Skip navigation

Why Diversity Is Crucial For Decision Making, Creativity And The Success Of Your Teams


DATE: 03 May, 2021

I was reading a story in a leading Australian newspaper the other day. It was about a young Chinese graduate working for a large accounting firm. She had a great job and good prospects, but she faced a major hurdle… no-one bothered asking for her opinion in meetings, nor did they listen when she offered them.

How many of you have felt this at work? I have, particularly as a new immigrant to this wonderful country some 18 years ago.

What is diversity?

Is our society truly accepting of diversity? What does diversity really mean, and why is it so important in the work context?

I recently read Matthew Syed’s book Rebel Ideas. In it he says:

Wise groups or teams express a different dynamic, they don’t parrot the same views, instead they bring insights which address a problem differently. They challenge, augment, diverge and cross pollinate ideas.

His view is that a truly diverse team presents a whole which is more than the sum of its parts and the output of this is true collective intelligence.

When it comes to diversity, we often think about one or a mix of the following, gender, race, religion, class, culture, sexual orientation, and age. But the missing piece is what Syed calls cognitive diversity – different perspectives, insights, experiences and thinking styles. Syed says if we surround ourselves with people who mirror our perspectives and who conform to our prejudices, we could end up with a group of individually very intelligent people but one which is collectively stupid.

The benefits of diverse teams are numerous. They have a better collective understanding of their clients or consumers, they bring a wider, more inclusive perspective and as a result there are fewer blind spots in their recommendations or approach which, in turn, lessons risk.

Diversity is great for performance

The good news is it also positively impacts performance. The latest in a series of diversity reports by McKinsey titled ‘Diversity Wins’, found the relationship between diversity on executive teams and the likelihood of financial outperformance is stronger than ever.

Companies in the top quartile of gender diversity on their executive teams were 25% more likely to experience above-average profitability than peer companies in the fourth quartile.

The case for ethnic and cultural diversity was equally compelling with companies in the top quartile outperforming those in the bottom quartile by a whopping 36% in terms of profitability.

But it is not only about doing better financially, today we are faced with more diverse markets, our customers and clients are increasingly diverse, and companies which survive must constantly innovate.

Diversity in the workplace is a no brainer.

Tips to overcome diversity issues in the workplace

Despite this, overcoming the diversity hurdle still faces significant barriers. The main one is the unconscious bias of the companies for whom we work and the people who work for them.

Think of the company for which you work and ask yourself who hires people, what is the process for hiring, how does the selection process work and does it unconsciously discriminate?

In its report titled ‘The six signature traits of inclusive leadership’, Deloitte gives six examples of subtle biases which negatively impact the way we see others and the decisions we make: unconscious stereotyping; gravitating to and connecting with people who look and feel like you; favouring members of the ‘in groups’; positive and negative attributions to behaviour framed by your biases and depending on whether they emanate from the ‘in group’ or ‘out group’; confirmation bias i.e. looking for views which validate your view; and group think i.e when the desire for group harmony overrides rational decision making.

In their Diversity & Inclusiveness Report, EY Oceania 2018-19, EY talks about what inclusive leadership means to the firm. What I like about their report is it articulates six inclusive leadership behaviours which help to guide their leadership teams about what it means to be inclusive. In summary, these comprise:

  1. I am aware of my own preferences and biases
  2. I actively seek out perspectives different from my own and take advice
  3. I support everyone to contribute
  4. I adapt my own style to work effectively with others
  5. I open my decision-making to other perspectives
  6. I make success possible for all

They have gone as far as to provide Cultural Agility training which appears to be receiving high ratings by the mentor and mentee participants. Leadership training at the firm also includes exploring concepts such as unconscious bias, insider/outsider dynamics and the like.

I am not part of EY nor are they a client so I cannot comment on how it is going and whether it is making a difference, but what is encouraging are the practical steps the firm has taken to address workplace diversity and the conscious effort it is making to be inclusive.

Habits will need to be broken

The days of viewing diversity as only being politically correct or morally right are past. The research is clear – diversity delivers better performance and innovation. But to ensure sustainable, meaningful change requires leadership to consciously break the habit of wanting to be surrounded by people who think the same and in so doing personally validate how smart or comfortable we feel day to day.

I call this ‘myopic poison' because it is an attitude which kills our ability to learn new ways, stay curious and to be open to new perspectives and ideas.