How diverse innovation can benefit businesses

Diverse innovation can benefit businesses. By embracing diversity, organisations can also build their competitive advantage, so having a diverse and inclusive workforce is crucial for businesses that want to attract and retain top talent.

Remember, though, that this isn’t just about ‘diversifying’ teams. A 2020 report by McKinsey & Company states: “Hiring diverse talent isn’t enough — it’s the workplace experience that shapes whether people remain and thrive”. (1).

Inclusive workplace

There is a direct correlation between employees feeling like they can’t bring their true selves to work and a decrease in their work performance, so creating an inclusive workplace will help you support a happier team and, in turn, to meet your immediate delivery goals.

Studies have shown that there are concrete benefits when diversity and inclusion are truly embedded. For example, according to Harvard Business Review, a team with a member who shares a client’s ethnicity is 152% likelier than another team to understand that client.

Research also shows that in companies with diverse leadership teams, employees are 45% more likely to report that their firm’s market share grew over the previous year and 70% more likely to report that the firm captured a new market (2).

In a survey of 1,300 full-time employees from a range of organisations and industries across the United States, Deloitte found that 80% of respondents said inclusion was important when choosing an employer (3)

Benefits of diverse innovation

The European Institute for Managing Diversity did some research into the benefits of diverse innovation commissioned by the European Community Programme for Employment and Social Solidarity (2007-2013). Their findings came up with four clear ways in which diversity contributes to innovation (4). Here is a summary:

1. Dissimilar mindsets enhance flexibility, creativity and the ability to innovate.
2. A diverse mix of participants and an environment where individuals views are valid lead to more effective learning.
3. Having a diverse range of perspectives and expertise can contribute to more effective decision-making, problem-solving and critical evaluation.
4. Diverse teams can access broader networks and have better cross-cultural competence. Making use of this increases productivity, innovation and creativity.

References

1. Sundiatu Dixon-Fyle, Kevin Dolan, Vivian Hunt, Sara Prince, 2020. Diversity wins: How inclusion matters, McKinsey & Company.
2. Sylvia Ann Hewlett, Melinda Marshall, and Laura Sherbin, 2013. How Diversity Can Drive Innovation, Harvard Business Review.
3. DeloitteFostering an inclusive culture at work: Engaging today’s workforce
4. Diversity and Innovation: A Business Opportunity For All, European Community Programme for Employment and Social Solidarity.