Ep03 – Is Diversity Important At Work?

Tara: [00:00:00] Hey there I’m Tara Landes. I’ve been working with small businesses for over 20 years, helping them implement the foundational business processes that get them to the next level. From DNA manufacturers to funeral homes. From web-based subscription services to third generation excavation contractors. Lots of business podcasts talk about the big companies. We’re digging into the secrets of the small companies. Want to make your business more fun, more profitable, and more self-reliant than ever before? Lots of people have done it. You can too, and you can start right now. This is the Small Business Foundations Podcast.

When you put a bunch of business leaders in a room and ask them what their most important business asset is, most of them will tell you, the people. When they win awards, they say they couldn’t have done it without the team. When they get interviewed, there’s always some credit shared with those that helped them get to where they are.

The business advice originally credited to Lee Iacocca, “Hire people smarter than you, and then get out of their way.” Okay. We get it. People are important and we should get the best ones to work for us. So, what’s that got to do with diversity and inclusion you may be wondering. Well, a football team composed only of the most incredible linebackers in the world, isn’t going to score a lot of touchdowns. A company is a team, and you need a bunch of different kinds of players to make it sing. It’s kind of intuitive, right? And as the issues around diversity and inclusion have been getting more attention in the mainstream media, we’ve had a lot more questions from our clients on how to find a more diverse candidate pool.

On the flip side, we’ve had lots of clients wondering if it’s even worth it. I don’t know what it’s like in your neck of the world, but in ours, it’s tough to find any talent at all. In almost any industry, the labor market’s really tight. People get snapped up so quickly, a lot of companies will take whatever they can get, diverse or not.

I’m not an expert in the diversity world, not even close. So, I reached out to Sylvia Apostolidis, the founder of The Jasmar Group. After our conversation, I realized I fell into the same diversity trap I never even knew I was falling into. Sylvia and I graduated from the same MBA class 20 years ago. We both grew up in Vancouver. We’re both cis-gender females. We’re married. We each have two sons. All of our children are even Geminis! Not a lot of diversity between the two of us. But when I started getting a wave of questions about hiring for diversity, she was my go-to resource.

Sylvia, how did you get started focused on this kind of work?

Sylvia: [00:02:49] I’ve always had a really strong sense of fair play from when I was really young. I think that was due to being brought up in a pretty traditional, Greek family, and being treated differently because I was a girl. And my brother was a year younger than me, and he was a boy, and that was the best thing to be. I had better grades, and you know, was a good kid. I was a girl. I was treated differently. So, I just didn’t like that. I hated that. So I ended up doing my undergrad and a master’s degree in sociology and really focused around women’s studies. I started in this field about 15 years ago, working for an organization called Catalyst, which works with most of the large organizations in Canada to help advance women. And there, really learned the ropes and also had the opportunity to influence different organizations. But then I left there and said, okay, we really haven’t made a lot of progress around women’s advancements in the corporate world. How do we do this differently?

And then I started The Jasmar Group, bringing in behavioral science with the question of “we’re trying to change human behavior at the end of the day, so we should probably bring insights from the science of human behavior, into our solutions”. The way we approach diversity and inclusion is largely around awareness, but awareness doesn’t really lead to behavior change. There was a study today I just saw. Another huge meta-analysis on unconscious bias training. It’s like, yeah, this doesn’t work. But so many organizations are doing that. And so we really have taken a step to bring this evidence-based approach to the world and yeah, something I’m really passionate about. What drives me really is trying to make some kind of change in this world, for girls, but for boys too.

Tara: [00:04:56] So I think this is a reasonable question. And maybe in today’s day and age, you’re not supposed to ask it, but I’m going to ask it anyway. Does diversity matter? Does it help?

Sylvia: [00:05:05] Yeah, it does, but it’s a really good question. And it’s not actually as clear cut as we would like.

There’s a ton of studies out there that show there’s a correlation between companies that have diverse teams and financial performance, but it’s really hard to see if there’s causation. Is that because companies that have diverse teams that are actually doing the right things on a lot of other things and therefore their financial performance?

But there is evidence that shows that diverse thinking teams, outperform homogeneous teams. And part of the reason is because they’re harder and they’re not as easy and so when it’s harder, you end up getting to more innovation and more ideas and you have those different perspectives that come into those conversations.

