Tech success through diversity – the beginning of a long story


Ever since Facebook COO, Sheryl Sandberg published, her book Lean it has always been in the spotlight that tech companies are not as inclusive and diverse when it comes to their employees or leadership body as about their customers. In the last couple of years diversity in tech has gone from “nice to have”, to “need to have”, to “desperately urgently need to have” and many companies (especially the ones in Silicone Valley) are putting huge efforts in growing their “diversity indicators”.

But how and why did diversity become so important? McKinsey’s ‘Why diversity matters’ report from January of 2015 shows that gender diverse companies perform 15% better financially, and ethnically diverse companies are 35% more likely to outperform the less diverse ones. Their research found that companies in the top quartile for gender or racial and ethnic diversity are more likely to have financial returns above their national industry medians. Companies in the bottom quartile in these dimensions are statistically less likely to achieve above-average returns. A similar research by Gallup outlines that more gender diverse business units have 14% to 19% higher average comparable revenue than less gender diverse units. And with these figures in mind both gender and ethnical diversity turns from a nice socially responsible goal to a change needed driven by business goals. Especially for companies that depend on innovation and build products for a diverse customer base, diversity should be understood as a business priority that leads to understand the needs of existing and potential customers better and thus perform better.

For most tech companies there is a long way to go until they can put the “diverse” stamp next to their brand’s name. Even just looking at the big players we can see that tech is still white man dominated. At Google, blacks and Hispanics each accounted for just 4 percent of Google’s non-technical workforce last year. In Facebook, blacks made up 3 percent of its non-tech workforce in May, while Hispanics were at 7 percent. Despite some of their effort to promote diversity – Apple’s gender diversity has moved just 1 percent, and the number of non-white employees also only moved 1 percent compared to last year. If we talk about leadership positions the picture is even more “monochrome” so to say.

Diversity in Tech
(source: TechCrunch)

On the positive side though many companies are already taking initiatives to tackle this issue, here mentioned are some of the most common or innovative ones:
  1. Diversity Reports: although tech companies are completely data driven when it comes to their business up until super recently we didn’t even had the data about how diverse (or non-divrese) company workforces are. We all know that you will never achieve what you don’t measure so Tracy Chou, engineer at Pinterest started a movement to collect more data about diversity in a call for tech companies to be more transparent. Growing from this initiative last week Slack became the fourth unicorn publishing it’s diversity report after AirBnB, Pinterest and Dropbox. With these reports potentially published every year in the future we will be able to see how companies progress in this question.
  2. Hiring Heads of Diversity: some companies like Yelp, Facebook, Twitter, Square already have a responsible for diversity within the company, others like Asana, AirBnB, Autodesk and Dropbox are currently looking for one. This shows that transforming a companies workforce, mindset and attitude towards multiculturalism is not a side-job although C-level involvement is also an irreplaceably important factor in achieving success.
  3. Working with companies specialised in diversification like Paradigm or Culture Shift Lab: Pinterest recently announced it’s new initiative Inclusion Lab initiative created in cooperation with Paradigm. This start up helps innovative companies attract, select, develop and retain a more diverse workforce.
  4. Building awareness about unconscious bias in hiring and promoting women and people of colour and explore how could this be decreased
  5. Focusing on retention: “It’s not just about hiring diverse candidates; it’s about keeping them. If companies don’t foster a welcoming environment, diverse candidates will be out the door just as quickly as they walked in”. For example there should be surveys to ask employees things like how long they plan to be at the company, how they perceive diversity and inclusion in the company, and if they are aware of opportunities for advancement
  6. Support initiatives aiming at creating diverse pipeline: Often times companies complain that they would hire people from more diverse background if there would be sufficient “supply”, a solution for this problem could be supporting girls and minorities to learn to code and get more involved with technology. There are already many initiatives of this kind like Black Girls Code, Code2040, Hack the Hood or Skool and many others.
With so many opportunities out there to improve gender and ethnical diversity I hope that the “diversity gap” will become visibly smaller and smaller year by year. And on a personal finish note this hope of mine is not just because all of the potential financial benefits but because I experienced the most creativity, the best output and most success when working with people from 18 different nationalities from all colours and background and I wish everyone can have such an experience.

Author: Gabriella Pimpao

Resources:
Lean in by Sheryl Sandberg
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3 responses to “Tech success through diversity – the beginning of a long story”

  1. 439362ss says :

    I completely agree with the article. For companies to survive and compete these days, diversity in terms of sex, age, race, religion etc. is almost a necessity. Companies and even Universities all over the world provide reservations for the female gender and for people from different backgrounds to promote diversity. The advantages of diversity are well researched and documented. But before reservations are made for a particular section of the society, we should also understand the downsides of promoting diversity.

    The truth is that while diversity makes a company stronger, it also comes with a price. Many organizations and universities have gone all out on promoting diversity so much so that they have lost focus on achieving actual results. The quality of people selected for the company gets affected. Many firms take in candidates simply to fill their diversity quota, irrespective of whether the candidate is appropriately skilled for the job or not. This not only affects the firm but also indirectly affects other skilled candidates who were better the job. Another downside is that while a highly diverse group might lead to diverse and innovative ideas, if the group is not compatible or not open to other genders/ religions, then the points of views produced will not engender respect or be fit for reality. People who have not had prior exposure to other cultures might not be able to deal with it and then the whole advantage of diversity is lost.

    Thus, I feel that diversity simply for the sake of it is more detrimental to a firm than no diversity at all. To properly implement it, firms should not just stop at fulfilling the diversity criteria. It needs to be explicitly encouraged and cultivated amongst the employees and students. People need to learn and be taught on how to respect and deal with a diverse group. Companies need to find ways to engage their people together to take advantage of the diversity.

    SID – 439362

    • gabriellapimpao says :

      Thanks a lot for sharing your views! When I wrote the article I was a bit expecting a comment about quotas/reservations, which I also completely agree is not the right way to go about diversity and that is why I didn’t mention it in the article.

      I also agree that diversity just for it’s sake doesn’t help that is one of the reasons why I really like Paradigm because they hold trainings to managers about unconscious bias, how to lead a culturally diverse group, how to involve the employees in this process.
      Hiring someone just to put a tick mark next to the diversification goal is perhaps even worse than not doing anything about it, one of the solutions for this could be supporting pipeline programs so that different groups also have enough suitable candidates.

      My only concern is that if we keep saying that yes diversity is important but we can’t really do anything about it because we shouldn’t hire people just for the sake of diversity we are closing our eyes in front of a quite pressing issue because there are quite a few stats showing that for example although there are more women finishing university than man there percentage in leadership positions within companies is super low. Or quoting from a TechCrunch article: “But this pipeline problem doesn’t account for the significant gap between the percentage of African-American and Hispanic graduates in computer science and computer engineering (11 percent from top research universities alone) and the representation of those groups in technical roles in Silicon Valley (around 5 percent). Nor does it explain the diversity gap in non-technical roles.” (http://techcrunch.com/2015/01/24/prioritizing-diversity-in-2015/)

      All is all this is definitely a very delicate and hard topic which can have many pseudo-solutions or unhelpful initiatives and perhaps just a few good ones that need to be complexly designed with a realistic point of view and lots of emotional intelligence.

  2. Michael Victor says :

    Very interesting article Miss.Pimpao. This brings a lot of perspective!

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