Originally published November 30, 2022 , updated on January 17, 2023

One only has to take a cursory glance around them to see that the world has become increasingly complex and interconnected. This is largely due to globalisation and the ever-increasing pace of technological advancement. As a result, diversity is now a defining characteristic of modern society. This increased complexity and interconnectedness has been a positive force in many ways, providing opportunities and advantages that didn’t exist before. And the value of diversity and inclusion is not lost within the business world. 

It’s no secret that the workplace can be a reflection of the broader society. We see this in how companies are structured, how employees interact, and the types of policies in place. Not surprisingly, our workplaces tend to mirror the sociocultural dynamics in our lives outside work. This correlation is evident in the way that employees are treated, the way that work is structured, and the types of benefits that are offered.

There is a growing body of evidence that workplace diversity boosts business growth, employee well-being, and productivity. In its capacity to foster innovation, creativity, and empathy, diversity has the potential to bring about significant improvements in organisational performance.

Diversity and Increased Creativity

In fact, several studies have shown that diversity can lead to increased creativity, better problem-solving and enhanced decision-making. Moreover, diversity can also help build trust and improve communication within an organisation, helping levy it in a crisis. 

While the benefits of workplace diversity are clear, it’s important to note that managing diversity can be challenging. Businesses must create an inclusive environment where all employees feel valued and respected. They must also ensure that hiring and promotion practices are fair and transparent. 

One of the best ways a company can cultivate a more diverse workforce is through working with diversity strategy experts. With the right policies and procedures in place, diversity can be a powerful source of strength for any organisation. 

Difference Between Diversity, Equity, and Inclusion

Poeple often use diversity and inclusion interchangeably, but they are two very different concepts. 

Diversity is about the representation of different groups within an entity. On the other hand, inclusion is about how well the contributions, presence, and perspectives of those different groups are valued and integrated into the environment. 

In other words, diversity is about who is in the room, while inclusion is about making sure everyone in the room feels heard and valued.

While the value of diversity and inclusion come as one, they serve different purposes. Diversity is important because it ensures the representation of all voices. Inclusion is important because it ensures that all voices are heard and respected. Both are necessary for creating a truly inclusive environment.

Equity refers to practices and policies that are fair and just. These actions ensure all community members can thrive. Equity differs from equality in that it implies treating everyone as if their experiences are the same. Equality would be providing the same resources to everyone regardless of need. But equity provides the resources necessary for each individual to have an equal opportunity to succeed.

All three are key to creating a harmonious and successful business sphere. 

The Importance of Diversity in Business

A diverse workforce is generally defined as one that includes employees from a wide range of backgrounds. It includes different races, religions, genders, sexual orientations, and cultural backgrounds. 

While diversity in the workplace can be misconstrued as a potential source of conflict and tension, the reality is that it has the potential to create a more productive and innovative working environment. 

In fact, research has shown that companies with diverse workplaces are more likely to experience increased levels of creativity and innovation. This rise of authentic flair is because employees from different backgrounds bring with them a unique set of skills, experiences, and also perspectives. When these employees can work together effectively, they can generate new ideas. They solve problems in ways that wouldn’t be possible in a homogeneous environment. 

Additionally, diversity in the workplace can help to foster empathy and understanding among employees. By working with people who are different from them, employees can learn to see things from another person’s perspective and develop a greater understanding of their needs. This increased level of empathy can lead to improved communication and collaboration, which can ultimately benefit the company.

After all, our workplaces can be a microcosm of society, and by understanding the value of diversity and inclusion and addressing the issues that arise, we can help to create a better world for all.

Greater Innovation and Creativity From Diverse Perspectives

As the business world becomes increasingly competitive, companies are looking for any edge they can get. A recent study by the Boston Consulting Group has revealed that one underutilised source of competitive advantage is diversity. 

The study reported that businesses with more diverse management teams enhance innovation, generating 19% higher revenues. This proof is vital for all businesses but especially significant for start-ups and tech companies that sit at the forefront of innovation, where creativity and authentic ideas are the keys to growth. The study shows that diversity is integral to a successful revenue-generating business.

People have long known that diverse teams are more creative. A wealth of research has shown that the ability to integrate different points of view enhances a person’s creativity—something that many of us learn when interacting with people from different backgrounds. 

There’s evidence that this same principle applies to organisations as a whole. In the McKinsey & Co report, public companies in the United States that include diversity on their executive board experience a 95% higher return on equity than their undiverse counterparts. Simply put, the more exposure an organisation has to other cultures, the more creative it is likely to be.

