Give Your Business The Edge with Greater Diversity
Diversity isn't just the preserve of the corporates. It's fast proving attractive to small and medium-sized businesses bringing benefits such as increasing creativity and innovation, new markets and, what probably matters most to any business, increasing profit. Find out why embedding diversity in your business can help your business grow even in these tough times.I know what you’re thinking. And it’s not because I was endowed with a special power at birth – society isn't quite ready for that gift yet.
But let me take a guess. I think you’re thinking: ‘Diversity is all well and good but I run a small outfit and it’s just not relevant to me.’ You may even be thinking that, as far as your list of priorities is concerned, this one probably wouldn’t register a pulse in these austere times let alone feature near the top. You might not even be completely sure what I mean by diversity since everybody seems to have their own view on what it means (isn't that a good example of diversity in practice?)
For the purposes of this article, diversity is about exploiting differences in the labour market and customer base to improve competitiveness and deal with changes. (This definition comes from the EU guide 'Diversity at Work: A Guide for SMEs')
So, if my mind-reading abilities are near the mark then you may be drifting away from this article but, since you came this far, you may as well HOLD ON for a few more sentences! Let me share a couple of pointers first to help clarify where I'm going with this. If those pointers don’t raise your interest level then feel free to depart, with my blessing as an added bonus, as this article really doesn’t hold any relevance to you.
See how you fare with these:
- At the moment, your priorities are about adapting your business to cope or even survive in these very challenging economic times
- One of the best responses to tougher competition is to invest in new and innovative products or services and to develop new markets
- Equally, containing costs is critical as well. After all, over-priced products and competitive markets aren't a good mix
I’m sure that there are very few amongst the business community (with a reasonable level of sanity, at least) that would not affirm the importance and current relevance of these three statements. The fact is that as recession bites the competition becomes much tougher and those businesses that equally prioritise cost management and innovation are the ones that are most likely to emerge from the current economic crisis stronger and better able to capitalise on growing markets.
So, I’ve you kept you with me this far but what on earth has diversity got to do with all of this?
As it happens, the idea of diversity in business may well hold the key to your current needs.
Enough teasing. Let me show you how…
The SME Business Case for Diversity
I aim to show you that diversity is not a nice to have when times are good and neither are its principles exclusively reserved for big companies. If being competitive is important to you then diversity is relevant to you.
The research first.
In 2008 the EU commissioned a research and consultation project on the business case for diversity in Small and Medium Sized Enterprises. It sought to identify if a business case existed with SMEs for diversity, understand what that business case might be and it looked at developing an associated set of SME-friendly diversity tools.
So, what was their business case? After consulting with over 1200 SMEs (covering micro-enterprises of less than 10 people, small companies up to 50 and medium-sized up to 250) across 27 countries and 70 SME intermediary organisation (such as Chambers of Commerce, trade unions and business support organisations) they determined the following:
- 79% of the SMEs surveyed recognised business benefits when employing and promoting a diverse workforce
- 60% believed that diversity policies enabled the recruitment and retention of higher quality employees
- 40% recognised a link between diversity, creativity and innovation
"Enough with the numbers," my, now almost famous, sixth sense is telling me. There were many other benefits recognised in this survey including accessing new markets, increasing client loyalty and reducing absenteeism but the question remains, why would diversity have these effects?
Well, the way I see it is that it comes down to three primary reasons: the introduction of an ability to think in a different way, an ability to access new markets and what recognising the value of diversity says about your company.
Let's start with the ability to think in a different way first. When the SMEs in this survey were asked why they thought that diversity delivered benefits with creativity and innovation they responded that employees with different backgrounds have different approaches to problems and that this breeds creativity. Further they suggested that the different perspectives of employees can complement each other and this may lead to innovation.
This really makes good common sense. We all know that bouncing our ideas off different people helps validate those ideas and can make them stronger. Imagine what happens when you bounce the ideas off people that are different - the effect can be even stronger.
And what about market access? There are two markets I'm referring to here - the market for your products or services and the market for employees.
With regards to the markets you sell to, I consider that it follows from our first point on thinking differently that if you have access to employees from diverse backgrounds they can help you shape new market opportunities that you would previously have not been aware of.
And as for recruitment markets if you're always tapping into the same pool of candidates that you always did then you're restricting your recruitment opportunity. You want the best people for the job you have to fill (don't you?) but maybe there is something about the way that you are advertising the role or where you are advertising the role that is switching off or maybe not even getting to people that could be fantastic for your company. By appreciating the importance of diversity in recruitment you can attract much stronger candidates to your business from a much wider pool.
And this brings me on to my final point here. How you treat your employees, how valued they feel has a massive impact on your business. People are not machines and their feelings will guide them on how much commitment they might give over and above their minimum contractual expectations and how long they are likely to stay with your business. And you know how much recruitment costs you. Having clearly established and working diversity principles will make people of all backgrounds feel valued, demonstrate that you care about all your employees and cement your reputation as great place to work.
I'm sure that you will all agree that, once we expand on the cause and effect, there is no rocket science going on here. It all makes good honest common sense.
So why not start thinking about how diversity can make your business more creative, innovative, and profitable and a great place to work, to boot, by looking into what and how creating a diverse workplace means to your business?
If you want to read up on this research or access some of the diversity tools that were created then follow this link.