A High-Impact Inclusion and Diversity Program

Why Diversity and Inclusion Has Become a Business Priority: JOSH BERSIN

Why Diversity and Inclusion Has Become a Business Priority

With all the press we read about diversity, inclusion, women in leadership, and the need to be open-minded about religious and cultural differences, one might ask “Is this the year of diversity in business?”

I believe the answer is yes: this topic has been raised in the public eye and research now proves that companies with great diversity outperform their peers by a significant margin. If you aren’t taking this topic seriously, you should be. Here’s the evidence:

  • McKinsey’s Research shows that gender-diverse companies are 15% more likely to outperform their peers and ethnically-diverse companies are 35% more likely to do the same.
  • Catalyst Research shows that companies with more women on the board statistically outperform their peers over a long period of time.
  • Deloitte Australia Research shows that inclusive teams outperform their peers by 80% in team-based assessments.

We just completed a two-year research study and the results are amazing:  among more than 128 different practices we studied, the talent practices which predict the highest performing companies are all focused on building an Inclusive Talent System. 

Business Impact of High Performers

Let’s look at the business impact.  The companies at levels 3 and 4, who we label “inclusive” and “managed” talent companies, are quite exceptional businesses.  Specifically, over the period we studied, these companies are:

  • 2.3 times higher cash flow per employee over a three-year period
  • The smaller companies had 13 times higher mean cash flow from operations
  • 1.8 times more likely to be change-ready and 1.7 times more likely to be innovation leaders in their market
  • 3.8 times more likely to be able to coach people for improved performance, 3.6 times more able to deal with personnel performance problems, and 2.9 times more likely to identify and build leaders.

In short, these level 3 and level 4 companies are not just “better at HR,” – they are higher performing companies measured by business, financial, and talent outcomes.

What is A High-Impact Inclusion and Diversity Program

What does it mean to have a strategic D&I program? As our research shows, Diversity and Inclusion is a top-to-bottom business strategy – not just an HR program.

Building a strong “Culture of Inclusion” is difficult, takes executive support, and will touch almost everything you do in leadership and HR. Companies like Sodexo, Novartis, AT&T, and other diversity leaders have been investing in these strategies for years.

Some of the keys strategies we’ve learned include:

  • Creating a top-level focus and strategy at the CEO/COO/CHRO level
  • Assigning a top executive the responsibility for leading and sponsoring the inclusion and diversity program
  • Creating behavioral standards, diversity metrics, and holding leaders accountable for results
  • Training people at all levels on topics like unconscious bias, similarity bias, structural bias, and self-rater bias
  • Integrating diversity and inclusion strategies in recruitment, performance management, leadership assessment, training
  • Creating employee networks (D&I champions, Employee Resource Groups, and Communities of Practice) to bring people together
  • Holding your company accountable to compete in external award programs to win and compete in this important area
  • Creating an internal and externally visible scorecard to measure progress in all areas.  Such scorecards include metrics for recruiting, promotion rates, compensation levels, participation in coaching programs, turnover, participation in ERGs, supplier diversity, and much more.

These examples help us realize that we must think about diversity and inclusion in a holistic way. Rather than just try to hire more women engineers from top schools, how about expanding your whole recruiting philosophy to include engineers, artists, mathematicians, and other creative professionals from a broad set of experiences.


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