The retirement plan adviser industry needs more diversity. But the diversity I am talking about is much more than what, literally speaking, meets the eye. We need diversity of thought, strengthened by a culture of inclusion.
When we capitalize on diversity of thought, multiple objectives are met. In more than three decades in the financial services industry, I have learned that diversity brings more voices to the table, and inclusion brings out their best ideas.
At our firm, we recognize the importance of both and are making them a priority.
Diverse companies outperform nondiverse companies by 35%, according to a McKinsey study, "Delivering through Diversity." They solve problems two times faster, their rate of innovation improves, they win the war for talent and their bottom lines tell the tale. Diversity also drives social justice; it's the right thing to do.
The definition of diversity has evolved. It is broader than gender, age and race. Diversity of thought grows from a diversity of experience and extends to other factors that shape perspective, including prior job experience, educational background, geography, skill sets and interests — even birth order!
Diversity is also most effective when paired with a culture of inclusion.
Some have described diversity as being invited to the dance and inclusion as actually being asked to dance. I think about inclusion as actually being invited to help design the playlist.
Diversity programs by themselves are not enough to change the culture in an organization; there has to be a systematic approach to inclusion, to bring out the ideas that the diversity cultivates.
Inclusive groups, according to McKinsey's research, make better quality decisions 87% of the time, work two times faster with half the meetings, suffer from less cognitive bias or groupthink, and deliver a greater number of product innovations.
Equality is the No. 1 factor given by millennials and Gen Z in determining trust of an employer, and 83% of millennials are actively engaged when they believe their organization fosters an inclusive culture.
Simply put: We need both diversity and inclusion.
Consider this: At a meeting of RPA firm leaders I attended last month, I looked around the room and saw only two other women. From a diversity standpoint, we might say that we need to hire more women into leadership roles. That same example seen through the lens of inclusion shows a need to facilitate opportunities for all employees to contribute ideas and be heard, as well as the need to ensure equitable access into leadership roles.
But we can't just talk the talk. The commitment has to start at the top.
Firm leaders should create a vision, model behavior and drive accountability.
Next, hire smart. Interview a diverse pool of candidates and develop internal communication tools that enable effective collaboration.
Also, institute procedures or technologies that influence behavior, such as use of a checklist approach to performance feedback that's tied to initiatives.
The question the leadership at Lockton asks ourselves is: Do we have the right people in the room to best serve our clients, grow professionally and propel our business forward? Do we have the right culture in place to foster it?
Let's all be catalysts for change. Let's develop new leaders who expect diversity and inclusion to be core to their strategy.