Why Diversity and Inclusion In
Leadership Matters
By Indira Bunic – LIC Board Member
Have you ever thought, Is diversity and inclusion in leadership the same, and why Diversity and Inclusion in Leadership matters? Has it ever been one of those things that we worry about as leaders because diversity and inclusion in leadership are important? Also, the terms are often used interchangeably. They are related but quite not synonymous. Therefore, thinking about growing and fostering innovation in our organizations, we must understand the difference between diversity and inclusion. Let’s get into the basic meaning.
What is Diversity?
Diversity implies differences. It’s a concept that recognizes various elements within a given setting. It’s almost like that brilliant tapestry woven with bright threads of race, gender, age, sexual orientation, physical ability, ethnicity, and many more threads to create a rich and complex whole. This variety could be multiple backgrounds, perspectives, and experiences, all combined to create the richness of the tapestry. In a workspace, dynamic diversity weaves in multiple outlooks and experiences, creating fertile ground for creativity and innovation.
What is Inclusion?
Inclusion is about creating an environment where all these contrasting elements come together positively. It means creating a work environment where everyone can feel respected, accepted, heard, and valued. It is a practice of ensuring that all, despite their diverse backgrounds, are open to identical vacancies and resources. It involves embracing and leveraging these differences to elevate the performance and culture of the organization to a standard where every voice can be heard and valued. It is not one picture out of the difference; it is the celebration and merging thereof into a plus-enhanced value. Instead, it should be made into a space where all those differences are welcome, respected, and valued. Rather, it is all about ensuring that every other team member feels like they belong and have power.
Diversity and Inclusion are Critical
Components
For example, did you know that companies with diverse executive teams are 33% more likely to outperform their peers in terms of profitability? Diversity and inclusion are important and imperative in the current global marketplace. This is reflected in the retention rate and the enhancement of financial performance. Let’s, for instance, explore the McKinsey report that indicates companies within the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective national industry medians. It is by diversity that different views come in, making it easier for innovation to take place, while inclusion is to ensure that such views are respected and used. In other words, it would lead to more informed decisions and build a good reputation for the company.
D&I is not just another box that must be ticked; it is a strategic imperative with tangible benefits. Diverse teams necessarily become innovative because they bring different perspectives. More so, an inclusive culture gives team members a sense of belonging, a feeling that everyone is most valued and empowered to give their best, which likely results in high engagement and productivity. In the long term, committed companies find attracting and retaining the best talent easier. Again, a diverse team will mean a wide understanding of different markets and customer bases, enabling wide and effective strategies to build on business growth.
Interface and Connectedness Between
Diversity and Inclusion
Understanding the subtle yet powerful interface and interconnectedness of diversity and inclusion is key for any organization to achieve sustained success. Diversity represents the composition of a workforce that derives from various backgrounds, perspectives, and experiences. Inclusion is the environment that pulls these diverse individuals into a context where they will thrive, contribute, and grow. And how do they converge?
Enriched Merged Value of Diversity
and Inclusion
The “what” of diversity is mostly about demographic differences, including age, gender, race, ethnicity, sexual orientation, disability, socioeconomic background, and more. Diverse workforces clearly represent the capacity of a firm. An organization can benefit from an enriched array of experiences and perspectives. Core to the notion of diversity is the acknowledgment of these individual differences, the premise of which allows an organization to have enriched collective capabilities. Inclusion, on the other hand, is the “how.” It speaks to how you approach an environment of work where individuals have to feel respected, accepted, and valued for who they are and what they bring to the organization. Behaviors are how we relate to one another, the practices that allow each team member to be welcomed and fully able to participate, and each voice to be heard and considered in making decisions.
Interconnectedness and Leveraging of
the Synergy Between Diversity and
Inclusion
Research has shown that diversity and inclusion are positive influencers of organizational change, creativity drivers, and decision-making enhancement. They also lead to increased employee engagement, better understanding of customers and markets, and enhanced resilience and adaptability. Commitment to diversity and inclusion is more than an ethically right thing to do; it is a strategic advantage. It promotes innovation and creativity because different perspectives result in distinctively novel solutions. It leads to better decision-making from an all-round perspective, and organizations that have diversity at their core always attract the best in the market, thereby improving public image. In addition, diverse teams serve to understand and cater for the needs of the customer across the board, thereby improving market coverage and business growth.
