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Developing A Succession Plan That Supports Diversity In The Workplace

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Looking to Improve Diversity in The Workplace?

You may see newspaper or popular press articles that outline the benefits of diversity in organizations. The so-called “business case” for diversity states that adding minority members to executive boards and leadership teams improves the bottom line, delivering higher returns and leading to better financial decisions. Some articles even suggest that women on boards, a common focus of diversity programs in organizations, will out-perform their male counterparts.

However, many of these claims are overblown or are based on selective research. In fact, when we combine the years of research on diversity in executive level positions, particularly gender diversity, we find that adding women to boards has a net-zero impact on the bottom line. That is to say, increasing diversity doesn’t harm an organization financially, but neither does it provide a guaranteed boost to the bottom line.

On the other hand, we are still major proponents of increasing diversity at all levels of the company. Here, we discuss how diversity really impacts the organization, and how to use succession planning to gain the true benefits of diversity.

How Workplace Diversity Benefits Companies

Although the argument that diversity on boards automatically improves the bottom line is largely unsupported, there are several benefits to increasing diversity. Firstly, let’s clarify that practices to improve diversity in the workplace refer to merit-based decisions that allow employees of all genders, races, or ethnicities opportunities to grow. This kind of diversity is often seen as more just and fair. In this environment, employees strive for success. As a result, they increase their performance because they know decisions aren’t based on extraneous factors.

“A diverse mix of voices leads to better discussions, decisions, and outcomes for everyone.” – Sundar Pichai, CEO of Google 

Diversity and Employee Motivation

This leads to the motivational nature of diversity. It can be confidence-building for employees to see a diverse leadership team. By distributing development resources and promotions among individuals of varied backgrounds, your employees will see that decisions are based on merit, not demographics. They will also see that any talented or hard-working individual can access these development opportunities. Furthermore, by providing opportunities to employees of different backgrounds, your company also gains valuable insight from members who may be otherwise overlooked. The different experiences, backgrounds, and educations can bring fresh new ideas to your company. Providing talent development opportunities for all members of your team is beneficial for both employees and the organization alike.

Diversity and Brand Image

Finally, increasing diversity within your organization helps to balance the demographic characteristics with the characteristics of your customer base. It can improve your company’s public image to have your leadership team reflect the clients that it serves. It also makes it more likely that the experience and background of your leadership team is representative of your clients. This may therefore help your team better connect with the people you serve.

Benefits of Using Succesion Planning to Increase Diversity In The Workplace

1. Add Objectivity To Your Business

Companies who struggle with increasing diversity can use succession planning as a way to get them on the right path. We recommend using science-based assessments to introduce objectivity into your talent management process. For instance, validated assessments can be introduced for hiring, as vetting for promotions, or to track the knowledge and skill development of employees over time.

In using objective measures, an effective succession planning process will put these results to good use. The process will create success profiles for the role you’re looking to replace. These profiles are created from evidence-based benchmarks of the skills and abilities needed to be successful in a given role. This shifts the focus from the individual as a person to the succession candidate’s qualifications for a position. In short, moving the lens from individuals to role fit is much less likely to produce bias that keeps minority groups from upper management and high-responsibility positions.

2. Reduce Bias

Further, it is best to conduct succession planning with the support of your entire senior management team. Together, your senior leaders make group decisions that are free from the personal biases of any one member. These biases are often unintentional and hard to avoid. One of the easiest ways to reduce the bias in your decision-making is to consult the opinions of people you trust. A good succession plan will have collaborative decision-making built into the process.

3. Focus Internally

Finally, succession planning allows you to internally address one of the major barriers to diversity. Some companies looking to increase the diversity of their leadership team face a shortage of interested and qualified succession candidates to choose from. This is rarely due to a lack of intelligent, hard-working individuals, and more often a case of unequal opportunity. Succession planning aims to develop your internal candidate pool by providing training and growth opportunities to all staff members. This includes those who may be traditionally overlooked. A good succession plan will allow you to create a diverse leadership team from internal resources and succession candidates.

How SIGMA Can Help

You can use succession planning to address many concerns most organizations face. These include increasing diversity, creating engagement, and reducing turnover. Learn more about our Succession Planning Process and all our great succession planning offerings. Contact us to learn more about how we can design a personalized succession plan for your company in just 30 days with our Succession Planning Launch Series.

About the Author

Erica Sutherland, Ph.D.

Senior Consultant & Executive Coach

Erica completed her Ph.D. in Industrial-Organizational psychology at Western University. She is a Senior Consultant at SIGMA, where she delivers consulting services and Succession Planning solutions to clients. As a member of SIGMA’s executive coaching team, Erica works one-on-one with leaders to develop talent. She also brings her expertise in measurement and psychometrics to the R&D team, assisting with the development and validation of SIGMA’s many assessments.