Diversity and its impact on innovation is something that I’ve covered on this blog numerous times in the past. Most of that coverage has revolved around thought diversity rather than identity diversity however, as it’s my belief that it’s the intellectual diversity that matters most when it comes to harvesting fresh ideas and innovations.
Last year a study from North Carolina State University set out to explore whether identity diversity does indeed play a part nonetheless.
The researchers crawled the MSCI ESG STATS dataset, which provides the diversity policies of the 3,000 largest publicly traded companies in the US. They then cross-referenced this with patent data from the US patent office, whilst also collecting data on product announcements from the Capital IQ Key Development database over a fifteen year period.
“Basically, once you get through all the statistical jargon, we found that a company that checks all of the diversity boxes would see about two new additional product announcements over 10 years,” the team explain. “Given that most firms produce an average of two new product announcement per year, that’s significant. On the other hand, it shows that improving diversity policies won’t lead to overnight improvements in innovation. It may take time to reap the benefits.”
Diversity and innovation
It’s a finding that consultancy firm Accenture confirmed in a recent report on equality in the workplace. It found that workplaces with a strong culture of equality were five times more likely to have an innovation mindset than those with less equal cultures.
The study, which suggested that 95% of executives thought continuous innovation important, revealed that equality was more important than practically any other factor, be that industry, country or other forms of workforce demographics.
Accenture suggest that an empowering environment is crucial for innovation to flourish, with American companies with a culture of equality seven times more likely to report that no real barriers existed to innovation in their companies.
There remains a lot of work to do before such cultures exist however, with an attitudinal gap between executives and workers a major barrier to achieving this. The authors report that in the most equal cultures, innovation was supported by things such as ample training, flexible working arrangements and good work-life balance. If this is coupled with a genuinely diverse leadership team and workforce, then innovation can really thrive.
“Accelerating equality in the workplace has never been more critical for driving innovation,” Accenture say. “If people feel a sense of belonging and are valued by their employers for their unique contributions, perspectives and circumstances, they are more likely to advance and feel empowered to innovate.”
