Q

How to Create a More Diverse and Inclusive Workplace

With consumer sentiment compelling a more thoughtful, critical look at labor and power structures, small businesses are prioritizing DEI.
Photo credit: matteo - stock.adobe.com

The U.S. runs on small business power. Employing nearly half the private-sector U.S. workforce (46%), small businesses with fewer than 100 employees accounted for 98% of employers and those with fewer than 20 employees made up 89%. With such strength in numbers, small business owners are in a prime position to lead on diversity, equity and inclusion (DEI) efforts in the workplace and to promote opportunity and diversity among their ranks. 

In many ways, this is already happening. Restaurants, retail shops, contractors, professional services, healthcare and other small businesses across the country are staffed by individuals representing different races, ethnic groups, religions, sexual orientations, gender identities and cultures, as well as led by diverse individuals. In fact, entrepreneurs of color run more than 8 million businesses, employing 7 million people – a rising number, though one not yet proportional to the population.  

The past few years have put diversity squarely on the docket of U.S. businesses. With social justice movements and consumer sentiment compelling a more thoughtful, critical look at labor and power structures, many small businesses have looked more deeply at DEI inside their operations. 

The Value of Workplace DEI

A growing amount of research literature ties workplace diversity to improved business performance and there is a growing roster of surveys that reaffirm the long-term impact of thoughtful DEI initiatives.

In an oft-cited 2019 study published in the Journal of the National Medical Association, researchers found “positive associations between diversity, quality and financial performance,” including “improvements to innovation [and] team communications.” Other research, meanwhile, has noted the impact of workforce diversity on analytical thinking and innovation. 

“When work environments are homogeneous, you don’t have the best of everyone,” said Kathleen Wilson-Thompson, the former head of human resources for Walgreens Boots Alliance and Kellogg who now helps companies unlock human potential and drive more diverse and equitable workplaces as a consultant. 

A more diverse workforce can also help a business attract and retain employees, a particularly important reality given that voluntary resignation rates have been rising since 2009 (with the exception of 2020), including an increase from 47.8 million people who quit their jobs in 2021 to 50.5 million in 2022. 

A 2023 survey from Benevity found that 95% of job seekers consider a prospective employer’s DEI efforts when choosing between job offers. This rings especially true for younger generations who are, on the whole, more diverse than Boomers and Gen X. 

Millennials and Gen Z not only want to work for companies committed to DEI, but are also choosing to spend their money with those who share their values. A recent study from Accenture focused on the retail sector – a relevant example for all businesses – found that 54% of younger Millennials believe retailers have a responsibility to address wider social and political issues with regards to diversity, while more than half reported that they were more likely to shop at a retailer that demonstrated awareness of such issues. Nearly one-third, meanwhile, said that staffing diversity influenced their shopping decisions. 

The takeaway? If a business is not genuinely committed to DEI, then it could fail to reach its potential, struggle to attract and retain talent, and see consumers take their dollars elsewhere. 

Cultivating a More Diverse, Equitable Work Environment

The tumult of COVID-19, including unemployment rates not seen in 50 years, and generational shifts has led many people to take stock of what they want from employers, from equitable opportunities to fair pay rates to work-life balance.  

The “Great Resignation” of 2022 gave way to “Quiet Quitting,” in which workers offer the least amount of effort in their jobs. Job hopping is increasingly common, particularly among younger employees. In 2022, 22.3% of those aged 20 or older spent one year or less at their jobs – the highest rate since 2006. An additional 33% stayed in their jobs for two years or less. 

We’re in a market where employees feel more confident to leave jobs that do not fulfill their personal values and needs. As a result, business leaders need to consider how they advertise, interview and onboard employees. That includes asking – and listening to – feedback from current employees about their experience. Wilson-Thompson suggests leadership remove any barriers to entry, resist pigeonholing certain types of people into specific roles and provide management-appropriate training to deal with workplace conflicts. 

“If you don’t reflect on the entire lifecycle of your employees and the mechanics of this, then you open yourself up to complaints,” said Wilson-Thompson. She added that even a massive corporation like Walgreens conducted listening tours to better understand frontline worker issues. “The top doesn’t have all the answers, which is why it’s so important to survey your workforce and listen to what they have to say.” 

Listening to employees, valuing their feedback and making tangible change to create a more responsive work environment is an important step toward inclusion, which Wilson-Thompson defines as “respecting and valuing employees.” 

DEI also extends to respecting each individual’s unique qualities and identifiers and treating everyone equally. While DEI is most associated with race, Wilson-Thompson reaffirmed that diversity encompasses all different facets of one’s identity, from religion and age to family dynamic and work experience. 

Considerations for SMB Leaders and Operators

Wilson-Thompson urges entrepreneurs and their managers to provide the same opportunities to everyone. Consider who gains access to certain training opportunities or positions within the company and try to broaden participation. 

“You don’t want to be doing things differently for different people,” Wilson-Thompson said. “If you really want to change the paradigm, then you need to remove any barriers to entry.” 

So many businesses have their heart in the right place regarding DEI, Wilson-Thompson acknowledged. They draft wonderful plans and put them on the wall, but then forget about them. Business owners should create an action plan rooted in their corporate culture and values set. This enables a business to move away from “checking boxes” to a more holistic and tangible DEI program with measurable results. 

“You want to create a safe, accessible workplace where employees can thrive,” she explained. “That’s when you create more diverse, equitable and inclusive work environments where everyone – the business, the employees and the customers – wins.” 

 
This article is adapted from a byline initially published on Pizza Today written by Daniel P. Smith. He is a Chicago-based writer that covers business issues and best practices for a variety of trade publications, newspapers and magazines.

