Diversity is important

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Photo by Stacey Koenitz R

Diversity is important in business. It avoids dreaded “group think”, which can occur when everyone in an organisation is of a similar type or background, and unquestionably follows a set of assumptions that turn out to be incorrect.

Having a diverse set of people in your business means it is more likely someone will have a contrary opinion, a fresh perspective, or a different and valuable life experience to draw upon.

It also means that your business is more likely to be representative of the customers it serves.

Target audiences become much less of a fuzzy and abstract concept when members of that group are sitting in the same room.

There is plenty of evidence to suggest that diversity leads to better financial performance too.

Recent analysis by McKinsey revealed that companies with both gender diversity and ethnic and cultural diversity in corporate leadership outperform less diverse peers on profitability.

This is hardly surprising. If your goal is to attract the best talent, irrespective of background, then you will inevitably recruit the brightest minds.

Over time this becomes a self-perpetuating cycle as people are drawn to successful, forward-thinking businesses.

But making businesses more diverse can be a challenge because, even with the best intentions, recruiters often harbour unconscious bias that can lead to hiring decisions being weighted towards people that are perceived as being right for a role.

This is a subject Wharton professor Katy Milkman has studied in detail, and her findings about how systemic changes can eliminate hiring bias are fascinating.

“If I hire five people in a row at the Wharton School one at a time, I probably don’t even notice how those five people look as a group because I’m zoomed in looking at candidates,” Milkman said on the Ripple Effect podcast recently.

“But if I hire five at a time, I’m thinking, ‘Wow, how did I end up hiring five people who were all from the exact same university and have the exact same dissertation advisor? They all look the same. They all walk the same and talk the same.’ I might notice if there’s a lack of diversity because hiring in a set forces me to attend to that.

“And that is what we found in study after study. When people are choosing from exactly the same applicant pool for each hire, they make more diverse selections in sets than in singletons.”

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