Workplace diversity can be viewed in any number of dimensions, as C-Level Executives well know. Diversity isn't only about race, ethnicity and gender; it can also encompass almost every aspect of how people communicate and work such as problem solving approaches, communication styles and differences in career experience.
Whatever the parameters, diversity is a fairness issue. Providing equal employment opportunity is also a legal obligation; failing to provide it may subject you to legal liability and massive reputation damage.
The Business Benefits of Workplace Diversity
Diversity management goes far beyond simple compliance — it better connects your organization to its customers and communities. Diverse workplaces tend to be more attractive to talented job candidates. They also tend to be better places to work, which drives retention. As the Center for American Progress explains, "Businesses that fail to foster inclusive workplaces see higher turnover rates than businesses that value a diverse workforce."
Is there a correlation between more diversity and better organizational performance? According to research by consulting group McKinsey & Company, the answer is a resounding yes: "In the United States, there is a linear relationship between racial and ethnic diversity and better financial performance." Companies that are ethnically diverse, for example, are 35 percent more likely to perform above their industry's median level than less diverse companies. Other dimensions of diversity, says McKinsey, also correlate to stronger financial results.
Workplace diversity is also good for innovation, according to Forbes Insights. Diversity, the article explains, "is a key driver of innovation and is a critical component of being successful on a global scale."
Measuring Workplace Diversity
Among the oldest business truisms is "what gets measured, gets done," and leadership commitment to diversity means treating the goal like any other worthwhile business goal: measuring it, tracking it and continuously improving outcomes.
Organizations need to have diversity indicators in order to know what success looks like. HR plays a central role in improving workplace diversity, but the leadership team must first express its commitment, create the strategic plan, set the benchmarks and invest in the whole effort. However you classify diversity benchmarks, make sure you implement them across your organization, allowing comparisons among divisions and business units or against competitors in the same industry.
If you conduct diversity benchmarking and discover that a competitor is more diverse than you in a certain area, focus investment on improving within that area. For example, if a competitor has more diversity in its leadership team, you could implement an accelerated development program targeted toward advancing your company's top diverse candidates in order to close that gap.
Diversity Benchmarking in Action
A good example of a widespread diversity initiative comes from U.S. high-tech companies, some of which have recently placed heightened emphasis on attracting more women into the IT sector. According to an American Association of University Women study, women hold just 26 percent of U.S. computing jobs. CIO.com investigated how companies address such an issue like that: "To solve the accountability problem, companies like Pinterest, Facebook and Intel have put specific initiatives, metrics and rules for diversity hiring in place."
According to Fortune, one commonly discussed principle (that's more known for its implementation in the NFL than in the tech world) is the Rooney Rule, which requires that "at least one woman and one underrepresented minority" be considered for open positions, particularly senior openings. Fortune also recently reported that executives from ten male-led companies, including Barclays, McKinsey & Company and Twitter, have partnered with the UN's HeForShe campaign to achieve full gender parity among both the total workforce and top leadership, by 2020.
Three Ideas for Enhancing Workplace Diversity
There are three basic rules that can help you expand your workforce into a more diverse one:
- Think beyond compliance and legal risk. If your goal is merely to stay off the radar screen of regulators and labor lawyers, you're missing the real business value of diversity.
- Communicate your organizational commitment to diversity both internally and externally, using diversity efforts to engage your existing employees and recruit outside talent. Diversity has a proven track record of retaining and attracting talent, so it should be part of your branding and recruiting efforts.
- Commit to diversity, not just in hiring but in all aspects of talent management. Diversity should be taken into consideration throughout the employee life cycle, so keep it in mind when promoting, setting up training courses and managing performances.
Workplace diversity can be a competitive advantage, and embracing difference widens your pool of available talent and enhances your organization's ability to respond to today's dynamic business climate. Inclusion isn't just fair and required by law; it also makes good business sense. Knowing the value of diversity and setting up a system to measure your results are crucial first steps to leveraging all the benefits workplace diversity has to offer your organization.
For additional information, view the webcast: The Future of Benchmarking is Here: Powering Business Decisions with Big Data.
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