Diversity = Performance Written by Shawn Bakker, Lead Psychologist Do you like working with diverse groups? If you care about performance, now would be a good time to start. Research studies consistently show that diverse workplaces are better in very tangible ways. Whether evaluated by examining financial results or workplace performance, diversity wins the day. Here’s just a short sample: Organizations with diverse boards generate returns on equity that were 53% higher, on average, than less diverse boards. (1) They also generate 14% higher earnings, on average. (1) Organizations with women on the board display better average growth. (2) Diverse groups perform better than homogeneous groups when making decisions. (3) Groups with new and different viewpoints achieve better results than homogeneous ones. (4) What is very interesting about the last study, which examined how diverse groups composed of new members better solve problems, is that the better performing groups reported less confidence in their performance. Having a diversity of opinions and ideas made them question themselves and their outcomes – but their solutions and choices were the right ones. The confidence of the homogeneous groups was misplaced! This brings me to the key aspects of diversity – it only works when the variety of ideas and perspectives that people bring are leveraged. This requires some effort and a way of communicating different opinions and thoughts in a positive way. Psychometric assessments can provide a powerful framework that can help others recognize diversity and incorporate what can initially appear to be competing perspectives. So how effectively are you and your teams at leveraging diversity? If you find yourself in constant agreement with those around you, beware! A lack of diversity may be present, and it will begin to show in your team’s performance. Footnotes: Barta, T., Kleiner, M., & Neumann, T. (2012). Is There A Payoff From Top-Team Diversity? McKinsey Quarterly (Online). Credit Suisse Research Institute, (2012). Gender Diversity and Corporate Performance (Online). Phillips, K.W. (2014). How Diversity Makes Us Smarter. Scientific American, 311, 42-47. Phillips, K. W., Liljenquist, K. A., & Neale, M. A. (2009). Is the Pain Worth the Gain? The Advantages and Liabilities of Agreeing With Socially Distinct Newcomers. Personality and Social Psychology Bulletin, 35(3), 336–350.