How Diversity and Inclusion Present Business Advantages

Practicing diversity and inclusion isn’t just about virtue signaling. It also presents real, measurable business advantages, allowing you to make more money and gain a true competitive edge. But how exactly do these benefits manifest? And how can you best take advantage of them?

Diversity and Inclusion
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Diversity and Inclusion Defined

Most people have an intuitive sense for what diversity and inclusion mean, but we need to recognize that these are different terms with slightly different meanings.

Diversity refers to the makeup of the population within your organization. An organization with a population makeup that reflects the natural makeup of the United States population can be described as more diverse than an organization with a population that’s 95 percent white men.

Inclusion refers to the interactive participation and influence of different types of people within an organization. An organization may be diverse but not inclusive if it hires many women and people of color, but those women and people of color aren’t decision makers and aren’t typically included in important meetings.

The Advantages of Diversity and Inclusion

Practicing both diversity and inclusion is associated with many different advantages, including:

  • Participation, candidates, and growth

As much as 40 percent of GDP growth in the United States between 1960 and 2010 can be tied to increased participation by women and people of color in the labor market. There are many reasons for this, but the most obvious one is that when more people are actively participating, more things get done. Plus, as a business, if you’re open to considering people from a wide variety of different backgrounds, your pool of potential recruits will significantly increase.

With more people to choose from, you’ll have more talent to choose from, which means you can practice better staffing and increase your overall potential as an organization.

  • New perspectives and new ideas

People from different backgrounds tend to think in different ways. They have different historical experiences, different values, and different cultural ideas. Tapping into the power of all these different people, collectively, allows your business to take advantage of new perspectives and ideas. You’ll come up with better concepts and competitive advantages reliably.

  • Innovation and better products

In many cases, having a diverse workforce in terms of gender and race means a better path to innovation and better products than ever before. Thanks to the power of diversity of thought and a more impressive talent pool, you’ll be able to do more.

  • Productivity and performance
What is productivity - a hybrid work environment does not harm productivity
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Racially diverse firms tend to have productivity 1.32 times higher than the productivity of their non-diverse counterparts. There are many potential explanations for this, but the bottom line is your company’s productive potential is going to measurably increase with the right diversity and inclusion strategy.

  • Reputation and consumer appeal

It’s also worth mentioning the fact that practicing diversity and inclusion can improve your business reputation. It can make you more attractive to customers, more attractive to other businesses, and it can serve as a way to generate publicity almost entirely on its own.

Practicing More Diversity and Inclusion

What are the best ways to practice more diversity and inclusion in your business?

  • Revisit your mission and core values

Start by revisiting your mission and core values, if you’re open to changes. If you want to put diversity and inclusion at the heart of your business, you can put it in writing.

  • Practice targeted outreach

Start practicing targeted outreach to advertise new job openings to the types of people you want to recruit. Get more involved on the community level and make sure each community understands how much you value diversity.

  • Instill empathetic leadership

Your strategy will be much easier to practice if you have empathetic leadership in place. Empathetic leaders who relate to the perspectives and needs of many different groups will foster a healthier and more productive work environment.

  • Avoid centralizing your strategy with quotas

It’s tempting to fill “quotas” of certain types of people to hire. But this can also be self-defeating; your goal isn’t necessarily hitting a certain number.

  • Consider diversity and inclusion at all levels

Practicing diversity and inclusion at the lowest levels while your leadership team is still mostly white men isn’t going to help your business much. Diversity and inclusion should be practiced at all levels within your organization.

  • Encourage participation and help people thrive

Support the women and people of color you hire. Make it easier for them to thrive in this environment.

If you don’t have a diversity and inclusion initiative in your business, you’ll be missing out on some serious potential. Even small, iterative changes to your strategy can lead you to create better products, operate more productively, and gain a competitive advantage.

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