On the surface, the changes required to create a diverse workforce appear to be straightforward. The business benefits are clear. According to McKinsey’s Diversity Matters Report, organizations in the top 25 percent for racial and ethnic diversity are 35% more likely to have revenue above the industry average.
From a personal perspective, we also know that diversity initiatives are, put simply, the right thing to do.
But creating a positive and inclusive workplace culture requires people to become aware of unconscious thoughts and beliefs that can impact their decisions and behaviors. After realizing how personal biases and resulting actions can preclude an inclusive workplace, people can be empowered to change and assumptions, which are often based on stereotypes.
Compounding matters, the sensitive nature of diversity can make people wary of sharing their challenges.
Accountability Alone Doesn’t Work
Organizations typically launch diversity programs by providing training and creating accountability. But when programs fail to drive change, they aren’t always sure where to look for solutions.
One common reason is a lack of understanding among senior leaders and middle managers of exactly how to effect change. Another is a lack of support—perceived or real—for managers as they work to influence years’ or even decades’ worth of entrenched behaviors.
Jennifer Brown, author of Inclusion: Diversity, The New Workplace & The Will to Change, often hears about companies that set up accountability metrics tied to compensation and then find that leaders fail to meet their goals. In these situations, she often finds that the leaders don’t know where to start or, in some cases, that larger organizational issues are negatively affecting their ability to drive change.
Organizations that just impose penalties without both looking at the bigger picture and working alongside their leaders can easily end up with the same result as if they hadn’t launched a diversity effort at all.
“Over the years, I’ve heard of leaders who have walked away from bonuses tied to diversity and inclusion. They didn’t know how to achieve the goals the organization set for them, and they didn’t even know where to start. So they just left the money on the table,” said Brown.
Conversely, when organizations tie bonuses to diversity hiring goals, they can unwittingly encourage managers to make sub-optimal decisions to achieve bonus. Worse, this can lead to discriminatory decision-making and expose the organization to legal risks.
One approach to avoiding this problem is to create incentives for improving the pool of qualified, diverse applicants. When recruiters attract skilled and diverse talent, the organization should see an increase in diverse hires. A related strategy, especially for senior positions, is to implement something akin to the National Football League’s Rooney Rule, which requires at least one minority and one female to be part of the applicant pool.
5 Keys for Supporting Managers and Leaders across D&I Efforts
A single action or program doesn’t provide the level of support necessary for lasting change. If senior executives take the following five actions, managers and leaders can get the support they need to drive change within their departments.
1. Engage with the leaders to brainstorm solutions.
Instead of telling leaders what to do, brainstorm together for ideas to help meet diversity goals. Often middle managers have a clearer view of the issues than senior executives do. Leaders often feel more engaged in the solution when involved in the process.
2. Provide mentors to leaders.
Find another leader at the same level who is meeting their goals and pair them with a leader who’s struggling. Leaders often share and relate to peers in a different way than they do with superiors.
3. Provide a safe environment for leaders to share thoughts, concerns, and fears.
Conversations about diversity can elicit emotional reactions. Leaders must feel safe from repercussions to share openly throughout the process.
4. Have regular check-in sessions throughout the accountability periods.
Companies often set goals and then leave the leader alone until the accountability period ends, which increases the chance of failure. By having regular meetings, leaders can work closely with the diversity team and change course if goals are at risk.
5. Consider the impact of company-wide or industry-wide challenges on the goals.
Sometimes the reason a leader fails to meet diversity goals has nothing to do with the leader’s individual actions. When a leader isn’t meeting goals, look at the whole picture to determine whether larger organizational issues or external factors are a contributing or root cause.
For more insights on how financial service organizations can create an effective diversity program, download our latest whitepaper: 10 Keys to Achieving Pay Equity, Diversity, and Inclusion in the Financial Services Industry.