Bringing together people from different backgrounds creates an environment where creativity can flourish. And as the world becomes increasingly connected, the need for creativity will only grow. So if you’re looking to boost your team’s creativity, look no further than diversity.

Employee Retention and Satisfaction

Employee retention is central to the success of a business. The cost of replacing an employee can be up to twice their salary, and the impact on morale can be considerable. A high turnover rate also reflects poorly on a business, making it difficult to attract new employees.

The value of diversity and inclusion in workplace is immense for both employees and employers. For employees, it can mean feeling seen and heard for their individuality and unique contribution. This can lead to increased job satisfaction and loyalty, which can, in turn, lead to improved performance and higher productivity. 

Let’s unpack this further. A survey published by Re-Shape reports that around 78% of employees believe it’s of vital importance that a company prioritises diversity and inclusion. Another report by the Deamer Group displays that one of the main reasons employees leave their organisations is because they have experienced a lack of social acceptance and belonging. 

A diverse workplace can also help to foster a culture of inclusion and respect. When employees feel respected and valued, they are more likely to be satisfied with their jobs, engaged and productive and more likely to stay with an organisation.

A company’s culture, employee engagement, productivity, recruitment, and retention efforts are all improved by diversity and inclusion. A diverse workforce allows for a broader range of perspectives and experiences to be brought to bear on problem-solving. At the same time, inclusion ensures that all employees feel welcomed, respected and valued. Companies need to create an environment where everyone can thrive to attract and retain the best talent. By committing to diversity and inclusion, businesses can create a more innovative and successful workplace.

A Healthy Work Environment Attracts Top Talent

In today’s business world, promoting diverse talent is more important than ever. A diverse workforce brings a variety of perspectives and ideas to the table. It can help to spark creativity and innovation. Additionally, promoting diverse talent can help to create a culture that embraces diversity, making your workplace more attractive to top talent. 

As the workforce continues to evolve, businesses face the challenge of attracting and retaining top talent. One key demographic that companies are looking to target is millennials. And if businesses want to appeal to this group, they must ensure that diversity is a significant part of their company culture. A survey conducted by Weber Shandwick showed that 47% of young employees search for diversity in the workplace during the hiring process. 

Ultimately, promoting diverse talent is good for business. It helps to create a stronger culture and attract the best talent. So if you’re looking to move the needle on your business, start by promoting diverse talent.

Inclusive Teams Thrive in Crises

As the economic fallout from the COVID-19 pandemic continues to be felt worldwide, many organisations are making difficult decisions about how to cut costs and protect their bottom line. However, new research suggests that companies who don’t let up on their diversity and inclusion (D&I) efforts during times of economic hardship can come out ahead in the long run.

A recent study published by Fortune shows fascinating results. The Great Recession of 2008 saw many companies fall to their knees. However, those that continued to prioritise their diversity and inclusion efforts and practices were able to flourish despite the circumstances. While many companies experienced around a 35% decline in stock performance, organisations that continued to stove for diversity and inclusion witnessed a dramatic 14% increase in their profits during the same period. 

Past recessions have proven that organisations that maintain their focus on diversity and inclusion (D&I) efforts outperform those that don’t. A study conducted by McKinsey & Company found that organisations in the top quartile for gender diversity in executive teams were 21 per cent more likely to outperform on profitability. This evidence demonstrates that organisations that keep up their D&I efforts during economic downturns ultimately come out ahead financially. 

As we teeter on the edge of another potential recession, companies should heed these lessons from history and maintain their focus on D&I. Being an effective leader is key to having a high-performing team. Inclusive leaders create a sense of belonging and build deep alignment on a clear purpose. Also, they seek out and value individual perspectives, all of which help create a successful team. 

The Value of Diversity and Inclusion in Teams

Leaders who are not inclusive run the risk of their teams underperforming. They foster an environment of command and control rather than collaboration. This can lead to resentment and conflict rather than respect and trust. Inclusive leaders must create a sense of community and purpose. It’s essential to keeping people motivated and focused on the goal. 

It’s clear that diversity, equity, and inclusion are paramount to business success, and the value of diversity and inclusion is profound for employees too. However, building a company on the basis of DE&I is more challenging and intricate than many believe. To create a strong foundation from the start, more businesses are reaching out to professionals. 

Goodman Lantern is proud to consist of dedicated diversity strategy experts. We offer DE&I strategy communication services that help your organisation form a diversity and inclusion plan, incorporate it into the overall business strategy and mission statement, and articulate it to the world to reap the full benefits. 

If you’re interested in learning more about our services, get in touch with us today.  

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