The ROI of Diversity and Inclusion: Why it Matters for Employers Now More than Ever 

Employers

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A CNBC survey shares that 80 percent of American professionals want to work for companies that value diversity, equity, and inclusion—proving that these terms are no longer mere buzzwords or social media trends.¹

Aside from attracting employees, DEI initiatives also impact an organization’s success. In this article, we’ll explore the tangible return on investment organizations can achieve by fostering a diverse and inclusive workforce.

From enhanced innovation and creativity to improved decision-making, we uncover the compelling business case behind DEI initiatives.

 

How Diversity and Inclusion Benefits Employers

A study by Harvard Business Review in 2022 says that about 60 percent of organizations have committed to implementing DEI initiatives.² But, what’s the reason behind this sudden adoption? The answer lies in the potential benefits organizations can gain by embracing DEI.

In essence, diversity drives business growth by offering the following advantages:

 

1. Enhanced Innovation and Creativity

Diverse perspectives and experiences are catalysts for innovation and creativity in an organization. When organizations cultivate a workplace that allows people with different backgrounds and unique insights to collaborate, they improve the possibility of generating groundbreaking ideas and solutions.

In embracing diversity, organizations can tap into fresh perspectives to drive innovation. This is proven by large organizations like Apple and Microsoft, who are actively working to create a culture of inclusion while driving creativity.

 

2. Improved Decision-Making

Aside from new ideas, different backgrounds and experiences bring valuable insights into the organization. This helps businesses make more informed, fair, and balanced decisions by having multiple viewpoints to consider.

Ensuring your workforce is diverse and inclusive can also result in open communication. This would facilitate the exchange of ideas and perspectives, leading to a more comprehensive understanding of company challenges.

 

3. Employee Engagement and Retention

Whether today or in the past, employees thrive and contribute their best work when they’re valued and respected by their employers. For example, a study by the American Psychological Association found that 93 percent of 1,714 professionals have a stronger drive to excel in their roles when they feel appreciated.³

Moreover, DEI can potentially improve retention as employees are more likely to stay with a company that embraces diversity and provides equal opportunities for growth and development.

 

4. Increase in Market Reach and Customer Satisfaction

Diversity directly impacts an organization’s ability to reach diverse customer demographics and deliver exceptional customer experiences. By having a workforce that mirrors the diversity of their target market, companies can better understand and address their customers’ needs.

Different perspectives can contribute to product and service customizations, quality, and efficiency. Ultimately, it can lead to higher customer loyalty and satisfaction. By prioritizing diversity, your company can gain a competitive edge through connecting with a broader audience.

 

5. Mitigation of Legal Risks

Lack of diversity and inclusion can expose organizations to legal and reputational risks. Claims of discrimination can damage an organization’s brand—no matter how strong it already is. To mitigate these threats, you can implement proactive measures like:

  • Fostering inclusivity
  • Implementing diverse hiring practices
  • Providing diversity training
  • Embedding equity into the culture

 

Moreover, companies must comply with laws like the Immigration Reform and Control Act. This safeguards businesses against legal repercussions, allowing them to attract better candidates and demonstrate their commitment to social responsibility.⁴

Read More: A Deep Dive into Diversity, Equity, and Inclusion’s Role in IT Delivery

 

Building Your Employer Solutions for Inclusion

Company leaders should understand that there’s a need to focus on employee ROI, meaning success is only possible when people are given priority. So, it’s necessary to conduct strategic planning and effectively implement inclusive practices to improve employee experience.

If you’re wondering how to get ROI from DEI, the following are some of the best strategies you can use to build a diverse and inclusive workplace for your workforce:

 

1. Create an inclusive work environment.

To observe a significant inclusion ROI, companies need to deliberately focus on cultivating a safe and supportive workplace that values and respects everyone. It starts with promoting psychological safety, where employees feel comfortable expressing their ideas, perspectives, and concerns without fear of judgment or reprisal.

Inclusive leaders play a crucial role in setting the tone and modeling inclusive behaviors. By actively promoting diversity, celebrating differences, and demonstrating respect for all team members, you can cultivate a sense of belonging among your employees.

This empowers employees to bring their authentic selves to work, which can drive their satisfaction and productivity, ultimately contributing to overall organizational success.

