The Business Case for Diversity - Again?

Can you state or provide evidence that substantiates the business case for diversity?

How often must diversity professionals answer this question for organizations’ leadership? When asked by leadership of at least two companies recently, their concern was how do we present or make the case for diversity relevant. Most CEOs and C-suite only see workforce and hiring a certain ‘quota’ as their only measurement for diversity success.

Okay.

Don’t let me get started on using the word quota to gage diversity metrics. That word became a trigger for some companies that wanted to impose diversity goals in hiring as a solution to discrimination but experienced some backlash particularly from white males. Although metrics are legal and when done properly, the organization can be intentional about including persons from underrepresented or sometimes overlooked communities of color, other diverse groups, gender, sex, religion, race, or national origin. (See Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, and the Americans with Disabilities Act, which safeguard the rights of people in protected classes from discriminatory hiring practices.)

“Inclusion is not a matter of political correctness. It is the key to growth.” –Jesse Jackson (Activist)

Now back to the question. Yes, there has been numerous research and case studies done to validate how valuing diversity AND the execution of a well thought out strategic plan that includes diversity goals can improve organizations’ bottom lines. Even more than that, a strategic approach will attract qualified candidates, i.e., workforce; improve the internal talent pipeline; create a more inclusive and engaging culture; and lessen turnover with better retention results. These are just a few optimal outcomes.?

I shared the McKinsey & Company 2020 report Diversity Wins: How Inclusion Matters with representatives of the two organizations who wanted some data. Let’s be real here. Just because the research is there doesn’t mean leadership is going to jump up and down excited to make changes and embrace a brave new world!

If your leadership does not lead the charge or sincerely exemplify to the rest of the company why diversity and inclusion matter, most likely it ain’t gonna happen. The usual excuses like these surface:

‘We hired one Black person, promoted her/him, but they couldn’t handle the job’. (Hint: That was enough for us.)

?‘We can’t find any.’ Or, 'my network does not include these people.' (I hear this a lot with predominantly white boards of directors.)

‘Our company isn’t affected by diversity.’ (Hint: We don’t need diversity here.)

‘We tried diversity training and it didn’t work.’ (Hence, no follow through and nothing changed.)

‘Our communities are not diverse.’ (What data or demographics are available to support that? Is your diversity span too narrow or not inclusive of all diverse communities?)

‘Our hiring managers may not cooperate.’ (Hint: Is this indicative of the organizational culture? If so, this problem needs to be addressed immediately. Managers should know and understand the organization’s commitment to DEI. Motivate or replace them!

“You have a responsibility to make inclusion a daily thought, so we can get rid of the word ‘inclusion.’ –Theodore Melfi (American Producer – Hidden Figures)

A Different Take

Now for a different take on this topic. Please don’t yell at me when you read this next part. I’m changing gears, just a little bit. While continuing my research on the business case for diversity, I came across two Harvard Business Review articles that might suggest a different spin. The summaries are pasted here; however, I encourage you to read each article to draw your own conclusions. These references can be the start of many robust conversations where you work. So here goes.?

https://hbr.org/2020/11/getting-serious-about-diversity-enough-already-with-the-business-case

Summary.??Leaders may mean well when they tout the economic payoffs of hiring more women and people of color, but there is no research support for the notion that diversifying the workforce automatically improves a company’s performance. This article critiques the popular rhetoric about diversity and revisits an argument the authors made 25 years ago: To fully benefit from increased racial and gender diversity, organizations must adopt a learning orientation and be willing to change the corporate culture and power structure.

Four actions are key for leaders: building trust and creating a workplace where people feel free to express themselves; actively combating bias and systems of oppression; embracing a variety of styles and voices inside the organization; and using employees’ identity-related knowledge and experiences to learn how best to accomplish the firm’s core work.

A version of this article appeared in the November–December 2020 issue of Harvard Business Review. Written by Robin J. Ely and David A. Thomas

https://hbr.org/2022/06/stop-making-the-business-case-for-diversity

Summary.??Eighty percent of Fortune 500 companies explain their interest in diversity by making some form of a business case: justifying diversity in the workplace on the grounds that it benefits companies’ bottom line. And yet, in a recent study, the authors found that this approach actually makes underrepresented job candidates a lot less interested in working with an organization. This is because rhetoric that makes the business case for diversity sends a subtle yet impactful signal that organizations view employees from underrepresented groups as a means to an end, ultimately undermining DEI efforts before employers have even had the chance to interact with potential employees. Based on their findings, the authors suggest that if organizations must justify their commitment to diversity, they should do so by making a fairness case — that is, an argument based in moral grounds — but to achieve the best results, they should consider not making any case at all. After all, companies don’t feel the need to explain why they believe in values such as innovation, resilience, or integrity. So why treat diversity any differently?

Written by Oriane Georgeac and Aneeta Rattan

My conclusion after marinating on these articles is that the business case is still relevant but execution of the strategy from the top throughout the organization requires commitment to get it done. In other words, the same hard work you attribute to your bottom line that encompasses actions across the full spectrum of business operations should also include DEIB!

Questions: What does your organization think about the business case for diversity? How are you making that case real and impactful?

“We are greater than, and greater for, the sum of us.” –Heather McGhee (Writer, ‘The Sum of Us: What Racism Costs Everyone and How We Can Prosper Together’)

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