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ISSUE 2 2, J A NUA R Y 2018

The diversity and

inclusion revolution
Eight powerful truths
By Juliet Bourke and Bernadette Dillon

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82 FEATURE

THE
DIVERSITY
& INCLUSION
REVOLUTION
EIGHT POWERFUL TRUTHS

by Juliet Bourke and Bernadette Dillon

The diversity and inclusion revolution 83

I
N 2013, QANTAS posted a record loss better risk management, better debates,
of AUD$2.8 billion.1 This low point in [and] better outcomes.”11
the airline's 98-year history followed Joyce’s insight reflects a growing
record-high fuel costs, the grounding of recognition of how critical diversity
its A380s in 2010 for engine trouble, and and inclusion (D&I) is to business
the suspension of its entire fleet for three performance. Indeed, two-thirds of
days in 2011 after a series of bitter union the 10,000 leaders surveyed as part of
disputes. Across the country, predic- Deloitte’s 2017 Global Human Capital
tions surrounding the fate of Australia’s Trends report cited diversity and inclu-
national carrier were dire. sion as “important” or “very impor-
Fast-forward to 2017, and the situa- tant” to business.12 Despite this, overt
tion couldn’t be more different.2 Qantas attributions such as Joyce’s are scarce.
delivered a record profit of AUD$850 Rarely does diversity and inclusion
million,3 increased its operating margin feature so centrally in a CEO’s story
to 12 percent,4 won the “World’s Safest of success. The challenge lies in trans-
Airline” award,5 ranked as Australia’s lating a nod of the head to the value of
most trusted big business6 and its most diversity and inclusion into impactful
attractive employer,7 and delivered actions—and that necessitates a coura-
shareholder returns in the top quartile of geous conversation about approaches
its global airline peers and the ASX100.8 to date.
Transformation is an overused word, To accelerate that conversation, this
but for Qantas it’s a perfect description. document presents eight powerful truths
How did it happen? The company’s 2017 about diversity and inclusion. It is the
Investor Roadshow briefing sounded culmination of our work with approxi-
like a textbook in disciplined operational mately 50 organizations around the
and financial management, as well as world, representing a footprint of more
employee, customer, and shareholder than 1 million employees. In this article,
focus. Yet for CEO Alan Joyce, the spec- we draw upon the findings of seven
tacular turnaround reflects an underlying major research studies that cut into new
condition: “We have a very diverse envi- ground, covering topics such as diversity
ronment and a very inclusive culture.”9 of thinking, inclusive leadership, and
Those characteristics, according to customer diversity.13 Our aim is to inspire
Joyce, “got us through the tough times10 leaders with possibilities and to close the
. . . diversity generated better strategy, gap between aspiration and reality.

www.deloittereview.com
84 FEATURE

1. Diversity of thinking
THE EIGHT is the new frontier
POWERFUL TRUTHS “The most innovative company must also be the
most diverse,” says Apple Inc.14 “We take a holistic
view of diversity that looks beyond usual measure-
1. ments. A view that includes the varied perspec-
tives of our employees as well as app developers,
DIVERSITY OF THINKING
IS THE NEW FRONTIER suppliers, and anyone who aspires to a future in
tech. Because we know new ideas come from diverse
ways of seeing things.”15
2. Apple’s insight lines up with Joyce’s. It’s about
looking beyond demographic parity to the ultimate
DIVERSITY WITHOUT
INCLUSION IS NOT ENOUGH outcome—diversity of thinking.
This is not to say that demographic character-
istics, such as gender and race, are not important
3. areas of focus. Organizations still need to ensure
that workplaces are free from discrimination and
INCLUSIVE LEADERS
CAST A LONG SHADOW enable people to reach their full potential.
But there is a horizon beyond this.
Our view is that the goal is to create workplaces
4. that leverage diversity of thinking. Why? Because
MIDDLE MANAGERS MATTER research shows that diversity of thinking is a well-
spring of creativity, enhancing innovation by about
20 percent. It also enables groups to spot risks,
5. reducing these by up to 30 percent. And it smooths
the implementation of decisions by creating buy-in
REWIRE THE SYSTEM
TO REWIRE BEHAVIORS and trust (figure 1).16
So how can leaders make this insight practical,
and not neglect demographic diversity?
6. The answer lies in keeping an eye on both.
Deloitte’s research reveals that high-performing
TANGIBLE GOALS MAKE
AMBITIONS REAL teams are both cognitively and demographically
diverse. By cognitive diversity, we are referring
to educational and functional diversity, as well as
7. diversity in the mental frameworks that people use
to solve problems. A complex problem typically
MATCH THE INSIDE
AND THE OUTSIDE requires input from six different mental frame-
works or “approaches”: evidence, options, outcomes,
people, process, and risk. In reality, no one is equally
8. good at all six; hence, the need for complementary
PERFORM A CULTURE RESET, team members.17 Demographic diversity, for its
NOT A TICK-THE-BOX PROGRAM part, helps teams tap into knowledge and networks
specific to a particular demographic group. More
broadly, it can help elicit cognitive diversity through
The diversity and inclusion revolution 85

