Diversity and Inclusion in the workplace are current buzzwords, but what exactly do they mean, and why are they important to your business? If you haven’t explored your company culture lately, then this is the time to focus on Diversity and Inclusion.
Diversity is usually defined as different demographics or social differences among a group, encompassing everything from race, class, gender, sexual orientation, country of origin, cultural, political, and religious affiliations as well as individual differences, including age, physical abilities or disabilities, learning styles, working styles, and personality types.
While we can agree that we are each unique in our own ways, classifying or defining people is a part of our mental wiring. Scientists suggest that our brains are wired to determine each new person, place, or thing as either safe or threatening. This behavior was imperative to survival for our cavemen ancestors. However, in today’s global atmosphere, spending time classifying or focusing on the differences between us stands in the way of better collaboration, creativity, and productivity in the workplace.
That’s where inclusion comes into play. Inclusion is the intentional action of accepting those who differ from us, whether by age, race, gender, marital status, educational background, or physical differences into our sphere, workplace, or community.
Why Diversity is Important in the Workplace
Innovation and creativity are skills coveted by every successful business. Today, more organizations are realizing the value that a diverse workforce can bring to these fields. The differences in life experiences, viewpoints, backgrounds, and cultures can result in totally new ideas and methods.
A wider pool of talent is available when a conscious effort is made to open opportunities to other groups, rather than just building on familiar or traditional models. It’s one thing for a company to tout its diverse range of talent, but if those individuals are hired merely for show and do not feel included, diversity falls flat.
Past hiring models focused on finding individuals who would fit in with the company culture, demographic, or other social parameters. Call it “culture fit”, or “the boy’s club”, companies that hire the same type of individuals usually do so under the guise of “we’ve always done it this way.” Many times, this is an unintended or unconscious bias that follows a long-standing corporate structure.
The Culture Add mindset instead views expanding diversity as a positive step in improving company culture. Being open to new ideas and innovations benefits a business’s workforce and profitability.
Why Inclusion is Important in the Workplace
Hiring a diverse workforce is the first step in the right direction, but filling metrics on a spreadsheet isn’t the end goal.
Employees who feel alienated or singled out due to age, sexual orientation, country of origin or any other distinguishing factor will most likely underperform or leave the organization. A successfully inclusive organization helps people feel they are respected and that their unique talents and contributions matter.
Employees tend to be more productive in an environment where they have a high level of trust and feel like part of the organization. A McKinsey report found that companies with more racial and ethnic diversity outperform competitors by as much as 35%.
Those businesses that lead in diversity factors such as race, ethnicity, and gender also show a 25% edge in profitability.
Unfortunately, a significant percentage of companies around the world haven’t grasped this potential. A survey by Forbes Insights found that only 48% of senior executives strongly agree that a diverse and inclusive workforce is essential to driving innovation in the workplace, followed by 37% who somewhat agree and 14% who disagree. This survey included senior leadership from the Americas, Asia Pacific, Europe, the Middle East, and Africa. There is growth yet to be realized and mindsets that need to be changed.
The High Cost of Bias and Exclusion
It may seem that workplace discrimination is tied solely to litigation. And while it is a significant factor, employee turnover is just as costly.
In a workplace environment, employees who feel that their ideas and opinions are not heard, or that they are disrespected, whether it’s due to bias or discrimination, are more likely to leave the organization. The cost of employee turnover is significant, estimated at $64 billion annually in the US alone.
Lost time and productivity of the exiting employee, plus the time invested in recruiting, replacing, and training a new employee can cost as much as $10,000 for an hourly employee and between $75,000 to $211,000 for an employee making $100,000 per year.
How to Make the Workplace Diverse and Inclusive
Increasing workplace diversity and inclusion, especially in those countries and industries where traditional hiring models and cultural bias still hold strong, is not only important but also possible.
Following the lead of major corporations that have implemented diversity and inclusion initiatives is a good model for creating a workplace where individuals are recognized for their skills and contributions regardless of defining factors such as gender, race, age, or other differences.
One example is Mastercard, which has been consistently recognized in DiversityInc’s 50 Best Companies for Diversity. Listed in the Top 10, Mastercard’s stance is “diversity is what drives better insights, better decisions, and better products. It is the backbone of innovation.”
A business’s core belief should include valuing and accepting different perspectives regardless of gender, race, age, or any other defining factor.
1. Examine Hiring Practices
The first step in increasing the diversity of an organization starts with examining the current workforce. Is your department or organization composed mostly of the same race, gender, or even individuals belonging to similar backgrounds?
Certain groups have always been at a disadvantage in the workplace. While some women have been celebrated for breaking into certain male-dominated industries, they often struggle with a pay gap and lack of representation. Members of the LGBTQIA+ community often face blatant discrimination, with 42% disclosing they have faced some form of employment discrimination at some point in their lives.
HR professionals can detect such areas of company cultural bias or undesirable work environments. Hiring them to help examine and find solutions for your work culture is another way to improve diversity and inclusion.
For example, at global pharmaceutical company Novartis Human Resources professionals are educated on topics such as unconscious bias, inclusive leadership, disabilities/accommodations, and compensation/pay equity to improve their diversity hiring methods.
2. Create Optimal Working Conditions That Enhance Inclusion
Regardless of the makeup of your organization, asking employees what they need or what they consider to be an optimal working environment will illuminate opportunities that may enhance inclusion.
For example, employees with different backgrounds can share the significance of holy days or holidays with management and coworkers. This can be done through informal lunch gatherings or potlucks where co-workers can discover new foods or customs. Discussions or presentations that include historical events or cultural practices can increase interpersonal understanding and open more dialogue.
Such initiatives will make your employees feel heard and valued, and these positive feelings will translate into their work ethic.
3. Facilitate Team Building Activities
Most successful companies recognize the value of team-building events and exercises. This is an ideal environment for increasing inclusion.
Pre-pandemic, many companies implemented happy hours to encourage networking and interaction among employees. Besides good food, games, or prize drawings, employees or departments can be recognized for accomplishments or milestones at such times.
Bringing in a trainer or speaker to facilitate team-building games and exercises is another way to boost inclusion. These trainers will be skilled at ensuring everyone participates and can draw out those who may not be fully engaged. These types of exercises increase conversation, idea exchanges, and understanding.
Post-pandemic, many of these activities have shifted online. However, they are still possible. You can organize virtual meetups for your team with fun games or icebreaker questions for your employees to get to know each better personally and foster understanding and friendships.
4. Eliminate Pay Gaps
Beyond the emphasis on hiring and filling positions, what reflects greater inclusion is paying fair and competitive wages across the board. The gender pay gap is often the most evident, however, it can also exist depending on the sociocultural background of the employee. Transparency in pay rates is often taboo in many organizations, however, it can help build more trust among employees, illustrating that pay is based on skill and position and not on the person performing the tasks.
Upper management should allocate resources to both examine pay disparities and correct flagrant oversights.
5. Lead by Example
Those companies that successfully increase their diversity and inclusion initiatives reflect that in their upper management positions. Demonstrating that your company is dedicated to a diverse and inclusive workplace should be reflected in the composition of the C-Suite and upper management. Companies shouldn’t stop there even with a full roster of diverse individuals e. It’s not a set-it-and-forget-it initiative. Continuing to monitor employee morale, engagement, and productivity will ensure that your workplace is truly diverse and inclusive, which will in turn attract more quality talent and help you reap the benefits of an engaged team.