BCG: Enculturation of the business diversity paradox

16 February 2015

Diversity within the business environment is a phenomenon in paradox – according to a recently released report by the B-Team in collaboration with BCG. While research shows that the correct management of cultural differences within an organisation is correlated with positive outcomes for a company, many companies have failed to achieve meaningful diversity. The report aims to identify the benefits of diversity; why even well intended implementation can go awry; and what to focus on to develop a well-rounded business.

Diversity on the work floor
The business case for diversity has been affirmed through a wide range of studies. One study found that teams that had members that represented the target customer were 158% more likely to understand customers’ needs, increasing the probability of innovation. Another study of 500 American companies found that gender diversity was correlated with increases in sales revenue and the number of customers. A third study, of 180 companies across the Atlantic, found that companies in the top quartile of board diversity had returns on equity that were 53% higher, on average, than the returns for those in the bottom quartile; with earning 14% higher for companies in the top quartile, compared with those in the bottom quartile.

The Diversity Paradox by B-Team and BCG

So while the advantages correlate well with improved profitability, something is holding back companies from making what is a competitive move – that also improves social well-being. To get to the core of the issue, B-Team, in collaboration with Boston Consulting Group (BCG), recently released the “The Diversity Paradox” report in which it identified places where things are going awry. The researchers note particularly that companies often take a myopic approach to diversity issues, which in the long run can harm not only minorities but also create an unpalatable business environment. Ways in which diversity programmes can go wrong include:

4 ways in which diversity programmes can go wrong

Treating Diversity as an HR or Isolated Function - Diversity efforts must be contextual and rooted in a company’s systems and culture, which necessitates a cross-functional approach. 

Defining Diversity Narrowly - A simplistic definition of diversity leaves majority and minority groups feeling pitted against one another, as they wonder whether the next promotion will be based on merit or identity.

Ignoring the Human Element of Diversity - Inviting difference is asking people to be vulnerable to an alternative view. By approaching diversity as a checklist, companies will not be able to overcome the emotional, irrational, and tribal reactions to valuing diversity.

Permitting an Inhospitable Environment - Another responsibility commonly placed on minority groups is to “fit in.” At worst, workplaces that demand assimilation see high turnover, as minorities quickly leave for roles in more pleasant cultures.

Reframing diversity
One aspect of the research is that by having a too narrow approach to understanding the phenomenon of diversity, companies come to treat it as a narrow policy issue rather than a broader cultural issue. To gain a better grip on the phenomenon, so that companies can start the process of changing their culture into one where differences are encouraged as a source of innovation and value, the authors develop a “diversity wheel”. This wheel maps visible core structural diversity, less visible core diversity and secondary forms of difference.

Diversity attributes

Visible core attributes are generally outside the individual’s control; these are things like physical gender, age, capacities. The less visible core attributes point out cultural and religious diversity into which individuals are general inculcated. While the secondary layer is primarily related to the path that we follow in our development toward the commitments we make about the meaning of human or individual existence.  According to the report, to create an environment where differences in core and secondary expression are meaningfully taken up within a business, companies need to develop cultures and business functions that minimise the possibility of treating an individual differently as a result of a more visible core dimension.

While conflict as a result from clashing secondary values is to be expected and a healthy part of human engagement, for businesses to flourish four core values will need to pervade the business culture. According to the researchers, these values turn conflict and divergence in opinion from being something toxic into being something that adds value. The core business cultural values are:

Core business cultural values

Cooperation - Sharing knowledge to build personal and organisational success.

Individual Accountability - Monitoring individual behaviour to foster a positive work climate for all.

Inclusion - Ensuring every member of the team and organisation is a welcomed and contributing member.

Respect - Treating others with dignity and consideration.

“Ultimately, cultivating diversity is the collective responsibility of leadership. Companies that invite employees to be different together and coach them to thrive when surrounded and challenged by different views can fundamentally change the workplace—for the benefit of all,” concludes the report.