FIGURE 1 | The value of diversity of thinking

+ 20%
Innovation

- 30%
Risk

Source: Juliet Bourke, Which Two Heads Are Better Than One? How Diverse Teams Create Breakthrough Ideas and Make
Smarter Decisions (Australian Institute of Company Directors, 2016).

its indirect effect on personal behaviors and group The truth is, optimal diversity of thinking
dynamics: For example, racial diversity stimulates cannot be achieved without a level playing field for
curiosity, and gender balance facilitates conversa- all talent, and clearly there is still work to be done
tional turn-taking.18 on that front.
Diversity of thinking is powerful for three
reasons. First, it helps create a stronger and broader 2. Diversity without
narrative about the case for diversity, one in which inclusion is not enough
everyone feels relevant and part of a shared goal.
Second, it more accurately reflects people’s inter- Deloitte’s research identifies a very basic
sectional complexity instead of focusing on only one formula: Diversity + inclusion = better business
specific aspect of social or demographic identity.19 outcomes. Simply put, diversity without inclu-
Third, a focus on cognitive diversity recognizes that sion is worth less than when the two are combined
demographic equality—rather than being its own (figure 2).20
end—is useful as a visible indicator of progression This insight is gaining traction, helping to posi-
toward diversity of thinking. tion diversity and inclusion as separate concepts

FIGURE 2 | The case for an inclusive culture

Organizations with inclusive cultures are:

2x
as likely to meet or
3x
as likely to be
6x
more likely to be
8x
more likely to achieve
exceed financial targets high-performing innovative and agile better business outcomes

Source: Juliet Bourke, Which Two Heads Are Better Than One? How Diverse Teams Create Breakthrough Ideas and Make
Smarter Decisions (Australian Institute of Company Directors, 2016).

www.deloittereview.com
86 FEATURE

At its highest point, by others, while at the same time have a sense of
connectedness or belonging to a group.
inclusion is expressed At its highest point, inclusion is expressed as
feeling “safe” to speak up without fear of embarrass-
as feeling “confident ment or retaliation, and when people feel “empow-
ered” to grow and do one’s best work. Clearly,

and inspired.” these elements are critical for diversity of thinking

to emerge.21
The truth is that only when organizations are
with equal importance. But there’s a problem. The clear about the objective can they turn their atten-
definition of “inclusion” is often left to personal tion to the drivers of inclusion, take action, and
interpretation, and many organizations seem measure results.
unclear about what it means. Without a shared
understanding of inclusion, people are prone to 3. Inclusive leaders cast a
miscommunication, progress cannot be reliably long shadow
evaluated, leaders can’t be held accountable, and
organizations default to counting diversity numbers. Deloitte’s research shows that the behaviors of
What does inclusion really mean? Deloitte’s leaders (be they senior executives or managers)
research reveals that a holistic definition comprises can drive up to 70 percentage points of difference
four related yet discrete elements (figure 3). between the proportion of employees who feel
First, people feel included when they are treated highly included and the proportion of those who do
“equitably and with respect.” Participation without not.22 This effect is even stronger for minority group
favoritism is the starting point for inclusion, and members.23 Furthermore, an increase in individuals’
this requires attention to nondiscrimination and feelings of inclusion translates into an increase in
basic courtesy. perceived team performance (+17 percent), deci-
The next element relates to “feeling valued and sion-making quality (+20 percent), and collabora-
belonging.” Inclusion is experienced when people tion (+29 percent) (figure 4).24 Pause for a second
believe that their unique and authentic self is valued to let those numbers sink in. This phenomenal
difference reflects the power of a leader’s shadow.

