). It is also noted that diverse companies produces 19% more revenue compared to non-diverse ones (Powers 2018).

Benefits of Diverse Workplace (Norwich University (2020)

Traits of an Inclusive Leader

According to research conducted by Dillon and Bourke (2016) for Deloitte, highly inclusive leaderships exhibit six signature traits which enables them to perform effectively in diverse markets, engage with diverse customers, and access wide range of diverse talent pool and workforce. These traits are about treating people fairly, understanding that each individual is unique, and being open to the collective power of diversified groups.

Curiosity. Leaders should demonstrates curiosity and open-mindedness to new ideas and experiences. Curiosity breeds learning, which is very important to rapidly changing business landscape.

Cognizance of Bias. Inclusive leaders are mindful of personal biases and are self-aware. They recognize that unconscious biases exist and pits in place governance and controls to mitigate these biases.

Courage. Courageous leaders are unafraid of changes, speaking up, and are humble of their own strengths and weaknesses. They are ready to challenge the status quo in order to drive transformation.

Cultural Intelligence. Inclusive leaders are capable of performing across different cultural settings. In addition to an awareness of different cultures, leaders are also mindful of their personal views of other cultures and how their own culture affects their perceptions.

Commitment . Inclusive leaders are committed to diversity and inclusion, not just because of the business benefits but also because it resonates with their personal values and their deep sense of fairness and justice.

Collaboration. Inclusive leaders fosters collaborations and leverage on the collective power of diverse group of people, working together. They understand that individuals may be uncomfortable sharing their own opinions within a diverse group, and thus leaders must promote a collaborative environment.

The Six Signature Traits of an Inclusive Leader (Dillon and Bourke 2016)

Reflection

Diversity without inclusion is meaningless. Organisations must have the composition and the inclusive culture to fully leverage the power of diversity. It starts with the leaders on top of the organization with the right mindset, values, and traits towards being inclusive. Diversity and inclusion are more than just a fad, they can translate to improved business performance as a result of innovation, productivity, and customer engagement brought about by the collective strength of diverse talents, skills, experiences, and knowledge. In a highly globalized business environment, monolithic thinking companies are committing corporate suicide.

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References:

Bourke, J. (2016) Which Two Heads Are Better Than One? How Diverse Teams Create Breakthrough Ideas And Make Smarter Decisions [online] available from <http://aicd.companydirectors.com.au/-/media/cd2/resources/director-resources/book-store/pdf/which-two-heads.ashx> [12 April 2021]

Bourke, J. and Titus, A. (2019) ‘Why Inclusive Leaders Are Good for Organizations, and How to Become One’. Forbes Magazine [online] available from <https://hbr.org/2019/03/why-inclusive-leaders-are-good-for-organizations-and-how-to-become-one> [12 April 2021]

Brown, J. (2016) ‘The Difference Between Diversity And Inclusion And Why It Is Important To Your Success’. Forbes Magazine [online] available from <https://www.forbes.com/sites/williamarruda/2016/11/22/the-difference-between-diversity-and-inclusion-and-why-it-is-important-to-your-success/?sh=13dc4f065f8f> [11 April 2021]

Clorox (2017) Inclusion Puzzle [online] available from <https://www.thecloroxcompany.com/wp-content/uploads/Inclusion-puzzle.png> [12 April 2021]

Cole, B.M. (2020) ‘8 Reasons Why Diversity And Inclusion Are Essential to Business Success’. Forbes Magazine [online] available from <https://www.forbes.com/sites/biancamillercole/2020/09/15/8-reasons-why-diversity-and-inclusion-are-essential-to-business-success/?sh=17ea11841824> [12 April 2021]

Dillon, B. and Bourke, J. (2016) The Six Signature Traits of Inclusive Leadership [online] available from <https://www2.deloitte.com/content/dam/Deloitte/au/Documents/human-capital/deloitte-au-hc-six-signature-traits-inclusive-leadership-020516.pdf> [12 April 2021]

Great Place to Work (2020) Why Is Diversity & Inclusion in the Workplace Important? [online]available from <https://www.greatplacetowork.com/resources/blog/why-is-diversity-inclusion-in-the-workplace-important> [12 April 2021]

Hewlett, S.A., Marshall, M., and Sherbin, L. (2013) ‘How Diversity Can Drive Innovation’. Harvard Business Review [online] available from <https://hbr.org/2013/12/how-diversity-can-drive-innovation> [12 April 2021]

Leonard, B. (2012) Inclusive Workplaces Lead to Engaged Employees [online] available from <https://blog.shrm.org/workforce/inclusive-workplaces-lead-to-engaged-employees> [12 April 2021]

Llopis, G. (2011) ‘Diversity Management Is the Key to Growth’. Forbes Magazine [online] available from <https://www.forbes.com/sites/glennllopis/2011/06/13/diversity-management-is-the-key-to-growth-make-it-authentic/?sh=5726a63466f3> [11 April 2021]

Myers, J. (2020) Opinion: The numbers don’t lie: Diverse workforces make businesses more money [online] available from <https://www.marketwatch.com/story/the-numbers-dont-lie-diverse-workforces-make-companies-more-money-2020-07-30> [12 April 2021]

Norwich University (2020) Leading Today’s Diverse Workforce Requires New Management Skills [online] available from https://online.norwich.edu/academic-programs/resources/leading-todays-diverse-workforce-requires-new-management-skills [12 April 2021]

Powers, A. (2018) ‘A Study Finds That Diverse Companies Produce 19% More Revenue’.  Forbes Magazine [online] available from <https://www.forbes.com/sites/annapowers/2018/06/27/a-study-finds-that-diverse-companies-produce-19-more-revenue/?sh=2867729b506f> [12 April 2021]

Rewardian (2020) Diversity & Inclusion can Boost Employee Engagement [online] available from <https://blog.rewardian.com/diversity-inclusion> [12 April 2021]

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