When people think of diversity, they tend to think of the differences they see or perceive, such as gender, race or physical disability. But those “visible” features are actually only a very small part of the diversity equation. To understand diversity better, it is vital to see what diversity as a concept can bring to organisations.
Put simply, diverse groups tend to outperform homogenous groups of equal capability. This is because they draw on a wider framework of mindsets, experience, approaches and ideas that a diverse group of people will have, compared with a group of like-minded people. When managed well, diversity fast-tracks innovation and competitive advantage. On the other side of the coin, diverse groups also avoid the paralysis of “groupthink”, where people of similar backgrounds and characteristics under pressure conform with group norms, avoiding the challenge and free-thinking that underpins idea generation and innovation.
Concept of groupthink
The concept of groupthink came to prominence during the depths of the recession, where several commentators pointed out the staggeringly non-diverse composition of the UK’s leadership cadre. While no single factor could realistically be highlighted as the primary cause of the downturn (although poor decision-making has certainly been a contributing factor), the theory behind groupthink certainly struck a chord with diversity champions, and much of the wider population. The word is now widely used in City HR circles, at least, as an argument for increasing female representation on boards.
So the value of diversity to organisations is that it drives challenge, ideas and innovation, drawing on a wider base of experience, knowledge and approaches. It is actually “diversity of thought” that is of true business value to organisations, rather than the more understood concept of “visible” diversity. The classic diversity box-ticking exercise is slowly being superseded by the realisation that diversity of thought is one of the few unexplored avenues of competitive advantage.
Different ways of thinking
The very best organisations – and I am talking about a very few enlightened bodies – understand that the less tangible elements of diversity, such as diversity of culture, education and upbringing, foster different ways of thinking and different ways of approaching and solving the same problems. At Green Park, we call it “the power of collective difference”. This captures the essence of diversity and inclusion as a positive business theory, rather than a legal obligation or chest-beating corporate-social-responsibility initiative aimed at other competitor brands.
The extreme pressures of the last few years have narrowed the field in the pursuit of competitive advantage: costs are pared back, strategies are streamlined for the new, uncertain world and organisational workforces are running very lean. It’s hard to find new ways to drive differentiated customer-service excellence, improve internal efficiencies, or empathise with new groups of customers, because firms have spent five years focusing on those things in order to survive. We need to encourage new ways of thinking.
Fundamental shift needed
It is my view that diversity is quite a simple concept, but we need a fundamental shift in the way people think about it and manage it within organisations. If the view becomes that diversity and inclusion involves having certain minimum numbers of a certain type of person, we are missing the main point. The simple concept is that well-managed diversity delivers value. It generates an environment rich in empathy, which in turn creates value for organisations by breathing life into their idea pool – and this is so important in the new economic context, where innovation is so crucial to survival.
Understanding that diversity of thought is the real driver of value is key to organisations’ ability to harness the power of collective difference: the diversity you can’t see is more important than that which you can.
Raj Tulsiani is chief executive officer at Green Park Interim and Executive Search