Now, then the question becomes what kind of diversity actually matters? Do you just throw a whole bunch of people in a room and say, or in on a team and say, “Okay, you’re diverse! You all look different, and so you should be good to go.” No. The research right now is quite limited. There’s no research really out there that says, if you bring in somebody that has, uh, diversity around sexual orientation or diversity around weight or diversity around disability. These are all great. And those people will bring different perspectives. But what we do know is that when you bring women into a group, it increases collaboration. When you bring visible minorities into a group, it makes people more curious and functional diversity makes a big difference. Also, people with different functional backgrounds.

So it’s not just around visible differences. Like when we talk about diversity, it’s not just visible diversity. It’s also the invisible. Do people have different levels of risk? Are they introverted or extroverted? When we define diversity, it’s often we just think about the visible differences, but really there’s a lot more to it than that.

We know that functional diversity on a team makes a difference. We know that educational diversity makes a difference. Um, but we’re not a hundred percent sure that all different dimensions of diversity make a difference to a team. Any small business that’s starting out could take an inclusive lens, right from the very beginning. Before you even start to design any kind of talent process, before you even hire your first person. To have a lens around diversity and inclusion is a really good idea for the long-term. Because you don’t really think about it right from the beginning. It’s like, okay, I just want to find the best person for the job, but when that best person ends up being somebody that’s very similar to you, is going to the same school as you, and you just happened to know them through your network, then it becomes a problem down the road, unless you’re actually thinking about it right in the very beginning. So it’s a really good opportunity actually, to, right from the very beginning to have these conversations. Um, so I totally get it.

Tara: [00:08:18] I mean, I did that with my own business. I went to my own school. I went to my own network. That’s what I did as well, because that’s where you know the people are and I’ve always said in the past, and maybe this is a mistake, you know, the best hire is from a personal referral, because then you can trust that yeah, at least this person has some sort of alignment with whatever it is you’re trying to accomplish. But you’re saying that, that maybe that pool’s too narrow.

Sylvia: [00:08:43] Yeah, because think about your network and how closed it is and how limiting it is. It’s one school of your close friends and so what kicks in is affinity bias or similarity bias. One of the most prevalent kinds of biases, and there’s about 180 of them out there, and that’s the one where we hang out with people like us and we treat them better. And most of our networks are like that. So, when we go out to our network like that, that’s what ends up happening. Or even if you think about a larger company that have referral, if you refer somebody and we hire them, then…

Tara: [00:09:20] We call that “a bounty on their heads.”

Sylvia: [00:09:22] That doesn’t work. We advise against that. Because of the same thing. You’ll end up getting more of the same people. And then the drawback of that of course, is that you don’t get the diversity of thought.

Tara: [00:09:32] Again, just from a small business perspective, there are so many things that you have to consider. There are just fires, burning all over the place. If I thought, “I want more diverse thinking,” am I not at risk to get people who don’t have the common values of my organization? Or should I not even be looking for common values?

When we refer to corporate values on this podcast, we’re talking about the behaviors and norms that are core to a company’s culture. People like us do things like this. They aren’t just platitudes stuck up on the wall in the boardroom. They are the driving force behind decisions for who to hire, how to reward behavior and decision making. When a company can articulate its core values and embed them in their team, authority (that is the things you’re allowed to do without asking permission first) can be distributed. For example, one fitness company we worked with had a core value that customers should always feel better when they left the studio than when they’d entered it. This guided the frontline staff’s decision making. If a customer had a complaint, they didn’t need to take it to their manager. They could just deal with the complaint, ensuring the customer felt better before they left. The idea of hiring people with values in opposition to the company’s in order to create diversity freaked me out a bit. But that’s not what Sylvia was recommending at all.

Sylvia: [00:10:51] Yeah. You have values in an organization and your values are your foundation. And so that is what you hire based on. So I don’t think that’s going to change, but there’s a lot of people with the values of your organization that come from different groups. And so that’s what we want to do. We don’t want to move you away from hiring someone against your values. You’d get into big trouble around that, but we do want to expand your pool so that you benefit from diversity of thought.

And certainly we know that diverse thinking teams outperform. So if you’re looking for innovation, then you’re going to want to bring in different perspectives and people from different backgrounds.

Tara: [00:11:39] How do I do that then? Do I put out an ad saying I’m looking for people diverse from me, with these values?

Can I put out an ad asking for diverse people? It sounds ridiculous. And yet I was asked that exact question three times in one week. I mean, I think we all know you can’t discriminate based on a person’s skin color, sexual orientation, religion. We all know that, but isn’t that what hiring for diversity implies?

