Why Diversity Matters in Leadership

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why diversity matters in leadership

Leadership in corporate America is changing. Our definitions of inclusivity and equity have evolved. Today, businesses are cultivating more diverse, blended leadership teams.

This emphasis on increased diversity isn’t just about public image – it’s about building leadership teams with a wide range of experience and viewpoints. It’s, in part, about attracting and retaining valuable team members. Up to 76% of applicants are looking for diverse workforces in their next jobs, and that includes diverse C-suite and senior management executives.

Diversity benefits everyone, from the CEO to the newest entry-level employee. At Strategy People Culture, we’ve seen first-hand the reasons diversity matters in leadership, and we want to share some of our findings with you.

The Positive Impact of Diversity in Leadership

Greater Depth And Perspective

Greater Depth and Perspective

Teams that consist of diverse leaders have something that other teams lack: breadth. They consist of team members from different backgrounds, races, genders, and sexual orientations, and that gives them power.

The more diverse a leadership team is, the more viewpoints and opinions it has to offer the company. A great leader leverages strengths from person to person, and their diversity initiatives contribute to better conversations and growth.

Even when mindsets clash, leaders need to form well-rounded approaches to problems. When you value a wide range of perspectives, you make others feel heard, then benefit from what they have to say.

More Varied Experience

Diversity in leadership positions also provides the company with crucial experience. Research from Gartner found that inclusion is a critical success factor for modern business performance, and a large part of that is due to the varied experience a diverse team can bring to the table.

If everyone on your leadership team comes from similar backgrounds and lifestyles, it will be difficult to support and understand other employees and customers. Experience is always a valuable business asset, especially when it comes to positions of power and influence.

Better Social Awareness

An effective leader doesn’t just know what’s going on in their own company and team. They are also aware of the outside world, including societal transitions and challenges. It’s easy to view the world through our own lenses and experiences, but that’s not necessarily an accurate perception of the organization’s full constituency.

Promoting diversity in leadership helps your company be at the forefront of social change and awareness. When multiple voices lead the charge, you are better equipped to navigate employees’ needs and customer experiences.

Financial Opportunities

Few people want to follow a leader who presumes their way is the only way to do things. When you promote diversity and inclusion in your leadership team, you also promote different mindsets – and as a result, different opportunities.

Specifically, data suggests that company diversity correlates with better financial performance in many industries. When your team has the ability to offer multiple viewpoints and strategies from people of all backgrounds and lifestyles, you expand your ability to make money in new ways.

The benefits of diversity all sound great – but what can leaders do to actually create a more diverse leadership team within their own company?

That’s what we’re here to help with.

What Leaders Can Do to Facilitate Diversity

More Varied Experience

1) Set the Company Tone

It doesn’t matter how big the company is or what industry it serves – leaders set the tone within their organizations. As the Harvard Business Review puts it, the CEO and senior management team have the ability to “define the desired culture and cultivate through leadership actions.” If the leaders’ tone embodies inclusivity, organizational diversity is much more achievable.

But what “leadership actions” can contribute to a diverse tone and culture?

In our experience, setting a company’s tone is more about what leaders do, not just what they say. This means hiring, promoting, and openly valuing employees of different backgrounds, races, genders, and sexual orientations. It means publicly supporting diversity initiatives, setting culture-building objectives, and generally working toward a more diverse workforce – not just talking about it.

2) Take Steps to Include Everyone

Hiring and promoting diverse candidates is great, but only if everyone on the team actually feels included in company conversations and initiatives.

According to Deloitte’s Unleashing the Power of Inclusion, 80% of the surveyed 1,300 respondents said that inclusion efforts were an important factor when choosing a company. Unfortunately, roughly one in every four employees feels that they don’t belong at work – often because of the factors that make them “different” from others.

If you want to promote diversity in leadership, you’ll need to take active steps toward inclusivity. Acknowledge those who come from different backgrounds or places. Honor various cultural practices, listen to what each employee has to say, and push every team to pursue their own inclusivity efforts.

It all starts at the top. As a leader, never underestimate your influence nor defer the responsibility on people’s sense of belonging in the organization.

3) Re-Evaluate the Hiring Process

We already touched on the topic of hiring briefly, but inclusive leaders need to do more than “briefly” evaluate their hiring tactics. Besides working to promote and consider more diverse candidates, we also suggest that leaders do the following:

  • Audit their job ads and listings to target a wide range of demographics
  • Create company policies that appeal to diverse candidates (e.g., flexible schedules for working parents)
  • Use blind resumes to remove any potential hiring bias
  • Consider screening for and assessing different candidate qualities

Discrimination against certain kinds of candidates during the hiring process isn’t just poor taste – it’s illegal under law and works in opposition to achieving diversity. By taking a long, hard look at your hiring practices, you can increase your chance to hire valuable and diverse candidates, as well as ensure your company avoids illicit policies or practices.

4) Increase Representation

A diverse team should be visible. Where are people seeing the diversity in leadership?

Are there women in positions of power? Are there people of color participating in important initiatives? Representation matters, and if it’s not apparent, leaders likely need to broaden their talent pools.

5) Bring in Experienced Diversity Training Experts

Lastly, one of the best things companies can do to pursue more diversity authentically is to invest in leadership coaching, specifically in regards to diversity and anti-discrimination policies.

As much as we wish otherwise, it’s not always easy to know where and how to implement diversity initiatives. You may not even be aware of the ways in which some employees can feel excluded or treated differently. Executive coaching can help with that.

At Strategy People Culture, we work to foster education on potential workplace biases and discrimination. We also help leaders tackle inclusivity challenges, find ways to increase representation, and become more aware of their team’s strengths and weaknesses.

Whether you’re educating a C-suite executive or an entry-level employee, some form of diversity training is highly beneficial to cultivating a more modern, welcoming company culture. In today’s world, skipping such efforts can lead to the difference between success and failure. That brings us to our next point.

What Happens When Diversity Is Not Prioritized?

When Diversity Is Not Prioritized

We’ve spent most of this post discussing the positive effects of increasing diversity in your workplace, but that’s not all we need to touch on. A lack of diversity can have more serious effects – and not in a good way.

When companies ignore the call for diversity in leadership, they risk experiencing:

  • Low employee retention rates
  • Recruitment and hiring difficulties
  • Disengaged, unhappy team members
  • Lower revenue than more diverse companies
  • Lost client opportunities

A lack of diversity can also result in public call-outs and tarnished reputations. Job candidates and employees won’t tolerate exclusive, non-diverse workplace environments, and leaders need to take action accordingly or suffer the consequences.

The good news is that promoting diverse teams and initiatives in your workplace helps everyone. There’s a world of opportunities out there, and many of them lie in the candidates that were once overlooked and underestimated.

Pursue Diversity Within Your Workplace – We’ll Help

Diversity In The Workplace

Whether it’s a small local business or a national corporation, diversity in leadership matters. It influences everything from company culture to engagement and revenue.

If you’re not sure where to start with your company’s diversity initiatives, let’s have a conversation. Our executive coaches at Strategy People Culture can help you identify and refine core challenges when it comes to diversity. We can also connect your organization with EEO anti-harassment and anti-discrimination training.

To learn more, send us a message online or give us a call at 833-762-5772.

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Andy Botwin

Andy is a seasoned executive & leadership coach, independent workplace investigator, and trainer with more than 25 years of experience working with companies across various levels. He was Chief Human Resources Officer for a 1500+ person professional services firm and a Principal & Chief Human Resources Officer for a top national professional services firm where he drove culture change in the organization culminating in recognition on Fortune Magazine’s prestigious 100 Great Places to Work in America.