FIGURE 3| The science of inclusion: Deloitte’s inclusion model

Fairness and Valued and Safe and open Empowered and

respect belonging growing

Sources: Bersin by Deloitte, High-impact diversity and inclusion: The new maturity model, 2017; Juliet Bourke and
Bernadette Dillon, Waiter, is that inclusion in my soup? A new recipe to improve business performance, Deloitte
Australia and the Victorian Equal Opportunity and Human Rights Commission, 2012.
The diversity and inclusion revolution 87

FIGURE 4 | Inclusive leadership and team performance

Team performance
17%
Individual feelings increase in team
performance
of inclusion

Inclusive leaders 70% 20%

increase in experiences of increase in
fairness, respect, value, and decision-making quality
belonging; psychological safety;
and inspiration
29%
increase in team
collaboration

Source: Based on Deloitte Australia’s analysis of 105 leaders as assessed by 600 raters against the six signature
traits of inclusive leadership and perceived performance outcomes.

What distinguishes highly inclusive leaders leadership is broader and a much more intentional
from their counterparts? Deloitte’s research identi- and effortful process. In essence, inclusion of diver-
fies six signature traits, all of which are interrelated sity means adaptation. Leaders must alter their
and mutually reinforcing (figure 5):25 behaviors and the surrounding workplace to suit
1. Commitment: They are deeply committed to the needs of diverse talent, ideas, customers, and
diversity and inclusion because it aligns with markets.
their personal values, and they believe in the The truth is, the rules of the game have changed,
business case for diversity and inclusion. They and the old “hero” style of leadership is . . . old. As
articulate their commitment authentically, the context has become much more diverse, inclu-
bravely challenge the status quo, and take sive leadership is now critical to success.
personal responsibility for change.
2. Courage: They are humble about their own 4. Middle managers matter
capabilities and invite contributions by others.
3. Cognizance of bias: They are conscious of their “Ah, the middle managers conundrum,” the
own blind spots as well as flaws in the system, authors of a 2007 research paper wrote. “The grass-
and work hard to ensure opportunities for others. roots are energized, the executives have seen the
4. Curiosity: They have an open mind-set; they are light, and the top-down and bottom-up momentum
deeply curious about others, listen without judg- comes to a screeching halt right in the middle girth
ment, and seek to understand. of most organizations.”26
5. Culturally intelligent: They are attentive to This may sound harsh, but in the context of
others’ cultures and adapt as required. diversity and inclusion, middle management is a
6. Collaboration: They empower others and create historically underserviced group. While many exec-
the conditions, such as team cohesion, for diver- utives have been afforded time to learn, reflect, and
sity of thinking to flourish. debate, mid-level managers are often given direc-
Clearly, these traits are much more than just tives. A change-management process that leaves
being “nice” to people, or even just being aware questions unaddressed results in managers feeling
of unconscious biases. Our view is that inclusive unable to move forward.

www.deloittereview.com
88 FEATURE

To say this is problematic is an understatement. Clearly, organizations should engage middle

