What Business Diversity Should Really Look Like

True diversity means more than just giving people a seat at the table.

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When it comes to elite U.S. institutions, discussion of "diversity" tends to emphasize the challenges and benefits of gaining "a seat at the table." This is not without justification, and part of my own work involves preparing business owners and professionals to master codes of privilege and power. That way, when they pose competitive market challenges on their own terms, they have every advantage at their disposal.

Nevertheless, we cheat ourselves when our discussion stops at reserving seats at the table. As pivotal as it can be to be pragmatic about access to power when pursuing one's ambitions, too great a focus on the benefits of this can hurt us. When busy competing for a seat at that table, we can come to accept the discussion going on there on its terms. This can suffocate the skepticism on which disruptive innovation depends. We lose the clarity of outsiders. We fail to notice when the conversation at the table has become stilted, and the action has moved elsewhere. To use a different metaphor, the gene pool of innovation becomes limited, and we all lose.

In my last two posts, I have observed that when planning a big heist, we lack the luxury of selecting collaborators who make us feel comfortable. I have referred to this as the Ocean's Eleven Principle. Putting together a productively diverse group in practice is difficult, in no small part because we need to know how to evaluate the disparate characters and skills required for the heist.

[ 2013: The Year in Cartoons]

If there were a single characteristic that sets effective leaders apart in today's economy, it would be the ability to recognize and manage multiple forms of excellence, as I emphasized in my previous post. When we rely too heavily on strengths we recognize, we often miss critical risks until it is too late. Nature itself tests the competitiveness of mutations through natural selection, but that takes generations. In many ways, our job as leaders is to telescope this process. To compete, we must recognize useful variations and harness them competitively within cycles of innovation that are faster and more intense than ever before.

In a decade at American Express, Deborah Cronen managed teams working on "contactless" payments, digital marketing and, most recently, enterprise knowledge management and social collaboration. As a leader on projects that spanned markets and functions, she came to understand the challenges and advantages of incorporating varied skills and expertise within a single project. She saw how pivotal this kind of diversity can be when it comes to keeping a major corporation innovative. She also came to believe that we have understood and applied the concept of diversity too narrowly. She said in an interview:

The benefit of opening up opportunities for excluded demographic categories can be obscured if we require aspirants to conform to a certain way of thinking in order to advance.

Requiring such conformity, says Cronen, often serves perversely to reinforce glass ceilings. Speaking of corporate America more broadly, she gives the example of women who, in order to advance, learn to talk and think in ways that make male leaders comfortable. This advantage can quickly turn into a liability, she says, at higher rungs on the organizational ladder when, despite having made a decent show of it, many women find they can never truly be one of the boys.

Similarly, adds Cronen, minority-owned firms are sometimes singled out for contracts, then relegated to marginal positions within supply chains dominated by longstanding communities with established relationships and codes. In the face of this, she argues that we need to move beyond box-checking approaches to diversity, and require supervisors, purchasers and hiring managers to demonstrate deeper competency in managing diversity. She explains:

It is essential that we begin to recognize the benefits (and challenges) of creating room for individuals who have disparate thought processes, communication styles, cultural reference points and even personality traits. This will be the next wave of inclusion in the corporate setting. If we can learn to incorporate it, it will release extraordinary value – not least for traditionally excluded groups that have had to conform in order to gain access to privilege and power.

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It is no simple task to learn to assess potential and reward success of a sort that deviates from established norms. Cronen goes so far as to say that failing to recognize and reward unfamiliar excellence is natural:

Without even being conscious of doing so, managers often reward excellence that is familiar to them. This typically entails promoting and supporting people who think or act in the ways that they do. Worse, it can mean rewarding those who "perform to type," because that strikes supervisors as recognizable and appropriate.

Cronen holds that, as natural as this tendency might be, the risks of letting it run rampant are high. When we trust a recognizable type after he or she employs the right codes of communication, we may be placing our confidence in him or her for all the wrong reasons. Cronen relates this to the Great Recession of 2008, when "the best and the brightest" were caught asleep at the wheel. She sees this as reflective of an accelerating tendency to associate ourselves with those who think like us, when the world is demanding just the opposite.

Considering the findings of Bill Bishop, author of The Big Sort, this may be no idle observation. Neighborhood by neighborhood, and institution by institution, we are clustering ourselves with others who think as we do. Small wonder should we lose what capacity we may have had for valuing backgrounds and ways of thinking that differ from our own. Cronen believes that when we lose that capacity, we put our competitiveness at risk:

What happens when there is no one left in the room to ask the very simple questions: What are our baseline assumptions and have they been pressure-tested? 

Her mission, she says, is to train a new generation of leaders to tell the difference between good and poor quality in disciplines and modes of work with which these leaders are unfamiliar or even uncomfortable. Mastering this will never be easy, she believes, but it is a skill that can be taught.

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Understanding what makes diverse individuals tick has long been part of the literature for career aspirants. If I come from a culture other than the dominant one, to what degree do I, as a matter of survival or advancement, learn to master its syntax, both literally and figuratively? When I adopt the syntax an Ivy League school or blue chip client demands, do I end up as a weak imitation of the type to which I learned to conform? Or is there another scenario in which I assert my own way of thinking with sufficient success that the people at the proverbial "table" start to frame their points in the terms I have introduced?

A decade ago I interviewed for a major strategy consulting firm. This meant responding to a business situation, or "case," in real time, which involved the challenge of marketing beer to women. I'll never forget what the interviewer, an alumnus of my business school, said after I relayed my solution, which involved a marketing campaign for beer with exotic nutritional ingredients. He closed his book, looked me squarely in the eye, and said: "That is by far the best solution I have ever heard to this case. But if you want to work in consulting you will need to learn to make people feel like you are one of them. That will require an approach that is much less creative. You need to decide whether you want to do that." He paused for a moment and then added, with unconcealed wistfulness, "you remind me of myself at this stage. I learned to sound like one of them. I wonder if I made the right choice."

Within a few months I had begun the work that evolved, eventually, into my own consulting practice. I can say without question that the road was harder – I did not have the advantage of honing my approach under the sort of tutelage I would have received at the firm he represented, or building my client base and reputation under its imprimatur. Yet I did gain an advantage, which my clients and students find valuable: the experience developing a distinct approach to the uncertain environments that perplex them today. Would I be qualified to offer them comparable value, had I learned to make consultants at that firm feel as if I were "one of them"?

The world needs insiders and outsiders, but at our particular moment in history, what we need most is to broaden our standards for what stays outside and what we allow in. We must make the borders between inside and outside permeable, and get practice crossing them. If we fail to do so, we risk becoming one of those civilizations that lost the sources of its dynamism, for reasons that may seem hard to divine when future generations read the history of its decline.

Alejandro Crawford is a senior consultant at Acceleration Group, where he develops strategy for leaders seeking to commercialize innovation and master change. He also teaches courses in entrepreneurship and growth strategy. He graduated from the Tuck School of Business in 2003.