Succeeding in D&I: Challenges of building an inclusive culture

As organisations become more driven by purpose, they are faced with the pressure and the opportunity to impact the social agenda on diversity, inclusion, equality and equity. If businesses expect to serve an increasingly diverse set of customers, or attract and retain the best talent within an increasingly diverse workforce, diversity must become a fundamental part of their organisational culture.

The influential report ‘Why Diversity Matters’ by McKinsey highlights that companies with a higher degree of racial and ethnic diversity are 35% more likely to have financial returns above their national industry medians. When it comes to gender diversity, the same report also says that companies with better gender balance are 15% more likely to perform better financially.

The benefits are clear: inclusive and diverse organisations are more productive, generate more revenue, perform better on problem-solving and strategy tasks, think more creatively, are better at negotiating, and make enhanced decisions.

Yet, achieving an effective level of diversity at work comes with its own challenges. From internal resistance to the adoption of a new culture, to more complex decision-making processes and unconscious bias, the challenges are real and can’t be ignored. To help HR and L&D leaders understand and overcome these challenges, we spoke to a group of diversity consultants and specialists. While some of these challenges are difficult to tackle, their general perspective is that the solution lies in understanding the root cause of the problem, having a strategic approach to diversity, and leading by example.

1. Overcoming resistance to D&I

Monika Hamori is an associate professor of human resources and organisational behaviour at IE Business School. According to her, it is common that those who perceive that a diversity initiative may harm their interests tend to oppose it. Therefore, the buy-in from managers and executives is key, especially if they are not the beneficiaries or targets of diversity efforts.

“Policies that induce such buy-in tend to work well: for example, asking senior managers to sponsor lower-ranking employees and provide them social support and career advice; involving senior managers in recruiting efforts to hire diverse talent, or sending them to campuses to attract such talent, are practices that are effective in boosting the proportion of gender, racial or ethnic minorities at the workplace”, says Hamori.

According to her, having people specifically tasked with promoting diversity and inclusion can have a positive impact. “Diversity managers, diversity task forces, or a higher representation of minority groups at higher managerial levels may facilitate such accountability, because these groups are more likely to scrutinise organisational pay-setting or performance appraisal practices.”

Diversity and inclusion are complex matters with often a strong emotional component. Incorporating new ways of doing things can affect people differently.

For the executive educator and board advisor Ragil Ratnam, “people who are used to having things one way, a way that has been positive and beneficial for them, often struggle to see that there might be other ways.”

This, according to Ratnam, can be a major challenge for companies that have historically been homogenous. “Where operations run smoothly when everyone is similar, and where everyone has similar perspectives on how things should be, diversity of thinking can sometimes appear to slow things down. If only lip-service is paid, diversity initiatives alone cannot provide the benefits and advantages that are seen when implemented properly.”

For him, some aspects of diversity can be very challenging for leaders who are used to the world and the decision-making process being more clear-cut.

“Change is difficult at the best of times, but when organisations have been working well, are efficient and profitable, and there are no obvious problems within the organisation, the case for change can be even more difficult to make. Promoting D&I in such businesses and workplaces can be very challenging.

The solution lies in a combination of promoting awareness to help people internalise the importance of the issue and engaging leaders in consistent work. “Promoting diversity and inclusion in the workplace begins with awareness. Organisations, and their leaders need to truly see the importance, and the business benefits of diversity and inclusion”, says Ratnam.

“Real change requires steady and consistent work”, adds inclusive leadership coach Tahmid Chowdhury. This, according to him, means building workstreams examining how diversity and inclusion underpins what the wider organisation is doing, rather than a bolt-on at the end.

“If you have a performance management system that favours those who are more visible, this will inherently undermine organisational efforts to have wider diversity as this will penalise carers, part-time staff and women who tend to have more childcare responsibilities.  As such, D&I is like any other piece of work – it requires dedicated resourcing with planning and professionalised support to ensure success within an organisation”, he advises.

2. Inclusion beyond diversity

Stephen Frost is the founder and CEO of Included, a D&I consultancy. According to him, one of the most common, and most critical, challenges his clients face is to truly understand the distinction between diversity and inclusion.

“Without an inclusive environment, it is not possible to leverage diversity successfully”, he says. “As well as other critical concepts such as equality, equity and belonging, we need to ensure both [diversity and inclusion] are applied successfully for a visible impact. Measuring the impact of change effectively is another common challenge seen in several organisations. Many organisations can successfully measure diversity, but very few are adequately measuring inclusion”.

For Suki Sandhu, a diversity specialist who runs a recruitment agency and an inclusion consultancy firm, the core challenge of inclusion is to ensure that each voice is heard, amplified, and respected equally. “Without this, organisations simply won’t benefit from the forward-thinking, progressive mindset that helps to drive innovation and success across an array of business landscapes.”

