Why diversity drives your bottom line

As the new year begins, I always review the previous year with a plan to improve in the following year. During my yearly reflections over the holiday period, I noticed that without planning it, I have an exceptionally diverse workforce. 

The more I reflected on it and the more I looked at what I’d done in previous years, I’ve always focused on getting the best people for the job, but just as importantly, the best people to make a high-performing team.

People who have different opinions from me, people who have the right attitude, strong mindset, the right skills, and confidence to deliver. And therefore, it has always led to a diverse workforce. 

Today’s podcast episode will be about why diversity in the workplace drives your bottom line.

Explanation of diversity in the workforce

Firstly, let me explain what I mean by diversity because when most people hear the word, they usually think of race or gender. Diversity is much more than that. It includes different backgrounds, perspectives, experiences, beliefs, skill sets, values, interests, and life experiences. And all of these can contribute to creating a diverse workplace.

Why is diversity essential in the business world?

In a world where innovation is king and every organisation is striving to be at the top of its game, diversity in the workplace should be an essential part of driving success. In other words, in the business world, diversity shouldn’t just be a buzzword. 

It’s essential because, without diversity, companies are missing out on a wide range of experiences, perspectives, and ideas that can help them create something truly unique. Individuals in a diverse workplace often come up with innovative solutions to problems because they see things differently than others may.

Five key points of the importance of diversity

To further understand why diversity is essential in the workplace, here are five manageable points to get a clear picture of its importance.

Number 1

Studies have shown that companies with diverse teams perform better financially than those without them. This happened due to the increased productivity that results from having people from different backgrounds working together on projects. 

According to a report by McKinley Company, companies in the top quartile for gender and racial and ethnic diversity are more likely to have financial returns above their respective national industry Mediums. Additionally, businesses with higher levels of diversity were 35% more likely to have financial returns above the median of their industry peers.

Number 2

Having a diverse team encourages creativity. A variety of people from different backgrounds can bring fresh ideas to the table. Studies such as the one at North Carolina State University into innovation in the pulp and paper industry have shown that companies with diverse workforces, come up with better ideas and solutions than those without them. Having different perspectives in the room leads to more creative problem-solving and innovative products.  

Number 3

A diverse workforce also helps your organisation connect with customers more effectively because having people from different cultural backgrounds allows you to develop an understanding of how different demographics interact with your product or service.

Number 4

When employees feel like they belong to an organisation, they’re far more likely to stay there for longer periods of time and be engaged while they’re doing it. So a diverse workforce helps ensure that everyone feels included and valued regardless of age, gender, race, or whatever other background, and that boosts morale across the board. This produces less employee turnover which is a big complaint among businesses.

Number 5

Much like the first point, studies have shown that companies with diverse teams perform better financially. Decisions made and executed by diverse teams delivered 60% better results.