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The Power of Inclusivity: Building Diversity in the Workplace

The Power of Inclusivity: Building Diversity in the Workplace

In today’s interconnected business landscape, more organizations recognize that diversity in the workplace is a must-have for a healthy workforce. Many top companies see the rewards of the varied perspectives diverse workforces bring, including innovation and stronger employee engagement.

What are diversity and inclusion? 

Diversity includes qualities that make us different such as race, gender, age, and physical abilities, as well as less visible attributes like educational background, socioeconomic status, sexual orientation, and religious beliefs. 

Inclusion is the deliberate and proactive effort to create an environment where everyone, regardless of their identities or experiences, feels valued, respected, and affirmed. Diversity and inclusion go hand in hand, and are the foundation of a thriving workplace culture.

What is diversity in the workplace?

Diversity in the workplace goes beyond a mix of individuals with different backgrounds. A truly diverse workplace recognizes, respects, and values these differences by fostering inclusive environments where employees’ unique needs, experiences, and work styles are intentionally supported. 

There are many different ways that organizations may name or structure these initiatives. For example, there are dozens of acronyms used to represent diversity and inclusion departments. Some of the more common ones include diversity (D), equity (E), inclusion (I), belonging (B), accessibility (A), and justice (J). Regardless of what acronym or set of words is used, the core principles are always the same. Diversity and inclusion in the workplace is a formalized set of principles and ongoing practices that aim to provide equal opportunities for growth, accessibility, and success for employees of all backgrounds. 

Why is diversity important in the workplace?

Diversity and inclusion in the workplace isn’t just a matter of compliance with legal or ethical standards; it’s imperative for business. Employees with different life stories and backgrounds bring unique perspectives and problem-solving approaches to organizations. Diverse companies can tap into a wide range of viewpoints, offering more thorough analyses and avoiding groupthink—where uniformity and conformity block critical evaluation and dissenting opinions.

8 benefits of diversity in the workplace

The benefits of diversity in the workplace extend beyond the internal workings of a company to positively impact talent attraction and retention, employee motivation and performance, and relationships with customers, clients, the broader community, and employees themselves. Some reasons why diversity and inclusion in the workplace are important: 

#1 Encourages innovation and creativity

Diverse teams bring different perspectives and experiences to the workplace, fueling more robust and inventive solutions that attract and keep customers. Diverse workplaces are 70% more likely to get new customers. 

#2 Improves employee retention and engagement

At diverse workplaces, employees are 9.8 times more likely to look forward to work, 6.3 times more likely to take pride in their work, and 5.4 times more likely to stay at a company longer. 

#3 Strengthens decision-making

Diverse workforces make better business decisions 87% of the time. Different cultural and professional backgrounds contribute to a richer and more nuanced understanding of complex issues. 

#4 Broadens talent pool

A commitment to diversity is key for many people when considering new employers. One survey finds that 70% of job applicants value a potential employer’s commitment to diversity in the workplace. 

#5 Improves employee performance and engagement

Another benefit of diversity in the workplace is that employees are motivated when they feel accepted and their contributions are recognized and appreciated. Research suggests companies experience bottom-line benefits when employees feel a sense of belonging. High belonging was tied to a 56% boost in job performance, 75% drop in sick days, and a 50% decrease in turnover risk.

#6 Heightens customer understanding

A diverse workforce mirrors the diversity of customers and can offer important insights into varying consumer needs and preferences. In an increasingly globalized world, a diverse workforce can provide a deeper understanding of different markets and cultures, which is especially crucial for companies with international operations or ambitions.

#7 Increases profitability

Some research finds businesses with strong ethnic and cultural diversity are 36% more profitable than less diverse organizations, and gender-diverse companies outperform their counterparts by 48%. Other research finds 75% of organizations with diverse frontline employees exceed their financial goals.

#8 Enhances reputation

Organizations that prioritize diversity in the workplace often have more positive reputations in the marketplace. Customers, clients, and partners who value diversity may be more inclined to engage with companies that demonstrate a commitment to hiring and developing diverse leaders. Some research shows 2 in 3 Americans say social values influence their shopping decisions.

Common DEIB challenges companies face

Some organizations face hurdles and resistance to DEIB efforts that can impede meaningful progress toward diversity and inclusion in the workplace. These can include: 

Insufficient resources

Many DEIB departments are led by one person or a very small team, making it difficult to distribute workloads or meet high demands. DEIB leaders are often tasked with a wide range of responsibilities—from developing training and assessments to providing interdepartmental consultation and acting as first responders to global and workplace crises. Lack of investment in appropriate resources and personnel can heavily stall DEIB efforts and increase the risk of burnout among DEIB leaders.

