Why should you invest in a diverse workforce?
Diverse workplaces often translate into a competitive advantage. This is why savvy recruitment management involves recognising a need to hire from a varied talent pool who reflect a diverse customer base.
The competitive advantage of a diverse workforce
Diversity can translate into competitive advantage because you're able to reach a more diverse market base. Your employees can identify problems or needs specific to a particular culture or ethnicity.
Take for example L'Oréal USA. Forbes reports that the company started a line of products aimed at catering to non-Caucaisian women. The project was specifically designed to address the problems that women of colour face.
Balanda Atis, a group leader at L'Oréal USA spoke about this problem: "As a woman with darker skin, I have always had a difficult time in trying to find a shade of foundation that was appropriate for my skin tone. Furthermore, I know that this is a concern for consumers."
As a result, L'Oréal gained great success from hiring staff who could relate to problems that some of their customers face. "Diversity gives us a competitive advantage," stated Howard Lewis, vice President of sales and education for Mizani, a L'Oréal brand that targets women of colour.
The customer base is increasingly heterogeneous.
The success of companies like L'Oréal lies in the fact that the customer base is increasingly heterogeneous, according to Boston Consulting Group's article "Hard-Wiring Diversity into Your Business." Customer segments are continually breaking into smaller, more specific groups with particular behaviours and preferences. As women and minorities acquire more purchasing power, they remain underrepresented in top positions in the corporations that sell to them. By having a leader who can relate to them in a more truthful and personal way, the company may be able to better reach these increasingly prominent customers.
How diversity gets you access to the best candidates
Not only does diversity allow you to have greater customer orientation, but it also means you're able to attract the best talent out there.
If you limit your company to hiring one kind of employee – for instance, a young, Australian Caucasian male – you are ignoring the full labour pool available to you. And the pool of young, Australian Caucasian males is rapidly getting smaller, according to McKinsey and Company. Talent gaps are occurring because more consistently high rates of GDP growth are making it so labour is in high demand, however the employability of graduates is constraining the supply.
"It's not smart to exclude 60 per cent of the talent."
For this reason, companies will need to venture out into greater geographic territory while recruiting and start looking to currently underutilised pools such as women, immigrants and older professionals. To not do so would mean putting your company at a significant disadvantage. Consider the words of Paul Bulcke, CEO of Nestle, he said that women are about 60 per cent of university graduates and that "it's not smart to exclude 60 per cent of the talent." It seems that more diverse companies often have exceptional talent simply because they're not limiting themselves to one group.
While bringing diversity into your company is not some kind of magic formula for profits, the opportunities for competitive advantage in both talent and products offered shouldn't be ignored. Contact Flexi Personnel today to learn how our Recruitment Consultants can help you invest in employees that will strengthen your company in an increasingly diverse and competitive world.
