The concept of diversity is not new. Many companies routinely seek input from a variety of sources in order to create services and products that serve their global customers.
What is often overlooked, however, is the makeup of the workforce that is creating these products and services. Just as limiting sourcing for products to one supplier is not an effective way to conduct business, having a workforce that is limited is not only inefficient but costly as it turns out.
“When we look at companies that report above average diversity in their management teams, their revenue is 20% higher than those below average,” explains Jeff Sorensen, industrial products leader with consulting firm PwC. “We know diversity is a profit driver and have seen it empirically with many companies.”
A diverse workforce is not just something that would be nice to have—it’s a necessity. In one measure of diversity, by 2030 the majority of U.S. workers will be people of color. “With the continued shortage of talent, diversity is a real opportunity for everyone to fill this gap,” says Sorensen.
According to PwC’s Diversity & Inclusion (D&I) Benchmark survey (conducted in 2019), looking specifically at the industrial products and services sector, the importance of diversity is on the rise with 76% reporting that investing in D&I programs is a priority.
While companies are feeling pressure from many stakeholders—employees, customers and investors—only 26% of companies have D&I goals for their leaders and just 17% have a C-suite level diversity role in place.
While these numbers have shown improvement, quicker progression is expected. “Before diversity was an action to be completed, and now it’s a movement,” Sorensen says. “Therefore, companies need to embed it across the organization. Once embedded it will change more quickly.” Jaime Irick, vice president, architectural coatings, U.S. and Canada with PPG Industries, a producer of paints and coatings, agrees with Sorenson as to the immediate need of diverse workplaces.
“D&I efforts in the workplace can lead to greater innovation in services and products,” says Irick. He points to a 2020 McKinsey report that notes that “diverse teams are more innovative—stronger at anticipating shifts in consumer needs and consumption patterns that make new products and services possible, potentially generating a competitive edge.”
Irick explains that the next generation of workers value diversity when choosing employers. “Companies will miss out on talent if they don’t have a strong D&I program in place.”
To ensure a diverse workforce, companies should take steps to “improve hiring and recruitment practices and programs that help to increase and diversify the talent pipeline needed to sustain the evolving manufacturing landscape,” says Irick.
He knows from experience that this tactic works; he has created one of the most diverse teams at PPG. “It’s not a coincidence that our team is performing well, as many studies have shown diverse teams outperform non-diverse teams.”
New Definition of Diverse
While diversity in the workforce is generally directed at bringing in different races and cultures, there are other definitions of diversity.
One of the most well-established categories of diverse employees are those that are disabled. In fact, 40 years ago consumer packaged goods giant Procter & Gamble (P&G) saw the benefit of including this talent in their workforce. The company founded the People with Disabilities Network when the Americans with Disabilities Act was created. This network’s goal is to enable people with disabilities to “perform at their peak in the workplace and enable managers and colleagues to become ‘disability confident.’”
P&G continues the tradition of becoming more inclusive to this day as evidenced by the 2019 opening in Cincinnati of its Neurodiversity Smart Automation Center. Neurodiversity talent generally refers to those on the autism spectrum.
“It’s important to understand the unique skills that this group is able to bring to the company,” says Laura Becker, P&G’s president of global services. The center was opened in an effort to automate labor-intensive processes which require STEM talent.
P&G has several neurodiversity programs across its footprint. “We have seen improvements in productivity,” says Becker. And she notes that the speed of learning a task is higher for this group of employees. “This group of employees has the ability to be very innovative,” she observes.
Just as P&G is bringing different types of employees to tackle a specific area of business, automaker General Motors announced in November 2020 that in order to meet its electric vehicle program objectives, it will hire 3,000 new employees, and diversity will play a key role here as well. In a statement the company said that “achieving an all-electric future can only become a reality by embracing and investing in diverse perspectives and talent. The company encourages each employee to bring their most authentic self to work.”
Inclusion as a Business Strategy
The concept of bringing an authentic self to work is a fairly new one but it has reached across all industries. If employees feel included and therefore comfortable—no matter their gender, culture or diverse abilities—they will feel safer and more confident and will perform better at their jobs. A study done by BetterUp found that workers who felt a strong sense of belonging showed a 56% increase in job performance and a 50% decrease in turnover.
Helping employees feel that their workplace is inclusive will require specific strategies and programs. In a new book, Belonging: The Key to Transforming and Maintaining Diversity, Inclusion and Equity at Work, the authors found that one in four employees feel they don’t belong at work. Looking at the U.S. workforce, 52% of U.S. workers don’t believe their employer takes personal responsibility for diversity at work.
That must change, says the National Association for EHS&S Management (NAEM). In a recent report, the group said, “For the rising generation of EHS&S leaders, diversity and inclusion is now a business expectation.” The report takes note that more than half (50.2%) of Generation Z belong to a group that might once have been called a “minority.”
So how can EHS professionals address these issues? Sorenson offers a practical tactic known as unconscious bias training. “Discussions about what it means to work with people who come from different cultures and experiences are necessary,” he says. “People need to identify their blind spots.”
And this is exactly what Irick did at PPG, in reaction to social unrest that occurred earlier this year. He held open discussions at every level at his organization, to help people discover what barriers there might be to increasing diversity due to unconscious bias.
In addition to this first step of opening discussions, NAEM offers some specific steps based on lessons learned from its research:
- Begin by engaging employees in the business case for change. You need to make a strong business case that begins with a clear set of business objectives and the benefits you expect.
- Emphasize that diversity and inclusion programs benefit everyone.
- Create opportunities for your employees to connect and learn from one another.
- Be willing to adapt to the changing needs of your employees.
- Teach employees to accept different paths to the same destination.
Creating a diverse and inclusive workforce is not an option; it’s essential to the success of any company. “In today’s world, if a company wants to compete in the market and provide a fair return to shareholders, they need to be creating diverse teams,” Irick insists.