Diversity matters. Allowing people to gain opportunities based on their merits instead of their identity — be it their sex, gender, age or race — is a huge step forward in forming an inclusive society.
Apart from the political and moral implications of inclusivity, studies show that diversity in the workplace is also good for business. How exactly? Let’s dig deeper.
Rewards and penalties
McKinsey has been studying how diversity factors in when it comes to the workplace setting for years now. Their study, which involved 366 public companies across Canada, Latin America, the United Kingdom, and the United States revealed some interesting results:
- Companies who are on top in terms of racial and ethnic diversity are 30 percent more likely to have financial returns that surpass the national median for their industry.
- Meanwhile, those companies which stay on top in terms of gender diversity are 15 percent more likely to have financial returns well above the national median for their industry.
- Companies who are lagging behind in gender, racial, and ethnic diversity are less likely to reap above-average financial returns.
Apparently, it’s not only embracing diversity which can impact financial returns. As it turns out, taking diversity for granted negatively impacts a company.
An aptitude for greatness
According to McKinsey, diverse companies are better fit that non-diverse companies when it comes to improving their:
- Customer orientation – Since they become more sensitive to variations in the needs of the consumers.
- Employee satisfaction – In comparison to non-diverse workplaces, an MIT study shows that a diverse team tends to give each other about equal time to talk. They also tend to be more sensitive towards one another and to give each other.
- Decision making – The same MIT study suggests that diverse team has the capacity to look at problems in a more innovative, creative, and inclusive manner.
In their assessment, McKinsey states that diversity is more than just a potential profit boost for companies — it is a differentiating factor. It is what sets apart companies who achieve greatness and those who get left behind.
An aptitude for greatness
Now we see just how high the stakes are. In this increasingly connected world we are living in, being stuck in the old ways is definitely the best way to fall behind.
It is about time for companies to recognize the need for diversity and start investing in it, not only for the society to progress but also for these companies themselves to survive.