While change needs to be driven from the top, the managers. But when they do, they should also stop
middle manager cohort is vital to the success of treating middle managers as if they are a single
an organization’s diversity and inclusion strategy. mass. Deloitte’s research identified six distinct
As Jonathan Byrne of MIT observes, “Regardless archetypes, or “personas,” that individuals tasked
of what high-potential initiative the CEO chooses with implementing change need to engage with and
for the company, the middle management team’s understand. These personas range from those who
performance will determine whether it is a success are deeply committed to those who can act as sabo-
or a failure.”27 teurs (figure 6). Against that backdrop, one size will
The diversity and inclusion revolution 89

not fit all with respect to the way that information is 5. Making tough decisions when needed to ensure
delivered, experiences shaped, and boundaries set. that the organizations’ values are upheld.
Senior leaders can influence middle managers Inclusion is not a euphemism for “anything
in a variety of ways, including: goes.”
1. Using storytelling to help move people emotion-
ally and engage them on the purpose of the D&I 5. Rewire the system to
agenda. For example, senior leaders could share rewire behaviors
their personal stories of commitment.
2. Addressing myths and misconceptions by Training is the most popular solution to increase
ensuring that middle managers understand the workforce diversity. Research shows that nearly
fundamentals—for example, by communicating one-half of the midsize companies in the United
the difference between equality and equity States mandate diversity training, as do nearly all
(figure 7).28 the Fortune 500.29 Not surprisingly, the effective-
3. Having open conversations to enable questions ness of diversity training has come under scrutiny,
and concerns to be surfaced. Senior leaders with some claiming a positive impact (increased
should enter these conversations with curiosity diversity representation), while others are dismis-
and courage—two of the trademark characteris- sive (citing backlash and even activation of
tics of highly inclusive leaders. stereotypes).
4. Exposing middle managers to influential role Diversity training programs come in many
models and other powerful experiences, such shapes and sizes: educational vs. experiential,
as putting them on high-performing, diverse voluntary vs. mandatory, inspirational vs. shaming.
teams; presenting them with counter-stereo- At its best (voluntary, experiential, inspiring, and
typic examples; offering them mentoring oppor- practical), training raises awareness, surfaces
tunities; and giving them experiences that put previously unspoken beliefs, and creates a shared
them in the minority. These tactics should help language to discuss diversity and inclusion on a
managers walk in someone else’s shoes and day-to-day basis. These objectives are a positive
enable perspective-taking. and important first step in the change journey.

FIGURE 6 | Deloitte’s six personas of strategic change

as applied to diversity and inclusion

Opposed Unaware Undecided: Undecided: Supportive Committed

Anxious Fatigued
A saboteur, Concerned In the dark about Once fired up In favor of Takes personal
deliberately about how diversity and about diversity diversity and responsibility for
undermining diversity and inclusion, either and inclusion, inclusion, but achieving
diversity and inclusion may because he/she now disengaged sees goal diversity and
inclusion goals impact has never read by the lack of achievement inclusion goals
through words him/her or or heard about it progress as someone
and actions colleagues or doesn’t else’s job
remember it

www.deloittereview.com
90 FEATURE

FIGURE 7 | Equality vs. equity in the short- and long-term

Graphic: Deloitte University Press | DUPress.com

In this first image, it is assumed Individuals are given different All three can see the view without
that everyone benefits from the support to make it possible for any support because the cause of
same support. They are being them to have equal access to the inequality was addressed. The
treated equally. view. They are being treated systemic barrier has been
equitably. removed.

However, when it comes to behavior change, 2. Identifying and remodeling vulnerable

training is often only a scene-setter. The more moments along the talent lifecycle. These are
complete story is that, to change people’s behavior points within specific talent processes where
organizations need to adjust the system. decision-makers are more susceptible to bias:
Why? First, biases can only be reduced rather for example, when decisions are discretionary
than completely eliminated, and it is difficult to and not subject to review.
control biases that are unconscious. Second, biases 3. Introducing positive behavioral nudges, such
can be embedded into the system of work itself, as altering the default setting. In 2013, telecom-
causing suboptimal diversity outcomes. Strategies munications firm Telstra introduced “All Roles
to rewire the system make it easier to tackle biases Flex,” which made flexibility the starting point
A saboteur, In the dark about
and create a more comprehensive and sustainable Concerned for all jobs rather than a special arrangement
deliberatly diversity and
solution. 30
undermining about how for some. 31
inclusion, either
There are and
diversity four steps to system rewiring: andTracking the impact. Periodically review diver-
diversity 4.
because they have
1. Using data
inclusion inclusion
to pinpoint leaks in the talent life-
goals maysity and inclusion data to assess the effective-
never read or
through impact
cycle. Towords
do this, organizations can look at ness of changes made. heard about it or
and actions him/her or
the profile of their employees from recruit- don’t remember it
colleagues When the BMO Financial Group, one of the
32

