Debunking diversity Featured

8:00pm EDT March 26, 2009

The million-dollar question about making an investment in diversity is: Will it pay back?

While experts say diversity in the work force is a business imperative, defining diversity by employees’ physical attributes won’t foster a functional or profitable environment.

In fact, the definition of diversity is always evolving. Twenty years ago, the word spurred thoughts of gender issues since men held a high majority in the work force, while today the gender gap is narrowed and is less of a concern. Diversity’s definition has expanded, and diversity of thought, education, socioeconomics, religion and life goals are only a few of the seemingly endless list of terms people use when defining the term for themselves. These differences in your employees can make or break your business. If you foster an inclusive environment, where all employees can contribute thoughts and plans to improve your product or service in confidence, you will improve your bottom line.

A February 2009 Groundbreakers report by Ernst & Young defines diversity as an equation for success and notes that research has proven diverse groups outperform homogenous groups even in cases where the nondiverse groups have heightened abilities. Scott Page, a professor of complex systems at the University of Michigan at Ann Arbor, created the diversity prediction theorem, which says the collective ability of any crowd is equal to the average ability of its members plus the diversity of the group, claiming diversity is a sure way to attain a strategic advantage.

“Diversity shouldn’t be separated into a policy,” says Jeffery L. Smith, associate director, global diversity and inclusion, Procter & Gamble Co. “Looking at diversity as a strategy allows you to be the best in your class. Consider having a diverse work force to be a strategic and competitive advantage and a way to build and sustain your business. To be the best in your class, you have to know who will be purchasing your products or services and keep evolving with your customers. Insights of diverse employees make that process possible.”

Still, the return on investment is the hard evidence you want to justify devotion of time and money. Some say it’s difficult to quantify diversity ROI, but metrics are attainable. If you start with a plan that establishes your company goals and maps out a strategy, you can document the benefits and obstacles of a diverse team’s functionality that will best benefit your business.

Why it’s important

Since the country’s demographics are continually changing, a failure to branch out and move past your comfort zone when hiring and communicating with employees will ultimately result in financial punishment for the business.

“Getting past your circle of influence might be the most difficult part of recruiting or being part of a diverse work force,” says Valarie S. Boykins, director of diversity, TriHealth. “If companies operate with that, they’ll block out other opportunities. You’re not helping the business being myopic in your thinking.”

U.S. Census Bureau reports show Hispanics are the fastest-growing population, with an increase of 121 percent since 1999. The Asian population nearly doubled since 1990 and the African-American population is predicted to increase to 65.7 million strong by 2050, an increase of 15 percent since 2008.

“You can have three generations of people working side by side,” Boykins says. “The differences and similarities of employees is what makes a great business, but ineffective communication between employees will not drive quality. Diversity isn’t a bucket you set aside and think about sometimes. It should be interwoven into everything the business does.”

Affinity networks — employer-recognized employee groups who share a common race, gender, national origin or sexual orientation — are a great way to attract and retain diverse employees. Networking by affinity groups reduces turnover and gives companies insights to consumers they otherwise may have never understood.

General Motors Corp.’s People with Disabilities Affinity Group has been a consistent resource for providing input and support relative to accessibility of products and services. The group played a role in helping OnStar develop the addition of TTY capability, the text telephone for the hearing impaired, for OnStar-equipped vehicles. Another example of diversity was witnessed in PepsiCo Inc.’s Hispanic professional organization called Adelante. Its Hispanic employee network provided insights that resulted in the development of the guacamole chip. In the first year of distribution, PepsiCo’s Frito-Lay division sold $100 million in Lay’s guacamole chips.

“There’s not one aspect of diversity that is more important than another,” says Jamie Richardson, vice president of corporate relations for White Castle System Inc. “The uniqueness is what makes a company great. Having an array of perspectives and talents helps us all practice prudence and patience with diversity. Not seeing benefits of diversity is shortsighted.”

What you need to know

Diversity isn’t about being politically correct; it’s about keeping your business competitive.

“A strong retention rate has everything to do with hiring the right people to begin with,” Richardson says. “A diversity of employees keeps us in touch with customers and alert to a wide spectrum of ideas so the business can stay a quarter step ahead.”

Keep in mind the customers who you want to attract and then investigate opportunities in markets in which you want to expand or improve business. If you’re interest is in attracting a broader customer base, employees should mirror the communities in which you want to expand. Forge relationships with diverse community organizations and let them know about opportunities in your organization. Sponsoring events that interest diverse groups makes your company more attractive to diverse candidates. For example, host events in coordination with Cinco de Mayo, Chinese New Year or Disability Awareness Month, and make your business’s diversity interests and job openings known.

If you’ve established affinity groups within your company, they can also help with recruiting. They may be able to give you suggestions that will help your business attract more diverse candidates and offer ideas of where to post positions.
Starting an affinity group is easy.

“You need to allow and support group thinking,” Boykins says. “Promote (employee resource group) meetings by allowing time for meetings in the workday — make sure there is structure to the meetings, goals. It’s possible to go too far with diversity if you don’t understand it. These groups can tell managers multifaceted recruitment techniques. Keep in mind different generations communicate in different ways. Some prefer blogs like Facebook while other stick with the traditional newspaper. You can’t have diversity without inclusion — the very objective is for engagement. A variety of thoughts, perspectives, ideas is what makes you stand out.”

Hiring managers also need to keep in mind how to motivate and manage their staff as part of a recruiting plan. Experts encourage incentives for staff contributions to a diverse work force, considering employees’ job satisfaction can be your best advertising.

“Diversity and inclusion is more important now that ever,” Boykins says. “Companies are asking employees to work more, have more responsibilities with less people. Everyone has their aha moment or something that triggers them into negative or disparaging thinking so we have to open up the line of communication with dialogue over this issue so everyone feels included in the conversation. We might [not] always agree, but we shouldn’t be disagreeable when we disagree.”