Diverse Work Groups Are Smarter and More Innovative

Point
Birds of a feather flock together, but when it comes to business, it may be better for pigeons
to flock with crows. Employees may feel more comfortable working with people who are
similar to them, but this comfort may come at the cost of success. Time after time, research
demonstrates that more diverse companies have the most success. A global analysis of 2,400
companies demonstrated that the presence of at least one female employee on an executive
board leads to higher net income growth and return on equity. Diversity at lower levels of the
organization may also be helpful, as companies with more diverse workgroups have higher
financial returns than companies with fewer minority or female employees. Diverse groups
think smarter. When people are asked to work with people who are different from them, they
are forced out of their comfort zone, leading to more critical thinking and innovation. In
mock juries, for example, more ethnically heterogenous juries made more accurate decisions
and supported their decisions with more facts from the case. Teams of heterogenous financial
professionals also performed better on tasks where they were asked to price stocks in a stock
market simulation. In addition, a recent analysis of research and design teams in Spain found
that teams with greater gender diversity created more innovative products. Other types of
diversity may also be beneficial. In a murder mystery task, groups with a mix of
organizational tenure were more likely to guess the correct suspect. When cultural diversity
of UK businesses was analyzed, more culturally diverse leadership teams created more new
products. So the next time you’re worried about working with someone you don’t have a lot
in common with, remember the words of Maya Angelou: “In diversity there is beauty and
there is strength.”
Counterpoint
There is some evidence that having diverse leadership may benefit companies. What about
the research that has shown that diversity is linked to lower employee morale and wellbeing,
slower decision making, and increased conflict? Organizations with more diverse work
groups are also more likely to be sued for discrimination. There are some situations where
more diverse tasks can boost innovation and critical thinking skills, but those advantages may
not be worth forcing employees to work with people they feel uncomfortable with. When
employees are forced to participate in diversity initiatives, it can lead to more stress. Over
half feel that they have to significantly modify their behavior to feel like they fit in. If
employees try to act like their peers, rather than acknowledging their differences, it doesn’t
just lead to stress. Research has shown that any advantages on creative tasks disappear when
team members don’t openly discuss and acknowledge their differing backgrounds. Even if
employees feel comfortable enough to express themselves, that’s no guarantee that they will
actually get along. Group members with diverse racial, gender, and educational backgrounds
might have a slight advantage over homogenous groups in some tasks. Yet they can be less
effective when group members have different values. When group members have different
values because, for example, they have different cultural backgrounds, it may be difficult for
the group to overcome these differences. It may be tempting to think a diverse team is better,
but remember, there’s a reason like attracts like.