What difference can diversity make for innovation? In this article we explore why diversity is critically important, and how diverse teams are able to move beyond mediocre ideas to great ideas.
It has long been recognised that diversity is important for innovation – and there is now more evidence than ever to support the case for diverse teams.
The reality is that teams of like-minded people often come up with average results. Diverse teams, on the other hand, have been found to inspire original ideas and enable more market opportunities.
So why are many organisations guilty of avoiding diversity, or not giving it the attention it deserves? And how can teams move to enable these diverse perspectives?
The dangers of uniformity
Most people prefer to be around others who are similar to them – and leaders will often select teams that are similar to themselves. Yet like-mindedness often leads to average results when it comes to innovation.
Although social networks sometimes do foster creativity, they can often also stifle it. While teams of like-minded people from similar backgrounds solve problems faster, the solutions they come up with are often lacklustre compared with those of diverse teams.
And that’s the problem. While there’s typically a great deal of back slapping and agreeable reinforcement in uniform teams, this limits the potential for the challenges required to push beyond standard ways of thinking. Similarly, a team of ‘yes-men’ is not going to point out if the ship is heading straight for an iceberg if the leader doesn’t want to see it.
Diverse teams do better
Diverse groups have been found to be the most creative of all types of collaborative groups.
In simple murder mystery problem-solving tasks, groups with greater ethnic diversity share information more openly and solve problems more effectively. Ethnically diverse juries have also been found to exchange a wider range of information about a case than homogeneous groups.
Employees from organisations that focus on both inherent diversity (such as gender or ethnicity) and acquired diversity (such as working in another culture or working with different gender groups) report that their company is 70 per cent more likely to have captured a new market.
Other research finds that diversity – and in particular cultural diversity – has been closely linked with better economic performance through innovation. Innovation-focused banks have, for example, been found to perform better financially where there is greater ethnic diversity.
However, as group diversity can also lead to higher levels of perceived conflict and a lack of trust, it is important to know how to best enable their potential. There is a clear need for coordinated management in order for the fresh ideas to thrive.
Maximising the power of diversity
So how can you maximise the potential of diverse teams?
To get the best out of diverse teams you will need to design for diversity, build systems that support diversity, and manage them well:
1. Design for diversity:
Deliberately designing diverse teams is an important first step for leveraging the value they can create. It’s possible to do this by analysing current diversity statistics and planning for the ideal balance. A number of Silicon Valley tech companies released data on their organisational diversity (or the lack of it), particularly in terms of gender and race, and the results were concerning to say the least. The statistics on women in tech companies in particular have actually been getting worse and as a result hundreds of millions of dollars have been pledged to an effort to improve this balance. Stats like these need to be regularly analysed and remedied.
2. Build systems that support diversity:
Don’t just expect that hiring for diversity will solve the problem. Systems that support diversity also need to be established. Urban theorist Richard Florida includes a tolerance for diversity as one of the key elements he believes is important in building a ‘creative class’. Tolerance for diversity is not just about simply accepting different types of people, he says, but about being open to and proactively including diversity. Systems for tolerance need to be built into the DNA of the organisation. Recruitment, selection processes for teams and communication will all need to actively promote tolerance.
3. Manage diverse teams strategically:
The successful management of team diversity has been found to relate to better working conditions and faster implementation of and adaptation to organisational change. The ability to deal with differences in diverse teams is important, as is a willingness to share opinions and voice objections. Strong cohesion within a team is conducive to rapid action, but the team’s culture must also allow for the expression of a range of points of view. Diverse teams can be effectively managed by setting up team codes of conduct and team norms – and by facilitating team processes well.
Gaia Grant and Andrew Grant are the authors of The Innovation Race: How to change a culture to change the game, along with a number of other international bestselling books and resources. The Grants are top-ranking keynote speakers, and Gaia is an HD researcher and guest lecturer at Sydney University Business School. For more information see www.the-innovation-race.com.