This article has been bolded for skim-reading.
There are two basic reasons for tackling diversity (seriously) in an organization. Both are valid.
Compliance and liability fall within one category. This is the risk management or ‘away from problems’ strategy.
The second approach to diversity is a ‘towards strategy’. Here differentness of many kinds becomes a driver of both short- and long-term profitability. The organization moves towards inclusiveness, innovation and engagement. Differentness is leveraged as part the strategic vision, sales and marketing strategy, branding, talent development and retention, networks and organizational culture.
If you’ve read Stephen James Joyce’s Teaching an Anthill to Fetch: Collaborative Intelligence at Work, you already have a significant piece of the diversity picture.
Compliance and Liability: A risk management or ‘away from’ strategy.
Please note: there is absolutely nothing wrong with focusing on differentness as a way of keeping out of trouble and away from lawyers. The point here is that this is only half the diversity story, and can create a focus on “classic” or on the more legal issues of differentness.
Compliance is essentially a brand, legal and dollar issue. The law of the land is on the side of previously-disadvantaged classes of employees, who are often still statistically disadvantaged by race, gender, disability etc. Corporate liability discrimination suits run into the hundreds of millions of dollars (e.g. 19 May 2010 award against Novartis AG, in New York: $250 million in punitive damages).
Federal law is maintaining its support for diversity in the workplace and has been expanding the rights of Blacks, Latinos, Asians, women, the disabled and other protected classes in the workplace over the past two decades. This aligns with international trends, such as the new Scandinavian laws which mandate 40% of women on company boards.
Employers may lawfully make decisions about hiring, promotions and access to training, using protected employee classifications. However, the most effective ways to grow successful, diverse cultures are through diversity training initiatives, cultural education, outreach programs, diverse recruitment, mentoring, supplier diversity programs etc.
The law permits companies to take direct action to redress imbalances, but diversity training initiatives are preferable. One reason for a sophisticated approach is that reverse-discrimination claims occasionally arise. Their dollar liability value is minimal, but this is not only about money. This of Sonia Sotomayor’s firemen’s decision and how that became a public debate. College entrance cases have also received publicity. Given a polarized political climate, unionized employees or a conservative brand, it is more effective to improve your diversity culture with education than with the considerable power of diversity law.
Profitability: a ‘towards’ strategy.
In many economic thinkers’ opinions, profitability is the better reason for investing in a culture of diversity or differentness.
A culture of diversity attracts the best and the brightest. Many companies take a very keen interest in diversity because they keep an eye on Vault.com, GreatPlaceToWork.com, Glassdoor.com, Jobvent.com and other websites, that GenX and GenY use when researching companies to work for. High-talented members of these generations generally check cultural diversity as a basic requirement for career plans.
The core challenge of the 21st century is innovation. Competitive advantage lies in new perspectives on the eternal question: how do we create and sell more new products and services, or more of our existing products and services, to new or existing customers? How do we create better processes and higher quality? How do we do this cost-effectively, sustainably and creatively while having at least some fun along the way?
Innovation thrives in an environment of diversity of perspective, experience and input. The numeric-based business case for this is in places like Mobilizing Minds: Creating Wealth from Talent in the 21st-Century Organization, 2007, by McKinsey’s Bryan and Joyce. Richard Florida is more a accessible writer if you prefer something you can browse at bedtime.
Diverse environments widen people’s worldviews, remove people’s blinders, and build cognitive flexibility. People possess many areas of competence, knowledge and insight that remain separated from their working lives by an arbitrary boundary of “this is not work stuff.” Training and experience in differentness dissolve this artificial barrier, and a vast range of skills and knowledge becomes available.
Diverse environments attract many different types of differentness. Once a company culture opens up to different races and ethnicities, languages, gender and gender orientations, generations, religions, disabilities, veterans, parents etc (all the ‘classic’ diversities), this encourages other types of differentness to emerge. The gardener and the part-time artist, the choir leader and the runner, the geek, the writer and the traveller suddenly appear from amongst your people and their idiosyncratic skills, perspectives and experiences become team resources.
A truly diverse culture delivers an emotionally mature workforce with problem solving skills, project management competencies and interpersonal intelligence, and it has many other advantages. Customers, project partners, high-talent colleagues and valuable network members are often from different genders, races, ethnicities, religions or nations.
Many of these people are from diffuse cultures, and it takes time and trust to get to know them. Mainstream Caucasian US culture one of the most specific cultures in the world. The specific/diffuse cultural difference is one of those invisible cultural boundaries that cannot be seen, or truly understood, without either training or long-term interaction with diffuse culture members. The same is true of the individualist/collectivist divide, the universalist/particularist gap etc.
Companies who do not pay attention to differentness suffer “revolving door syndrome” as they lose high-talent minority hires. They are also mystified as their minority, multinational and diverse customers bleed away to competitors.
Similarly, organizations with good differentness programs and real diversity commitment (from recruitment and development to supplier diversity) find themselves making steady profits, and building trust, networks, employment brand and other advantages. They too are sometimes mystified at how powerful diversity values are in delivering dollar-based results.
Away from and towards:
In Teaching an Anthill to Fetch, Joyce observes that an ‘away from’ strategy begins strongly and tails off as it achieves most of its objectives. For instance, if a service desk wants to very few complaints, they will do enough work to get very few complaints , then ease off. A target of zero does not make a good, continuous goal.
A ‘towards’ strategy grows as it moves towards its objectives, because it is not based on avoidance. For example, a “get out the vote” initiative has no limits, a design team goes all out for better designs as an event draws nearer, or an entrepreneur’s dreams grow with success.
Business needs to pay attention to diversity-differentness for many reasons. They are all valid, and there’s no need to pick only one good reason, when you can pick all of them.
But ‘building a vibrant, creative, inclusive and thriving economy” is more fun that “avoiding lawyers” any day of the week.
