As our nation becomes more diverse, so does our workforce. More women and racial and ethnic minorities are in the labor force than ever before, and companies that embrace this environment are flourishing. Both employers and employees are gaining many benefits from diversity.
Gender diversity in the workplace is important for a multitude of reasons. One obvious reason is that it helps the economy grow. A McKinsey & Company study has shown that over the past 40 years, women went from occupying 37% of all jobs to occupying 47% of them. In addition, diversity is good for the bottom line. A recent Catalyst study showed Fortune 500 companies having three or more women on the board outperform other companies with 53% more returns on equities, 42% more return on sales and 66% more return on invested capital.
Ethnic diversity is important is because it promotes a multicultural environment and companies should strive to have a workforce reflective of its customers. Having people of multiple different backgrounds is important because it promotes racial and ethnic equality, and increases human capital.
Companies striving to have a more diverse workforce must address four pillars:
First, they should have buy-in from senior management and a commitment toward a more diverse and inclusive environment. This point may seem obvious, but a critical success factor for companies to have more diversity is for the commitment to be there from the top and a deep understanding of why diversity is critical for the company’s success.
Second, employees must have access to relationships that can propel their careers. If the entire senior management team consists of caucasian males, the natural tendency is for them to mentor and sponsor other Caucasian males. This illustrates the need for formalized mentoring within a company.
Third, employees must have strong networks, both in and outside of the company. Employees who have a strong network are more likely to succeed and feel supported as they advance their careers.
Finally, leadership development opportunities for diverse employees is critical. Leadership development can include training or other opportunities for practical application.