ment to retirement, coupled with data on 10 largest banks in North America, introduced an
inclusion experiences. initiative based on these steps along with a commu-
nications and education campaign, it achieved
The diversity and inclusion revolution 91

significant impact. First, a record 83.5 percent of prompting decision-makers to cast a wider search
people managers voluntarily completed the initia- for candidates beyond their default comfort pool of
tive’s learning module within the first few months of talent.
its launch, signifying the program’s value. Second, Second, tangible goals should incorporate
there was an unprecedented year-over-year increase measures of inclusion, not just diversity. If diversity
in employees’ perceptions of inclusion (+2 percent) is the only metric, the organization misses half the
and of having a “voice” at work (+2 percent). In story. Leading organizations know this. The finan-
addition, the hiring rates of minority group candi- cial firm Westpac, for example, not only measures
dates increased by 3 percent in 12 months. diversity outcomes, but also uses the annual
The truth is, rewiring the system
is equally, if not more, important
than retraining behaviors. There has been an
6. Tangible goals make
ambitions real
overemphasis on diversity,
When it comes to diversity and
and an underemphasis
inclusion, nothing ignites greater
debate than goals, targets, and
on inclusion, as well as on
quotas.33 On the one hand, the
setting of specific diversity goals has
the broader ecosystem of
been found to be one of the most
effective methods for increasing the accountability, recognition,
representation of women and other
minority groups. On the other hand, and rewards. The truth is,
contentious arguments about targets
vs. quotas, accusations of reverse without appropriately crafted
tangible goals, ambitions are
discrimination, and fears of incen-
tivizing the wrong behaviors have
arisen around goal-setting efforts.
Our view is that tangible goals merely ephemeral wishes.
are important. (By goals, we mean
measurable objectives set by an
organization at its own discretion,34 as distinct employee survey to test whether individual “people
from dogmatic quotas.) However, their impact is leaders” are committed to the creation of a diverse-
tied to four conditions: communication, coverage, thinking workplace.36 In the United States, facilities
accountability, and reinforcement. and food management firm Sodexo includes a diver-
First, leaders should be capable of communi- sity and inclusion competency in its performance
cating confidently about what tangible goals do and management process, and 40 percent of a manag-
do not mean. As Andrew Stevens, former managing er’s scorecard is devoted to inclusive behaviors.37
director of IBM Australia and New Zealand, Third, tangible goals can only work when
observes: “[Goals] don’t guarantee a woman a key decision-makers are accountable. By taking
job or promotion. What they do is to increase the accountability for goals, leaders signal the impor-
probability that a talented woman will be consid- tance of diversity and inclusion as a business
ered alongside a talented man.”35 This is done by priority and help focus people’s attention.

