The reality
Creating deeply innovative organizations must replace the more simplistic view of creating organizations that are technically innovative but maintain a business culture that is toxic and destructive. Too often this is overlooked until there are legal, financial or societal consequences. As a result, in most companies, innovation in brand risk management has yet to expand beyond this limited framework for assessing and addressing toxic and disruptive issues. Brand risk management is still primarily viewed through the lens of risk avoidance and legal liability exposure, and innovation is mostly understood exclusively through the lens of technological innovation. This is how glaring blind spots remain present in cultural thinking and become institutionalized. Alternatively, those who embrace the importance of including diversity in fostering innovative organizational cultures reap the rewards.
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85% of CEOs whose organizations have a vibrant diversity and inclusion strategy say it has improved performance.
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Highly inclusive organizations are rated 170% better at innovation
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Improving organizational culture means less employee absenteeism
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These organizations also have higher employee retention
- Deliberately promoting inclusion makes companies 45 percent more likely to increase their market share.
Step Up: Obstacles and Challenges
Innovation requires the ability to see things in unexpected ways. Bringing together unique perspectives from different backgrounds is often the catalyst for forward-thinking solutions, and that’s where diversity inclusion is needed. Furthermore, research shows that innovation requires an environment where all ideas can be considered, regardless of their source. Adversarial issues typically manifest as lawsuits and public shaming on social media following individuals in an organization acting on their own personal biases. Despite having policies that condemn discrimination and bias, companies like Hilton, Starbucks, and Toyota have paid big this year…both in actual dollar terms and in lost social capital that the brands built up over the previous decades. At the same time, even some of the engines of the tech industry have been dethroned by reports and allegations of sexual misconduct and discrimination.
So why do we see this time and time again from companies that boast policies that promote inclusion and respect?
Because the people in their organization, the ones who literally define what the organization is in real terms, have not been able (in too many cases) to identify their personal biases and choose a better course of action to experience the transformation of personal growth.
What we had were business cultures shaped by societies still struggling with legacies of oppression and exclusion.
The cost of status quo over innovation
Because business decisions are in many cases primarily driven by profitability and risk aversion. This is part of the flaw in this approach to brand risk management, and a reason why innovation is so necessary sooner rather than later.
There was an experiment where a resume with a black-sounding name received half as many callbacks as the same resume with a white-sounding name, even when sent to corporations with strong reputations for diversity. Technology has made the world smaller and also increased transparency in many cases. Since it is clearly established that diverse perspectives are key to innovation, what is the value to be gained when discrimination is essentially normalized?
“There is a price to be paid for discrimination in the workplace – $64 billion.
This amount represents the annual estimated cost of losing and replacing the more than 2 million American workers who leave their jobs each year due to unfairness and discrimination.
Hi Michael. “Workforce Discrimination Costs Businesses $64 Billion Every Year”
What is more difficult to ascertain are the effects on the discriminated individuals. The waves set in motion continue as evidenced by the current state of affairs. Looking back at the tech sector, which is usually where people turn to get an idea of what’s on the front lines of innovation. There are disturbing implications, beyond the obvious, for the toxic and discriminatory tech culture seen in places like Silicon Valley.
“If we don’t do this now, all of these biases and discriminations will be rewritten into the algorithms, artificial intelligence and machine learning that power the technologies of the future.” Already facial recognition technology is fundamentally sexist and racist. it doesn’t recognize women and people of color the same way it recognizes white men. It’s a big deal.”
McGrane, Claire. Emily Chang on Silicon Valley’s ‘Brotopia’ and how companies can deal with a toxic culture
The past is connected to the present. Today, it is the basis for a long-term plan. and since the response of a few leaders is usually a band-aid approach, progress is slow and painful. The truth is that hearts and minds cannot be legislated by outside forces, new policies and laws will have painful limitations. The way forward is deeply personal as a result of the results mentioned here all come from a deeply personal place within the people affected.
The solution
The simple solution starts with the leaders. Smart leaders must embrace personal innovation to lead by example. Policy statements or diversity training that make things worse or provide short-term remedies are no longer accepted as solutions. Too many studies show that these approaches don’t work. But a leader who shows the courage to step up with personal innovation can cultivate a meaningful innovative organizational culture that seems to naturally increase market share, launch products and services that lead your industry and play a vital role in creating a better world.