For years, the overwhelming message to employers and employees has been that diversity in the workplace is not only desirable from a fairness perspective, it is also good for business. Company leaders who endorse this idea believe they are doing what is right, but also believe they are adding to their bottom lines. After many studies, there is now considerable evidence supporting both the tangible and intangible value of diversity. If you are skeptical, please read on to learn just how important this practice can be for the future of your staff and your company.
According to Steven Cates, retired graduate professor at Purdue University Global, diversity originally referred to differences in such factors as age, disability, gender, race, and religion. But in the world of business, this definition changed out of necessity. Now, it is just one part of the ongoing effort to to include and engage the entire organization in forming a common culture. Reading this definition, the still-skeptical might ask, “if the goal is to form a common culture, why not just start with one, rather than assemble it from different pieces that don’t always fit well together?” The reason is simple – diversity has a robust return on investment.
- According to a Gartner study, 75% of organizations with diverse and inclusive frontline decision-making teams will exceed their financial targets.
- Study data also shows gender-diverse and inclusive teams outperformed gender-homogeneous, less inclusive teams by 50% on average.
These Are Big Numbers
If you told the CEO you had a surefire way to beat company targets 75% of the time, you might be moving into the adjacent office. How is this performance possible? Effective leaders know it’s not just how people look that defines diversity, it’s how they think. A small group of talented engineers from different backgrounds will offer a number of solutions for the same problem. These solutions can then be analyzed for time to market, complexity, cost and client suitability. A homogeneous group may be able to “think outside the box,” but keep in mind they’re beginning with the same box. A diverse team of six starts with six totally different boxes, so there’s no telling where the creative process will take them.
Diverse Leadership Also Delivers
If a diverse workforce is beneficial to company performance, diversity in leadership is equally important.
- McKinsey reports that companies in the top quartile for ethnic and cultural diversity in leadership are 33% more likely to earn above-average profits
- Study data also show companies with boards of directors in the top quartile for ethnic and cultural diversity are 43% more likely to earn above-average profits.
It is likely the same factors are at play in board deliberations as in problem-solving sessions. How do you solve a given problem in the least time and at the least cost? If everyone on the board has experience in carpentry, don’t be surprised if all the proposed solutions involve a hammer and nails.
Brainstorming is not Teamwork
Let’s say your company is in the top quintile for diversity and your team has been presented with an engineering problem that must be addressed quickly. Many leaders might be tempted to throw everyone into a conference room and hash it out over donuts. In our experience, brainstorming often becomes one of those “buzzwordy” activities that sounds much better on paper than in practice. This is what happens – people will all contribute, everyone will offer opinions, people will judge each other’s ideas, and ultimately, people will hold back to avoid the risk of looking foolish to the group. In this scenario, the best ideas are usually held back. While a brainstorming session with a diverse group can be productive, you might try giving everyone an hour (or a day, etc.) to come up with a solution on their own. Don’t forget that a camel is a horse designed by a committee – the most talented, diverse team can indulge in self-homogenization if not allowed to pursue their individual muses.
Techtonic Creates Diverse Teams
It is undeniable that by charging tens of thousands of dollars for bootcamps or other intensive IT training, companies are dramatically reducing the diversity of their technical teams (by limiting the applicant pool to those with economic means). By offering free classroom training (and an hourly wage for client work), Techtonic maximizes the diversity potential of its graduates, and maximizes the inherent benefits. Consider this statistic – employees in a diverse workplace are 12% more productive than those in a non-diverse work environment. These employees are also less likely to leave the company. If as a company owner your net margin is 12%, having a skilled and diverse team just doubled your profits.
Read more on how Techtonic can create the ideal, risk-free tech talent pipeline for your software development needs.