A bit about me and who I wrote this series for: I am an organization development consultant trained in strategies for managing the human side of organizational transformations. This is the first post in a series that I wrote for “people people” — those who often find themselves in HR, People & Culture Operations, organization development, and organizational leadership — whether they’re consultants like myself or work internally within organizations. (Shout out to Culture Amp for creating a platform to unite the People Geeks of the world!) One type of transformation that speaks to me is culture change work, specifically institutionalizing an inclusive culture that acknowledges diversity in the workplace and leverages its strengths. Women of color have led this work for a long time, both out of self-interest and also because others, especially white men, weren’t willing to prioritize it. I identify as a white man, and hope that more white men will come off the sidelines and make diversity and inclusion a priority for themselves and their organizations.*
Diversity and inclusion (D&I) continues to get attention from organizational leaders and media outlets, as exemplified by the June 2017 pledge by 150 CEOs to take action on D&I issues. Much of this attention, however, focuses on matters related specifically to diversity, such as hiring practices intended to increase the number of employees who identify as women and/or people of color. To be clear, it’s important to diversify our national labor force so it better reflects the general US population. However, hiring women and people of color into organizations historically dominated by white men without proactively making those organizations more inclusive will ultimately backfire. In such cases, new recruits will need to assimilate into cultures that are not designed to support them. This mismatch in culture can lead to burnout, attrition, and lowered creativity, innovation, and productivity. Without properly focusing on the inclusion aspect of diversity and inclusion, D&I efforts are sure to fail. But first, let’s take a step back and look at the importance of D&I as a whole.
Why care about diversity and inclusion in the first place?
Addressing issues of diversity and inclusion (D&I) is important because it’s the right thing to do.
Much of the business world, however, employs a pragmatic, rather than ethical, rationale. Thus, a “business case for diversity and inclusion” is often used to motivate organizational change on the grounds of economic benefit. Here’s what I mean:
In 2010, the US Department of Labor found that women comprised 47% of the total US labor force and were projected to account for 51% of the increase in total labor force growth between 2008 and 2018. By 2044, the US Census predicts people of color to comprise the majority of the US population. In other words, US workforce representation of women and people of color is growing, and white men’s slice of the pie chart is diminishing.
These demographic trends offer an opportunity. A 2015 McKinsey study found that companies with a greater representation of women in leadership are 15% more likely to financially outperform their competitors, and companies with a greater ethnic representation in leadership are 35% more likely to outperform their competitors. The study’s authors credited this performance to four attributes of diverse organizations: (1) they are better able to recruit the best talent; (2) they have a stronger understanding of their customer base; (3) their employees are more satisfied; and (4) they make better decisions.
But not all diverse organizations are created equal. The data listed above speaks to companies that have figured out how to effectively manage employee differences. We can think of diversity as the variation in attitudes, perspectives and approaches to work that people from different identity groups bring to the table.[1] These kinds of differences among employees are inevitable. The inability to manage these differences can lead to exclusion. Employee engagement, productivity, creativity, innovation, and retention can all suffer in exclusive workplace environments. Explicit company policies and implicit cultural norms should never make someone feel ashamed about who they are. As Fred Miller of the Kaleel Jamison Consulting Group suggests, assimilation is taxing and diverts energy that could be put towards productive work.[2]
Where a company falls on the inclusion-exclusion spectrum is largely a matter of organizational culture, and culture is much harder for competitors to replicate than product or process. An inclusive culture is a source of sustainable, long-term competitive advantage for employee engagement and productivity.[3]
Okay, I understand how diversity and inclusion (D&I) efforts contribute to the bottom line, but why focus on inclusion specifically?
Diversity without inclusion is insufficient.
Diversity in and of itself doesn’t guarantee high performance. In fact, the presence of diversity in an organization or team has the potential to create obstacles to performance such as ineffective communication and interpersonal conflict.[4] Furthermore, a group’s mindset can shape whether diversity actually impacts performance. Harvard professors Robin Ely and David Thomas offer three perspectives on diversity that we might find in our organizations: (1) the “discrimination-and-fairness” perspective focuses on the moral imperative to provide equal opportunities for all regardless of identity; (2) the “access-and-legitimacy” perspective recognizes that marketplaces and consumers are culturally diverse and views diversity as the key to penetrating these markets; (3) the “integration-and-learning” perspective sees the experiences and skillsets of employees from different backgrounds as resources for learning and responding to a changing environment. In Ely and Thomas’ study, the organization modeling the “integration-and-learning” perspective was the sole firm to effectively leverage diversity to enhance performance.[5]
Inclusion creates the link between diversity and performance.