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92 FEATURE

Finally, tangible goals are most effective when First, customer diversity and inclusion have
combined with broader acts of recognition and often been largely overlooked, with the lion’s share
reward. This powerful truth sits behind the success of attention devoted to employee diversity. And
of global initiatives such as MARC (Men Advocating when customer segmentation is considered, it is
Real Change),38 the 30% Club,39 the CEO Action for more in terms of a customer’s financial profile than
Diversity & Inclusion,40 and MCC (Male Champions who customers are as people. As a consequence,
of Change)41—each of which implicitly recog- services and products often reflect a stereotypical
nizes the seniority and influence of its members. view of the customer. Lloyds Banking Group’s
Conversely, there is embarrassment when leaders 2016 review of British advertising found that many
are called out for their organization’s poor diversity minority groups were underrepresented in adver-
and inclusion track record. tising, and only 47 percent felt that they were accu-
Our view is that tangible goals have often been rately portrayed.45 Similarly, Deloitte research from
bluntly crafted and poorly communicated. There 2017 revealed that up to 1 in 2 customers from
has been an overemphasis on diversity and an minority groups46 felt that their customer needs
underemphasis on inclusion, as well as on the were often unmet over the past 12 months.47
broader ecosystem of accountability, recognition, Second, customers are becoming, and starting
and rewards. The truth is, without appropriately to lean into, a sense of empowerment; they commu-
crafted tangible goals, ambitions are merely ephem- nicate what they stand for with their wallets and
eral wishes. social media shares, and messages of equality have
a pervasive appeal. Deloitte’s 2017 research found
7. Match the inside that up to one-half of customers had been influenced
and the outside to make a purchasing decision in the past 12 months
because of an organization’s support for equality—
In 2015, Samsung launched its “Hearing whether around issues of marriage equality, gender,
Hands” commercial. Built around a day in the life disability, age, or culture. The purchasers did not
of Muharrem, a hearing-impaired man, it revealed come only from the groups directly targeted by
a new world in which Muharrem’s neighbors the message (such as the hearing-impaired in the
engage with him for the first time in sign language, Samsung campaign); they included anyone who
allowing him to feel much more connected to his felt that the message of equality had spoken to their
community.42 In 2017, TV2 Denmark launched its personal values.
“All that we share”43 campaign with a commercial The truth is that while many organizations have
that starts with the physical separation of people prioritized workplace diversity over customer diver-
into line-drawn boxes based on stereotypical differ- sity, both are equally important to business success.
ences, and ends with a single larger group who Moreover, customers are often more ready to
now understands their shared points of common- support diversity and inclusion than organizations
ality. That same year, Nike ran a commercial perhaps realize. But a word of caution: This is not
entitled “Equality,” which promoted the message about vacuous marketing. Commercials that lack
that if diverse athletes can be equal on the playing authenticity will be shamed by the very customers
field, they “can be equal anywhere” because “worth they seek to attract.
outshines color.”44
Each of these commercials went viral: 19 million 8. Perform a culture reset, not
views for Samsung, 4.5 million views for TV2 a tick-the-box program
Denmark, and 5 million views for Nike. The ques-
tion of why they were like cups of water spilled on Our final truth is the most sweeping and under-
dry earth underscores two compelling points. pins all seven truths above: Most organizations will
The diversity and inclusion revolution 93

need to transform their cultures to become fully suggests that organizations frequently underesti-
inclusive. While an overwhelming majority of orga- mate the depth of the change required, adopting a
nizations (71 percent) aspire to have an “inclusive” compliance-oriented or programmatic approach to
culture in the future, survey results have found that diversity and inclusion.49 For most organizations,
actual maturity levels are very low.48 change requires a culture reset.
What prevents the translation of these inten- This is no simple task. Cultural change is
tions into meaningful progress? Our experience challenging irrespective of the objective, but it

FIGURE 8 | The Deloitte diversity and inclusion maturity model

Mandate Transition point Movement

Level 4
Level 3
Level 2
Level 1

COMPLIANCE PROGRAMMATIC LEADER-LED INTEGRATED

Compliance with Increasing the Leveling the playing field Leveraging difference
equal opportunity/ representation of for all employees by to create business
Focus

affirmative action specific demographic addressing systemic value

goals groups (e.g., women) cultural barriers
Center of
gravity

Whole
Legal/HR/D&I team HR/D&I team Business leaders
organization

• Largely • Business case is • More sophisticated • Workforce is

homogeneous articulated understanding of D&I demographically and
workforce • Diversity seen in terms and link to business cognitively diverse
• Diversity seen as a of demographic strategy • Shared sense of
problem to be numbers and targets in • D&I a personal priority purpose (i.e.,
managed place for the CEO and diversity of thinking)
Illustrative characteristics

