Attracting top talent can be a challenge when it comes to building a successful organization — and then you have to retain it.
Part of holding onto your staff is ensuring your employees feel valued, welcome, and respected, and one way to do this is through a strong commitment to diversity, equity, and inclusion — also known as DE&I.
In fact, a company’s commitment to DE&I can result in even more benefits than sourcing talent and building effective teams. Utilizing a diversity, equity, and inclusion strategy can give your organization an edge over competitors and strengthen your bottom line. Let’s dig into how, and discuss nine key benefits to DE&I in the workplace.
What is DE&I?
Diversity, equity, and inclusion are often lumped together or used interchangeably, but these are three distinct parts.
Diversity refers to a wide and varying range of groups within a community or population — think ethnicity, religion, abilities, sexual orientation, and other dimensions of diversity. Inclusion is the active engagement of all members of that community or population. Equity is the fair and just treatment of those members regardless of how they identify.
Each DE&I element is important, and they are all deeply interconnected. But there are differences. For example, a diverse population is not automatically inclusive or equitable. Similarly, an inclusive community is not always diverse.
To successfully bring DE&I to your organization, the three must be integrated into every aspect of the workplace. Only then will you and your employees reap the benefits.
How is DE&I Connected to Company Culture?
Diversity, equity, and inclusion are important to company culture because they foster creativity, fresh perspectives, and understanding. By implementing DE&I, people of different races, abilities, ages, genders, religion, sexual orientation, and other diverse backgrounds can be made more comfortable in the workplace.
Women make up just 26 percent of the C-Suite in the United States, with women of color holding just 5 percent of the overall C-Suite roles. DE&I implementation can actively address a lack of diversity at the top by providing opportunities for all employees to rise through the ranks.
It can lead to new ways of solving problems, developing products and services, and understanding the world around us. Inclusion also helps ensure everyone feels valued and respected, making people more engaged and productive.
By promoting DE&I, companies can build a stronger, more vibrant workplace culture.
Nine Benefits of DE&I in the Workplace
From improving employee productivity and creativity to reducing turnover rates and creating a more positive company culture, strong DE&I can also be good for business. Here are nine benefits it has for your business.
1) Reach a More Extensive and Inclusive Talent Pool
As the workforce evolves, the importance of diversity, equity, and inclusion in the workplace is becoming more evident. Businesses are embracing DE&I and finding that they can tap into a vast pool of talent they might have otherwise missed out on.
According to a recent study, 70% of job seekers consider diversity a factor in evaluating a prospective employer. That number is even higher among Gen Z job seekers.
By focusing on DE&I, you can create a more diverse and inclusive environment that attracts top talent from various backgrounds. And the more diverse your team, the more diverse the talent pool can become from their referrals. Additionally, DE&I initiatives can help develop a more substantial pipeline of qualified candidates and create a more positive employer brand.
In short, when your organization has a diverse, inclusive, and equitable environment, it is better positioned to attract and retain premier talent.
2) Diverse Workplace Teams Are More Likely to Perform Better Financially
Research has found that diverse teams are more likely to outperform their less diverse counterparts.
Gartner found that 75% of companies with “frontline decision-making teams reflecting a diverse and inclusive culture” exceed their financial targets. They also found that “gender-diverse and inclusive teams outperformed gender-homogeneous, less inclusive teams by 50%, on average.”
They found that this is because ethnically diverse executive teams bring a wider range of perspectives and experiences as well as varied thought to the table, which can lead to more innovative thinking and better decision-making.
A more diverse team can be more effective at identifying new opportunities and exploring different markets simply because they are aware of other options. They are more resourceful, positioning diverse teams to be better at finding untapped potential and driving growth for your organization.
3) Inclusivity Fosters A Sense of Belonging for Employees
A strong DE&I presence in the workplace can also do wonders for employee morale. Studies have found that when team members feel like they belong and are valued for who they are, they are more likely to be productive and engaged in their work.
Diverse and inclusive workplaces can foster community and collaboration. Employees can feel comfortable working together towards common goals in them. DE&I strategies can range from ensuring that all employees have access to the same tools and possibilities to establishing safe environments for workers to discuss their concerns.
4) Higher Employee Retention and Lower Turnover
Retention and turnover can be challenges for any employer. Churn can be frustrating and costly, and often impacts the bottom line — another reason employers are adding focus on DE&I in 2023.
When done correctly and honestly, DE&I can increase retention and reduce turnover, making it increasingly important in the business world. According to Deloitte’s 2020 Millennial Survey, Millennials, the largest generation in the U.S. labor force, said they would stay longer with firms that appreciate the demands of a diversified workforce.
