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Diversity Program Success Part 3: Making the Case for Diversity

CoAdvantage-In our previous articles about implementing diversity programs in the workplace, we looked at the state of such programs and why they so often fail. In Part 1, we discussed some of the advantages of fostering greater diversity in the workplace; and in Part 2, we looked at what organizations can do to prevent their diversity programs from faltering, failing, or even outright backfiring. Still, the fact that so many attempts to diversify perform poorly can make it harder to convince people, from executives to middle management to workers, to support future diversity programs. That’s especially true if the organization has been previously burned by a failed diversity initiative. So, how do you do it?

Here’s the business case for pursuing diversity initiatives even if your track record isn’t perfect.

Most studies of the impact of diversity at business organizations look at correlations, not causation. It’s hard to say if improved diversity causes the benefits listed below, or if increased diversity and increased business performance are both the result of the same underlying factors. Regardless, however, research is crystal clear on one point: highly diverse organizations outperform less diverse organizations by huge margins in all kinds of areas. The numbers speak for themselves, and better business performance is all the convincing many executive leaders need.

  • Companies with diverse workforces generate 3 times higher cash flow per employee (Deloitte)
  • Companies with racially diverse workforces see 15 times more sales revenue than the least racially diverse organizations (American Sociological Association)
  • Companies with diverse management teams have 19% higher revenue and 21% to 33% more likely to be more profitable than others (Boston Consulting Group, McKinsey)
  • Companies with diverse boards are 43% more likely to have higher profit than others (McKinsey)
  • Companies with diverse workforces are 45% likelier to grow market share year-over-year and 70% likelier to expand into new markets (Harvard Business Review)

But what if the challenge isn’t selling these programs to executives but to middle management and employees?

Convincing executives may not be the issue. According to the Randstad Sourceright 2021 Talent Trends Report, 80% of employers already say it’s extremely or very important to have a strong diversity and inclusion strategy in place to help with hiring and retention, and 68% have already implemented such a strategy.

Unfortunately, employee resistance to these programs can undermine or negate their beneficial impacts. If workers feel the strategy is exclusionary (and possibly tipping into “reverse discrimination”); if the ways in which the strategy is implemented feel unfair and inconsistent; or if the diversity programs feel so forced workers see themselves as being strong-armed into compliance, they will resist any associated programs. In extreme cases, mandatory diversity training can actually increase animosity toward minority groups, for example.

Success in selling workers and mid-level managers on a diversity strategy rests on getting them engaged, according to the Harvard Business Review. The most successful diversity programs tend to be voluntary. They issue invitations rather than mandates, and they are intentionally designed to give employees opportunities to look good to others (“look how open-minded I am!”). Fostering contact between different demographic groups within the workforce also makes a big difference. In other words, to get workers on board, selling a diversity program isn’t necessarily as much about why it’s needed – that’s more for executives – as about how it will be implemented.

CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with HR administration, benefits, payroll, and compliance. To learn more about CoAdvantage’s ability to create a strategic HR function in your business that drives business growth potential, contact us today.