 

2. Promote inclusive recruitment and hiring practices.

To attract candidates from diverse backgrounds, you must intentionally eliminate bias in job postings and descriptions. This enables you to make informed and equitable hiring decisions.

For example, avoid exclusive terms that follow traditional gender stereotypes. By using inclusive language, you make your job posts more appealing to a broader range of candidates.

Expanding candidate-sourcing strategies is another vital step in fostering diversity. It’s essential to go beyond traditional channels and explore diverse networks to attract a broader pool of candidates.

Additionally, implementing diverse interview panels that represent a variety of perspectives helps ensure a fair and unbiased assessment. This evaluates candidates based on their skills, qualifications, and potential rather than their perceived notions based on their personality, appearance, or status.

 

3. Focus on employee development and growth opportunities.

Investing in the professional growth of your employees can be a strategic advantage. To achieve this, organizations can offer comprehensive mentoring programs that pair employees with experienced professionals who can provide guidance and support to help them navigate their roles and potential career paths.

It’s also advisable to organize training programs that can improve the skills and capacity of your workforce. Give importance to upskilling and reskilling initiatives and offer them to everyone despite their background.

Through these initiatives, organizations can empower their employees, foster a culture of inclusivity, and cultivate a diverse pipeline of future leaders who can bring fresh perspectives and innovative ideas to the organization.

 

4. Utilize employee resource groups (ERGs).

ERGs create a sense of belonging and support that fosters an inclusive environment where everyone’s voices are heard and respected. These groups serve as vital forums for employees to:

  • Come together.
  • Share their experiences.
  • Collaborate on initiatives that drive positive change.

 

To do this, encourage your employees to form groups that offer a safe space to connect with others who share similar life experiences. Moreover, allocate resources and administrative support to aid them in organizing ERG events and workshops.

 

5. Conduct diversity and inclusion training to remove bias.

Take diversity and inclusion training to a new level with interactive and engaging programs. Training sessions should be captivating where employees find interest in understanding DEI initiatives.

Focus on challenging biases, broadening perspectives, and igniting meaningful conversations. Tackle tough topics head-on with a dash of wit and humor to keep things light while driving important ideas and conversations.

Through these training programs, you’ll empower employees to recognize and address their own biases, creating a more inclusive and harmonious workplace. This breaks down barriers and builds bridges among your people, eliminating harmful biases and prejudice.

 

6. Measure progress and accountability

Believe in the power of metrics and KPIs to measure the impact of diversity and inclusion initiatives. Instead of ticking boxes, look for meaningful data that tells a compelling story.

Track key metrics, such as representation at different levels of the organization, employee satisfaction surveys, and diversity in leadership positions, to give you a clear picture of progress. But don’t stop at numbers alone. Dive deep into the stories behind the data to uncover the real impact of your efforts.

 

7. DEI is a continuous effort.

DEI is an ongoing journey that you should be committed to making a part of your organizational DNA.

This means always looking for new ways to nurture an inclusive environment, challenge biases, and create opportunities for everyone to thrive. It also means embracing feedback, learning from mistakes, and adapting your strategies to create a more inclusive environment that allows your employees to succeed regardless of who they are.

 

MAKE INCLUSION YOUR COMPETITIVE EDGE WITH STRATEGIC SYSTEMS

At Strategic Systems, we understand the transformative power of diversity and inclusion. If you’re ready to take action and prioritize diversity and inclusion in your organization, reach out to us!

Together, we can build a diverse and inclusive future that drives success and growth for your business.

 

References

  1. “The Number of Diversity, Equity, and Inclusion Specialists in U.S. Companies Is on the Rise.” LinkedIn, 18 Oct. 2022, www.linkedin.com/number-diversity-equity-inclusion-specialists-us-companies.
  2. Carter, Evelyn and Johnson, Natalie. “To Sustain DEI Momentum, Companies Must Invest in 3 Areas.” Harvard Business Review, 4 Nov. 2022, hbr.org/to-sustain-dei-momentum-companies-must-invest-in-3-areas.
  3. “APA Survey Finds Feeling Valued at Work Linked to Well-Being and Performance.” American Psychological Association, 9 Mar. 2012, www.apa.org/news/press/releases/2012/03/well-being.
  4. “National Origin Discrimination.” U.S. Equal Employment Opportunity Commission, https://www.eeoc.gov/national-origin-discrimination. May 24, 2023.