Business & Leadership

Why Diversity Programs Fail… and How to Ensure Yours Doesn’t

While businesses have been implementing diversity programs for decades, research has shown that inequality is still widespread. Tactics such as diversity training, hiring tests, performance ratings and grievance procedures don’t work; while engagement, contact, social accountability and mentorship do - and leaders must play a bigger role.

© George A. Spiva Center for the Arts - https://www.flickr.com/photos/spivaartworkers/8751203110

While businesses have been implementing diversity programs for decades, research has shown that inequality is still widespread. Tactics such as diversity training, hiring tests, performance ratings and grievance procedures don’t work; while engagement, contact, social accountability and mentorship do - and leaders must play a bigger role.


It is widely recognized that diversity can boost innovation and employee engagement: greater diversity in general leads to greater diversity of thought, to the ability to attract and retain top talent, and to a better understanding of the company's customer base. Yet there is still a lack of women and minorities in leadership positions, and certain industries like tech and finance lack diversity at all levels. According to the research by Harvard University sociology professor Frank Dobbin and Tel Aviv University sociology associate professor Alexandra Kalev, the proportion of white female managers at US commercial banks actually dropped from 39% in 2003 to 35% in 2014, and black male managers from 2.5% to 2.3%, although Hispanic representation in the same category rose from 4.7% to 5.7%.

 

After analyzing three decades’ worth of data from over 800 US companies and interviewing hundreds of line managers and executives at length, Dobbin and Kalev affirm the command-and-control approach to preempt lawsuits by policing managers’ behavior that companies have long relied on is of no help to motivate change and can even create adverse effects by activating bias or sparking a backlash.

 

Among the most popular diversity tools used by midsized and Fortune 500 companies, diversity training is proven to only have very short-lasting positive effects, at best. Furthermore, the use of negative messages in the training (eg. the highlighting of legal cases or huge settlements) implies threat and cannot win converts, and compulsory courses may trigger anger and resistance in participants, especially when companies signal that training is remedial, implying the participants are the culprits.

 

Another widely used tool is mandatory hiring tests to assess the skills of candidates, but this practice fails, too. Dobbin and Kalev’s research suggest that managers often use these tests selectively and that they amplify bias: they made only strangers – most of them minorities – take the tests and hired white friends without testing them.

 

Because of their inherent limits as a way of identifying the best workers, performance ratings don’t work either, and neither do grievance-reporting systems that are meant to identify and rehabilitate biased managers. Often, discrimination complaints receive retaliation, leading employees to report less, and managers who receive few complaints to conclude that their firms don’t have a problem. What’s more, laboratory studies demonstrate that such protective measures lead people to drop their guard, as they assume that company policies will guarantee fairness.

 

The good news is that some other measures do work. As a matter of fact, Dobbin and Kalev observe that firms get better results in diversity programs when they ease up on the control tactics and apply three basic principles: engage managers in solving the problem, increase their on-the-job contact with different groups through rotating management training or cross-project teamwork, and encourage social accountability – the desire to look fair-minded – by enforcing transparency and discussion.

 

That’s why interventions such as voluntary training, targeted college recruitment, formal mentoring programs, as well as flexible complaint system offering informal mediation apart from a formal hearing process, have boosted diversity in businesses. Some of the most effective solutions like self-managed teams and cross-functional task forces aren’t even branded as diversity efforts.

 

Since diversity initiatives are more effective when launched from the top level, Stefanie Johnson, associate professor of management and entrepreneurship at University of Colorado’s Leeds School of Business, summarizes a few key lessons to leaders after interviewing 11 CEOs who have achieved great performance in their companies’ diversity:

 

  • Lead by example when it comes to diversity

Speak openly about diversity, consider “culture add” (over culture fit) as part of the hiring criteria, even sometimes if it means waiting longer in order to have a diverse slate of candidates to select from

 

  • Have yourself and others abide by the suggestions of diversity initiatives

Data and deadlines are imperative to making diversity initiatives work, so set and follow through on diversity goals and metrics

 

  • Forster diversity throughout the organization

Have diverse teams at all levels of the company, from the frontlines to middle management to senior leadership

 

  • Broaden your perspective on diversity

Address racial and gender diversity issues, but also issues faced by LGBTQ workers, people with disabilities, or other minority groups like working mothers and older employees at youth-oriented start-ups

 

In short, it is also vital to think of evolving from equality to equity. One key point in building inclusion is how to change yourself and the environment to foster people’s success. It’s not about giving everyone the same things, but giving everyone what they need.

 

 

This article was adapted from the following HBR articles:

Why Diversity Programs Fail by Frank Dobbin and Alexandra Kalev

What 11 CEOs Have Learned About Championing Diversity by Stefanie K. Johnson

 

This article is dedicated to our monthly newsletter “Leaders Wisdom Journal”. To Subscribe.

 

J.Y.

 

Photo by George A. Spiva Center for the Arts - https://www.flickr.com/photos/spivaartworkers/8751203110

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