The more diverse and inclusive your team is, the more likely your company is to be successful – and benefits go beyond bottom line, to areas like recruitment and retention. Find out why, and how to implement diversity and inclusion policies in your own company.
Despite the well-demonstrated link between diversity of the workforce and business success, every country in the world is behind in implementing workplace diversity at the executive level. Real strides towards diversity and inclusion in the workplace are only just beginning to happen, and the trailblazers are already benefiting, as the more diverse the company, the more impressive its results.
Diversity Equals Success
McKinsey and Co. published a landmark Diversity Matters report in 2015, which revealed that companies with the most racial and ethnic diversity were approximately a third more likely to have above-average returns than those with more average levels of diversity. Those in the top diversity quartile of the study were also 15% more likely to yield above average returns. A few years later, McKinsey confirmed in its 2018 follow-up diversity report that those in the top bracket were still more likely to reap significant rewards, and that the returns for this segment had in fact increased to 21% (more likely to have above average returns).
The evidence is clear: diverse leadership is key to increasing the growth of your business. By developing a comprehensive diversity and inclusion (D&I) policy, your business can maximize its own returns while out-performing competitors. If that weren’t incentive enough, the days of diversity devoid boardrooms are waning fast. Businesses will need to adapt to stay with the pack, let alone lead it.
So, why is a diverse workforce such a boon for companies? First and foremost, it is a key factor affecting the attraction and retention of top talent. The generation currently entering the UK workforce is the most diverse in history. Many later-born millennials and Generation Z recruits have grown up in multicultural settings in a time of mounting social pressures which, with the rise of social media, have only become more pertinent. Incoming workers are increasingly looking for a workplace environment that reflects the culturally rich and inclusive environments they have become accustomed to. And, as the right talent can affect the efficiency of a company’s operations by up to 400 percent, it is critical that top talent is not only recruited but retained – particularly by small businesses whose staff salaries constitute a large percentage of their outgoing cash flow.
Alongside talent recruitment goes the equally important client and customer recruitment. For small businesses especially, diversity within the company must match the demographics of the neighbourhoods in which, or with which, they operate. Businesses should adapt their D&I policies to reflect the communities they are working with. For larger businesses, this might entail different D&I goals for different departments.
It is worth remembering that diversity is very much a top-down phenomenon, and that D&I policies should be prioritised at the managerial level. Businesses with significant growth planned, will benefit from incorporating a diverse staff to assist in the upcoming critical stages of expansion.
The Future of D&I
Diversity also has a marked, if not hard to quantify, effect on a business’ decision-making potential. More perspectives contribute to a better understanding of any situation, with a combination of viewpoints and life-experiences contributing to a balanced and nuanced conclusion. This is where the second part of diversity and inclusion comes into play: inclusion.
Modern D&I initiatives put the focus very much on how a diverse staff can fully contribute their individual perspectives. Fortunately, at the small business level, this is an easier task. New talent will have something to provide in any decision-making process, irrespective of experience. And decisions will be better considered as a result. For small businesses looking to grow, their workplace environments should be as welcoming as possible, encouraging employees at every rung in the ladder to contribute their unique perspectives. The result will be an internal consulting process that will safeguard expansion against unseen dangers while simultaneously opening up new avenues of growth. The future’s small business owners will have the courage to collaborate.
To reap the rewards a diverse team will bring your business, why not spearhead the diversity revolution within your team. Just don’t forget to implement your policies from the top down and be sure everyone feels they have a voice.