Why Do You Need to Prioritize DEI?

Written by Raul Pereyra HR Pro | Human Resources Consultant

Because doing nothing about racial inequality is part of the problem. 

The problem: $171.9 billion. This is the cost of turnover to U.S. businesses due to unfair treatment based on race or ethnicity in the last five years.

A survey (The Cost of Racial Injustice) by the Society for Human Resource Management (SHRM) looked at perceptions of American workers about unfair treatment based on race or ethnicity in the workplace and how it manifests into disengaged employee behaviors that contribute to an increase in absenteeism, productivity loss, and turnover.

What else did the SHRM report find?

Over the last five years, here’s the percentage of American workers, by race/ethnicity, who have felt unfairly treated in the workplace due to race or ethnicity:

  • 42% Black
  • 26% Asian
  • 21% Hispanic/Latino
  • 12% White

Additionally, 72% of American workers claiming unfair treatment reported experiencing this treatment between one and five times.

What are the effects of racial inequality on behaviors and productivity?

The SHRM survey found that those people who felt like they were treated unfairly because of their race or ethnicity experienced these counterproductive work behaviors:

  • 45% put less effort into their work than they could have.
  • 35% took longer to complete their work than they could have.
  • 28% spent work time on non-work activities as a result.
  • 25% took extra or longer work breaks.

Is Leadership to blame?

The SHRM survey confirms a brutal truth we’ve all heard before: good people don’t leave companies, they leave bad bosses.  According to the survey: “those in leadership positions are often to blame for racial injustice manifesting itself at work. Of those American workers who claim to have been unfairly treated due to their race or ethnicity over the last five years, 57% were reportedly mistreated by a supervisor, manager, or leader other than their direct supervisor.”

So, is it fair to blame leadership?

Leadership has the power to create REAL change.

At be the change HR, we truly believe that managers are the most influential people who can set expectations for behaviors and create positive relationships with employees. Managers have the power to foster an inclusive work environment. An inclusive workplace fosters meaningful interpersonal connections, psychological safety, and trust, all of which shape workers’ behaviors and drives employee engagement.

Changing behaviors isn’t that difficult as long as you keep in mind that the leadership, specifically managers and supervisors, have the power to set behavioral expectations. It’s just a matter of figuring out what behaviors do you want – do you want behaviors that further create feelings of unfair treatment or behaviors that promote inclusion and belonging?

Figure this part out and you’re on your way!

Leaders can lead DEI initiatives and boost employee engagement.

The Gallup Q12® Meta-Analysis found that companies with greater levels of employee engagement outperformed others on these crucial performance outcomes:

  • 81% LOWER absenteeism
  • 18% LESS turnover (in high-turnover organizations)
  • 43% LESS turnover (in low-turnover organizations)
  • 41% FEWER quality (defects)
  • 28% LESS shrinkage (theft)
  • 18% HIGHER productivity (sales)
  • 23% HIGHER profitability

When you make DEI a priority, you’ll discover the benefits of employee engagement.

DEI matters to the bottom line.

The most diverse companies are now more likely than ever to outperform less diverse peers on profitability. A 2019 study by McKinsey & Company found that the relationship between diversity on executive teams and the likelihood of financial outperformance has strengthened over time.

Their 2019 analysis found that companies in the top quartile for gender diversity on executive teams were 25 percent more likely to have above-average profitability than companies in the fourth quartile—up from 21 percent in 2017 and 15 percent in 2014.

So what? Now what? 

Find your spark!

Yes, taking the first step as a leader is difficult – sometimes we wait around and see what others are doing. We look for cues on what’s expected, what’s everyone else doing?

Ok, stop. Take a deep breath. Find the spark to do something.

Being a leader requires you to take the first steps. Stop asking others to go first. Ask them to join you – and you both go at it together. Because together, you build something worth building.

The cost of doing nothing or supporting the status quo?

Of course, you heard about the ROI on DEI. Yes, the return on investment is important to consider but so is the cost of not doing something to address the problem.

The SHRM report revealed that the cost of lost productivity for American businesses due to unfair treatment based on race or ethnicity in the past year was $58.7 billion and the cost of absenteeism due to unfair treatment based on race and ethnicity in the past year was $54.1 billion.

If these numbers don’t inspire you, then perhaps try to think in terms of these questions:

  • What kind of company do you want to build – one that treats people unfairly, fostering negative emotions such as anger and distrust?
  • What kind of reputation do you want to have, competitive edge?
  • What kind of culture is best for driving organizational performance?
  • What is your company doing to address racial inequality?

Do Something

When you prioritize DEI you’re looking at ways to adjust management strategies and behaviors. This is where real change happens – this is where you have the power to do something.

And doing something means identifying the policies, processes, and behaviors that support and maintain your company’s current structure. Structures refer to your company’s systems, processes, practices, or policies. To do something is to change your structures so that they support DEI.

As you grow in your DEI journey, you’ll begin to change the way you think and behave. You’ll begin to understand what it takes to include people throughout the organization, how you share power, celebrate diversity and uniqueness, and change your culture. 

As you grow, you have a deeper understanding of DEI’s role in supporting behaviors that drive organizational performance.  So there’s no real need to overthink DEI when you understand the power it has to drive organizational performance.

After all, didn’t we all sign up to deliver results, drive performance?

DEI is a Journey!

For things to change, someone somewhere has to begin acting differently. Wouldn’t it be amazing if you were that someone?

We’d be honored to help you along this journey. Contact us to see how we can support you in your journey.


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