Successful Companies Are Diversified. Is Yours?

It sounds like a cliché, but the world is changing. By 2050, the U.S. Census Bureau estimates that racial minorities will become the majority of the population. If you travel to any big city in the country, you’re likely to see a mix of people of different nationalities, religions, ages, ethnicities, and genders working side-by-side. In 2020, the country elected its first black, South-Asian, female vice president, Kamala Harris. The Miami Marlins baseball team hired Kim Ng, an Asian American, to become the MLB’s first female general manager. While progress is happening throughout the U.S., the business world is progressing a little more slowly, in some cases.

We’ve got the inside scoop on the importance of diversity for small businesses, plus proven steps you can take to diversify your business.

• Age. We’ve all seen those articles describing the industries dying out due to millennial purchasing habits. There are also a million articles about the precarious economy created by the boomers. Still, a diverse business has a mix of old and young employees.

The importance of diversity based on gender is underlined by a straightforward question. Can a successful company market or sell to women without their input on the inside?

The Harvard Business Review found that diverse companies had better financial performance than similar, less varied companies. In fact, companies with management teams that include people of different ages, genders, races, and sexual orientations enjoyed a 10% boost to their performance. (Levine, 2020). Big companies are starting to notice that diversity improves profits. Robert Stevens, former chairman and CEO of aerospace company Lockheed Martin, said, “At Lockheed Martin, we recognize that diversity is not just a short-term trend. It is a business imperative.” (Skrzypinski, 2011).

All employees enter at the same level, and how they progress is up to them. It must have taken Tim Cook, the CEO of Apple, the first company to hit $1 trillion valuation, a lot of thought before he came out in a Bloomberg article as a gay man in 2014. The business world is still a tough place for LGBTQ people. But, Mr. Cook quoted Dr. Martin Luther King saying, “Life’s most persistent and urgent question is, ‘What are you doing for others?” (Cook, 2014). As a business owner, it’s important to move the ball forward whenever you can.

It may sound simple, but people with different perspectives usually come from diverse backgrounds. Diversity in the workplace encourages left-brain thinkers to compromise with right-brain thinkers, women to shed light on what female shoppers look for, and veterans to share their work ethic with artists who share advertising tips to salesmen. Every combination of dissimilar people will come up with countless ways to tackle problems. Foreign-born employees may bring in a new point of view on a particular product or service, or they may help you discover untapped resources in your community that you can reach out to. If your team feels comfortable discussing out-of-the-box ideas, working in diverse groups, giving credit where it’s due, and speaking up when problems occur, creativity will abound, and innovation will increase. According to Josh Bersin, a researcher on corporate talent, companies with high inclusion levels are 1.7 times more likely to be innovation leaders in their respective markets. (Bersin, 2019.). For example, Alphabet, Google’s parent company, has a consumer hardware team that researches, designs, and develops new technology. Known for being innovation leaders, this branch of Google is headed up by COO Ana Corrales, one of Fortune’ 50 Most Powerful Latinas in Business. (ALPFA, 2018).

A my-way-or-the-highway mentality may have a few practical uses in life, but for the most part, it’s a terrible way to run a company. Marcus says that “The customer is not No. 1 to me. They’re No. 2, right behind the employee.” One key to long-term success is diversity in the workplace and employees who share their knowledge. If any company – or school, neighborhood, group of friends, etc – is only made up of like-minded people, it makes it very difficult to understand other perspectives. Having a diverse team helps companies broaden their outlook.

That’s what Anilu Vazquez-Ubarri, Chief Diversity Officer and Global Head of Talent at Goldman Sachs does. She drives recruitment and develops diversity strategies to find the right employees for the right positions.

If you’re hiring for a role that was traditionally thought of a masculine position, avoid using “he,” “his,” or “him” in your wording. Otherwise, you might accidentally miss out on the best person for the job.

If you’re running a small business and want to expand to new locations, hiring someone from an adjacent city could provide you with unique insights. Hiring military veterans could improve your team morale or offer you new management techniques. There are a million ways to expand the way you see your business and its potential.

Ultimately, making your business a more inclusive place to work will yield nothing but benefits. The importance of diversity shows itself in many different areas, from inspiring and aiding growth to making your business an innovation leader. It also brands your company as a pleasant place to work, making it easier to hire superior candidates. Sometimes, it won’t be easy. But, our tips will help you maximize your business’s potential. Marcus tells us that “people are the most important thing.” Expand the people you include in your organization, and you’ll expand your business.