Record numbers of organizations are either reviving and rebuilding their diversity programs or building one from scratch. In conjunction with this revival, diversity’s definition is changing. Corporations are now boring through traditional, more intrinsic categorizations (e.g, race and gender) to something even more basic, and perhaps more powerful: diversity of thought and experience.
On top of that, it’s not just about having diversity within a company for the sake of having it. Companies are realizing that they must leverage that diversity if they are to produce better products and services.
The Business Case For Diversity
The business case for diversity has become undeniable, as companies find that diversity and inclusion are directly correlated with improved business performance. The Center for Talent Innovation found that firms with high diversity levels an 80% improvement in performance among those who did not. Customers will increasingly evangelize a brand because of its diversity philosophy, giving diversity an ROI that is hard to ignore. For example, research by American Sociological Association finds that for every 1% rise in the rate of diversity in a business, there is a 3-9% rise in sales revenue. Internally, diversity and inclusion also improve employee engagement and retention, both of which are critical for a company to thrive.
As Clorox observed on its corporate blog, “If you cannot answer the diversity question clearly and favorably when it is asked in the recruiting process, young people are going to choose to work elsewhere.”
Case Study: L’Oréal USA
L’Oréal USA has committed to diversity at every level of the organization. However, it is an example of how important it is for commitment to diversity to come from the top. CEO Fédéric Roze is intimately involved with the efforts to create a culture of inclusion. He is quoted as saying, “I have to be the champion of diversity and inclusion. It is my job to be a role model and show how important this is to our company.”
At L’Oréal USA, the importance of diversity and inclusion is expressed by this formula: DIVERSITY + INCLUSION = INNOVATION & SUCCESS. This formula serves as the foundation for many functions in the company, from recruitment, to sales, to community outreach. One example of this is a L’Oréal USA research initiative focused on foundation makeup for women of color. Through a series of national studies that interviewed women and measured their skin tones, the team was able to scientifically demonstrate that women of color had specific needs that weren’t being met by existing products. This finding opened up new doors for L’Oréal’s foundation business. Sumita Banerjee, Vice President of Talent Recruitment at L’Oréal USA, observed:
The recruitment of diverse talent for our organization is critical to our ability to build our business and drive future growth… The diversity of thought, industry, and multi-market backgrounds of the candidates that we recruit directly impact our ability to innovate and give us a foundation upon which we are able to help to achieve our business goal of reaching a billion new consumers in the next 10 years.
Key to Diversity Efforts: Embracing Technology
Companies leading the way in the area of diversity and inclusion are increasingly turning to technology to leverage data in their quest to integrate D&I in their hiring and retention efforts. Diversity technology is helping HR teams bridge the gap between data and meaningful insights in order to drive more precise, actionable changes at organizations.
For example, Gap Jumpers allows for blind interviewing and testing via computers to help address the risk of biased hiring decisions. Unitive helps employers develop more inclusive job descriptions and creates accountability during interviews (for example, calling out a hiring manager if s/he disregards criteria s/he initially indicated as being very important). Another platform, called Triplebyte, provides the first “credentials-blind” hiring process for engineers. It seeks to give anyone with the right skills the opportunity to work at leading technology firms, regardless of what school they went to or companies they’ve previously worked at. And Jopwell is on a mission to connect Black, Latino, and Native American students and professionals with top companies.
Companies are leveraging technology in a variety of different ways to tackle diversity and inclusion. Johnson & Johnson, ranked 9th in D&I by Diversity Inc. in 2015, has a custom web-enabled service called “Mentoring Works!” as well as “J&J Diversity University,” an online resource to help employees build diversity into their day-to-day interactions. BASF employs a talent dashboard that allows leaders to gauge progress on diversity and inclusion by asking comprehensive questions about their thoughts on hiring and retention. The dashboard ensures that multiple voices are heard and encourages employees who might not otherwise speak up to voice their opinions. Bayer has implemented eLearning modules as a way of providing ongoing diversity education to employees. These modules reinforce the importance of of creating an inclusive environment in the context of the company’s values and expectations.
Learn more about building a diverse and inclusive culture by downloading our eBook, Talent Crisis: Diverse and Inclusive Culture.