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Diversity offers businesses competitive advantages but only with the right approach
Diversity offers businesses competitive advantages but only with the right approach

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A diverse workforce comes with a myriad of benefits: it creates a culture of innovation and strengthens employee retention, both of which give businesses a competitive advantage. In 2020, McKinsey & Company published the report, “Diversity wins: How inclusion matters,” which found that the higher the representation of diverse people in an organization, the higher the likelihood of outperformance.¹

This comes as no surprise. When organizations have a diverse workforce, it unlocks more opportunities for innovation, which trickles down into everything it does: products, solutions, customer service, and more.

But now organizations are dealing with an uptick in attrition and a fall in diversity since the pandemic, especially when it comes to women.² Organizations are now having to rethink how to rebuild diversity across the enterprise. Hybrid work must be prioritized and opportunities created for employees to connect even if they’re not in person. Not only that, companies will need to track employee engagement and sentiment to make sure that new tools and policies to cultivate collaboration and innovation are working.

These challenges also bring opportunities to capture competitive advantage. Here are three ways to create more diverse and equitable workplaces.

 

  1. Align around the right objectives

Often, organizations center strategies around building value for customers. But this leaves out an important stakeholder, employees. Many companies don’t consider employees’ needs and often fail to align them with the larger vision and purpose in driving customer and corporate goals.

Therefore, one of the first things that organizations must do is to create an employee experience that supports their growth, health, and sense of inclusion. This is instrumental in connecting employees to broader organizational strategies and the customer vision.

  1. Unite employees through shared purpose

Organizations should establish a purpose beyond revenue that guides all of its decisions and interactions. Having a purpose engages employees around a common mission and facilitates collaboration, innovation, and learning.

A strong purpose embedded across the enterprise is positively correlated with business performance and can help augment business growth. In fact, purpose-oriented companies have 30% higher levels of innovation and 40% higher retention rates than companies that don’t have a purpose statement. ³

  1. Tap into data for better DEI

For an organization to truly understand its employees and their needs, it should use data and technology to gain deeper insights into employee sentiment.

Organizations should then bring data-led insights together with the people who understand the business, industry, and their processes, so experts can apply their skills and judgment. This is how data helps companies make decisions that benefit employees, and in turn, the enterprise.

With so many people working remotely, organizations should increase their effort and investment in collaboration technologies that can overcome physical boundaries and foster connection between employees.

Diversity is now a key ingredient for organizations to stay competitive. And to foster diversity, it must be embedded throughout the organization – it’s purpose, people, and products.  

Author: Lavanya Shrinagesh, Global Corporate Social Responsibility and Diversity, Equity, and Inclusion Leader at Genpact


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