Why should companies concern themselves with diversity? Until recently,
many managers answered this question with the assertion that discrimination is wrong, both legally and morally.
But today managers are voicing a second notion as well. A more diverse workforce, they say, will increase organizational effectiveness. It will lift morale, bring greater access to new segments of the marketplace, and enhance productivity.
In short, they claim, diversity will be good for business.
Yet if this is true — and we believe it is — where are the positive impacts of diversity? Numerous and varied initiatives to increase diversity in corporate America have been under way for more than two decades. Rarely, however, have those efforts spurred leaps in organization effectiveness. Instead, many attempts to increase diversity in the workplace have backfired, sometimes even heightening tensions among employees and hindering a company’s performance.
Needed: A fundamental change in attitudes and behaviors
This article offers an explanation for why diversity efforts are not fulfilling their promise and presents a new paradigm for understanding — and leveraging — diversity. It is our belief that there is a distinct way to unleash the powerful benefits of a diverse workforce. Although these benefits include increased profitability, they go beyond financial measures to encompass learning, creativity, flexibility, organization and individual growth, and the ability of a company to adjust rapidly and successfully to market changes.
The desired transformation, however, requires a fundamental change in the attitudes and behaviors of an organization’s leadership. And that will come only when senior managers abandon an underlying and flawed assumption about diversity and replace it with a broader understanding.
Most people assume that workplace diversity is about increasing racial, national, gender, or class representation — in other words, recruiting and retaining more people from traditionally underrepresented “identity groups.” Taking this commonly held assumption as a starting point, we set out six years ago to investigate its link to organizational effectiveness. We soon found that thinking of diversity simply in terms of identity-group representation inhibited effectiveness.
Organizations usually take one of two paths in managing diversity.
- In the name of equality and fairness, they encourage (and expect) women and people of color to blend in.
- Or they set them apart in jobs that relate specifically to their backgrounds, assigning them, for example, to areas that require them to interface with clients or customers of the same identity group.
African American MBA’s often find themselves marketing products to inner-city communities; Hispanics frequently market to Hispanics or work for Latin American subsidiaries. In those kinds of cases, companies are operating on the assumption that the main virtue identity groups have to offer is a knowledge of their own people. This assumption is limited — and limiting — and detrimental to diversity efforts.
Diversity is about bringing varied approaches and perspectives to work
What we suggest here is that diversity goes beyond increasing the number of different identity-group affiliations on the payroll to recognizing that such an effort is merely the first step in managing a diverse workforce for the organization’s utmost benefit.
Diversity should be understood as the varied perspectives and approaches to work that members of different identity groups bring.
Women, Hispanics, Asian Americans, African Americans, Native Americans — these groups and others outside the mainstream of corporate America don’t bring with them just their “insider information.” They bring different, important, and competitively relevant knowledge and perspectives about how to actually do work — how to design processes, reach goals, frame tasks, create effective teams, communicate ideas, and lead.
When allowed to, members of these groups can help companies grow and improve by challenging basic assumptions about an organization’s functions, strategies, operations, practices, and procedures. And in doing so, they are able to bring more of their whole selves to the workplace and identify more fully with the work they do, setting in motion a virtuous circle.
Certainly, individuals can be expected to contribute to a company their firsthand familiarity with niche markets. But only when companies start thinking about diversity more holistically — as providing fresh and meaningful approaches to work — and stop assuming that diversity relates simply to how a person looks or where he or she comes from, will they be able to reap its full rewards.
Reprinted by permission of Harvard Business Review Press. Excerpted from HBR’s 10 Must Reads: On Managing Across Cultures. Copyright 2016. Harvard Business Publishing Corporation. All rights reserved.