Diversity can’t happen in isolation. Yet, human nature, to avoid cognitive dissonance, tends to discount perspectives that contradict what we already believe to be true, and it takes conscious effort to move beyond this. This makes diversity something that can’t be taken lightly. And this is where planning and strategy comes into place.

“Increasing diversity is not all sunshine and rainbows – without proper organisational planning, diversity can actually lead to a worse working environment. This is why we talk about ‘inclusion’ as being a key part of this”, says Tahmid Chowdhury.

For Choudhury, efforts to recruit underrepresented groups through internship schemes or special graduate programmes can often be unsuccessful as these recruits are “expected to conform with the majority, effectively eliminating any benefits of having them in the first place. Worse still, they are likely to feel excluded, leading to a divided workplace.”

For a truly diverse working environment to work, according to Choudhury, inclusion needs to be fostered as a way to ensure that people feel welcome and fully able to contribute.

The idea that diversity alone doesn’t work is also shared by inclusion consultant Fiona Daniel, founder of FD2i consultancy, which specialises in helping companies progressing from diversity to inclusion.

“The most challenging aspect of a diverse working environment is accepting and embracing difference”, she says.

“The modern working environment still in many cases have dominant cultures where the outcome is a lot of diversity in junior levels and homogeneity in senior levels. Working in these environments can be very challenging for groups and individuals who look up and don’t see themselves. It can be difficult just simply trying to fit in, be able to speak up, be respected, valued, and supported for who you are. If your differences, the things that make you who you are, make you feel like you don’t belong, you can’t thrive.

For inclusion consultant Nick Basannavar, the solution to this challenge lies in adopting more adequate ways to measure inclusion:

“Most organisations undertake engagement surveys and pulse surveys that offer limited insights and little that is actionable. However, it is more effective to test concepts such as psychological safety, transparency, and micro aggressions. In this way we can pinpoint the behaviours that contribute to, or detract from, greater inclusion, cut by geography, function, demographic and other categories. This allows organisations to allocate resources to areas that will have the most impact,” he concludes.

“Diversity is all the ways we differ. Inclusion is valuing those differences”, adds Sergey Gorbatov, an author, researcher, professor and senior HR executive for a large pharmaceutical company. Whether you adopt a more compliance-led approach or a more strategic view, Gorbatov advises that it’s important to choose your definition of D&I wisely as it determines your actions.

“In general, the broader the definition, the more difficult it is to operationalise”, he adds. “Getting the percentages of female representation in management is easy. Collecting data on the number of single parents or LGBTQIA+ employees is not. We favour a broad definition of diversity. Despite the operational challenges. And with that comes a growing responsibility to ensure a culture of inclusion, so each individual can thrive.”

3. Overcoming unconscious bias

One common challenge for companies that have adopted measures to improve diversity and inclusion is unconscious bias.

Unconscious bias is linked to subconscious prejudices we all adopt throughout our lives. It leads us to make unconscious, unfair assumptions about people simply based on their gender, ethnicity, socioeconomic background, religion, age, etc. Differently from more obvious or clearer acts of discrimination, unconscious bias is much harder to identify and can be present even in people who are committed to equality.

“Our unconscious biases are where our mind can wander when our thoughts are automatic”, says Marcia Hazzard, a consultant at a diversity and inclusion consultancy firm. She says that biased thoughts come to the forefront when we are tired, stressed, hungry etc. To override these thoughts, she argues, “we need to utilise the two-thinking system, where we use conscious thinking to reduce cognitive bias and irrational behaviours. The first step to reducing our own bias is to first recognise it.”

“If we interact with a range of differing perspectives and experiences and we are open to feedback, we can reflect on where our blind spots are and educate ourselves to address them”, she added.

So how can we reduce unconscious bias in the workplace?

According to Hazzard, there are practical steps that we can take.

“Firstly, we can examine our organisation, looking at our workplace data to really establish what it looks like. Is the organisation full of the same kinds of people – age, ethnicity, gender, educational background etc? If so, question the hiring processes and debias the profile of potential hires.”

“Secondly”, she adds, “we can look at our decision-making processes – who makes the decisions and is there adverse impact on those that they effect?”

“Thirdly, we can engage employees in the conversation – where do they consider any biases are within the system and what do they think the company should be doing about them?”

Leadership and inclusion consultant Chelsea C Williams, adds: “we can reduce unconscious bias by first understanding that everyone has biases. We should realise it is a part of the human experience, although some make more of a conscious effort to acknowledge and reduce bias than others.”

“Through education, awareness and connection, biases can be mitigated, and individuals can celebrate diversity and foster inclusion and equity. It takes mindfulness and intention”, Williams concludes.