How Diversity Can Improve a Company’s Performance

Diversity and Inclusion (D&I) is turning back to its roots. That means a return to a focus more on enterprise results and effectiveness and less on sociology. The outcome will be a revolution in the approach, the acceptance, and the efficacy of D&I efforts across the world.

When the father of diversity Dr. Roosevelt Thomas introduced his concept (Managing Diversity) to the business community in the mid 1980s, it was an instant hit. Not because it promised a more equitable and inclusive world, but because it was good for business. That was the simple promise of diversity management. And it was widely accepted by corporate leaders. Businesspeople liked that it offered an approach to a growing and vexing problem (increasing demographic and psychographic variety in the workforce) that focused on enterprise performance and required companies to utilize their existing skills at problem solving, change management, leadership, people management, and project management. It was presented as a business issue with business related outcomes.

What Leaders Said

Jim Preston, the last male CEO at Avon, put it best. He said that Managing Diversity is “an idea whose time has come.” Corporate leaders were awakened to the fact that a diverse work force is not a burden, but a source of greater strength – when managed properly.

These leaders bought the concept of managing diversity as a managerial process that created an environment that worked for everyone (white men included). It was a commitment to all employees, not an attempt at preferential treatment for some. It was a natural fit for the way large enterprises were managed, especially at the team level. It required changing individual behavior; it required a new corporate way of life; it could take years to implement.

One author, Peter Wood, compared diversity (short for diversity management) to other advances in sound management principles like scientific management (Taylorism), efficiency experts, One-Minute managers, Total Quality Management (TQM), Six Sigma, etc. The rapid shift in workforce makeup required a shift in management strategies to maintain world class performance.

From Complexity to Simple

Diversity was originally defined as the collective mix of differences and similarities. Managing diversity was a way to manage the mix in a very practical way to support business goals. A return to the concept of Managing Diversity challenges modern leaders to abandon the current conventional norms about diversity. We can’t continue to position diversity as a struggle between the “main” people and the “others” (the new and different ones). A focus on any single dimension of diversity is inherently divisive. Once we begin to see diversity as the collective mix, made up of the main ones and the others, it becomes obvious that D&I is a discipline to help develop productive relationships in the face of an ever-changing blend of attributes, behaviors, and talents.

Diversity management is a simple concept. The simple purpose is to develop skills to remove artificial barriers to relationships. The focus is not on us vs them. It is on human-to-human connections. To get the benefit of this simple concept, you must assert and maintain an objective of promoting comfortable, effective, productive relationships. All humans are included in this approach, with no emphasis on any cohort of people. This approach does not limit efforts to recruitment, retention, representation, or reputation. It focuses on results.

A Business Issue Requires a Business-like Approach.

It is hard to hit the target when you are not clear what the target is. For diversity to improve a company’s performance, enterprise performance must be the target and relationship skills must be the approach. It is not enough to recruit more Blacks, retain more women, improve your representation profile, or have a reputation as diversity friendly. You must keep the goal in mind. Establishing diversity management as a strategy and a competency is the right start. Front line managers must master the skills of getting the best performance from all employees all the time. 

When people ask me how we should measure the efficacy of diversity and inclusion, I always say, measure it the same way you measure any other management initiative. How does it help or hinder the production of commercial value by the enterprise? Measure team productivity, revenue increase, cost decrease, quality of output, efficiency and effectiveness, product yield, improved cycle times, and employee commitment. If the goal is enterprise performance, measure how much better the enterprise performs when people feel seen, included, supported, and recognized for their contribution to the enterprise.

It’s About People

Laura Kangas, my friend, and co-author of Diversity Training That Generates Real Change, always reminds me that at the end of all this (business performance) is “people”. Nothing good happens in D&I unless and until people experience the value of an immersive experience that promotes behavior change, better relationships, and personal growth. Better people mean better teams. Better teams produce better firm performance. The concept is simple. The prospects for value creation are enormous. The key is focus and execution. Don’t get distracted.

Have you read?
Unite and Conquer by Leo Bottary.
A Sustainable Plan Toward Profitability by Rhett Power.
4 Ways IT Can Make or Break Your Business by Yama Habibzai.
Why Remote Work Will Win This Fall by Dr. Gleb Tsipursky.
Why self-awareness is your best friend & 4 tips to get better at it by Roxanne Calder.