Diversity & Inclusion Challenges
The process of coordinating successful Diversity and Inclusion (D&I) initiatives worldwide is extremely complicated. Balancing universal D&I principles with local culture and expectations poses a significant challenge for organizations. Balancing all of this with the myriad legal systems around the world is no small feat, and these different frameworks can massively affect how D&I progress gets rolled out in a business. In one country, a policy could be progressive, and in another, it is compliance only – whilst across the border into an entirely separate state (in this case, Croatia to Hungary), that same document may even technically breach local [legal] requirements. Above and beyond, one of the more difficult aspects for companies is making sure they have a common set of D&I metrics that apply across their globally diverse operations; as you can imagine what diversity means in Chicago may be different than Uzbekistan.
At the same time, though, delivering good D&I strategies can be complicated by factors in different cultures. This means understanding how to better integrate the global D&I strategy without compromising on local cultural norms and expectations. However, there are different regulations and diversity compliance requirements between countries, which can greatly influence the way that D&I initiatives are integrated – or not.
Embracing Diversity & Inclusion
Looking back on my years of leadership, I can see how reorganizations demonstrate the necessity of diversity and inclusion. These values aren’t meant to be aspirational. We must embody them and create a culture to fuel growth and transformation. Based on my experience, the following best practices emerged.
1. Forming cross-functional teams
We created cross-functional teams that combined experienced staffers with those fresh to the field, blending historical and newer perspectives. Teaching the growth mindset is critical to innovation and adaptability. It also means harnessing diverse expertise, and the best organizational model comes from cleverly melding many points of view together.
2. Utilizing open forums and feedback loops
We held open forums and feedback loops to make sure we were building a truly inclusive environment. This allowed all team members, whether freshers or senior executive, to share their insights. It is up to leaders in the field, over and above any other incentives or policies being put into place, that inclusive practices are encouraged, showing all victims will be believed. To keep our teams engaged and morale high, regular check-ins are a must, as well as transparent channels for communication.
3. Letting the members participate in decision-making
Our approach was for all stakeholders to participate in the transformation effort. We empowered all the team members by getting them involved in decision-making, so they got buy-in and believed that it was their own baby (ownership). As leaders, we must proactively ask for the perspectives of a wide range of people inside and outside their organization to synthesize more holistic decisions that work well across the organizations.
4. Encouraging a culture of continuous improvement
We benefited from a wealth of diverse ideas, in our organization and built momentum behind improvement. We must foster a culture of creative problem-solving and ongoing learning. This ensures it not only adjusts to market dynamics much faster but also places the company above competitors.
5. Earning trust, creating safe environments
Underpinning an environment of diversity and inclusion is trust. Good leaders enable a safe environment wherein team members feel comfortable sharing suggestions or notions with their significant body without being penalized. This is done by gaining the trust of our clients, showing empathy, and keeping certain things confidential when required. Leaders can promote more open, honest communication and unlock the full power of a team by establishing an atmosphere where employees feel safe and respected.
6. Driving psychological safety without fear of retaliation
We must create workplaces where workers can speak out without fear of retaliation. Creating a clear policy that punishes any form of retaliation gives team members the confidence to express their fears or suggestions. That psychological safety is core to creating a culture where innovation can flourish and employees are truly valued.
7. Executing on service delivery and customer need-aligned initiatives
Creating this inclusive environment translated into creative solutions that met our process and clients’, customers’, and stakeholders’ requirements. True leaders want to ensure that they are using diverse perspectives for better business, and if we create a product or service, it should be something any client or customer from every corner of this giant planet can use.
8. Inculcating and restoring resilience, adaptability
We bolstered the overall resilience by fostering a team culture that stands up for all members. Leadership has to set the stage for behaviors that include everyone…thereby making an organization more flexible in managing change and uncertainty. This harmony of voices from different backgrounds allows the organization to meet adversity with an empowered perspective.
9. Leading by example
Finally, we, as leaders, must also reflect the core values of diversity and inclusion. We must lead by example and establish a standard for the organization. This requires not only the promotion of these values in words but also their integration into day-to-day business operations and decision-making.
10. Training and developing
Continuous learning in diversity and inclusion has the power to transform an organization. Investing in training programs that teach employees diversity, cultural competence, and inclusive behavior is absolutely crucial. This not only helps personal development but also fosters an inclusive work culture.
11. Celebrating
Recognizing employees’ unique perspectives – and then celebrating this – gives a feeling that you belong. We must actively hold events and highlight months that celebrate different cultures, traditions, and perspectives of the people within their organizations. This is not only good for team building, but it shows that the organization supports diversity.