 

How to Create a More Diverse and Inclusive Workplace

by | Sep 8, 2023

With consumer sentiment compelling a more thoughtful, critical look at labor and power structures, small businesses are prioritizing DEI.

The U.S. runs on small business power. Employing nearly half the private-sector U.S. workforce (46%), small businesses with fewer than 100 employees accounted for 98% of employers and those with fewer than 20 employees made up 89%. With such strength in numbers, small business owners are in a prime position to lead on diversity, equity and inclusion (DEI) efforts in the workplace and to promote opportunity and diversity among their ranks. 

In many ways, this is already happening. Restaurants, retail shops, contractors, professional services, healthcare and other small businesses across the country are staffed by individuals representing different races, ethnic groups, religions, sexual orientations, gender identities and cultures, as well as led by diverse individuals. In fact, entrepreneurs of color run more than 8 million businesses, employing 7 million people – a rising number, though one not yet proportional to the population.  

The past few years have put diversity squarely on the docket of U.S. businesses. With social justice movements and consumer sentiment compelling a more thoughtful, critical look at labor and power structures, many small businesses have looked more deeply at DEI inside their operations. 

The Value of Workplace DEI

A growing amount of research literature ties workplace diversity to improved business performance and there is a growing roster of surveys that reaffirm the long-term impact of thoughtful DEI initiatives.

In an oft-cited 2019 study published in the Journal of the National Medical Association, researchers found “positive associations between diversity, quality and financial performance,” including “improvements to innovation [and] team communications.” Other research, meanwhile, has noted the impact of workforce diversity on analytical thinking and innovation. 

“When work environments are homogeneous, you don’t have the best of everyone,” said Kathleen Wilson-Thompson, the former head of human resources for Walgreens Boots Alliance and Kellogg who now helps companies unlock human potential and drive more diverse and equitable workplaces as a consultant. 

A more diverse workforce can also help a business attract and retain employees, a particularly important reality given that voluntary resignation rates have been rising since 2009 (with the exception of 2020), including an increase from 47.8 million people who quit their jobs in 2021 to 50.5 million in 2022. 

A 2023 survey from Benevity found that 95% of job seekers consider a prospective employer’s DEI efforts when choosing between job offers. This rings especially true for younger generations who are, on the whole, more diverse than Boomers and Gen X. 

Millennials and Gen Z not only want to work for companies committed to DEI, but are also choosing to spend their money with those who share their values. A recent study from Accenture focused on the retail sector – a relevant example for all businesses – found that 54% of younger Millennials believe retailers have a responsibility to address wider social and political issues with regards to diversity, while more than half reported that they were more likely to shop at a retailer that demonstrated awareness of such issues. Nearly one-third, meanwhile, said that staffing diversity influenced their shopping decisions. 

The takeaway? If a business is not genuinely committed to DEI, then it could fail to reach its potential, struggle to attract and retain talent, and see consumers take their dollars elsewhere. 

Cultivating a More Diverse, Equitable Work Environment

The tumult of COVID-19, including unemployment rates not seen in 50 years, and generational shifts has led many people to take stock of what they want from employers, from equitable opportunities to fair pay rates to work-life balance.  

The “Great Resignation” of 2022 gave way to “Quiet Quitting,” in which workers offer the least amount of effort in their jobs. Job hopping is increasingly common, particularly among younger employees. In 2022, 22.3% of those aged 20 or older spent one year or less at their jobs – the highest rate since 2006. An additional 33% stayed in their jobs for two years or less. 

We’re in a market where employees feel more confident to leave jobs that do not fulfill their personal values and needs. As a result, business leaders need to consider how they advertise, interview and onboard employees. That includes asking – and listening to – feedback from current employees about their experience. Wilson-Thompson suggests leadership remove any barriers to entry, resist pigeonholing certain types of people into specific roles and provide management-appropriate training to deal with workplace conflicts. 

“If you don’t reflect on the entire lifecycle of your employees and the mechanics of this, then you open yourself up to complaints,” said Wilson-Thompson. She added that even a massive corporation like Walgreens conducted listening tours to better understand frontline worker issues. “The top doesn’t have all the answers, which is why it’s so important to survey your workforce and listen to what they have to say.” 

Listening to employees, valuing their feedback and making tangible change to create a more responsive work environment is an important step toward inclusion, which Wilson-Thompson defines as “respecting and valuing employees.” 

DEI also extends to respecting each individual’s unique qualities and identifiers and treating everyone equally. While DEI is most associated with race, Wilson-Thompson reaffirmed that diversity encompasses all different facets of one’s identity, from religion and age to family dynamic and work experience. 

Considerations for SMB Leaders and Operators

Wilson-Thompson urges entrepreneurs and their managers to provide the same opportunities to everyone. Consider who gains access to certain training opportunities or positions within the company and try to broaden participation. 

“You don’t want to be doing things differently for different people,” Wilson-Thompson said. “If you really want to change the paradigm, then you need to remove any barriers to entry.” 

So many businesses have their heart in the right place regarding DEI, Wilson-Thompson acknowledged. They draft wonderful plans and put them on the wall, but then forget about them. Business owners should create an action plan rooted in their corporate culture and values set. This enables a business to move away from “checking boxes” to a more holistic and tangible DEI program with measurable results. 

“You want to create a safe, accessible workplace where employees can thrive,” she explained. “That’s when you create more diverse, equitable and inclusive work environments where everyone – the business, the employees and the customers – wins.” 

 
This article is adapted from a byline initially published on Pizza Today written by Daniel P. Smith. He is a Chicago-based writer that covers business issues and best practices for a variety of trade publications, newspapers and magazines.