Extreme Diversity is a radical approach to smash the barriers that don't allow minorities to grow and excel in organizations. While the common diversity initiatives try to address micro-problems, Extreme Diversity is a radical transformation of operations, values and people to really make a difference.
Lack of diversity is a liability for most companies, because it hinders innovation, organizational adaptability, permeability between business units and functions. The overall stakeholder network is smaller and more homogeneous, with less chances to detect external signals, market trends, and potential threats of disruption.
Organizations are trying to increase diversity with multiple programs that (when successful) deliver incremental progress towards non ambitious targets. In the meanwhile, diversity in the top teams and boards worldwide is still underwhelming.
The world is waiting for the ultimate diversity program that will work better than anything tried before, but it could be looking in the wrong direction. There is only so much that programs can do, if the core engine of the organization stays unchanged.
If diversity programs are delivering incremental results, exponential results require a more structural approach.
Benefits of a diverse workforce have been demonstrated by multiple reliable sources, but there is a reason why companies are still not making it happen. The price to pay is very high.
The five steps of Extreme Diversity are increasingly challenging and disruptive. Before undertaking this path, leaders need to commit to the full journey. Half-baked delivery of these components may be counter-productive and generate resistance to diversity.
Step 1: Know your walls
Understanding what is limiting diversity in the organization should be the foundation of any diversity initiative. Leaders should answer with brutal honesty to the following questions:
- What is limiting diverse talent to join our company?
- What is limiting internal diverse talent to progress into leadership roles?
- What is disincentivizing diverse talent to stay in our company?
This step wouldn't be particularly challenging if the management used it as an introspective exercise. It would also be a waste of time. A real understanding would require a much deeper listening exercise that involves:
- Exit interviews with individuals leaving the company (for any reason)
- Focus groups with unhappy employees and minorities (employees with different academic titles, career background, gender, generation, interests)
- Interviews with rejected candidates
Once the qualitative raw data is collected, the analysis should be guided by one northern star: frustration. What organizational processes, behaviors, cultural elements annoyed them the most? Which factors drained their energies? Which events generated a feeling of unfairness? In which occasions did they wish to be someone else?
The output of this exercise is a list of walls, constraints, obstacles to a natural internal progression based on merit, leading us to step 2
Step 2: Know the price
Very few things in life generate more happiness that breaking a constraint. This is for a reason: in most cases the process of breaking it it's terrifying. The bigger the demon, the bigger the amount of happiness generated by defeating it.
Once leaders have identified what are the constraints of diversity, it's time to face the demons. In other words, what is generating those constraints?
The first painful part is to face the truth. In a company, a low level of gender diversity could be advertised as a lack of applications from women candidates. On top of this factor, there could be a much more horrible truth: the company can't afford the cost of maternity leaves, and they may fear the unpredictable disruption of productivity. Deeper biases against women can be wired in managers' minds, and a few cases of unsuccessful women in leadership positions could reinforce the negative stereotype.
The second painful part is to realize the role of the management. Leaders need to understand how they are reinforcing certain ways of thinking and doing with their daily habits, including things that they should do and that they are not doing. They need to accept that they are biased, that sometimes they are lacking integrity and treating values as a formality. It also requires to be aware that they are favoring people similar to them, and disfavoring everyone else.
The third part is the worst: realizing what is the cost for beating the demon. If it's persisting despite being at the center of the company's agenda, then probably a small investment of time and money it's not sufficient. In certain cases leaders need to give away part of their decision making power. In other cases, they need to renounce to have control about forming their own teams. The price could be increased uncertainty, more unpredictable processes, less control over the future direction of the firm. They could also be required to renounce to their perks, benefits, elite circles, political support, and high salaries. In certain cases, it goes as far as stepping down from a leadership role, a seat in the C-suite or in the executive committee.
Only few companies can survive step 2 if executed in its fullness. The amount of resistance, conflict, rage, negative emotions generated is proportional to the size of the constraints. Leaving this analysis half-cooked, without embracing it in total authenticity, will generate a false perception of the company, damaging the constraints so weakly that it becomes a vaccination to any future attempt of introspection.
Step 3: Smash the walls
Once the constraints are clear and the management is willing to pay the price, it's time to hold firmly the sledgehammer and hit the walls with all strength. This is a point of no return.
Each organizational context is different, but we can expect a few common factors that will need to be revolutionized
- Talent acquisition: The internal and external hiring process needs to be rethought completely, to ensure a diverse talent pool.
