Innovation, diversity and inclusion

Innovation is fast becoming central to the way we think about every role in every function in a business.  Even if you don’t work in R&D, chances are you’re having to think about how to innovate. The last thing you want is more of the same people, with the same ways of thinking and the same ways of doing.  No really.

Innovative teams are inclusive teams

Many people have long held the common sense view that a diverse team is more likely to come up with diverse solutions and avoid groupthink.

There is now a large (and growing) body of evidence proving common sense correct.

Research by independent, New York-based thinktank the Centre for Talent Innovation[1] (CTI) shows that teams with multi-layered diversity – real diversity of experience, not just having a few different people around – are more likely to successfully:

  • Innovate for their target consumers – 158% more likely!
  • Penetrate a new market – 70% more
  • Create a new product – 75% more
  • Capture market share – 45% more

Further, research by Deloitte[2] supports the CTI conclusions on innovation, finding it 83% more likely that companies with an inclusive team will develop innovative solutions and 31% more likely that they will be responsive to their consumers’ changing needs.

Backing this up at an even more basic level, in-depth quantitative analysis of US corporate results[3] demonstrates that companies with a good diversity record have significantly higher revenue, number of customers and profitability.

You cannot afford to ignore this.

It’s not magic, but hard work

Take care in your rush for diversity – it’s all too easy to get it badly wrong.

There are studies out there (summarised helpfully here[4] and here[5]) to show that just throwing together different people can harm team dynamics, happiness and productivity.  Not so cool.

This is where the idea of inclusion is so important.  Inclusion isn’t just about including minorities.  It’s about making everyone feel included.  And what you’re including is a variety of experiences and perspectives, not just some BAME people (for example).

Common sense tells you that throwing different mindsets and ways of doing things together could result in friction.  It also tells you that good team functioning, and good results, depend on every person being heard and their viewpoint valued.  And, further, that those viewpoints need to be as mixed as possible to ensure the outputs are likely to pick up the best possible solutions.

Lucky for us, the evidence supports that common sense.  This, in fact, precisely what the CTI’s research found:

  • Diversity that is linked to success is multi-layered, encompassing both innate characteristics (like race, gender, age etc) and skills picked up through life experiences (like social media skills, language skills or general cultural fluency).
  • Leaders of diverse teams must possess some of this multi-layered diversity themselves.
  • A culture of openness and tolerance for risk is necessary to foster the kind of dynamic where everyone feels they can put their views forward and be valued. Again, Deloitte’s conclusions support this with 42% more people in companies that prioritise diversity and inclusion feeling they work in a collaborative environment.[6]

What to do?

So, the challenge for creating dynamic innovation is not only to make sure you’re inclusive but also to carefully manage employees’ perception, understanding and experience of what that means.

It also involves fostering a team and organisational culture of openness and tolerance for mistakes.  That brings us back to the old saying that ‘there is no innovation without risk’ – a truism that is easy to acknowledge but hard to act on.

We understand exactly how this feels.  We’ve been using diverse teams to produce innovative solutions for clients for years.  We’re constantly on the lookout to actively manage potential friction and get the best from those teams.

It’s not easy but, as an award winning HR Director told us recently, the rewards of inclusion won’t be reached without putting in the hard yards.

So, like most things in business, capturing innovation, revenue and profitability through genuine inclusion requires some concerted work.  You can’t afford not to start.

[1] Center for Talent Innovation: Innovation, diversity and market growth (2013)

[2] Deloitte: Waiter, is that inclusion in my soup? A new recipe to improve business performance (2013, Sydney, Australia)

[3] Herring, C: “Does Diversity Pay?: Race, Gender, and the Business Case for Diversity” (2009, American Sociological Review, Vol 74, pp 208-224)

[4] ibid., pp 208-212

[5] Deloitte: Only Skin Deep: Re-examining the business case for diversity (2011, Sydney, Australia) pp 9-15

[6] Deloitte: Waiter, is that inclusion in my soup? A new recipe to improve business performance (2013, Sydney, Australia) pp 7-8