Resistance to structural change

Companies may face resistance to deeply ingrained biases and systemic barriers within traditional organizational structures, making it difficult to change established norms and power dynamics. Some people might believe that DEIB initiatives don’t apply to them or aren’t helpful. Or they may feel frustrated with the perceived lack of meaningful change, further limiting the impact and reach of these efforts.

Limited understanding of intersectionality

Everyone has multiple, coexisting identities that shape our experiences, perspectives, and needs, both inside and outside the workplace. People who belong to multiple marginalized groups may experience overlapping forms of discrimination, isolation, and exclusion. For example, an older female employee who belongs to a historically marginalized ethnic group may experience discrimination at the intersections of age, gender, and ethnicity.

Many organizations struggle with understanding and incorporating intersectionality into their DEIB efforts, limiting their ability to provide comprehensive and nuanced support for their employees.

Burden of representation

People from underrepresented groups may feel a heavy internal or external responsibility to serve as representatives of their communities. This can cause added pressure to perform or exceed expectations at work and contributes to DEIB challenges by perpetuating tokenism (including a few individuals from underrepresented groups to create a facade of diversity), reinforcing stereotypes, and hindering a truly inclusive and diverse environment.

Surface commitments

When the purpose of DEIB initiatives is only to align with external expectations or bolster public image, rather than genuine transformation within internal practices, it can feel disingenuous and alienate employees.

Focusing on the business case

While the business case for diversity and inclusion in the workplace is a compelling reason for DEIB efforts, a narrow focus on economic benefits can overshadow ethical and moral reasons to create equitable and inclusive workplaces. This can cause a lack of sustained commitment to DEIB initiatives and may harm the much-needed buy-in from employees.

Lack of comprehensive metrics

Organizations may have trouble defining metrics that go beyond superficial assessments such as just counting the number of diverse hires or tracking demographic statistics.

Ways to promote diversity in the workplace

Promoting diversity in the workplace involves creating an inclusive culture, challenging  biases, and providing equal opportunities for all employees. It also requires a shared responsibility from all members of an organization—because we’re all responsible for supporting, amplifying, and caring for one another. 

How organizations can support diversity in the workplace

#1 Build trust

Earn trust by providing transparent communication about organizational goals and values. Actively solicit and listen to employees’ perspectives across multiple mediums (e.g., written, verbal), and ensure consistent and fair treatment across all staff to promote a culture of equity. 

#2 Demonstrate commitment from top leadership 

Train and empower leaders to create a culture of psychological safety where employees may question and challenge traditional norms and practices that may perpetuate existing biases. Establish clear expectations and guidelines for leaders to actively champion diversity in the workplace, such as creating company, team-wide, and individual goals that focus on promoting DEIB-related values. This may include developing or participating in DEIB training programs, formalized mentorship opportunities, and other actions that focus on championing diversity and inclusion in the workplace.

#3 Implement inclusive hiring and workplace policies

Ongoing diversity and inclusion in the workplace training for all employees helps raise awareness and understanding. Actively seek candidates from varied backgrounds, experiences, and perspectives to ensure a diverse talent pool, and include diverse representation in hiring panels and committees.

#4 Give employee resource groups (EGRs) a voice

Create and support ERGs that focus on different dimensions of diversity (e.g., race, gender, LGBTQIA+) to provide support, networking, and a sense of community. Schedule regular opportunities for ERGs to contribute to organizational initiatives and decision-making processes, and be sure to provide adequate funding.

#5 Offer flexible work arrangements

Consider remote work options and flexible schedules that make it possible for people from different locations, family responsibilities, and abilities to get their work done in ways that are most conducive to their needs and circumstances.

#6 Include diverse perspectives in decisions

Encourage employees from all levels to contribute ideas and feedback on workplace problems and solutions. This can look like administering company-wide employee feedback surveys, with the option to provide feedback anonymously, as well as encouraging people leaders to regularly ask for employee input.

#7 Evaluate diversity metrics

Implement metrics and analytics that go beyond surface-level diversity numbers. Focus on meaningful indicators that reflect the organization’s commitment to diversity and inclusion in the workplace such as representation, pay equity, promotion rates, ERG participation, job satisfaction, hiring sources, retention, inclusion survey results, training participation, supplier diversity, and leadership pipeline data.

