The Financial Proof DEI Has An ROI
Alex Edmans has a series of incredibly informative posts debunking the current proof points on the ROI of DEI.? They are discouraging, particularly after every marginalized group in the U.S. was sucker-punched in the guts over the past few weeks.? This is also fueling other political leaders to dial up their subjugation of marginalized groups; like a drunken Ivy League frat party full of predators ready to haze and violate anyone who is not part of their little club. (rant over)
Now let me be clear, the definition of DEI has been an epic failure because it excludes others and focuses predominantly on race.? There has been immense discrimination against low-income Caucasian Americans.? They have been excluded from DEI discussions for over four decades.? The disability community has been equally excluded.? As have those with invisible disabilities.? Even women are excluded in the discussion, which is ironic since women intersect with all marginalized groups and is the largest minority in the world.
On the other hand, race still tops the DOJ’s 2023 list of hate crimes at 52.5% (please note the sexual assault of women is not considered a hate crime when you look at how the statistics are reported and despite the U.S. legal definition of a hate crime).? One cannot ignore the spillover of personal hatred and biases into the workplace, and its business impact.
For the last 300+ years, the “immigrant threat” has been a rallying cry. First the French.? Then the Catholics.? The Asians.? The Irish.? The Jewish.? The Italians. And so on.? All versions of cheap replacement labour after the genocide of the Indigenous and the enslavement of Africans.? Good enough to build up America’s greatness but not good enough to be allowed to stay and participate equally.?
Here’s Some Financial Proof—The Expulsion of Asians in Uganda
Idi Amin, Ugandan “president”, believed Asians had been “sabotaging Uganda’s economy, deliberately retarding economic progress, fostering widespread corruption and treacherously refraining from integrating in the Ugandan way of life.”?? In 1972, he acted on his racial bias and gave the Asians 90 days to leave the country.? The estimate is that somewhere between 40,0000 and 50,000 Asians left their homes and businesses behind.? Originally, it was just those without citizenship but eventually the expulsion included Asians with Ugandan citizenship, with threats of concentration camps as an incentive to leave.
He used hate speak, branding Asians as “bloodsuckers” despite them being responsible for approximately 90% of Uganda’s tax revenues.? They represented 1% of the population.
Once all Asians were “dealt with” the GDP of Uganda dropped significantly.?
How does this relate to Business Results and Brand Economics?
Most DEI research is conducted in a vacuum.? Prospects and customers are asked a series of questions that focus on their personal ethics.? When asked in that form, the research respondent will always inflate their responses.? Who wouldn’t claim that they would be willing to buy a more environmentally friendly frying pan over one that isn’t? ?It is business suicide to focus your value proposition on a social cause without testing other factors that drive the customer’s decision.
Most consumers are not going to pay a 40% premium for an environmentally-friendly pan if offered one with other benefits such as non-toxic, well-known brand, saves you money, etc.? McKinsey surveyed over 7500 consumers worldwide and found that although 87% stated they “are concerned about the environmental and social impacts of the products we buy” only 25% have purchased a green product. Knowing the difference between intent and behaviour will allow you to more accurately forecast business results.
Brand Economics requires that all value propositions be assessed against each other, and against behavioural patterns throughout the customer journey, to understand whether there will be a noticeable change in sales.?
So, when people ask what the relevance is of discussing DEI on a business networking site, there is a clear intersection between DEI and economic performance. Knowing how to evaluate it is possible.
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