Hiring a diverse team is imperative for your success as an organization. It is clear now – more than ever – that it is both socially and morally imperative – period. That should be more than enough reason for growing organizations to start attacking this like you would other business opportunities today. Although we certainly don’t have all the answers, we know that now is not the time to be quiet and just “hope” things change; we all must do our part. We are each where we are today – founders, investors, partners, teammates – because we are leaders. So let’s lead.
In each of our past, pre-Oceans lives, we have dealt with the herculean task of helping to transform foundations, mindsets, and tech for hundreds and/or thousands of people in an organization. As a whole, the industry waited far too long to acknowledge and act on diversity hiring back in the day, but we’ve learned from those mistakes. Our hope is that we implement strategies for diversity hiring earlier – we know we will all be better for it. With that, the next tool we’re including in our Founders Toolbox is the Hiring Diverse Talent Framework.
“You’ll be happy to know our previous conversation on this already paid off. Upon your advice, we expanded our interview pool for one of our open posts, and just made a terrific new hire who happens to be an underrepresented minority. It was great to see the process in action – this candidate was one of three final candidates (all strong), and was the unanimous favorite. Thank you for your excellent counsel. When you said (paraphrasing here) that if we could “do just one thing, make sure there’s a URM in the interview pool” – I was worried that it wouldn’t really have an impact, that it wasn’t enough. I’m sure that it doesn’t always shake out this way, but really powerful to see it work so beautifully right out of the gate.”
– ONE HAPPY PARTNER
As a founder, there is a great advantage to focusing on diversity now. ‘Now’ is critical no matter what size your company is, but with every new person, every new process, this gets harder. There is a massive opportunity for smaller teams or organizations to make a real meaningful impact that will pay off for years to come.
Don’t just take our word on this. Let’s look at some of the reasons and the data to support this:
- Moral High Ground: We each have a social and moral responsibility to support one another – it is simply the right thing to do – and that is all you really need
- Promoting diversity and inclusive mindsets builds cohesive and successful teams: Gender-diverse and inclusive teams outperformed gender-homogeneous, less inclusive teams by 50%, on average in a Gartner study.
- Diversity + Inclusion = Better Business Outcomes: Inclusiveness isn’t just nice to have on teams. Harvard Business Review research shows that it directly enhances performance. At its highest point, inclusion is expressed as feeling “confident and inspired,” research from Deloitte Insights found. This research shows that the behaviors of leaders can drive up to a 70% difference between the proportion of employees who feel highly included and the proportion of those who do not. Teams with inclusive leaders are 17% more likely to report that they are high performing, 20% more likely to say they make high-quality decisions, and 29% more likely to report behaving collaboratively. They also found that a 10% improvement in perceptions of inclusion increases work attendance by almost 1 day a year per employee, reducing the cost of absenteeism.
- Differences of age, ethnicity, gender and other dimensions foster high performance: the difference in employee performance between nondiverse and diverse organizations is 12%, with similar improvements in intent to stay factors.
- Diverse teams focus more on facts: according to a study published in the journal PNAS, the researchers found that individuals who were part of the diverse teams were 58% more likely to price stocks correctly, whereas those in homogenous groups were more prone to pricing errors. They also process those facts more carefully: In a study published in the Personality and Social Psychology Bulletin, Katherine Phillips of Northwestern University and her team divided sorority or fraternity members into four-member groups, each of which had to read interviews conducted by a detective investigating a murder. Three people in every group, referred to as “oldtimers” in the study, came from the same sorority or fraternity, whereas the fourth, the so-called “newcomer,” was either a member of the same sorority or fraternity or a different one. It turned out that although groups with out-group newcomers felt less confident about the accuracy of their joint decisions, they were more likely to guess who the correct suspect was than those with newcomers who belonged to the same group.
- Diverse organizations are more Innovative: In another study, published in Economic Geography, the authors concluded that increased cultural diversity is a boon to innovativeness. They pooled data on 7,615 firms that participated in the London Annual Business Survey, a questionnaire conducted with the UK capital’s executives that asks a number of questions about their companies’ performance. The results revealed that businesses run by culturally diverse leadership teams were more likely to develop new products than those with homogenous leadership.
- Diversity and inclusion drive financial targets: a Gartner analysis shows that through 2022, 75% of organizations with frontline decision-making teams reflecting a diverse and inclusive culture will exceed their financial targets. A 2015 McKinsey report on 366 public companies found that those in the top quartile for ethnic and racial diversity in management were 35% more likely to have financial returns above their industry mean, and those in the top quartile for gender diversity were 15% more likely to have returns above the industry mean.
We all must do our part, and this begins with making everyone accountable. Since resources are scarce right now and headcount is limited, you may not be able to hire a full time recruiter or a diversity programs manager today. Instead, make this a priority of a current team member within their role today. Add this to their existing goals or make this a new goal for them. Someone needs to be responsible for holding the org accountable. This won’t get better overnight, so you want to make a commitment to move a little bit forward everyday. It’s about progress. Bottom line is: be committed AND buy in. This is better for your business – full stop.