4 Ways Diversity Makes A Rock-Solid IMPACT
Cultural diversity – whether it’s racial, ethnic, gender, or sexual – is an increasingly hot topic that shows no signs of slowing down. Let’s examine why diversity in the workplace has gone from a “nice-to-have” to a critical business imperative.
- Diversity leads to a higher market share
While communities are becoming increasingly culturally diverse, businesses need to mimic the communities they serve by bringing together individuals from different backgrounds and experiences. Put simply, people want to engage with companies that employ people similar to them. This enables companies to capture a greater share of the market by marketing more genuinely to diverse communities, communicating effectively with their diverse customers, and understanding their needs.
Looking for proof of the above? Research from McKinsey revealed that companies in the top quartile for racial and ethnic diversity are 35 per cent more likely to have above-average financial returns, while companies in the bottom quartile were less likely to achieve above-average results.
- Diversity supercharges problem-solving
Institute for Supply Management CEO Tom Derry told Procurious that cultural inclusiveness is no longer an idea, but an expectation. “Your team needs to be diverse – in fact, you’ll look impoverished if you don’t have that. The benefits include being able to tap into a diversity of experience and opinion to solve challenges. This creates a truly attractive environment for top talent.”
If you lived in a dystopic Brave New World scenario where every member of your workforce had identical cultural backgrounds, education and work experience, it’s highly likely that each individual would come up with an identical set of solutions when presented with a problem. That’s why it’s imperative that any group includes people with culturally diverse backgrounds and highly varied work experience who can bring entirely different schools of thought to the table, and hence a wide variety of innovative solutions.
- Diversity in the workplace helps you become a more effective global professional
Supply management professionals are increasingly working within the global supply chain, which is why being about to communicate effectively in different parts of the world is a must-have skillset. Having high cultural intelligence (CQ) means knowing how to create relationships, understand cultural nuances and adapt your approach to suit cultural differences in foreign countries.
Shelley Stewart, CPO and VP, DuPont, told Procurious that “A diverse workplace provides a wealth of varied experiences that are crucial for supply management organisations to operate even more effectively in the global economy.”
How? Because an inclusive and diverse business will increase the empathy (and CQ) of all employees as cultural tunnel-vision is reduced. In short, everyone benefits from a higher appreciation of different outlooks and an increased understanding of others. Armed with these skills, a supply management professional is much less likely to suffer culture shock or put a foot wrong when interacting internationally.
- Diversity will help you attract and retain the best talent
If your company has built a solid reputation as an organisation with a truly diverse and vibrant workforce, it will attract the very best and brightest in the market. Companies that fail to recognise this are missing out on top talent, as potential candidates may have the perception that your company simply doesn’t tend to hire people from their cultural background. To state the obvious, companies should be making every effort to widen, rather than shrink, the talent pool.
There’s evidence that businesses which fail to foster inclusive, diverse workforces suffer from higher turnover rates, as a hostile work environment forces employees to leave. High turnover leads to avoidable costs, which is another reason why cultural diversity positively impacts your organisation’s bottom line.
More resources on Diversity from ISM:
- ISM’s statement on Diversity
- Learn how to become a Certified Professional in Supplier Diversity (CPSD)
- Join ISM’s Diversity Mentor Program
