Diverse Teams Perform Better – Here's Why

Multiple studies have revealed that companies achieve greater success with a diverse workforce. Diversity, whether it's inherent (gender, ethnicity, etc.) or acquired (traits you gain from experience), has become an integral part of any company, wherever it may be operating. Backed by these results, companies today prioritise maintaining a diverse workforce and implementing various diversity, equity and inclusion (DEI) initiatives. This strategy not only attracts more employees but also helps avoid scrutiny.

That being said, reports also said that success has been marginal for companies that thrive on diversity. Sources say that employee fatigue and backlash with DEI initiatives are often the reasons for the initiative's failures. Interestingly, Harvard Business Review noted that even with effective results, homogenous teams still "feel" more effective, while diverse teams tend to experience more significant conflict.

While homogenous teams might feel more comfortable and easier to manage due to shared backgrounds and perspectives, they often yield fewer effective results compared to diverse teams. Research indicates that employee productivity in diverse workplaces is 12% higher than in businesses that do not prioritise inclusivity.

Furthermore, inclusive teams outperform their homogenous counterparts by up to 30% in situations that benefit from strong diversity, attributing this performance boost to a broader range of ideas, perspectives, and problem-solving approaches.

When you examine the data, it reveals that while it may feel easier to be part of a homogenous workgroup – such groups often yield lower results because people tend to take things lightly. In contrast, diverse teams tend to work harder and produce better outcomes.

Even with existing DEI initiatives, many still fail to see the bigger picture as to why these programs are being implemented. Current challenges include superficial implementation, where many programs lack depth and focus on token gestures rather than systemic change. Additionally, the absence of clear, measurable goals makes it difficult to assess the effectiveness of DEI initiatives and inadequate training, whether ineffective or insufficient, often leaves employees ill-equipped to contribute to a truly inclusive environment.

Diverse teams outperform homogeneous ones because they work harder to integrate their varied perspectives, leading to superior outcomes. While simply making a team diverse does not automatically yield better results, research indicates that when individuals with different viewpoints collaborate, there is a tendency to downplay these differences to maintain group harmony.

However, it is crucial to acknowledge and emphasise these differences for the team's benefit. Studies show that diverse teams generate better ideas than homogeneous teams, but this advantage only emerges when team members are explicitly encouraged to consider and incorporate their teammates' perspectives.

While the path to maximising the benefits of DEI initiatives may be challenging, the rewards are undeniable. Companies must move beyond token gestures and implement DEI strategies that promote genuine inclusivity, supported by clear goals and comprehensive training.