Sheila A. Stamps, Independent Board Director, Atlas Air Worldwide, CIT Group, & Pitney Bowes
Ignoring diversity, equity, and inclusion (DEI) is an enterprise risk. The 2020 U.S. Census data supports that, with increasing velocity, there will be no racial or ethnic majority in the United States by the year 2045. Whether you operate domestically or globally your customers, employees, and investors are diverse. Leading-edge companies understand the upside of addressing this risk strategically. Don’t miss this opportunity.
We have all seen the reported bottom line benefits of DEI from consulting and research firms:
- Better innovation (19% higher revenue),
- Faster decision making (2X faster with ½ the meetings),
- Greater workforce engagement and ownership, and
- Healthier financial performance (33% more likely to outperform).
Strategic diversity works. Kaiser Permanente, one of the most successful healthcare organizations in the U.S., has no racial or cultural majority in its labor force. Kaiser’s strategy – to provide culturally-acceptable medical care to all the 140 cultures represented in the U.S. – and its DEI efforts are aligned with its marketplace.
Personally, I know what it means to implement, rapid fire strategic diversity. Taking over an unprofitable capital markets business as an African American female banker in the UK during the late 1990s had its own diversity moments (a topic for another time). Covering numerous western European countries and the UK subsidiaries of Japanese banks, I knew we had go-to-market gaps. We needed to hire and work with partners that could help elevate the team’s performance. This multifaceted group brought knowledge and relationship insights critical to the resulting turnaround.
Alternatively, missing the linkage between DEI and strategy is an opportunity cost and potentially a reputation lost. Remember Gucci’s damaging misstep with a blackface sweater launch. A significant hit to the company’s reputation and a self-acknowledged “learning experience”.
Calls to action related to recent social injustices have brought the conversation to the forefront. Despite external pressures, however, embracing diversity comes down to one important reason – it is best practice.
The WHY: As Marshall Goldsmith notes, “What got you here
won’t get you there.” The status quo is not sustainable. Your stakeholders know this.
- Employees – 73% would consider leaving an organization for
one more inclusive (Deloitte inclusion survey),
- Consumers – vote with their wallet and look for companies
serving the ever-growing needs of a diverse marketplace,
- Investors – are placing increasing emphasis on environmental, social and governance (ESG) initiatives in the companies they support, and
- Community – reputation is more important than ever in an era of social media where missteps can wipe out reputations and market cap in seconds.
It may be overwhelming to determine where to start. So, let me share four fundamental, often glossed over, steps to make your strategic diversity program standard operating procedure.
The 4Cs: Clarity, Commitment, Communication, and Continuation
Clarity: If you don’t know where you are going chances are you will never get there. What is your strategy for the next 3-5 years? What human capital do you need in the leadership team, in the boardroom, on the factory floor, out front and customer facing to get your company to the next level.
Commitment: No one will follow you if your commitment is not clear. Openly commit to the goal. Set measurable outcomes. Encourage desired behaviors through promotion, compensation, and recognition.
Communication: Verbalize what success looks like. Do it clearly and often. Set up the infrastructure to foster the culture. Highlight successes and don’t be silent when issues arise.
Continuation: When it comes to incorporating DEI into your operations, there is no finish line. The process evolves with the corporation.
Unlocking the potential of diversity is transformational. Use these 4Cs to your advantage. Take the first step. Get clear on your risk-based strategy and how including diverse voices will benefit you. Embrace the African proverb, “If you want to go fast, go alone. If you want to go far, go together.”