Diversity: Simply another management initiative? Or integral to success?

Maintaining a diverse and inclusive workplace is critical to an organisation’s future success. A diverse team operating to its full potential is one of the biggest levers an organisation can have to create competitive advantage.

Through a diverse workforce organisations will find the most capable and talented employees. Diverse representation is a core enabler of diverse ideas; diverse ideas lead to better solutions; better solutions lead to better business results.

What is Diversity?

Diversity is defined in numerous ways. A diverse workforce includes many types of diversity, including:

Social category diversity: demographic differences such as race, age, gender, ethics
Informational diversity: organisational differences such as education, tenure, function
Value diversity: psychological differences in personality and attitudes
In the broadest sense, diversity is about valuing differences; those differences may be of culture, ethnicity, race, gender, nationality, age, religion, disability, marital status, sexual orientation, education, life experiences, or beliefs.

It is about recognising that everyone is different. Everyone is unique. It is about recognising that everyone has both strengths and development areas and most importantly, it is about recognising that everyone has something to offer.

Changing Demographics

In searching for talent, organisations have had to react to changing demographics. European birth rates are falling, leading to a shrinking talent pool; Disability affects 15 - 20% of every country’s population; by 2020, close to half the adult population of the UK will be over 50 years old; and women currently represent 44% of the workforce.

Another way of looking at this is that by 2011 only 18% of the UK workforce will be white, male, not disabled, heterosexual and under 35 years old.

The Business Case for Diversity

Simply put, diversity “makes good business sense”.

Diversity adds clear value to employees, to the business, to customers, to clients, to shareholders and to the communities in which organisation’s operate.

In making the business case, there are 5 key focus areas:

  • Recruitment and retention of talent
  • Better understanding of your customers and clients
  • Corporate Image
  • Corporate & Social Responsibility
  • Complying with legislation

1. Recruitment and Retention of Talent

In order to attract and recruit the most capable and talented employees, organisations need to look at the broadest pool of candidates from which to select. In doing so, organisations harness a more diverse range of experiences and skills.

At a time when the “War for Talent” is as strong as ever, embracing diversity is key. Getting it right for minority groups sends out messages that this is an organisation that you would want to work for.

To retain this talent it is crucial to create a climate where people from all backgrounds feel included and valued.

2. Better understanding of your customers & clients

Diversity confident organisations will be able to capitalise on the greater understanding they have of the spectrum of current and potential customers and clients at a time when the demographics of the marketplace are changing fast as is the demand from consumers for flexible products and services.

Special purpose and customised products are often adopted and welcomed by customers who do not have special needs, as time and time again they simply work better for everyone.

3. Corporate Image

Research shows that members of the public prefer companies that are seen to be positively contributing to the environment and society. A good reputation is one of the most valuable intangible assets a company can have, and maintaining it is a key motivation for companies to engage in responsible business.

4. Corporate Social Responsibility

The ethical benefits of diversity confidence are a central component of the business case for action. Responsible behaviour, also referred to as CSR, should be at the core of a company’s programmes and strategies, not a bolt-on to operations

The most success organisations are those that recognise that responsible business can help them to innovate and develop new products and services, access new markets and minimise risk.

5. Complying with Legislation

Legal compliance is obviously a key aspect of corporate governance and responsible business.

Diversity confidence helps to ensure that organisations stay within the law and there are a number of obvious benefits of ensuring that you do not act in an unlawful manner.

These include:

  • Reputation Management: discrimination and human rights violation cases are extremely damaging to corporate reputation; they attract high profile negative press coverage and stakeholder pressure.
  • Reduced legal costs and damages: discrimination cases in the UK have resulted in payouts costing millions of pounds, with legal costs in fighting cases even higher.

How to Approach Diversity

The ultimate aspiration is that diversity should be embedded in everything an organisation does.

An integrated approach to diversity is more likely to “stick” and lead to a permanent shift in the culture and value-set of the organisation than if the focus is solely on the recruitment and retention of talent.

An integrated approach combines 6 key areas:

1. The Business Case

An organisation must have a strong business case for embracing diversity; this should include the following core strands:

  • Commercial: increasing effectiveness and reducing costs
  • Legal: avoiding costs of legal action
  • Moral: its’ the “right” thing to do.

2. Leadership in a Strategy

As with any strategy, there must be strong leadership. Organisations that have been most successful in this area have a highly visible strategy which is led by the Board members.

Diversity must become “Business as Usual”, and to mainstream diversity into all operational areas.

3. Accountability

The more that managers are held responsible / accountable for delivering diversity the more it will become integrated into your organisation’s activities (40% of line managers do not believe they are accountable for diversity).

Building middle and line management commitment is a key priority for success; in order to achieve diversity objectives, the commitment to change needs to be matched by action at all levels of the organisation to promote the required culture change

4. Measurement

Activities about measuring and evaluating the impact of managing diversity show more scope for demonstrating how diversity initiatives and mainstreaming diversity can make a difference and add value to business performance.

Data must be captured and progress measured in order to understand the real effectiveness of diversity initiatives.

5. Communication

Communication is key in achieving a real commitment to diversity. Diversity must be openly talked about as an integral part of the business strategy.

Line Manages must be accountable for cascading information down. And crucially communication must go much much further than simply putting information on the intra-net.

6. Learning

As goal posts constantly move and new challenges present themselves organisations must be prepared to continually learn and be ready with new solutions.

Benchmarking, sharing best practice and networking are all effective ways of learning and keeping abreast of our changing society.

© Helen F Cooke 2008