Why leaders must balance technical expertise with soft skills

17 April 2019

Soft skills matter in the workplace just as much as technical expertise, writes Samantha Caine, Managing Director of Business Linked Teams.

For too long technical expertise has been seen as the marker of a strong candidate for development into a sales or leadership position. Sales and leadership candidates are tasked with demonstrating a diverse and wide-ranging set of technical skills, yet their aptitude in these technical skills or ‘hard skills’ cannot signify great leadership potential. This is why a healthy balance of soft skills and technical ability is required. 

So what exactly is the difference between technical skills and soft skills? In engineering, it’s crucial to demonstrate knowledge of physics as well as a strong grasp on mathematical equations. Yet, in any industry, it’s important for leaders to be able to interact with other people effectively with soft skills like communication, empathy and adaptability. 

Business Linked Team’s 2018 study into internal leadership development revealed that 69% of large organisations are prioritising the identification and development of future leaders from within the workforce. As more and more organisations begin to invest in sales or leadership development within their existing workforces, more focus needs to be placed on ensuring the right soft skills are in place. 

With those soft skills in place throughout the workforce, the business will benefit from a wider pool of potential leaders developing under their noses, and it should be the same where sales candidates are concerned. 

It’s not just about easier access to ideal candidates for these positions without the rigmarole of recruiting from outside of the organisation. The leadership development study also found that 89% of HR decision makers say succession planning has become a top priority. Those currently serving in leadership positions can’t lead forever and the same goes for those generating sales for the business.

Why leaders must balance technical expertise with soft skills

From people leaving for new opportunities or retirement, to people simply stepping aside to focus on other areas of the business, successful leaders and salespeople require experienced and capable successors that will be ready and able to confidently step into their shoes and pick up the mantle without the business experiencing any lapse in performance.

Soft skills make stronger candidates

When it comes to the soft skills required, a strong leader must be able to manage through clear communication and effective time management, coaching and goal setting. They must be able to demonstrate empathy and empower their teams to be successful, productive and fully engaged. And beyond simply giving direction, they must also be able to take direction from those above them and cascade the business strategy down through their teams. 

A strong sales candidate must possess the ability to communicate value to the customer, negotiate well and protect margin or the ability to increase the scope of a particular sales opportunity. 

With the relevant soft skills in place, the business will benefit from increased productivity, greater agility against changing market conditions and greater transparency. In turn, this will provide visibility on issues and inefficiencies while removing opportunity for miscommunication. All of this can transform the culture of a department, improving employee satisfaction and reducing staff turnover. 

Ultimately, developing leadership or sales candidates will require the business to strike the right balance between technical skills and soft skills, and this requires an effective and sustained learning journey.

A balanced learning journey

Facilitating and supporting the development of leadership and sales is best achieved by establishing training groups. By cultivating training groups, businesses are creating talent pools that will inspire and support each other on the learning journey. However, personal goals and learning objectives must be defined for each individual based on their own existing skillsets and the skills that each individual needs to develop. 

With the emergence of e-learning, businesses recognise the value of online-based learning activities, yet many make the mistake of opting for one-size-fits-all solutions which are solely focused on self-study. A development solution will only deliver true return on investment if it combines e-learning activities with group learning activities that provide opportunity for shared experiences and support.

A blended learning solution that combines self-study and face-to-face group learning activities will aid strong development of the talent pool through shared experiences. Through these shared experiences, those undergoing the training will organically develop a support network that supports the development of the group as much as it supports the development of each individual. 

The blended learning approach is supported by one of the seven principles of human learning that socially supported interactions aid the individual development of expertise, metacognitive skills, and formation of the learner’s sense of self. The strongest opportunities for development can be unlocked by blending workshops with online activities such as virtual sessions, peer coaching, self-study, online games and business simulations. But it’s crucial to provide a blend of one-to-one and group sessions too.

Beyond delivering a better learning outcome for the employee, the blended learning approach allows organisations to adapt their training quickly and easily to shifting business demands in an ever-changing landscape.