Business Spotlight



Making the most of difference­s


Bis vor nicht langer Zeit beschränkt­e sich Diversität in vielen Unternehme­n auf ein ausgewogen­es Verhältnis zwischen den Geschlecht­ern. Doch das hat sich inzwischen geändert. ROBERT GIBSON führt aus, was heute Vielfalt ausmacht und welche bereichern­de Wirkung sie hat.

What do you think of when you hear the word “diversity”? Gender equality? Quotas? Political correctnes­s? Yet another trendy buzzword from the US? The United Colors of Benetton? Promoting diversity is increasing­ly being seen by business people not just as something you should do, but as something you must do if you want to survive. It is being taken more seriously than ever before by more and more companies. Diversity department­s are being establishe­d and they are appointing chief diversity officers (CDOS), with influence beyond HR, to play a strategic role in business developmen­t. Ambitious diversity targets are being set, key performanc­e indicators (KPIS) implemente­d and initiative­s launched.

What lies behind all this activity? Is there a real business case for diversity?

Monocultur­es and bananas

As a farmer, you may be tempted to grow just one crop. This can be highly lucrative, as you can benefit from economies of scale. If the crop fails, however, it can be disastrous, as you will lose everything. A current example is the banana. We are heavily dependent on one type of banana, the seedless Cavendish, which is under threat from the fusarium wilt fungus. If it spreads, bananas will be in extremely short supply or even become extinct.

The danger of monocultur­es is also evident in the world of finance. As an investor, you may be tempted to invest everything in an exciting startup company that seems to have great potential in the market. The trouble is: if it fails, you lose everything.

The same principle applies to business. If you employ only one type of person, focus on one type of customer and rely on one type of supplier with a limited range of services or products, you may be successful in the short term. But your company will probably not survive in the long run in a fastchangi­ng business environmen­t.

What is diversity and why promote it?

According to the Cambridge Dictionary, “diversity” is “the fact of many different types of things or people being included in something; a range of different things or people”.

Promoting and supporting diversity in the workplace is about valuing everyone in the organizati­on, so that everyone feels able to participat­e fully and achieve their potential. This is not only a moral obligation; it also makes business sense.

Beyond gender

In many companies in Western Europe and the US, the focus of diversity initiative­s is on gender. Getting a balance of male and female employees at all levels of an organizati­on is obviously important, but so are other diversity dimensions. Which dimensions are particular­ly relevant will vary widely across the globe. For instance, in China, you may find a relatively high proportion of women in management positions, but the lack of representa­tives of particular regional groups is more likely to be a key issue.

At the core, there are internal dimensions to an individual that are hard or impossible to change. These include gender, sexual orientatio­n, world view, physical and mental ability, ethnic origin, nationalit­y and age.

External dimensions are easier or possible to determine or change. These include family status, parenthood, physical ap pearance, educationa­l background and socioecono­mic status.

Organizati­onal dimensions are easiest to influence and include function (such as sales, procuremen­t, HR, finance), job

grade, field of work, length of service, place of work and membership of organizati­ons (for example, trade unions).

These dimensions can be visualized as a diversity wheel, which can be used as a basis for the diversity policy in your organizati­on.

Legal requiremen­ts

In many countries, there are laws about diversity and discrimina­tion that businesses have to follow. In some cases, a business will have to prove that it has implemente­d a diversity policy in order to be considered as a bidder for a government contract.

A famous case was the London Olympics. The London Organizing Committee of the Olympic Games and Paralympic Games (LOCOG) had a clear policy of using a diverse pool of suppliers. This seems to have been successful, with the heads of 18 per cent of UK companies involved coming from ethnic minority groups, while 20 per cent were run by women, two per cent by LGBT people and 1.7 per cent by people with a disability.

Financial performanc­e

More and more research is linking diversity with financial performanc­e. The nonprofit organizati­on Catalyst summarizes the research in an infographi­c titled “39 Reasons Why Diversity Matters” (see “For more informatio­n”, p. 25). Harvard Business School researcher­s examining venture capital have concluded that “diversity significan­tly improves financial performanc­e on measures such as profitable investment­s at the individual portfolioc­ompany level and overall fund returns”.


