Improvements in diversity, equity and inclusion can be aligned to also positively impact normative and strategic management. Where HR has the lead for DEI with these kinds of impacts, HR assumes the role as strategic partner for the business: HR drives the benefits of DEI into an enhanced market position and raised company performance.
Four sorts of key benefits to the business from DEI can be linked to four forms of normative management as well as four typical strategic sources of competitive advantages. These benefits are gained by DEI policies which are extended to actively include more people with diverse backgrounds, without excluding or disadvantaging people with conventional backgrounds.
Heightening Industry Leadership via Diverse Expertise
The commitment to Diversity holds out the promise of seeking out and finding the most expert people for a company, no matter their demographics. Equity policies of fair and equal treatment give them the chance to exercise their expertise on the job and gain recognition and authority, the same as everyone else. Finally, Inclusion will give them participation in the developments in the company, allowing them to take part in decision-making and be promoted along with others in their cohort. Their expertise will fully unfold and be applied to maximize their contribution to the company’s success.
HR partners with the business to realize these DEI benefits in expertise, which are most relevant to companies with the mission to be a leader in their industry. This normative aim is often attained via competitive advantages in the functional excellence of the products and services, customer service, marketing, systems, and so forth. The strategy of functional excellence is boosted by DEI policies to recruit, retain and reward the best experts available.
Serving the Mass of the Market via Diverse Personnel in Processes
Diversity can recruit diverse personnel who tend to be more sensitive to the preferences of the increasingly diverse range of customers when collecting market information. Equity ensures that these diverse employees can be effective as the “voice of the customer”: they are accorded a proper weight in the internal processes to define the design requirements in such a way as to address the entire range of demand on the market. Inclusion integrates the sensitivity of diverse personnel to the spectrum in market preferences into the marketing campaigns and sales activities. In this way, the range of the diverse customers feel spoken to by the company. In addition, the greater internal variety in the processes arising from people with diverse backgrounds leads to a greater capacity to accept and work with external variety in the market, i.e. improved resiliency and creativity.
HR and the business as partners realize the DEI benefits of better-reflecting market demand and coping with market dynamics. These benefits are best suited to companies rooting their competitive advantages in all-around benefits which appeal to the mass of the market. Often linked to this strategic management are normative values such as mutual respect and teamwork which lubricate working together in the value chain so that processes are smooth and efficient. Mature DEI policies further enhance process flows with resiliency and creativity to raise company performance in generating all-around benefits positioned at the heart of the market.
Grasping Market Opportunities via Diverse Skills of “Intrapreneurs”
Diversity can recruit a set of employees who from their unconventional backgrounds are open to the variety of so-called “weak signals” emanating from a range of diverse sources on the market and in technologies. They can identify emerging opportunities before other companies take notice. Equity enables them to act as a so-called “intrapreneur” – an entrepreneur in the setting of a company – where they are accorded resources and room for maneuver to pursue the opportunity by developing a new solution. Inclusion then means that the company as a whole integrates the developed solution fully into the market offerings of the company. In addition, the diverse employees can tend to be more accustomed to variety and change in their lives, raising the agility of the company.
HR partners with the business to realize these intrapreneurial DEI benefits, which are most suited to companies with the normative goal to pursue specific ventures. The associated strategy generates competitive advantages from offering new technological solutions to meet specific emerging customer behaviors, furthered by policies to diversify the range of intrapreneurs working to raise performance.
Addressing Latent Demand via Diverse Collaboration
Here looking first at normative and strategic management, some companies pursue a normative vision of enriching the quality of life of customers. This is often accomplished via a strategy of addressing latent demand to give customers benefits that they were not aware of. Products, services, and solutions for latent demand typically are composed of multiple modular elements consisting of different functionalities, which on the one hand have been synthesized to make the whole greater than the sum of the parts, and on the other hand give customers the choice to fine-tune the different modules exactly to their preferences.
The DEI benefits in collaboration, realized in partnership between HR and the business, are most suited to this normative and strategic management. Diversity can recruit to the company functional specialists with diverse profiles who deeply relate to diverse customer segments, in a sense “knowing them better than they know themselves,” so as to identify the latent demand. Specialists with diverse backgrounds can also tend to have more skills and experience in collaborating with other people who are somehow “different” from themselves. For each functional specialist, specialists from other functions are “different” in their language and thinking. Equity supports these functional specialists with diverse profiles in their collaborative give-and-take to adjust the modules to each other. They find a way to collectively agree on the best approaches to synthesize the different functionalities in the solution. Inclusion establishes the collaboration between the solution under development and the other company departments to prepare the market launch: purchasing, production, marketing, etc.
Conclusion
Working with the business to improve DEI in the organization, HR can become a key partner for the business in realizing its normative and strategic management objectives.
Authored by Benjamin Wall