Barry Rosen is CEO, Interaction Associates, leading provider of training & consulting services to build a collaborative leadership culture.
On May 25, 2020, Minneapolis police officers arrested George Floyd, an African American man, in an incident that resulted in Mr. Floyd’s death during the arrest. The unfairness and horror of the incident galvanized people across the United States to advocate for changes in policing protocols and to examine how to cultivate safer communities that work for everyone.
This examination also spotlighted the effectiveness of diversity, equity and inclusion (DEI) initiatives in major corporations and small and medium-sized businesses, where over $7 billion had been spent by those businesses by 2020, with budgets once expected to surpass $15 billion by 2025.
But something else started to happen in 2021. As businesses felt the COVID-19 impact and leaders grappled with economic uncertainty, DEI became one of the first programs cut. According to one report, DEI positions are now being eliminated at a higher rate than other jobs, and 300 DEI professionals have left positions at influential companies in the past year.
A 2023 DDI report, which surveyed thousands of business leaders and more than 1,550 organizations across 50 countries, found that “in the wake of several exhausting years of the pandemic and uncertain economic headwinds, many companies are on the brink of a serious backslide on DEI progress.”
Beyond The Business Case For DEI
DEI initiatives are rooted in the assumption that all people are created equal and are endowed with certain unalienable rights and that among these rights are life, liberty and the pursuit of happiness. However, DEI isn’t just an altruistic priority.
The business case for DEI begins with this data-supported conclusion: Diverse companies are more profitable and productive than more homogenous organizations. The impact is multifaceted and far-reaching, including:
• Attraction and retention: People want to work for companies that reflect their values and align with their priorities. DEI is at the top of the list. Organizations that champion DEI attract a diverse pool of talent and engender higher levels of employee loyalty and retention. Specifically, 67% of job seekers say they evaluate a company’s DEI efforts when making an employment decision. Employees who see their ethnic, racial, age, gender and other identities reflected in the demographics and culture of the workplace are more likely to feel valued and recognized, making them more inclined to remain with the company—and provide discretionary effort.
• Creativity and innovation: Diverse teams, rooted in the psychological safety of human-centric principles and routines, are more insightful, creative and productive when designing and deploying products, services and strategies for a diverse consumer base. A diverse workforce provides leaders with a ground-level perspective on changes in market trends, customer needs and potential business risks. This heightened awareness can facilitate better strategic decisions and foster business resilience and agility.
• Culture and impact: People want to work in a company where they can tell their friends and family: “This is a good place for me.” As one HR leader recently told The New York Times, “People want to feel like they belong. They want to come to work and not feel like they have to check themselves at the door.”
Companies that emphasize DEI as a way they operate often provide practical, team-based training in essential communication and collaboration skills. These programs socialize respectful behaviors and cross-boundary understanding.
Taken together, DEI brings bottom-line benefits that impact every organizational facet, making companies strong, more resilient and more innovative than companies that fail to diversify.
Leveraging Differences Is The Next DEI Milestone
For HR leaders and DEI professionals, your next DEI milestone is testing your company’s new strategy for leveraging differences on diverse teams and work groups. Leveraging differences transcends platitudes and start-and-stop initiatives. It is a thoughtful, strategic move, requiring intention and attention from leaders, team engagement and dialogue and action-learning projects.
The implementation could look something like this:
1. The leadership team decides to test the concept of leveraging differences, starting with themselves. They participate in a facilitated conversation about the differences that could “really make a difference” for their team, employees and customer and end-user populations.
2. Select a few other teams to have that same conversation. Start by agreeing on behavioral guidelines to help establish a psychologically safe space for authentic interaction.
3. Each team selects, based on their initial conversations and with leadership input, a focused project.
4. Incorporate communication and collaboration training as part of the project.
5. Reflect on progress and setbacks, and share insights with the entire organization.
Coupled with a commitment to continuous improvement, companies can leverage differences to succeed across three dimensions: Better results, better group and interpersonal processes and routines and better, more equitable and inclusive relationships across boundaries.
After the smoke of reaction blows out to sea, the demographic reality of workforce and customer populations will drive business decision making. Diversity, equity, inclusion and belonging (DEI&B) initiatives will rebound and grow in the United States under many names and different packaging.
As a business leader, HR adviser or DEI professional, you will lead the way by learning more about what it looks like to leverage differences and make your plans for reaching this next important milestone.
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