Miller advises that a fundamental shift in culture is necessary for most organizations to value difference as an asset.[6] “Problems arising from diversity,” veteran HR consultant John Fernandez claims, “are caused not by the changing composition of the workforce itself but by the inability of companies to truly integrate and utilize a heterogeneous workforce at all levels of the organization.”[7] Responding to companies that go through the motions for compliance reasons, Miller and Kaleel Jamison colleague Judith Katz explain, “Some organizations increase their diversity in an effort to meet Affirmative Action goals. However, this increase is superficial if the organization is not prepared to include an increased range of differences in its day-to-day activities and interactions.”[8] Two empirical studies back up these theories. Researchers in the Netherlands found in 2015 that inclusion serves as a bridge between diversity management and organizational citizenship behaviors and affective commitment (e.g. employees going above and beyond their job description).[9] Another study conducted in 2014 at the University of Texas at Dallas found that diversity management is not a statistically significant predictor of perceived organizational performance. Meanwhile, two aspects of inclusion were indeed found to significantly predict perceived performance: commitment from top leadership and involvement of employees in individual and organizational decision-making processes.[10]
Furthermore, inclusion enhances psychological safety, which in turn contributes to performance, as evidenced in two additional studies. In 2010 Israeli researchers found that inclusive leadership behavior engenders psychological safety, which in turn was associated with increased participation in creative work projects.[11] Likewise, a 2010 study conducted at Northeastern Illinois University suggested that psychological safety connects the dots between diversity and group performance because safety enhances empathy, self-disclosure, communication, group involvement and group trust.[12] “Creating safety does not mean creating an environment that is risk-averse,” Miller and Katz assert. “It means fostering an environment of respect for and acknowledgement of different people’s needs and approaches.”[13] As this suggests, people who feel acknowledged and valued are more willing to go the extra mile for their organization.
Diversity is about demographics. Inclusion is about culture.
Demographic trends and financial data for diverse organizations point to the necessity for US businesses to create workplace cultures that are inclusive of employees regardless of gender and race — as well as other identity groups including ethnicity, religion, age, ability, and sexual orientation.
Inclusion is a positive attribute of any organizational culture, and it’s good for everyone — for people in marginalized groups as well as for those in dominant groups. In a work setting, everyone should be able to show up as their full self. Inclusion is not about “helping the less fortunate.” It’s about setting up a better life for everyone.
Super. Now I understand why diversity and inclusion initiatives are important in the first place, and why it’s imperative to prioritize inclusion specifically. But HOW do I go about making these changes?
Keep reading to learn 5 Principles for Inclusive Culture Change.
Notes:
*A special word of gratitude and appreciation for Management Professor Lori Roth, who advised my graduate research at The New School, much of which informed the content of these posts.
Thomas & Ely, as cited in Roberson, Q. M. (2006). Disentangling the Meanings of Diversity and Inclusion in Organizations. Group & Organization Management, 31(2), p. 214.
Miller, F.A. (1988). Moving a team to multiculturalism. In B. Reddy & K. Jamison (Eds.), Team Building: Blueprints for Productivity and Satisfaction(192–197). Alexandria, VA: NTL Institute for Applied Behavioral Science.
Meehan, P., Gadiesh, O., & Hori, S. (2005). Culture as competitive advantage. Leader to Leader, 2006(39), 55–61.
Cox, T. (2001). Creating the multicultural organization: A strategy for capturing the power of diversity. San Francisco: Jossey-Bass.
Ely, R. J., & Thomas, D. A. (2001). Cultural Diversity at Work: The Effects of Diversity Perspectives on Work Group Processes and Outcomes. Administrative Science Quarterly, 46(2), 229.
Miller, F. A. (1998). Strategic Culture Change: The Door to Achieving High Performance and Inclusion. Public Personnel Management, 27(2), 151–160.
Fernandez, as cited in Mor Barak, M. E. (2000). Beyond Affirmative Action. Administration in Social Work, 23(3–4), p. 47.
Miller, F. A., & Katz, J. H. (2002). The inclusion breakthrough: Unleashing the real power of diversity. San Francisco, CA: Berrett-Koehler, p. 5.
Ashikali, T., & Groeneveld, S. (2015). Diversity management for all? An empirical analysis of diversity management outcomes across groups. Personnel Review, 44(5), 757–780.
Sabharwal, M. (2014). Is Diversity Management Sufficient? Organizational Inclusion to Further Performance. Public Personnel Management, 43(2), 197–217.
Carmeli, A., Reiter-Palmon, R., & Ziv, E. (2010). Inclusive Leadership and Employee Involvement in Creative Tasks in the Workplace: The Mediating Role of Psychological Safety. Creativity Research Journal, 22(3), 250–260.
Roberge, M., & Dick, R. V. (2010). Recognizing the benefits of diversity: When and how does diversity increase group performance? Human Resource Management Review, 20(4), 295–308.
Miller, F. A., & Katz, J. H. (2002). The inclusion breakthrough: Unleashing the real power of diversity. San Francisco, CA: Berrett-Koehler, p. 60.