Why diversity (and inclusion) matters to leaders

The workforce of today is more diverse than ever before – the workforce of the future will be still more so. Not only do women play a greater part in all levels and sectors of the workforce than when I left university 30 years ago, but the ethnic, national and religious diversity of the economically active population has also transformed (for example ethnic minority graduate recruitment at PwC in the twenty years that I’ve worked there has risen from less than 10% of the total to more than 30%).

We all know about those changes and we know they reflect the social and demographic changes that continue to transform UK society. We also know that these changes haven’t yet been reflected much in the boardroom or at senior grades below the C-suite where people are still far more likely to be white and male in both private and public sectors. As a generalisation I would say that the organisations I have worked in have made a bit of progress on gender diversity, some limited progress on race/ethnicity and almost none on disability.

Does this matter to the success of the organisation? I would say, yes, definitely. It matters for a number of reasons. For a start it can be pretty dispiriting to look up the organisation and see few, if any, people who look like you. In my experience this leads to a lot of an organisation’s high potential people (many of who are bound for example to be women and/or from ethnic minority backgrounds) self-selecting themselves out. I’ve seen it happen so many times – and the result of the loss of these high potential people is not only a loss in itself but also a loss of future senior role models for the people who come after them.

Secondly all the research (and my own experience) says that a good mix of people with different perspectives leads to better decision making. So diversity is likely to be important to the long-term success of the organisation. Some people might argue that a visibly homogenous leadership team could contain within it sufficient diversity of experience. While this is in theory possible, my experience from everywhere I’ve worked is that leadership groups tend to be remarkably mono-cultural. Those with a particular set of (quite similar) experiences, behaviours, backgrounds and views tend to rise to the top. They can then reinforce things by promoting others like themselves – much of which is sub-conscious preference. Of course, leaders have traditionally looked like middle-aged white males and the behaviours associated with that group are naturally associated with leadership success by many – even if past success is no guide to the future in a complex, changing world.

Organisational cultures are incredibly strong and most large British firms and government organisations have cultures based strongly on the sort of middle-class values and behaviours traditionally taught at private schools and top universities. The Civil Service and professional services, both of which I’ve worked in, are good examples. There’s nothing wrong with these values and behaviours in themselves, but the organisation can miss out on other ways of doing things which sometimes might be better. Individuals who don’t fit the mould can easily feel excluded. Age is another major source of difference (a growing body of writing shows how baby boomers and millennials often see the world differently) and given that many organisations are full of young people, large chunks of the workforce may prefer different behaviours.

Alongside considering difficult decisions from lots of different angles, the hardest thing for a homogeneous leadership team to do is lead a diverse workforce in a way that gets the best from everyone. A high quality organisation needs to get its people to give their “discretionary effort”, but this only happens when people feel highly engaged. Failure to communicate well with minorities or to take into account their needs or ways of seeing the world can easily alienate them. This can be the fault of the leadership or the line managers – often both. However the individuals sometimes need to make adjustments or compromises too.

So in order to buy in the commitment of the whole organisation and to identify with its customers and clients, leaders need to listen and learn from all angles, embrace different approaches and cultures and understand the needs of a diversity of its clients. This is inclusive leadership and we need more of it.

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