Some may still think diversity in the workplace is a trendy, politically correct concept for businesses today. But it is much more. In fact, companies who are failing to pursue true diversity in their workplace environments are losing ground in competitive markets. Are you pursuing diversity in the workplace? Maybe it’s time to step back and take a look. Your business’ competitive advantage in the market may depend on it.
Exploring What Diversity in the Workplace Really Means
Defining diversity in the workplace goes well beyond equality in gender and race. Indeed, these are important areas to consider when examining the level of diversity in your workplace. But workplace diversity encompasses much more. For example, age diversity plays a role since different generational influences affect insights and perspectives. Millennials will typically approach problems differently than Baby Boomers, and vice versa. Diversity also involves cultural influences and past experiences socially, economically, and educationally.
Given the scope of what diversity in the workplace can entail, it may seem challenging for businesses to define. Researchers have tackled this problem by grouping workplace diversity as either inherent or acquired. Inherent features of diversity include gender, sexual orientation, and race. Acquired diversity features, however, involve cultural influences and an array of past experiences.
In pursuing diversity in the workplace, it is therefore essential to seek broad areas of both inherent and acquired diversity in the workplace. Unfortunately, recent statistics show that fewer than a quarter of businesses have workplace diversity based on these criteria.
Diversity in the Workplace Equals Competitive Market Advantage
Investing in greater workplace diversity may seem like a great deal of effort. Is it worth it for your business? Absolutely. As many firms are realizing, diversity is not simply an ethical way of doing business. It places your business in a great position to be competitive in the market.
Optimizing Human Resource Value
When diversity in the workplace is encouraged, employees become more engaged. Inclusive environments and organizational cultures promote teamwork, collaboration and exchange of ideas. Diversity and the inclusiveness allow you to more effectively tap into your human resource talent.
Innovative Thinking and Creative Problem Solving
With greater diversity in the workplace, multiple perspectives are inherently present. Rather than coming up with the same solutions repeatedly, workplace diversity stirs the pot. New points of view will allow others to see and think in new ways. Creativity and innovation result. Ultimately, this means your business will be more likely to gain a competitive market advantage.
Improved Employee Retention
Diversity in the workplace promotes inclusion, and inclusion promotes positive workplace cultures. Positive workplace cultures make employees want to stay. In the tech industry where it is traditionally low, tremendous employee turnover exists. In fact, poor employee retention results in $16 billion in costs in this sector alone.
A Better Bottom Line
Market research consistently shows diversity in the workplace is linked to better financial performance. For example, firms in the top quartile in workplace diversity are 35 percent more likely to outperform other businesses in their industry. Likewise, for every 10 percent increase in ethnic diversity on senior executive teams, firms enjoyed a 0.8 increase in earnings. Diversity pays nice dividends.
Greater Competitive Market Dominance
In a study involving 1800 professionals and 40 case studies, diversity in the workplace correlated with greater market share. Specifically, firms with workplace diversity were 45 percent more likely to have market growth year after year. Likewise, diversity in the workplace correlated with a 70 percent higher chance of capturing new competitive markets.
Making Diversity in the Workplace a Reality
According to surveys involving large global enterprise executives, approximately 85 percent state diversity in the workplace is critical for success. However, other research shows only 78 percent of businesses in competitive markets achieve workplace diversity. Based on these figures, diversity in the workplace doesn’t simply happen overnight. Businesses must be bold and develop specific strategies to achieve these goals. The more competitive the market, the more important diversity in the workplace will be. Smart businesses will acknowledge this and invest their efforts accordingly. Those firms that achieve such workplace diversity will likely be market leaders of tomorrow.