How To Use Inclusive Decision-Making To Drive Innovation And Performance

Posted by Erik Larson on Jun 19, 2018 12:22:32 PM

achievement-agreement-arms-1068523What are you doing to unlock the power of inclusion in your organization? Our recent research reveals the pernicious inclusion gap between workforce diversity and inclusive decision-making in enterprises. Learn how best practices can improve outcomes and speed up innovation by measuring and closing this gap.

The Impact of Measuring Inclusion

The mix of ages, genders, geographies, skills and experiences you see across your company can make communication more difficult and increase the risk of conflict. But diversity also provides potential energy that represents an opportunity for innovation and higher performance. It offers an opportunity for inclusive decision-making to spark kinetic action that will improve your business results.

However, our recent research has found that there is a gap between companies’ diversity potential and their ability to unlock that potential. We call this the inclusion gap, which is a measure of how often diverse perspectives are directly included in business decision-making processes.

Who doesn’t want equality? The executives I’ve spoken with all have said something to the effect of: “You know, we believe that inclusive teams make much better decisions. The more diverse they are, the better.” But the desire for diversity doesn’t guarantee inclusion. Without inclusion, companies leave the potential energy of diversity unused.

A foundational problem is that organizations haven’t developed the technological infrastructure to measure and improve diversity and inclusion in the workplace. While it isn’t challenging to measure diversity with basic HR systems, it is more difficult than it should be to see the inclusion problem in most businesses. Without hard data, you’re making decisions with an unmeasured view of the world. You may be cultivating a diverse workforce--or already have one--but the inclusion gap is likely much bigger than you expect it to be.

The Pernicious Inclusion Gap

We’ve done extensive research into the remarkable persistence of an inclusion gap between men and women in medium and large companies, a gap that sticks around even as gender diversity increases.

For instance, consider the employee base of two companies. Company A is 70 percent male and 30 percent female, which translates to a 20 percent diversity gap. Company B has an equal 50/50 gender mix, or zero diversity gap:

The diversity gap is relatively easy to measure.

Most executives expect that if more women are working in a company, then more women will be included in decision-making. In other words, a more diverse company would have a much smaller inclusion gap. With an equal gender mix, how could the gap it be anything but zero? But in an extensive survey of over 500 companies, our research shows that in reality, the inclusion gap looks more like this:

According to Cloverpop data, the average decision-making inclusion gap is 32% even for companies whose workforce is half male and half female. In my experience, the only way to uncover this issue is to directly measure how decisions are made and who is involved in the process. Our perceptions do not match reality, and but clear metrics reveal the truth.

The Goal: 100% Inclusive Decision-Making

A diverse and inclusive workforce represents an enormous opportunity to improve decisions and thus business performance. For this reason, it is a strategic imperative that decision-making is more broadly delegated to include a wider set of employee perspectives. The beauty of this approach is that more involvement in decisions will also increase your employees’ engagement and job satisfaction levels.

If we continue to push harder, we’ll reach 100% inclusion. Any organization can attain 100% inclusive decision-making. But companies will never get there without measuring decision-making practices and using that data to improve business results.

Transparency Is Key

How can you close your organization’s inclusion gap? Through transparency, in three steps:

1) Share research: Research data is powerful because it helps your organization see the world in a different way.

While it is the foundation of effective training and can lead to new perspectives, research alone isn’t enough. To actually activate kinetic inclusion energy, the organization must change behaviors and processes, even if you start small.

2) Share decisions: Keep track of all management and executive decisions made at your organization. Say, “Hey, we made a decision. Here is what we decided. Here are the people involved. Here are the other things we considered.” If you capture this data in a way that is easily measured, you’ll start seeing the gaps in inclusion where more attention is needed.

3) Share metrics: Companies have to benchmark and measure their decision practices. Consider how companies measure profitability when they want it to increase. If they want customer retention to increase, they measure customer retention. And so if you want the inclusion rate increase, you have to measure it.

Introducing this level of internal decision transparency starts with engaging managers and leaders across your organization in a brief discovery conversation:

  • What are the most painful problems with our current decision practices?
  • What steps are taken today to include diverse perspectives?
  • How important are speed, alignment, and transparency?
  • Which repeated decisions are the best to start with and gain early wins?

Or you can short-cut the process by taking a decision practices assessment to give you a quick and clear view of where the biggest problems lie.

Transparency In Action

Other companies have unlocked inclusive decision-making to activate kinetic action.

Take our customer Ian Martin Group as an example. They employ 50 percent men and 50 percent women with a near-zero inclusion gap. Ian Martin Group has a lot going for them. They were founded 60 years ago by a male and female team of engineers. They are regularly ranked as one of the top places to work in Canada. They are focused from top to bottom on issues surrounding diversity and inclusion. They use a process to ensure that everyone is involved in decision-making and use software to track decisions. They are a great example of a company that is using decision transparency to close the inclusion gap.

Cloverpop, my company, is another example. When we first started to measure ourselves, I was shocked to learn that we had a 34% inclusion gap. We thought we were already taking diversity and inclusion very seriously. I could look around our office and see that there were women involved in a serious way in our company. But, again, diversity doesn’t ensure inclusion. I knew that we had to fix the gap.

Consider the following chart of the Cloverpop engineering team, where the green indicates an inclusive decision-making process with respect to gender. The improvement is clear to see:

 

Measuring Inclusion Is The First Step To Improving It

Our engineers began with an 11% inclusive decision-making rate. To fix this, we immediately hired more people to hit the 50% to 60% mark. But then things stagnated until we began actively reviewing our inclusion rates in our weekly executive committee meeting. In Q1 of 17, where the second purple arrow begins, you can begin to see the impact of our actions. To achieve this, we followed the transparency steps above and measured and tracked our decisions on a monthly basis. When our leadership team reviewed the data on a weekly basis, we discussed the decisions being made, reviewed who was involved and took steps to continue to improve inclusion in our organization.

These steps made a big difference, and a year later our inclusion gap dropped to only 3%:

Through this process, Cloverpop went from 37 to 45 percent female employees. Our inclusive decision-making grew from 56 to 92 percent in only six months. Our engineering team went from 11 percent inclusion to 88 percent inclusion in a single year. And, as I said above, our company’s overall inclusion gap shrunk to 3 percent, a thousand percent improvement.

Executives like you play a critical role in unlocking the power of diverse workforces. You can change the focus of the conversation with hard measurements of decision making inclusion. To achieve this, you’ll need the right tools, metrics, and tactics that complement your leadership development and hiring practices. Inclusive decision-making is the energy that will drive innovation and unlock the potential of diversity in your organization.

Wondering how to start? Reach out to us for a decision practices assessment to benchmark your organization, hone in on challenges and get practical recommendations.

Topics: High Performance Decision Making, The Art and Science of Decisions

Exploring how the decision-making revolution is changing business leadership.