Although monocultur­al teams may be able to perform more efficientl­y than multicultu­ral ones, they are less likely to be innovative. Research carried out by the Technical University of Munich and the Boston Consulting Group into 171 German, Swiss and Austrian companies showed a clear relationsh­ip between the diversity of companies’ management teams and the revenues they receive from innovative products and services.

Frans Johansson, in his bestseller The Medici Effect, shows why innovation happens at the “intersecti­on” where ideas and concepts from diverse industries, cultures and discipline­s meet.


If you want to understand how diverse customer groups think, and market your products and services successful­ly, then you need to involve people from the target group. If you don’t do this, mistakes can be expensive. Dolce & Gabbana’s recent advertisin­g campaign in China, featuring ads showing a Chinese woman struggling to eat Italian food with chopsticks, is an example of how a brand can be seriously damaged overnight. No doubt more involvemen­t of the target group in the marketing team could have saved the day.


As a result of demographi­c trends, there is a serious shortage worldwide of skilled workers, particular­ly those with a background in STEM (science, technology, engineerin­g and mathematic­s) subjects. Employers cannot afford to exclude potential candidates on the basis of their gender, physical ability, sexual orientatio­n, ethnic background or any other diversity dimension.

And it is not just about recruiting. If you are to retain employees from diverse background­s in your company, there needs to be an inclusive environmen­t and developmen­t opportunit­ies. If employees believe that this is not the case, they will leave and your investment in them will be lost.

Diversity management

To be successful, diversity in a company has to be managed in a systematic way. The German associatio­n Charta der Vielfalt recommends a fivestep approach to increasing diversity in organizati­ons, whether they are small and mediumsize­d enterprise­s (SMES), large corporatio­ns or publicsect­or bodies:

1. Define objectives

2. Determine current situation

3. Plan implementa­tion

4. Carry out implementa­tion

5. Measure success

They ⋅ suggest asking a number of important questions:

How and where can diversity management be helpful for your business as regards, for instance, customers and ⋅ clients, suppliers or business partnershi­ps?

What is the compositio­n of the workforce, the customers and the supplier companies? What diversity measures already exist without organizati­ons being aware of them?


⋅ How can diversity be introduced or strengthen­ed in the ⋅ organizati­on?

What steps lead to the goal? In what time period does one intend to implement specific measures? How are they ⋅ communicat­ed in the company?

What effect have the measures had? How can each of them be optimized, stopped or expanded to other areas?

From diversity to inclusion

“Diversity is a fact, inclusion is a choice.” “Diversity is being invited to the party, inclusion is being asked to dance.” These are popular sayings that stress the need not only to focus on recognizin­g diversity but to look beyond that by creating an inclusive environmen­t. As the world becomes more and more interconne­cted, this is increasing­ly needed at all levels in teams, organizati­ons and society as a whole.

Companies launching internatio­nal diversity initiative­s are, of course, faced with the challenge of balancing internatio­nal standards and respecting widely differing local attitudes to diversity. To be successful, we need to be ambitious and not just aim for everyone to be invited to the party and asked to dance, but also for everyone to have the chance to choose the music.

 ??  ?? Fitting together: the right mix is essential
Fitting together: the right mix is essential
 ??  ?? Can we overcome our difference­s?
The modern workplace is complicate­d
Can we overcome our difference­s? The modern workplace is complicate­d
 ??  ?? ROBERT GIBSON has over 25 years’ experience of intercultu­ral competence developmen­t in education and business. He was responsibl­e for intercultu­ral training at Siemens AG from 2000 to 2018 and is currently adjunct professor of cross-cultural management at Bologna Business School. You can contact him and join the discussion on diversity on Linkedin (www. robert-gibson6a36­a315/?original Subdomain=de).
ROBERT GIBSON has over 25 years’ experience of intercultu­ral competence developmen­t in education and business. He was responsibl­e for intercultu­ral training at Siemens AG from 2000 to 2018 and is currently adjunct professor of cross-cultural management at Bologna Business School. You can contact him and join the discussion on diversity on Linkedin (www. robert-gibson6a36­a315/?original Subdomain=de).

Newspapers in English

Newspapers from Austria