Do you know why is diversity in your small business so important?

diversity for small businesses

Diversity and inclusion (D&I) in the workplace has become a big deal for big businesses. So much so that most have dedicated D&I officers, with official processes and procedures in place to boost diversity and ensure every member of staff benefits from inclusion. However, D&I shouldn’t just be a concern for larger businesses, SMEs can also improve their staff morale and business performance through enhancing their D&I, especially in post-Covid times.

What is diversity?

Diversity is all about achieving a genuine mix of people in your workforce and valuing and accepting each of them. When we speak about diversity, people often assume it is just about race or gender. But diversity goes much further than that. As well as creating a racially diverse team of employees, with genders represented as equally as possible, diversity is also about people’s identity, such as their sexuality, their nationality, their different gender identities, their age and their disability status.

Then there’s socio-economic diversity to consider, which involves creating a workplace that’s welcoming to people of different educational backgrounds and socio-economic status. Then, going further still, we can look at factors like personality types and knowledge and skills bases. Only when you have a team that you feel truly reflects a number of different identities and types of people will you and your employees be able to reap the benefits of that diversity.


Why do we need diversity and inclusion in the workplace?

When your workplace isn’t diverse, you’re missing out in terms of ideas generation, experience sharing and skills. Every single member of your team brings with them their own unique set of values, views and experience. The more diverse your workforce is, the wider your access will be to all of these unique and valuable characteristics.

Millennials are way ahead of Gen Xers and Baby Boomers when it comes to appreciating the link between diversity and business performance. This study by Deloitte found that, among millennials, some 71% focus on its benefits in terms of its positive impact on teamwork and innovation, while the older generations saw it more as an issue of representation and fairness.

What does this tell us? It suggests that, in the future, diversity will be less of a ‘have to’ and much more of a ‘really want to’ for leadership teams and recruiters.

Managers and small business leaders will actively build and nurture diverse teams because it’s the right thing to do, but also because the business case is clear.

One of the more famous recent studies into this business case was carried out by McKinsey & Company. The 2019 report, entitled ‘Diversity Wins: Why Inclusion Matters’ found that companies in the top 25% for gender diversity in their senior teams were a quarter more profitable than those with weaker gender diversity.

Meanwhile, those in the top 25% for ethnic and cultural diversity outperformed less diverse businesses by 36%. The advantages to embracing diversity are clear to see. So how can you improve diversity in your small business?


What can you do to boost your levels of diversity and inclusion?

You may feel that your options are limited, as a small business, to take any significant steps to increase the diversity of your workforce, but you’d be wrong. Some small businesses, for example, report receiving very few applications for a job from non-white candidates. Other sectors attract mostly male, white candidates, such as engineering, which still consists of 90% men when it comes to its workforce, and most of these will be white.

Despite these limitations, there are steps you can take as a small business owner to increase your chances of generating a more diverse workforce and enjoying the benefits of an inclusive working environment:


1. Take advantage of remote working opportunities

In these post-covid times, the vast majority of white collar workers are still working from home, and things aren’t likely to change for many. If you’re one of the many business owners who have decided to embrace remote working as either the default situation, or an option open to any employee, you can, in theory, recruit from anywhere. You’re no longer limited to taking on staff who can access your offices, the world really is your oyster.


2. Advertise your job openings

The vast majority of roles are still filled through internal appointments or staff referrals. This means that, if you are already working with a homogenous workforce, it’s not likely to get any more diverse if you’re not actually advertising your roles externally.


3. Be proactive

There’s nothing wrong with being proactive and using your network to widen your pool of candidates for the role. LinkedIn can be a great source for those looking to actively diversify their team. Send messages to people who have the right skills, but will bring something new to your workforce, to see if they might be interested in working for you. Actively look for fresh perspectives and embrace representation.

4. Focus on inclusion

Inclusion is all about making sure that every individual in your workforce feels heard, included and valued. Everyone should feel they have the same opportunities for career development, training and support and your working culture should feel positive and accessible to each and every member of staff. Pay attention to things like social events, where barriers to inclusion can unintentionally appear.

5. Develop mentoring programmes

Mentoring programmes can improve inclusion in your workplace. Mentoring can help to make people feel part of the team and can boost feelings of inclusion, especially among staff members who may feel somewhat out of their comfort zone.

6. Invest in diversity training

If you have a management team or workforce that is resistant to the idea of diversity and inclusion, providing some diversity training could be incredibly beneficial. You’ll be surprised what a difference an afternoon’s worth of training and education can make when it comes to improving inclusion, particularly. Avoid mandatory training for employees below managerial levels, as this plays on people’s fears that they are being ‘forced’ to change. Instead, allow people to make up their own minds and bring themselves to the training room.

To sum up…

It’s easy to put diversity and inclusion on the ‘nice to have’ list that seems to get forgotten. After all, simply surviving is challenging enough for many business owners at the moment.

However, improving diversity and inclusion in your business should not just be a box-ticking exercise, it’s an investment in your workplace culture and your employees. It can increase productivity and profitability, and even more importantly, it will result in a happier, more supportive and fairer working environment for every single member of your team.


Caroline Ramsey

Caroline Ramsey, Editor

Caroline is mycashline’s business and finance editor and doubles as our copywriting whizz.

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