Affirmative action and all that.

Sylvia: [00:12:04] No, you wouldn’t be able to put out an ad. I guess I would start with, you’re trying to bring in people that are diverse and define what diversity means for you. So what does that mean? Like, does that mean you’re looking for more women? Does that mean that you’re looking for more visible minorities? Does that mean that you’re looking for people from different schools? Why do you want that diversity? How is it going to help you?

Tara: [00:12:36] Sylvia raises an excellent point. Why do you want this diversity anyway? What business objective is it intended to achieve? I’m thinking of lots of clients where it’s almost all men and maybe all white men and they like the idea of having more diversity,

how ever they want to define that. But maybe they’re in a situation where the executive also has to be an owner and ownership requires, you know, 20 years of service. And so it’ll be great in 20 years, but right now they don’t have the pool of people to go into that position.

Sylvia: [00:13:14] So there’s a few things that you’ve mentioned there.

The first thing that I would do is question whether or not that position actually needs that number of years of experience. Often, we ask for qualifications just because we’ve always asked for those qualifications. The Jasmar Group is all evidence-based through our approach to inclusion. And so you’ll all hear me talking about the academic literature, because I’ve been doing this for 15 years now.

And I started The Jasmar Group stepping back and saying, what actually does work? You know, so many of the things that we’re doing in this space right now are based on what we’ve always done on what we assume works. And so I share that because I often use research, says academics, because that’s one of the resources we go to for our evidence.

And evidence says that years of experience doesn’t actually make a huge difference as to how well that person performs on the job. And so that would be one thing that I would recommend for any company to do is to take a critical look of what are those things that you’re asking for in that job itself?

Tara: [00:14:27] Wait, wait, wait I’ve got to dig on that. Years of, I mean, some years of experience must make a difference?

Sylvia: [00:14:32] You know, some. But I do know that what we know about experience is that we often ask for way more than what we actually need. By increasing the number of years of experience you’re actually losing out on a huge talent pool. Especially for women, because what women tend to do is they tend to look at job application and say, okay, I don’t have all of these criteria and therefore I won’t apply and we know that does happen. Whereas men don’t have that. They say, oh, you know, I’ve got 50% of those criteria, I’m good to go. Women just apply in a different way. And I think that’s what we really need to keep in mind is, how can we design our recruitment process so that you’re increasing the number of, let’s say, women applicants or BIPOC applicants?

Tara: [00:15:22] BIPOC is an acronym that stands for Black, Indigenous, and other People of Color. Get woke people.

Sylvia: [00:15:30] So even the way we use language in our job postings makes a big difference.

Tara: [00:15:38] Like what?

Sylvia: [00:15:39] So is language sending signals that this person will belong? Is this language sending signals that motivates that person?

I’ll give you an example. Take a profession like childcare worker. And when we advertise and use language that is more feminine, if you will, we’ll get more applicants. When we use language that motivates men though, which might be around different kinds of outcomes, then we’ll have more men apply to those kinds of jobs.

So using different kinds of language and there’s tools out there that you can put a job application through to test whether or not the language is inclusive, whether or not it is appealing for women or men. So we can use those kinds of tools, but language makes a big difference.

Tara: [00:16:43] I have to get the name of those tools from you.

Sylvia: [00:16:45] I think one of them is called Decoder.

Tara: [00:16:47] That’s really interesting to me. I think there are also just some professions where the candidate pool just isn’t as large. So construction, for example, it’s not that there aren’t women in construction, of course there are. But if you look at the candidate pool, it’s smaller. Women haven’t self-selected into that. So if you’re not hiring for junior, if you’re hiring for someone who needs some sort of experience, it’s a smaller pool.

Sylvia: [00:17:13] Often it is a smaller pool and for STEM positions as well and different kinds of male dominated, it is a smaller pool. But that doesn’t mean that we can’t expand the pool that we currently have and use different ways to design a process that is much more inclusive.

Tara: [00:17:31] That point really resonated with me. Yes, there may be fewer diverse candidates available, but of the ones that are available, how many are we attracting? Are we doing anything different? Anything in our recruiting process to maximize the attractiveness of the opportunity to the underrepresented people we want to attract?

I know, I know it sounds like a lot of work. But the opportunities with the highest return often are a lot of work, so maybe it’s worth it. And then she hit me with this.

Sylvia: [00:18:00] So often what happens is that women do apply. Let’s say you have 30% of your applicants and they are all women. And then they get to the next stage where a resume is selected to interview, and then it goes down to 15.

