Why diversity is key to a competitive advantage

The business case for diversity has been made repeatedly by business leaders, consultancies, government commissioned bodies such as the Hampton Alexander Review and thought leaders.

Why diversity is key to a competitive advantage

The business case for diversity has been made repeatedly by business leaders, consultancies, government commissioned bodies such as the Hampton Alexander Review and thought leaders.  I for one am grateful for the compelling reports produced McKinsey ‘ Why Diversity Matters and Women in the Workplace 2021 because of the case studies they share and the fact that they put a spotlight on the particular value that the black woman in an organisation brings.

This is all well and good but what’s needed next is to examine the case from a pragmatic business leader’s perspective. This is where I want to take the discussion. 

Diversity is paramount to competitive advantage and time is running out for those companies and their leaders who do nothing but pay lip service to it. Those who celebrate black history month, renew their pledges to a wholistic approach, wheel out attractive video promotions and sound bites and yet do very little to move the dial in a positive direction. 

For those company leaders who genuinely want to act, and it doesn’t matter how late it is you come to the party, the key is that you do genuinely want to take action, here are some compelling reasons why you should start now:

The global village in which we now live

Thanks to technology and the acceleration of the virtual working world, the talent pool for any organisation at any stage of its development is one that is global. To capitalise on the global talent pool, an organisation must be willing to fish for the very best talent across the world.  Ensuring first mover and/or fast follower advantage in any product range means the ability to attract and retain the best talent. The closeness of the global village means that the very best talent can easily vote with their feet. Increasingly the talent in the earliest stages of their career, who will make up our future leaders, are most attracted by employers who have diversity and socio-economic goals embedded into their employer branding. 

The future of work

As we advance towards the future of work, the impact of technology, AI and their relatives on the structure and nature of work means that, to remain productive and competitive, STEM capabilities are in demand. The skills and talent that a neurodiverse team can bring to an organisation is becoming increasingly valuable as a result. It is great to see that companies like SAP, Microsoft and Hewlett Packard are fast adapting their attraction, recruitment and retention strategies to ensure that such talent is brought into their workforce, as illustrated in this HBR article.  In addition to this, increasingly now, your future talent do their research into your culture and what you are like as an employer before choosing to work with and for you, as highlighted in this PwC report

The ageing population 

The quality of life in the west means that people are living longer. Creating an age-friendly workplace will become increasingly critical. The company that adapts its HR and talent development processes over time is the company that will survive and remain competitive.  Whilst it may not seem like a matter of urgency today, companies that lay the foundations today are the ones that will retain and/or gain competitive advantage as the future emerges.

Difference breeds breakthrough

There is nothing more attractive than people with different skills, experiences, backgrounds, cultures and perspectives coming together with a common goal and objective. When difference is celebrated and everyone’s contribution is welcome and encouraged the speed of innovation accelerates. This enables creativity and lessens the chances of group think. Not only does diversity enable speed when it comes to innovation, it also avoids the potential heavy costs of getting product launches, names and go to market strategies across cultures and geographies wrong. This research report by Deloitte provides powerful insights that enforce this. 

The diversity of consumers and customers 

Very rarely today does any product or service have a homogeneous customer, client and/or consumer base.  To attract and retain your end user your workforce must look like them.  How can you launch products targeted at the black population if there is no one in your organisation that genuinely understands them? Nor can you launch a product successfully in Asia, other parts of Europe, the USA and Africa if your company does not have effective representation and/or understanding of the cultural nuances that exist not only in the geographical regions but also in the ethnicities of the end users. 

The hidden cost of exclusion 

It’s not enough to hire diverse talent. Organisations must enable and include diverse talent. Individuals must feel engaged, valued and like they belong. This is down to the quality of your leadership and the extent to which they in turn genuinely believe in the contribution each person in their team has to offer. If your talent, no matter how capable, feels excluded then your ability to tap into their potential will be minimum.  Discrimination, racism, sexism and all the isms that work against the harnessing of a diverse workforce can result in the exit of your very best talent, whether they are in the minority or not, and can result in long term and irreparable damage to your employer brand. 

Competitive advantage is increasingly critical to the short and long term survival and success of an organisation of any size whether local, international or global.   The people and talent of the organisation are the differentiating factor that’s key to ensuring this.  Seizing the reigns of diversity and enabling the release of all the benefits it has to offer is the only way forward.  

Yetunde Hofmann
Yetunde Hofmann

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