Diversity and inclusion is evolving, but many of the approaches that companies are using have stayed the same since the 60s. Traditional policies are designed to police the thoughts and actions of managers, which can reinforce bias and result in discriminatory behaviour.
If you want to champion diversity in your organisation, then you first need to understand how it’s changing. After that, we’ll explain why existing programs haven’t been working, and what you can do to introduce a modern approach to diversity and inclusion – that actually works.
How diversity and inclusion is changing
A recent survey by Deloitte found that millennials define diversity as the blending of unique perspectives within a team, also known as “cognitive diversity”. While millennials focus on the knowledge, experience and unique insights of an individual, older generations aim to represent different genders, races, religions, ethnicities and sexual orientations on a team.
In the words of one millennial survey respondent, “Diversity is a variety of cultures and perspectives working together to solve business problems.” When talking about inclusion, millennials also tend to focus on collaboration in pursuit of positive business outcomes.
This focus on cognitive diversity can help to tackle unconscious bias in the workplace and prevent groupthink, but there are still issues when it comes to representation. 5% of Fortune 500 CEOs are women (a drop of 25% since 2017), and there are only 3 black CEOs, which is the lowest number since 2002 – compared to roughly 72% who are white and male.
Why traditional diversity programs don’t work
Diversity and inclusion are often uttered in the same breath, but that doesn’t mean they’re the same thing. Charlotte Sweeney OBE wrote « Equality is being invited into the room. Diversity is getting a seat at the table. Inclusion is sharing your views and being heard. »
A look at some of the facts and figures around diversity and inclusion reveal there are still significant issues when it comes to minority groups. 22% of LGBTQ Americans have not been paid equally or promoted at the same rate as their peers, while only 35% of people of working age with at least one disability have a job, compared to 78% of non-disabled people.
Diversity and inclusion might be changing, but most organisations are still using the same tools they were in the 1900s. Some of which include:
- Diversity training
- Hiring tests
- Performance ratings
- Grievance procedures
One of the most significant reasons these approaches haven’t been working is that they’re used as a way to avoid negative consequences, and often involve placing rules and restrictions on how managers operate – which can interfere with their sense of autonomy.
Diversity training is a common tactic, which aims to tackle issues of discrimination. That being said, studies have shown that when diversity training is implemented poorly it usually results in anger and resistance, with many participants reporting more animosity toward other groups afterward.
Recruitment is another area where discrimination can arise. In one field study, researchers at Rutgers University sent out over 6,000 applications for fictional accounting positions. Two-thirds of the applicants disclosed their disabilities – a spinal cord injury or Asperger’s Syndrome – in their cover letters, while one-third didn’t. Despite the fact the applicants were qualified and their disabilities wouldn’t interfere with their work, those with disabilities received 26 percent fewer responses from employers.
The use of hiring tests can also be counterproductive and provide opportunities for existing biases to come into play. Lauren Rivera, a professor at the Kellogg School of Management, studied how investment banks and consulting firms use maths and problem-based scenarios during interviews. She found that the hiring team paid little attention when white men failed the tests, whereas they paid more attention when women and black people did.
The same pattern emerges when companies introduce grievance procedures. Rather than trying to change their problematic behaviour, many managers accused of discriminatory treatment try to “get even” with those who complain.
Even though it’s clear that unconscious bias and discrimination are alive in the modern workplace, trying to forcibly control manager and employee behaviour is rarely the solution. It’s much more effective to use a carrot instead of a stick when it comes to diversity and inclusion.
How to make diversity and inclusion stick
It’s important to have systems in place that create more opportunities for those in minority groups. For example, at P&G, ten percent of executive compensation is linked to diversity goals, which are evaluated as part of performance reviews. Criteria include being an executive sponsor of an employee resource group, being a cross-cultural mentor, and recruitment and promotions in the executive’s area of responsibility. Additionally, the stock option awards for the company’s top officers are linked to diversity results.
One of the best things you can do for diversity and inclusion is to continuously involve managers and senior leaders, rather than running one-off sessions. Combined with greater social accountability, your diversity programs more likely to be successful from the start.
Involve managers and senior executives in diversity initiatives
When managers are involved in improving diversity, they eventually start to see themselves as diversity champions. One of the best examples is college recruitment programs targeting women and minorities. Managers shouldn’t be forced to take part, but when the message is positive and involvement voluntary, the results speak for themselves.
Five years after a company implements a college recruitment program targeting female employees, the share of white women, black women, Hispanic women, and Asian-American women in its management rises by about 10% on average. Our reports also reveal the benefits of women in leadership.
Another way that managers can positively impact diversity in the workplace is through “inclusive leadership”, which is defined by six key behaviours:
- Encouraging team members to speak up
- Making it safe to propose new ideas
- Empowering team members to make decisions
- Taking advice and implementing feedback
- Giving actionable feedback
- Sharing credit for team success
Of employees who report that their team leader has at least three of these traits, 87% say they feel welcome and included in their team, 87% say they feel free to express their views and opinions, and 74% say they feel that their ideas are heard and recognized.
Inclusive leaders do their best to create a sense of psychological safety at work, which has knock-on effects for productivity and engagement. Employees who feel they can be their authentic self at work are nearly three times more likely to say they’re proud to work for their company, while employees who feel a sense of belonging at their company are more than fives times more likely to to feel empowered to perform their best work.
Create a sense of social accountability in the workplace
Do you care what other people think about you? Most of us do, which is why it’s a powerful way to ensure managers and employees uphold diversity and inclusion initiatives.
As part of a study into accountability and transparency at work, Emilio Castilla of MIT’s Sloan School of Management, found that African-Americans in one firm were getting smaller raises than white employees, even when they had identical job titles and performance ratings.
Can you guess what happened when the firm posted each unit’s average performance rating, along with pay raise data by race and gender? The differences soon disappeared, which highlights what happens when decisions are available for the whole company to see.
Another way to create social accountability is to hire a diversity manager. Companies that appoint diversity managers see 7% to 18% increases in underrepresented groups in management over the following five years.
If budget is an issue, then task forces can be just as effective. Ideally, they need to consist of people from different departments and include members of underrepresented groups. When a task force is present, it forces managers to think about how their actions would look if they were shared with the rest of the organisation.
Companies that put in diversity task forces see 9% to 30% increases in the representation of white women and of each minority group in management over the next five years.
Diversity doesn’t work without inclusion. Organisations need to create equal opportunities for minority groups when it comes to recruitment, but creating a more inclusive culture is the key to making diversity initiatives stick. Involving senior managers and creating a sense of social accountability are both effective tools for combating unconscious bias in the workplace.
Definitions of diversity and inclusion might be different depending on the generation, but it’s clear that a more diverse workforce can pay dividends, not only in terms of a more inclusive place to work, but also when it comes to innovation and financial performance.