Diversity as a Business Strategy
Many HR practitioners groan as they attempt to navigate through the triple BEE regulations foisted on them by government. Would they groan if they knew that a diverse workplace is truly good for business, impacting on Profit, on Innovation and on Sales?
Delegates to the Women in HR Conference earlier this year had the opportunity to learn firsthand from Caroline Berns of Ericsson why and how to create and maintain Workplace Diversity:
- Profit
There is evidence that diversity increases companies’ financial bottom line, with one study showing that companies in the top quartile for racial and ethnic diversity are 30% more likely to have financial returns above their national industry median. *1 Credit Suisse analysed more than 2,500 companies over seven years, and found that companies with more than one woman on their board have outperformed those with no women on their board by 26% since 2005.
- Innovation
Diverse teams are more likely to innovate, possibly because of the injection of new ideas and perspectives into the group. *2 A 2009 study (Phillips, Liljenquist and Neale) showed that diverse teams (containing both old-timers and newcomers) were more likely to predict the correct answer on a given task than homogenous teams (containing old-timers only). This, despite the diverse teams perceiving the likelihood of their having predicted the correct answer to be lower than that of the homogenous teams.
- Sales
Sales people who are culturally matched to the company’s clients are better equipped to understand those clients. For every 1% rise in the rate of ethnic diversity in a workforce there is a 3 and 9 per cent rise in sales revenue. *3
Now that you’re thoroughly sold on the concept, how best to go about not only creating, but also sustaining a diverse workplace?
1: Attract Diverse Talent
It’s important to ensure that the language used to advertise available posts is devoid of bias. Advertising for a ‘Ninja Developer’ for example, is unlikely to attract female programmers.
2: Eliminate Hiring Bias in Written Applications
Some companies use an anonymous application process, so that the candidate’s name, age and gender aren’t visible to HR. Another strategy is to request work samples from anonymous candidates.
3: Create Shortlist Quotas
Recruiters should create shortlists for hiring managers which reflect the percentage of employees the company wishes to have represented. Aiming for 30% previously disadvantaged employees? Make sure that 50% of the candidates on your shortlist are previously disadvantaged candidates. female.
4: Targeted Employee Referrals
Another option is to incentivise your employees to refer people from the group you’re targeting. Higher commission payments for female recruits for example leads to – you guessed it – a higher number of women referred for a position.
5: Minimise the Impact of Bias in Interviews
An education process which helps the employer to recognize and challenge their own biases before the interview can mitigate the influence that bias can exert on the hiring process. HR should ensure that hiring decisions aren’t made under time pressure, so that ‘cognitive shortcuts’ (including bias) aren’t used in the decision-making process, and that decision makers aren’t ‘overwhelmed by choice’ as may be the case if there are too many applicants. A diverse interview panel can reduce the impact of bias that one group of decision makers may have against or for another. A female engineer, for example, would be less likely to underestimate female applicants for IT positions.
6: Ensuring that Selected Candidates say “Yes!”
Policies such as equal pay for men and women in the same position increase the chance that women take up those positions. Working conditions which support the parenting role of employees (regardless of gender) have the same effect.
7: Retaining a Diverse Workplace
Its sobering to note that women are almost twice as likely as men to quit tech jobs after their first year than men. Once a new candidate has been onboarded, they may easily be lost to the team if efforts aren’t made to integrate them. If diversity is ‘getting the mix right’, inclusion is ‘making the mix work’.
Mentoring programmes, run by senior employees of the same gender/age/racial group for newer recruits can provide support to those new employees who might otherwise experience a sense of alienation and isolation.
Managers should have ‘Diversity’ as one of their KPI’s to make sure that the importance of Diversity is constantly kept in their line of vision.
Employee Resource Groups can provide support and community to minorities within the Workplace, and as such can be effective tools for maintaining workplace diversity.
8: Foster Diversity in the Long-Term
Once-off or occasional attempts at diversity won’t have the same long-term impact as a sustained and systematic Diversity programme. For this reason, HR needs to partner with Management and Talent Management in a sustained Diversity drive.
Diversity is good for your business: it increases sales, promotes innovation and is correlated with an increase in profit. To create and maintain a diverse workforce, it’s necessary to promote diversity at each stage of the recruitment process. To retain a diverse workforce, it’s necessary to promote inclusion throughout the lifespan of your Diverse workforce.
Caroline Berns currently heads up Talent Acquisition for sub-Saharan Africa at Ericcson. Diversity & Inclusion is one of her focus areas. Follow her Diversity and Inclusion blog or her blog on the Ericsson page. Both are updated every Friday.
