The Business of People Blog Series
I was on holiday recently and it was boiling. As a man with ginger hair and pasty skin, I burn easily. So, as I sat around the pool, I started wondering why there wasn’t a shady area and began to imagine the team of designers and architects who’d built the pool. I’d be willing to bet there wasn’t a pale skinned, ginger person within that team because if there was, they’d have definitely said, ‘we need to stick in a shady area for all the gingers out there.’
Now this is a slightly silly – but good example of why diversity in business is important. And also shows that diversity is about more than we may think. I’m sure most people would agree that having an inclusive workplace is important – and businesses have a responsibility to be diverse. But people think of it as a very linear thing – old and young, male and female, black and white. Personally I don’t see it that way. It is those things of course, but it’s also all the views, beliefs, opinions and ways of thinking in between. You might be hitting your diversity target on one scale and have 50% of women in your boardroom but be extremely limited in another way – and be 100% Christian or Conservative.Too often businesses get bogged down in the importance of hitting a target and that’s absolutely not what we should be chasing. It’s limiting to see diversity as merely ticking boxes. It’s actually about looking beyond the obvious – making sure you’re recruiting from across the personality types for example or from different academic backgrounds. It’s about surrounding yourself with as many different opinions as possible.
Why would you want to do this? Well, firstly because if you’re a business with a customer base – there’s a pretty good chance it will be a diverse one. If you’re able to understand and associate with all aspects of that customer base, you stand a much better chance of satisfying them – back to me and that pool. But it’s not just about the creation of a product, it’s also about seeing opportunity. I was with a guy yesterday who has fantastic tech product and a superb technical mind. Working in tech, he surrounds himself with technical people – even his sales and marketing people have tecky brains. After talking for twenty minutes to me – and I’m not technical at all – he started to see his product in a totally different way. And I wasn’t saying anything clever, in fact what I was saying was significantly less clever than what he was saying. I just saw it differently. People with different sets of experiences bring different processes and ways of solving problems. This is invaluable in business.
Diversity, to me is also about challenging beliefs and biases that we all have within us. For example, the belief it’s better to recruit a graduate over someone who left school at 16. Now academia is fantastic, but a degree is just one measure of intelligence. It shows that person has learned what someone else has told them for three years. But often it might be better for that business to recruit someone who isn’t so conformist, who hasn’t been through the education system for years. Sometimes the rebellion and risk taking that’s labelled negatively in the education system is exactly what you’re looking for. You might want someone who says, ‘I’m not going to do what everyone is telling me to do. I’m going to do it my own way. I’m going to innovate.’
The other reason diversity matters is because it’s often a better use of resource. Let’s look at part time women who want to return to work after having a child – I think it’s embarrassing and actually criminal that as a society we underutilize this resource so much. You’ve got qualified, intelligent, motivated people and so many of them are excluded from the corporate world once they’ve had a baby. It’s a terrible waste not to fuel that resource into the GDP. This is the country’s growth we’re talking about and all it requires is something as simple as companies having more flexible working hours, or to introduce home working. The top performer in my business last year was a female who worked a four-day week. Many businesses would reject that idea and they’re idiots to do so. Don’t get me wrong, as her boss I wish she could do five days a week because I’d get 20% more from her – but she still smashed the competition around her who do work five days!
The most recent McKinsey Report research hugely argues the case for diversity in business. They examined 366 public companies across America, Canada, Latin America and the United Kingdom, across a range of industries. They found that companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective industry medians. And companies in the top quartile for gender diversity are 15% more likely to outperform their competitors in terms of financial returns. And in the UK for every 10% increase in gender diversity on the Senior Exec team, EBIT rose by 3%.
These figures are staggering. And that’s also how diversity needs to be thought about – as something that offers a real ROI. No one cares about it when it’s done in a box ticking, HR way. Businesses are formed to make money so if we can show our CEO’s and shareholders there’s a fantastic ROI for being more diverse, they’ll listen. And that doesn’t happen on a case by case basis or by saying, ‘yay, we employed a woman last week.’ It happens by making a strategic decision to truly be as open-minded as possible, from the top down. It’s an underlying attitude across the company, it’s engrained in your vision and strategy. Because it’s the right thing to do – in every way.
How do you ensure your organization is diverse? And how much does it matter? Share your views and join the debate. And if there are any other topics you’d like me to blog about then just let me know.