- Performance management system: How people get assessed, promoted, fired. It's the core process that defines the leadership team, and it's at the core of all diversity issues.
- Compensation and benefits: How much people make, how bonuses are structured, who controls the payrolls, how transparent are the salaries across the organization. Radical decisions that will encounter radical resistance.
- Career tracks: The internal barriers between careers are actively protecting homogeneous groups of individuals from external contamination. Diversity thrives in contamination, and to achieve it those barriers have to be smashed. Employees need to be empowered to upskill themselves and be able to transition into any career track that they are passionate about. People from finance will enter sales, and engineers will transition into HR. Criteria for the transition will change from background based to skills based. This will be possible as long as the employee will be able to build a robust skillset.
Step 4: Shield the new system
As previously mentioned, every significant change that will make a difference, will also create a massive resistance from multiple sides. Leaders that rely on politics, hidden underperformers, employees that are benefiting from the status quo, traditionalists, skeptical people. Sometimes even representatives of the minorities, worried to be targeted because of the transformation. Extreme Diversity implies extreme fear for many people.
Among the multiple initiatives that need to be put in place, a few processes are critical:
- Leadership support: With no exception, all the most senior leaders need to hammer their total support for the cultural transformation. Sometimes it's necessary to showcase a few striking cases of leaders stepping down from their responsibilities to support diversity. When employees look up to the decision makers, there is no space for doubt or misalignment.
- Communication system: How the story is told can make or break the whole process. When the story is told is also critical. This is not the job of a few amateurs in some bureaucratic department, this will require relying heavily on internal/external communication experts. It needs to be a significant investment.
- Support system: Mitigating fear is one of the first milestones to minimize resistance. Creating teams to help people navigating the transformation, understanding the implications, and defusing negative myths. Employees need to have the opportunity to express their frustration and be listened. Reassuring about what will not change will provide an anchor to accept the biggest shifts.
- Tracking system: Diversity needs to be measurable, in a quantitative way that can be seen by everyone inside the organization. Although some of the most interesting cultural aspects are hard to be translated in numbers, the symbolic power of numbers is critical to create a common language inside and outside the leadership team. Progress toward the objective creates a powerful momentum that can help breaking the toughest barriers
Organizations that embrace Extreme Diversity will enjoy multiple benefits:
- There will be a contamination of ideas, insights, knowledge, skills from all functions and business units. This will push the innovation agenda fast forward at unprecedented speed.
- Increased awareness of market trends, external factors from different sectors and geographies, innovative ideas that are growing in small communities sparse around the globe
- The newly found system of values will create pride, purpose and motivation. The energy created by the transformation can be channeled in delivering challenging endeavors with passionate productivity.
- The best talent in the industry will be interested in joining the organization, especially those coming from minorities that have faced frustration while working for other competitors.
- Higher collaboration across functions, with employees that can speak multiple technical languages, and teams that are inclusive and leverage their diverse skillsets.
- Incentives will be less and less financial, and increasingly based on purpose and values. This can imply a decrease of cost by cutting astronomic bonuses, while experiencing increased productivity.
The price for Extreme Diversity is too high for a large majority of companies. Facing the truth, accepting to make substantial sacrifices and managing the hurricane of negative emotions is too much for most.
While the benefits are worth the effort, the journey is successful only if completed. Quitting mid-way will backfire, creating increased skepticism toward any diversity initiative, and making people question the value of diversity.
This is not an effort that can be addressed relying only on internal capabilities. Identifying the right external partners to pursue this effort is a critical success factors. Having the right budget is also important.
Extreme Diversity is an aggressive answer to the diversity dilemma, and should put in perspective shallow initiatives that scratch the surface and don't deliver results. Startups, agile companies and corporates with forward-looking leadership teams should consider it seriously if they want to put an end to gender pay gap, discrimination and lack of innovation.
Although Extreme Diversity requires an all-in approach, this can be done initially in one vertical. A single top leader can show how strong is the power of diversity, by implementing the journey in its entirety and showing the results to the rest of the organization. To do so, she will need the following conditions:
- Full support from the CEO
- A firm conviction that diversity generates outstanding outcomes, built on research results but linked to deeper personal values
- Total control over HR operations for the vertical
- Acceptance that the brutal truth about the vertical will be exposed to everyone with transparency
- Willingness to go through the full process no-matter-what
- Being prepared to multiple set-backs and resistance from different internal and external parties
Jim Collins: The key concept of brutal facts described in Good to Great strongly influenced my thinking
Rocío Lorenzo: I've been inspired by her Ted Talk "How diversity makes teams more innovative"