By building creating diverse and inclusive teams, you can encourage your employees to stay with the company longer. Happy employees are less likely to leave, and new hires are expensive to train, so the company might even save money in the long run.
5) Diverse Workplaces Breed Innovation
A strong diversity, equity, and inclusion strategy is something any company that wants to foster innovation and creativity should be thinking about.
Companies must adapt quickly to new trends and challenges in today’s rapidly changing marketplace. A diverse workforce in thought and experience is better equipped to identify opportunities and generate innovative solutions. By valuing and respecting the unique perspectives of all employees, DE&I allows your business to tap into a wider pool of ideas and solutions.
6) Inclusion Can Improve Business Decision-Making
When everyone feels they have a seat at the table, they are more likely to speak up and share their perspectives. Giving your employees a safe space to voice their ideas on a variety of topics from new products to new markets, leads to a more diverse set of options when making decisions or solving problems.
Prioritizing an inclusive workplace gives your employees the confidence to contribute ideas and actively participate in the decision-making process.
7) Equity And Inclusion Can Tackle Workplace Burnout
A 2022 survey found that nearly 80% of employees recently felt workplace stress, and 60% said that stress had negative impacts on them. This widespread feeling can lead to negative consequences such as decreased productivity, increased absenteeism, and heightened stress levels.
A more inclusive workplace can where diverse employees feel they are being treated equitably can help reduce the incidence of burnout by building a more positive workplace culture. This can also further improve employee morale and motivation.
8) Creates Competitive Business Advantage
DE&I strategy can create a competitive advantage for businesses. In today’s global marketplace, many customers and employees are seeking out organizations that reflect their values. In 2021, Gartner found that more employees were soul searching and thinking about where work fit into their lives — some 65 percent. Part of that was how they could better contribute to society. Feeling valued and offering value to others is becoming more of a focus.
Research has also shown that organizations with diverse teams are 33% more likely to outperform their rivals in profitability.
By creating a workplace that is truly inclusive of all people, businesses can be part of those conversations with employees — and tap into new and diverse markets for talent. As the business world becomes increasingly competitive, those with a strong DE&I strategy will be well-positioned to succeed.
9) DE&I Protects Company Culture
Workplace culture is the combination of values, beliefs, and behaviors that contribute to an organization’s unique social and psychological environment. When it comes to creating a positive culture experience, all types of diversity is essential because it takes people with different skill sets, diverse backgrounds, and new perspectives to build a successful company.
The equity of diverse groups ensures everyone has complete access to the same opportunities regardless of background or circumstances. And maintaining an inclusive environment allows everyone to feel comfortable sharing ideas and being their authentic selves.
Company culture improves when all employees feel comfortable, respected, and have a sense of belonging. A lack of differences can lead to an “echo chamber” where everyone simply agrees with each other without considering other viewpoints.
Effectively Measuring DE&I in the Workplace
Now that we’ve addressed the value in a more diverse and inclusive environment, let’s talk about how to start improving DE&I in a company. By measuring DE&I in the workplace, organizations can better understand where they need to improve and take steps to create an inclusive environment.
There are a few key metrics that organizations can use to gauge DE&I in an organization.
- Look at the representation of different groups within the company. This includes percentage of employees from underrepresented groups, age, genders, or differing abilities or the ratio of women to men in leadership positions, etc.
- Conduct regular DE&I surveys to ensure that the company is properly and effectively implementing these values in the workplace. Use an outside consultant or firm to help with developing the survey and analyzing the results. It is also valuable to create additional DE&I surveys specifically for leadership.
- Assess the impact of DE&I initiatives by looking at changes in company culture, employee behavior, etc.
How Do I Create a DE&I Strategy?
There’s no one-size-fits-all answer to this question since the best way to create a DE&I strategy will vary depending on an organization’s needs. However, there are a few key steps that any business could take when developing a DE&I strategy.
- Assess the current diversity, equity, and inclusion situation.
- Identify areas where the organization can improve.
- Develop action plans for improvement and set concrete goals and objectives.
- Implement the plan and measure its effectiveness over time.
- Make sure there is accountability to sticking to the goals
Following these steps, any business owner or HR leader can develop a tailored DE&I strategy to help their business and foster a more inclusive environment.
Always Have DE&I In Mind
Whether you’re looking to make your next hire or level up your day-to-day leadership, keeping diversity, equity, and inclusion in mind can have a positive impact on your staff and your business. With a thoughtful and well-executed DE&I strategy, you and your teams can work together to create a strong culture long-term. Plus, it can help your business retain talent, drive growth, and give your company a competitive hiring edge.
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