With increasing global migration and other factors stimulating demographic shifts, in the United States and abroad, the need to develop inclusive, culturally competent leaders has never been more pressing. What sort of diversity and inclusion (D&I) training should organization’s offer that will meet their needs now and into the future as well as translate to bottom-line results?
A new study by the Institute for Corporate Productivity (i4cp), Diversity and Inclusion Practices that Promote Market Performance, found that organizations with 10,000 or more employees will increase emphasis on diversity in the next five years by nearly 40 percent and on inclusion by more than 45 percent. The study, a product of i4cp's Chief Diversity Officer Board, a working group of diversity professionals from over a dozen prominent organizations, defines diversity primarily as variations in workforce makeup (from race and gender to skills and points-of-view), and inclusion as the practice of incorporating diverse individuals into cohesive and productive working units.
D&I Programs Can Support Business Strategies
To shed light on D&I programs that support business strategies to improve market performance, the i4cp study correlated those practices to reported ratings of organizational growth in profitability, revenue, market share, and customer satisfaction over a five-year period. High-performance organizations—companies in the top quartile of those ratings—differentiate from lower performers on a number of D&I related practices, but primarily they display a genuine appreciation for the business benefits that their D&I strategy has to offer.
D&I in these companies is a driver of performance and a base-level consideration when looking at human capital and market strategies. One way these organizations keep focus on D&I is by developing inclusive leaders who seek awareness of cultural differences, then seek to build relationships with people from other cultures, countries, races, and backgrounds to help them build understanding of those differences.
According to the study, high-performance organizations are 23 percent more likely to integrate D&I into learning and development and 41 percent more likely to integrate it into leadership development. They also are more likely to engage in a number of development practices that increase diversity awareness, promote an inclusive culture, and support inclusive leadership behaviors. They include:
- continuous review of all practices, policies, and procedures as they relate to development to ensure they are being applied in the same manner across all employee populations
- providing inclusion-specific training for leaders, managers, and employees (with training for leaders having the strongest correlation to market performance)
- providing cultural competency training
- providing cross-cultural/demographic cohort coaching and mentoring.
In addition, they are more likely to consider D&I when recruiting, onboarding, selecting high-potentials, and in succession planning. This emphasis alone requires input from D&I and learning leaders in the areas of selection criteria, bias training, and cultural/linguistic sensitivity for both the leaders these diverse individuals will be reporting to and for the HR practitioners involved in selection and recruiting.
High-performance organizations, particularly those that report having effective D&I functions, are more likely to offer D&I programs that directly impact market and leadership performance. Two specific programs stand out:
- education on cultural, societal, and business etiquette customs in key markets
- recognition and management of conscious and unconscious biases.
The i4cp study also found that D&I and learning leaders can influence leadership development through specific practices that have strong ties to market performance, but which are less programmatic, such as recommending or facilitating opportunities for leaders to make connections with influential groups in key communities or sectors, and providing advice/guidance on go-to-market strategies for new markets or demographics.
Make Leaders and Potential Leaders Aware of Available Resources
Proper training on both gathering these insights and acting on them is a module that can be easily integrated into existing leadership development programs. Making leaders and potential leaders aware of the resources available in the organization's workforce—be they employee resource groups (ERGs), diversity councils, or more informal ad-hoc focus groups made up of employees with a particular affinity—is a valuable tool once ingrained as a consideration in planning and implementation phases.
And while it may be a cliché, the "think global and act local" mantra is a necessary mindset for keeping on top of today's markets. The benefits of institutionalizing the practice of building more inclusive and culturally competent leaders is not limited to global and multinational organizations or to leaders and teams from diverse regions.
Andres Gonzalez, chief diversity and inclusion officer for Massachusetts-based Baystate Health, asserts in the study that although his organization operates primarily within a three-state U.S. region there is no reason not to pursue inclusion in the same way as truly global players. "You have to have that mindset," he said. "The reality is that we operate in a global market, so the patients that we're serving here are from all parts of the world. It requires the same type of attention and commitment on our part that would be needed if we were operating outside of the United States."
Gonzalez describes Baystate's home office location of Springfield, Massachusetts, as a resettlement city, with large African, Asian, and Central/South American communities. "For many of these individual this may be their first encounter with a formal healthcare system," he shared. "Helping them to navigate it and have that first good experience is key." This can be especially important for promoting preventative care—the best financial option for both healthcare providers and patients. For this reason, many D&I professionals in the health services industry must promote a level of cultural and linguistic competency that rivals any global firm.
Global Leaders Need Local Knowledge
Another thing to keep in mind when putting together training for leaders is the reciprocal need for regional insights among leaders on global assignments, as was found in the i4cp/AMA study Global Leadership Development: Preparing Leaders for a Globalized Market. That study revealed that, to be effective, global leaders need local knowledge. Specifically, leaders need cultural and linguistic competencies in combination with customer insights for the markets they serve. They also need to be able to teach/coach individuals with diverse learning styles and should be skilled in collaboration, which requires openness and understanding of diverse perspectives.
For instance, at American Airlines, maintaining diversity awareness and D&I involvement are important leadership expectations. Apart from other D&I modules included in specific leadership training programs, all employees at the airline—from the frontline to the upper echelons—are required to go through a regularly updated training program called “The Value of Respect.” Beyond just reemphasizing policies, this module is meant to build awareness of why a product, an environment, and a brand that is inclusive is so important to the business.
"It [The Value of Respect training program] talks about the demographics of not just our employees, but the demographics of our customer base," says Mike Waldron, managing director of diversity and talent development for American Airlines.
"We will talk about things like the spending power of the African American community within the United States or disposable income of the LGBT (lesbian, gay, bisexual, and transgender) community. From a pure dollars and cents standpoint, that's going to help us be successful. Every two to three years we try to migrate the content with the maturity of the organization, so that kind of training has moved from a compliance slant to much more about inclusion and business connection." Popular with leaders, this training is offered both online and in an in-person setting for those who want to facilitate dialog within their departments or teams,” Waldon adds.
"We report out to our senior leaders and to our board of directors on our efforts from a representation standpoint, and from an engagement standpoint," says Waldron. "We also have goals for all of our senior officers as far as attendance, involvement, and participation in diversity and inclusion events. That gets reported out to the board of directors as well."
Awareness of the need to develop inclusive behaviors and cultural competencies among leaders has increased exponentially in the last decade, but if your organization hasn't made the development of a global mindset a priority, it may not recognize the talent and revenue opportunities it’s missing out on. By ingraining diversity and inclusion considerations into as many learning and development programs as possible, an inclusive and global mindset can quickly work its way into an organization's DNA and have significant impact on bottom-line results.
Editor's Note: Additional insights from American Airlines and Baystate Health—along with other organizations—are featured in i4cp's Diversity & Inclusion Practices that Promote Market Performance, available exclusively to i4cp members.
