There’s no simpler way to say it — companies that care about diversity and inclusion outperform those that don’t. It shows up in their bottom line. However, there’s more to gain from diversity and inclusion (D&I) initiatives than just a financial boost. There’s intrinsic value, too, and it is reflected in many other areas of the business.
According to McKinsey & Company’s 2015 report, Why Diversity Matters, whichstudied industries throughout the U.S., Canada, Latin America and the UK, diverse companies can attract top talent from a broader pool of applicants, as well as improve customer experiences, employee satisfaction, and overall decision-making.
But it is not HR’s job alone to lead the charge. It’s up to the CEO and the board — which should also be diverse, by the way — to take the reins on D&I, communicate the company’s goals, explain why those objectives matter, and then be strategic about meeting them.
For companies that are already implementing successful D&I strategies, keep up the great work! But be aware that some D&I policies that work today may be obsolete a few years from now. So, keep learning, tinkering and being open to fresh ideas.
For companies that still need some convincing, here’s why to get on board:
Connect Better with Customers
For starters, a diverse workforce helps build better connections with customers, which improves their experiences with the company, helps drive consumer loyalty and may even open the door to some untapped markets for your business.
So, it makes perfect sense then for companies to mirror the people they serve. Which means if your products or services are intended for people of all ages, races, ethnicities, religions, abilities, and sexual orientations, your employees — on all levels — should reflect that.
Gender equity is just as important; women should be well-represented throughout the organization as well.
Change With the Times to Stay Current
The global workforce has evolved to become more … well, global, in terms of the way it looks, thinks and operates. Successful companies embrace change and strive to stay ahead of the curve. The best way to do so is to actively recruit, hire and retain employees from all walks of life, especially those who keep up with the latest trends in technology, marketing, HR, social media and other areas.
For example, this might include hiring some tech-savvy millennials (those born between 1981 and 1996). According to the U.S. Bureau of Labor and Statistics, millennials are expected to make up 75 percent of the U.S. workforce by the year 2025. Their generation typically views diversity differently than their predecessors, so their global perspective can be an asset in the workplace.
Boost Your Bottom Line
As stated earlier, successful D&I efforts can pay off on the financial end as well. Companies that ranked highly for racial and ethnic diversity were 33 percent more likely to have above-average returns, according to McKinsey’s 2017 follow-up report, Delivering Through Diversity. And those in the top quartile for gender diversity are 21 percent more likely to have higher-than-average profits.
McKinsey research also shows that diverse and inclusive groups tend to be more creative because they bring different experiences and perspectives to the table. Plus, they make faster, well-thought-out decisions, with less cognitive bias or groupthink. And again, the numbers don’t lie: Better decision-making ultimately leads to better business performance.
Diversity and inclusion — with genuine, strategic direction — is a win-win on all accounts.
Next week: 3 Simple Ways to Make the C-Suite More Diverse
Jeff Chaponick is CEO of MAC Diversity Recruiters, an international search firm that partners with companies of all sizes, including companies such as Deloitte, Nike, and Marsh & McLennan, to help them reach their diversity talent goals. Jeff is on the Board of Directors for the Texas Diversity Council and the National Diversity Council. He also is a member of various professional organizations that help address the disparities in hiring among traditionally underrepresented groups.