#8 Demonstrate genuine allyship

Actively listen to and amplify historically marginalized voices to better understand and respond to individual and group needs. Once you have a concrete understanding of what employees value, advocate for and implement inclusive policies to create a diverse, supportive workplace culture. True allyship also means acknowledging and learning from mistakes and continuously self-reflecting to address biases—with the understanding that this is a lifelong journey.

#9 Seek employee feedback on DEIB 

Encourage open dialogue about diversity, equity, inclusion, and belonging to create an environment where employees feel comfortable discussing sensitive topics and sharing their experiences. Keep in mind, the goal isn’t necessarily to encourage self-disclosure, but rather to create a culture where people can choose how they’d like to participate without fear of negative consequences or barriers to sharing. 

#10 Offer comprehensive mental health benefits

Recognizing and addressing the unique mental health challenges people from diverse backgrounds may face promotes a supportive and inclusive environment as well as overall well-being. This helps employees contribute their full potential to the organization. Choose benefit providers who offer identity matching as many people feel safer with providers who share their background and experiences.

How employees can support diversity in the workplace

#1 Lean into discomfort

Anticipate and embrace the inevitable discomfort, which may manifest in feelings such as fear of making mistakes or confronting biases. Recognizing that these emotions are common and expected helps us navigate them as signs of personal and collective growth and an opportunity to normalize this work.

#2 Move away from defensiveness

When someone shares an experience you may not fully understand, such as being on the receiving end of bias, or tells you that your actions have caused harm, the first reaction may be defensiveness. It’s natural to sometimes feel this way, but resist the urge to seek evidence about someone’s pain or assurance that you’re not a bad person. Instead, simply notice what’s coming up for you and actively listen to what the other person is sharing and make an effort to understand them.

#3 Learn from mistakes

Recognize that mistakes are inevitable. In times of relationship ruptures, foster inclusion and belonging by acknowledging what happened, offering a sincere apology, actively listening to the affected person, reflecting on the impact, and committing to learning from the experience—all while holding empathy for yourself throughout the process. Remember, it’s how we repair after a rupture that matters most.

#4 Give yourself grace

Extend grace and patience to yourself and others, recognizing the diverse stages of learning journeys and avoiding self-criticism for past knowledge gaps. When addressing actions inconsistent with DEIB principles, offer care and respect through a “calling in” approach that’s rooted in care, rather than a “calling out” one. This fosters a collaborative environment, acknowledging that everyone is collectively engaged in the ongoing work.

#5 Expect that change takes time

Acknowledge that meaningful change takes time. Celebrate small victories along the way, and understand that individual actions, no matter how small, contribute to powerful ripple effects in collective societal progress and inclusivity. 

A deeper commitment to diversity in the workplace

By championing diversity, we not only enrich our work environments but also unlock a range of perspectives that are essential for sustained success and growth in the modern workplace.

Build a work culture that celebrates diversity, equity, inclusion, and belonging.

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About the reviewers
Evelyn Farías, MA, EdM

Evelyn Farías is a diversity, equity, inclusion and belonging (DEI&B) Program Specialist on the Workforce Transformation team at Lyra Health. She is the creator and leader of Lyra’s Community Leads Program which provides a community for leaders of employee resource groups and peer champions programs to learn best practices for mental health promotion. Prior to starting this role in 2022, she worked as a full-time therapist, specializing in working with BIPOC and LGBTQIA+ populations in private practice and non-profit settings. Evelyn holds Master’s degrees in Psychological Counseling and Bilingual-Spanish Latinx Mental Health from Columbia University and is a former fellow of the American Psychological Association’s Minority Fellowship Program.

Andrea Holman, PhD

Dr. Holman is a DEI&B program manager on the workforce transformation team at Lyra Health. Previously, she served as a tenured associate professor of psychology at Huston-Tillotson University. She served as co-chair of the health and wellness working group for the city of Austin's task force on Institutional Racism & Systemic Inequities and now works as a leader in the nonprofit Central Texas Collective for Race Equity that resulted from the task force. She has conducted research on understanding the psychological experience of African Americans and racial advocacy from the perspective of Black and Latinx Americans. She has contributed to articles (including publications in The Counseling Psychologist and Harvard Business Review), book chapters, national conference presentations, virtual seminars, workshops, and a number of podcasts on these subjects.

By The Lyra Team
30 of January 2024 - 10 min read
Mental health at work
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