D&I from A Global Perspectives
Taking a step back to examine D&I from a global perspective unveils common elements – and regional nuances. In Japan, D&I efforts focus mainly on gender diversity as part of a larger push to tackle labor shortages and demographic problems. In the business sector, where residual inequities of apartheid are rife and social cohesion is still fragile, an emphasis on racial as well as ethnic diversity is meant to heal old wounds. European countries most frequently highlight their national efforts to achieve better gender parity and inclusion of the LGBTQ+ communities in this wider narrative, drawing heavily on discourse related to human rights. Though this sounds similar to some regional differences, the shared ambition is a single one worldwide: enabling diverse talent as an invincible competitive factor in their workspace. Global research demonstrates the importance of diversity and inclusion in driving innovation, productivity, and profitability.
Creating Agile D&I Strategies
In an era where businesses are progressively becoming globalized, making a place that enables mixed talents to flourish is no longer an issue only limited to one region; it has actually inadvertently become a worldwide necessity. The way forward will include creating agile D&I strategies that can be filtered through diverse cultural understandings but backed by universal principles of equality and inclusion.
There is hope for the future of diversity and inclusion in organizations as they increasingly recognize their significance. Technology will have a big hand, and a lot more AI will be used in recruiting, thus eliminating bias and identifying inclusion gaps. More broadly, a workforce that values diversity and inclusion – as the next generation of workers does even more so than any prior cohort — will meaningfully advocate for culture transformation at work. In the wake of these trends, we will see more and better places to work established.
Final Reflection
Diversity and inclusion are critical to creating a resilient, innovative, or successful organization. These best practices are not limited to everyday workings but apply to transformational processes: AI integration or any other type. Adopting and embodying these values makes it a more desirable workplace for many employees and improves core business outcomes.
I argue that diversity and inclusion cannot be sidelined as a nice-to-have feature on the journey to greater resilience but should morph into a strategic play in every future-ready resilient creation. Taking on these principles will help with incremental change and innovation and improve the way organizations are more agile in developing a culture ready to cope, adapt, survive, thrive, change, etc., due to or required by the ever-changing needs of global business.
Embracing diversity and fostering inclusion are not just corporate ideals but the cornerstones of a thriving, innovative world. When we really get to the heart of diversity and inclusion, we can forever change institutions for the better. We can work together to make spaces where everyone feels welcomed and can give their best. Together, we can create a future where diversity and inclusion are not sideshows or separate initiatives but part of our corporate culture and a better, diverse, and inclusive World.
Diversity and inclusion are like twins, inseparably linked and thriving together. One brings a spectrum of perspectives and experiences, while the other ensures that every voice is heard and valued, fostering a richer, more vibrant community.
Let’s raise our twins together; let’s build spaces where every voice is heard and every perspective is valued, transforming our institutions and ourselves for the better!
Share your experience:
I invite you to share your experiences and practices in promoting D&I within your organizations:
– What challenges have you faced, and how have you overcome them?
– How do you see the future of diversity and inclusion evolving in your industry?
– How can leaders ensure that their efforts towards diversity are matched by genuine inclusion?
– What role does cultural competency play in fostering an inclusive workplace?
Connect with Indira B.
http://www.linkedin.com/company/iempoweru
Further Readings:
Books:
Hewitt, S. A. (2020). Diversity Wins. HarperCollins.
Page, S. E. (2017). The Diversity Bonus. Princeton University Press.
Lohja, D. (2019). Inclusion Revolution. Berrett-Koehler Publishers.
Frey, W. H. (2018). Diversity Explosion. Brookings Institution Press.
Reports and Studies:
McKinsey & Company. (2020). Diversity Wins: How Inclusion Matters. https://www.mckinsey.com/featured-insights/diversity-and-inclusion/diversity-wins-how-inclusion-matters
McKinsey & Company. (2018). Delivering Through Diversity. https://www.mckinsey.com/business-functions/organization/our-insights/delivering-through-diversity
Deloitte. (2017). The Diversity and Inclusion Revolution. https://www2.deloitte.com/us/en/insights/focus/human-capital-trends/2017/diversity-and-inclusion-at-the-workplace.html
Harvard Business Review. (2013). How Diversity Can Drive Innovation. https://hbr.org/2013/12/how-diversity-can-drive-innovation
Catalyst. (2020). Why Diversity and Inclusion Matter. https://www.catalyst.org/research/why-diversity-and-inclusion-matter/
