Well-managed diversity can drive business success in our connected world
The debate about diversity and inclusion in business usually focuses on fairness: promoting racial and gender equality, in pay and opportunity, to make the workplace a level playing field. While fairness is of course important, in our highly-competitive business world, we also need to stress the value of diversity in improving business performance.
Observations by four panellists, at an event sponsored by the British-Swiss Chamber of Commerce, the Dutch Business Round Table and the University of St. Gallen, concern the more hard-headed aspects of diversity: how it can be used to build successful multinational business, but how it needs to be managed.
You need to be a bridge builder… or to find one
The first speaker was Prof. Dr. Winfried Ruigrok of the University of St. Gallen. As he put it “diversity is all about the what happens when I put THESE people here together.” And business always asks if this matters for performance.
Research shows that diversity is especially helpful for companies operating in multinational markets. Companies with too strong a local focus do not profit as much from having diverse teams. But having a wild mix of people is not the best way to handle it: you can have too much of a good thing. The more diverse the teams, the more coordination and management skills are necessary to make them work efficiently. Here managers need to find ‘bridge-builders’ or be such themselves – people capable of recognizing or creating a common ground among diverse team members.
A fascinating result of research was that over time the positive and also the negative aspects of diversity tend to diminish. Prof. Winfried pointed out that companies have a lot of data that can show them where diversity is necessary for enhanced performance. But most do not take advantage of this information.
Dare to be yourself
Leon Pieters of Deloitte came next and took a more personal approach to the theme. One thing is managing a diverse team, another is being the one ‘diverse person’ within the team. Recognizing oneself as the different one leads to a lot of wasted energy spent in trying to fit in. Pieters believes it is in the interest of companies to coach people to be their authentic selves, and channel that energy. He also finds it very useful to use broad ranged qualities to discuss diversity. For example, to discuss about ‘extroverts vs introverts’, applicable to women, men, black or Asian people. This helps keep the focus of the discussion on managing the issues of diversity and inclusion themselves, and not the specific group issue. He believes in the need for measurable forms of guaranteeing diversity, and on the necessity of an aggressive approach to ensuring it.
Communicate… but do not scare
Estefanía Tapias, one of the co-founders of WeSpace, did not feel confronted by sexist or discriminatory behaviour for a long time during her career, having worked for bosses who supported diversity and women’s advancement. Though once she started working on the start-up scene it became a tangible problem. She noticed how she would be disregarded in conversations or not taken seriously, just for being a young woman. To her surprise these attitudes would come often from fellow young people in developed countries.
She commented that some developing countries are ahead of developed ones in that regard. Colombia for example has so many women in leadership positions that it is not even perceived as a problem. That she assigns to the fact that developing countries have to re-invent themselves all the time and value all their resources. Estefanía believes diversity is an important theme – but you can make people afraid of a topic if you communicate it the wrong way. For example, people originally got the wrong impression that WeSpace was only for women. It took a while to find how to communicate the WeSpace message in a light but assertive way – ‘Inspired by women. For Everyone.’
Hard on oneself, hard on others
Kate Hughes from the Zurich Insurance was asked about how members of minority groups sometime act especially harshly against others in their group to deflect criticism of favouritism. Being ‘the woman’, ‘the gay’, or ‘the black’ in a team may lead to the fear of being in this very position not because of one’s own capacities but because of some company policy. This leads to the demanding behaviour against people of a similar grouping mentioned above. This can be a very toxic component of diversity and one which also needs to be managed consciously. Promoting diversity means recognizing key promoters in your organization, which are aware of such problems.
Agreeing with Winfried Ruigrok about the usage of data, she mentions that data shows where problems start, and prediction models can help us solve that. We need therefore to identify these barriers and find people that stick their hands up for these causes. Barriers can also be both vertical as well as horizontal: it is important to break silos in a diversity context too. For her, diversity is an important theme because disruption is everywhere, but how can you disrupt your business internally and still function externally. For that you need people capable of thinking in many different contexts.
This is an edited extract from an original article, by Julio Prina, published in St. Gallen Executive School’s online magazine Vista.
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