So then the question goes, well, how did you go from 30 to 15? And really taking that critical view and saying, where are decisions being made? How might bias be creeping in? So when you see a name on a resume, if it’s similar to yours, you might immediately, without you even knowing it, feel an affiliation to that person and treat them better than you would a name you might not even be able to pronounce.

And all of a sudden you’re unconsciously, we’re all biased, but that doesn’t mean we’re consciously biased, right? Like we’re unconsciously biased. And so we have to be careful around, you know, if you see something on a resume that is your school or you like scuba diving and that person likes scuba diving. Then all of those things like I’m going to interview that person. And in a male-dominated industry, you can see how that kind of bias would creep in throughout the whole process. So part of what we do is we use behavioral insights and we design a whole process around it that eliminates every decision point, the possibility of those biases creeping into your decision.

Does that make sense?

Tara: [00:19:21] I recently spoke to a client that said they only hire mountain bikers or surfers because those are “their kind of people”. And no, their industry is not in either of those sports. Another said, “You can’t trust people who’ve never played on a team.” If a team sport doesn’t make it to their resume, they’re immediately excluded from the hiring process.

I can see how these attitudes can significantly shrink the candidate pool before they even meet the people.

It sounds like a lot of work.

Sylvia: [00:19:47] It doesn’t have to be actually. And so there are really simple changes you can make. So I’ll give you an example of a simple change that makes a big difference. You know, many people, when they review a resume they’re might review one and then another, and then another back-to-back.

If you lay them out, on a table or on your monitor side by side, and you compare them. This is actually shown to eliminate the gender gap in recruitment, which is astounding, right? Like you think, how can that possibly happen? It’s just the way that our brains work when we compare things to each other. So even for example, a nudge would be, if I’m in a meeting and we’re discussing promotions and we want to promote a certain number of people, if there were photos of women leaders on that wall that has actually been shown to impact whether or not more women get promoted. So that’s a really small design that costs nothing. Just because of what’s been triggered in our brain by that photo.

Tara: [00:20:58] A nudge is a concept in behavioral science that states indirect suggestions or positive reinforcement can influence behavior. For example, when you go to the grocery store, you’ll notice the sugary cereals are at the child’s eye level. That’s a nudge, maybe not a good nudge, but a nudge. The sign that suggests you reuse your towels in a hotel bathroom. That’s a nudge too.

Sylvia: [00:21:21] And those are the kinds of things that can be used that don’t cost anything really.

Tara: [00:21:26] Wow! That’s really interesting. That’s crazy.

Since you were that little girl competing with your brother, how has your perspective shifted?

Sylvia: [00:21:34] I’m much more aware of the gender stereotypes that affect us all. I’m much more aware of how much we’re influenced from the moment that we’re born by society and what society tells us. And I think I’m much more courageous around building this world. I have two boys right now and very proud of them for being feminists because they understand men really should have quite similar roles in the world.

There shouldn’t be the gender stereotypes. I want them to grow up without the stereotypes around men and what that means. I don’t want, I want them to be able to show their emotion and be able to cry and be able to be human. There’s not just women’s inequality, but there’s also men’s inequality that we need to be addressing moving forward as well.

Tara: [00:22:35] Jim Collins said “people aren’t your most important asset, the right people are”. Maybe it’s time to start questioning our assumptions about what “right people” means. Behavioral science has come a long way in the past decade to teach us how we can make our workplaces more inclusive. And there’s evidence that while working with a diverse group might be harder work, it can produce more innovative results. Yup, I said science and I said evidence. These aren’t guesses or hypotheses. They’re facts. Innovative companies that can thrive in tumultuous times need diverse teams. I started this episode admitting to the lack of diversity between Sylvia and myself. But I’ve come to realize that there’s more to diversity than our obvious similarities.

We’ve had some great debates over the years. We might look very alike, but our thinking can be quite different as has our experience. Her parents are immigrants, mine aren’t. She has a gaggle of siblings and I have none. She spent the majority of her career working on diversity and inclusion in large corporations. I’ve buried myself in small business, where diversity has never been a burning platform until very, very recently.

Finding a diverse candidate pool takes work. Even once you get them in the door, it can be hard to manage communication in a diverse environment. But change is inevitable, and you can do it. Don’t worry. We got you.

Follow our podcast. Subscribe to our newsletter. Give us a call.

We’re here to help you, on The Small Business Foundations Podcast.