The research is clear – diverse teams perform better than homogenous teams. A recent report from McKinsey, for example, shows that organizations that embrace ethnic diversity are more competitive; organizations with executive teams consisting of more than 30% women are 48% more likely to outperform their peers whose executive teams are made up of less than 10% women.
Deloitte Insights found that inclusive cultures translate into value: Organizations with inclusive cultures are twice as likely to meet or exceed financial targets, three times more likely to be high performing, six times more likely to be innovative and agile, and eight times more likely to achieve better business outcomes. But what does it mean to be diverse and inclusive?
From diversity, equity and inclusion to belonging
According to Merriam-Webster, diversity is defined as “the condition of having or being composed of different elements, especially the inclusion of different types of people (such as people of different races or cultures) in a group or organization”. Diversity elements are characteristics individuals are either born with or have acquired throughout their lives, such as race or ethnicity, gender identity, socio-economic status, military or veteran status, LGBTQ+ status, disability status, and more.
Equity and equality are terms that are often used interchangeably, but they are not the same thing. When an organization aims to treat all employees equally, there is an underlying assumption that all people are the same. However, in a diverse workplace where differences exist, people need support in different ways. Equity requires an organization to acknowledge that everyone has different needs, experiences, and opportunities and respond accordingly.
For example, an organization that treats all employees equally by equipping them with the same standard desk, office chair and laptop may be unfairly disadvantaging individuals who are vision impaired or unable to sit for long periods of time. A more equitable approach would be to offer different desk configurations to meet employees’ individual needs, such as an adjustable-height desk and different type of computer monitors.
Inclusion is the practice of making all members of an organization feel welcomed, respected and valued, with equitable opportunities to contribute to the organization and advance their skillsets and careers. Being inclusive means seeking people out and actively connecting with them, listening to them, accepting them, and inviting them to actively participate so that they feel comfortable and confident being their authentic selves in the workplace.
But unfortunately, we aren’t quite there yet. According to a recent study, 61 percent of employees report they are “covering”, or hiding, on some personal dimension (appearance, affiliation, advocacy, association) to assimilate in their organization, meaning they are not bringing their whole authentic selves to work.
Diversity without equity, inclusion or belonging will only get you so far. Belonging is the sense of feeling accepted and part of the team – feeling safe in the workplace to show your differences without being marginalized for it. Belonging results from a successful combination of diversity, equity and inclusion efforts.
More than just a nice to have
Inclusiveness and belonging are more important than ever. Deloitte Insight’s 2020 Human Capital Trends survey of 9,000 business and HR leaders in 119 countries revealed that 79% of organizations believe fostering a sense of belonging in the workforce is important or very important for their success over the next 12 to 18 months (up from 69% in 2017 and 59% in 2014), and a whopping 93% agreed that a sense of belonging drives organizational performance. But how do we get there?
So, what can you do?
Creating an inclusive culture involves looking at every step in the employee lifecycle – from how an organization is structured to how the organization tracks people data and how it uses the insights to shape improvement in its diversity and inclusion culture. What is the strategy for attracting, hiring and onboarding diverse talent? Is your interview panel made up of people of different backgrounds and ethnicities? Does manager training include diversity training? Is there a consequence if a manager is not welcoming of diverse employees in their teams? Does everyone get enough opportunities to develop toward agreed to career goals? Is pay fair across all categories of employees? And who is running the show? Are the top levels of leadership representative of the organization’s customer base and the talent throughout the firm?
These are many questions that have to be addressed to truly create an inclusive culture. It’s not an easy task nor a quick fix. It requires commitment from the top down and ongoing efforts to listen, understand and act. By building a culture of belonging, underrepresented employees can feel more at home in the workplace — emotionally and culturally — so that they’re more likely to stay, be engaged and creative at work. And as stated above, diverse teams simply perform better.
Watch the webinar replay as we explore insights from the Deloitte 2020 Global Human Capital Trends report.
Learn how the SAP SuccessFactors HXM Suite supports building inclusive cultures and creating business beyond bias.