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How to lead a diverse team in the workplace

Posted by Shivali Anand

September 17, 2021    |     5-minute read (854 words)

According to a study conducted by the Pew Research Center, "Americans are more racially and ethnically diverse than in the past, and the U.S. is projected to be even more diverse in the coming decades. By 2055, the U.S. will not have a single racial or ethnic majority." This is certain to significantly influence the workforce and how companies contend with workplace diversity.

Understanding workplace diversity

Workplace diversity refers to the broadly varying range of characteristics that exist among employees at a business. It encompasses how these people define themselves as well as how they are viewed by co-workers. Understanding, accepting and respecting variations in gender, race, religion, age, ethnic group, citizenship status, sexual orientation, military service, mental and physical differences, and other notable distinctions among individuals is a working definition of diversity.

Note that workplace diversity is not a novel concept. Its beginnings can be traced back to at least 1948, when President Truman signed executive order 9981 to eliminate military racial segregation.


Seven advantages of a diverse workforce

A diverse workplace has numerous advantages. For one thing, firms that are open to employing diverse staff have a broader pool of candidates to pick from, which can help them identify more competent employees.

Check out these seven research-backed reasons why having diversity in the workplace is excellent for any organization's bottom line:

  1. Increases profitability: Several studies have demonstrated that cultural diversity in the workplace may increase earnings for any organization. According to McKinsey’s "Delivering through Diversity" study, businesses with the most ethnic/cultural diversity on executive teams were 33% more likely to achieve industry-leading profitability. According to Credit Suisse Research Institute, large-cap firms with at least one female board member outperformed their peer group with no female board members by 26% over the previous six years.

  2. Fosters creativity and innovation: Hiring individuals with opposing viewpoints on the same problem will generate new ideas, enhancing everyone's creativity and providing more innovation potential. According to a Boston Consulting Group research, firms with "above-average diversity on their management teams" generated 19 percentage points greater innovation revenue than companies with "below-average leadership diversity" – 45% of total revenue against just 26%. According to survey respondents to Forbes research, a diverse and inclusive staff offers the varied views that a firm needs to propel its innovation strategy.

  3. Increased productivity: Workplace diversity not only fosters innovation but also boosts output. According to Entrepreneur.com, "creativity leads to productivity if the working environment is established and fostered in a way that allows the two to coexist happily." The more inclusive and varied the workforce, the more diverse the brainstorming, the more diversified the ideas, and the more diversely effective the workers.

  4. Facilitates improved decision-making: According to Harvard Business Review, teams with higher cognitive diversity solve issues faster. Employees from various ethnicities and origins are more likely to develop multiple solutions when faced with a challenge. As a result, more informed and well-considered judgments are made, and the end product is better.

  5. Gives you a deeper understanding of your customers: Customers come in many shapes and sizes. According to studies, persons with disabilities control an estimated $544 billion in annual disposable income in the United States alone. As a result, businesses employing disabled employees better understand the services and products that individuals with disabilities prefer.

  6. Promotes employee engagement: According to Deloitte Australia research, employees that are committed to diversity and inclusion have the most exceptional levels of engagement. When employees feel included, appreciated and empowered, they are more likely to be engaged, which leads to increased productivity and retention.

  7. Enhances brand value: Diversity enhances reputation and aids in the recruitment of top personnel. Organizations that promote workplace diversity are seen as more socially responsible, which opens doors to new markets, business partners and customers. "Over 80% of participants said that an employer's stance on diversity, equality, and workforce inclusion is an essential consideration when selecting whether or not to work for them," according to a PwC study.
How to cultivate and manage a diverse team

Now that you understand the benefits of diversity among staff, there is work to be done. Check out these five measures on how to build and manage a diverse workforce:

Overhaul the recruitment process: To build a diverse workplace, hiring employees from various backgrounds is essential. This requires leaders and hiring managers to overcome partiality in interviewing and assessing talent. 

Communicate, communicate, communicate: To effectively manage an inclusive and diverse workplace, businesses must regularly communicate with employees. For instance, to overcome cultural and language barriers, they may need to translate procedures, policies and other important information using pictures and symbols.

Treat all employees with respect: Companies should never make assumptions about their staff members from diverse backgrounds. They must judge successes and failures based on individual merit instead of attributing actions to their background.

Set the same rules for all employees: Companies must ensure that all necessary actions follow standardized criteria to ensure each employee is treated the same.

Encourage employees to work in diverse groups: Employees who work in diverse teams learn about and value others, which can help break down cultural misunderstandings. 

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