How EDI impacts business transformation success
Equity, diversity and inclusion (EDI) plays an important role in your business’s business transformation success. Here’s why.
What is EDI?
EDI stands for equity, diversity and inclusion, and is sometimes referred to as (DE&I) diversity, equity and inclusion. The business practice involves:
- Equity: Ensures fair treatment for all individuals — in access, opportunity and advancement.
- Diversity: Focuses on embracing and allowing similarities and differences among individuals. It aims to account for all aspects of personalities and individual identities.
- Inclusion: The extent to which each person feels welcomed, respected, supported and valued.
“Diversity is being invited to the party. Inclusion is being asked to dance.” — Vernā Myers
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What does EDI have to do with business transformation?
EDI enables business transformation by increasing trust and buy-in by cultivating innovative thinkers and improving transparency and accountability to boost financial performance.
Demonstrating fair treatment, earning trust, and increasing buy-in
Trust and buy-in do not need to be elusive — they are easily in reach for any company. Both can be obtained through simply one act — equity. Equity means equitable treatment and equitable compensation for all. It stems from the leadership team, and must be expected throughout the entire company to get the desired outcome. There should be written policies that clearly spell out what equity means for your business. Only by implementing these equity policies are companies truly able to reap the benefits of increased trust and buy-in. Once trust and buy-in can be established, employees can become more motivated and productive; ultimately, it shows where it matters most — financial performance.
Creating an inclusive culture increases innovative thinking
When companies build a culture of inclusiveness, employees feel free to come up with (and more importantly, share) ideas. Innovative thinking can only be sustainable when confirmation bias is kept at bay, because confirmation bias ensures the status quo is maintained and blocks innovation. Once confirmation bias is removed, differences can more readily be seen as strengths rather than weaknesses, increasing open and unencumbered thinking. As the business culture becomes more focused on working and winning together, it can greatly reduce individual self-interest and conflict. This, in turn, paves the way for more innovative thinking. This is an essential ingredient in business transformation.
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Encouraging transparency and accountability increases financial performance
One study showed that companies that increased gender diversity achieved increased profitability by 25 percent; an increase in ethnicity, likewise, increased profitability by 36 percent. There is an opportunity to focus on diverse skills and performance when there is accountability within company boards and leadership teams rather than the status quo or like-mindedness. During business transformation efforts, this further creates opportunities for accountability and transparency across all levels of the business.
Successful business transformation relies on all leaders and employees to be able to feel the company values of equity, diversity and inclusion. It is in the best interest of all stakeholders that an inclusive culture exists to increase innovative thinking and for transparency, accountability, trust and buy-in to forge a path toward real business transformation.