• Legacy clubs/ • Ad-hoc and/or executive team and meaning

cliques and other stand-alone initiatives • Systemic cultural • Integration into all
passive exclusions such as mentoring, barriers surfaced aspects of the
exist unconscious bias • Strategy for culture organization—e.g.,
• Actions are largely training, employee change created and behaviors,
reactive; any resource groups and growing resistance structures, and
additional focus is events managed systems
on the recruitment • Resistance from the • Leaders/managers are • Flexibility
of diverse talent majority is nascent committed, role model mainstreamed
• Minority employees inclusion, and are held • Focus on
adapt or leave accountable for high-performing,
actions/outcomes diverse-thinking
• Talent systems reset teams
• Progress monitored • External brand
relentlessly matches internal one

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94 FEATURE

is perhaps even more so when the objective is an mentoring or unconscious bias training). At levels
inclusive culture. Resistance is common: Those 1 and 2, progress beyond awareness-raising is typi-
who are currently successful are likely to believe cally limited.
the system is based on merit,50 and change to the More substantial cultural change begins at level
status quo feels threatening. Consequently, change 3—a true transition point—when the CEO and other
toward greater inclusion probably requires more influential business leaders step up, challenge the
effort than many other business priorities. And yet status quo, and address barriers to inclusion. By
it usually receives much less. role-modeling inclusive behaviors and aligning
and adapting organizational systems (for

Workplaces have emerged example, by tying rewards and recogni-

tion to inclusive behavior), they create the

as a venue in which these conditions that influence employee behav-

iors and mind-sets. Communications

disparate pressures have

are transparent, visible, and reinforced.
And at level 4, diversity and inclusion
are fully integrated into employee and
manifested and become other business processes such as innova-
tion, customer experience, and workplace
much discussed. Caught design.
The truth is, significant change will
in the middle, workplace not happen until organizations go beyond
tick-the-box programs and invest the
leaders around the world appropriate level of effort and resourcing
in creating diverse and inclusive cultures.
tell us that they feel ill- Eight powerful truths,
equipped to navigate seven powerful actions
these swirling waters. To borrow from Charles Dickens,52 this
is the best of times and the worst of times
to be advocating for diversity and inclu-
So what does the path to an inclusive culture sion. On the one hand, there is a groundswell of
look like? global energy directed toward the creation of work-
Deloitte research identifies four levels of diver- places that are more inclusive: 38 percent of leaders
sity and inclusion maturity: (1) compliance, (2) now report that the CEO is the primary sponsor of
programmatic, (3) leader-led, and (4) integrated the diversity and inclusion agenda,53 and the forma-
(figure 8).51 Level 1 is predicated on the belief that tion of global initiatives speaks to the importance
diversity is a problem to be managed, with actions of these issues for the broader business commu-
generally a consequence of external mandates or nity. On the other hand, some communities have
undertaken as a response to complaints. At level 2, become mired in divisive debates about equality
the value of diversity starts to be recognized, with (for instance, around issues related to sexuality,
this stage often characterized by grassroots initia- race, and religion).
tives (such as employee resource groups), a calendar Workplaces have emerged as a venue in which
of events, and other HR-led activities (such as these disparate pressures have manifested and
The diversity and inclusion revolution 95

become much discussed. Caught in the middle, 5. Nudge behavior change by rewiring processes
workplace leaders around the world tell us that they and practices
feel ill-equipped to navigate these swirling waters. 6. Strengthen accountability, recognition,
Believing in the business case, but feeling time-poor and rewards
and uncertain, leaders question what to say (and 7. Pay attention to diverse employees
what not to say) as well as what to do (and what and customers
not to do). The truths we have presented challenge current
To address these eight powerful truths, we practices, which are heavily weighted toward diver-
propose seven powerful actions: sity metrics, events, and training. Our view is that
1. Recognize that progress will take a culture reset the end goal should be redefined, cultures reset, and
2. Create shared purpose and meaning by broad- behaviors reshaped. Leaders should step up and
ening the narrative to diversity of thinking own that change. Embracing these truths will help
and inclusion deliver the outcomes that exemplars have experi-
3. Build inclusive leadership capabilities enced. It will deliver the promised revolution. •
4. Take middle managers on the journey

JULIET BOURKE is a partner in Deloitte Human Capital and leads the diversity and inclusion consulting prac-
tice in Australia. She is based in Sydney.

BERNADETTE DILLON is a director in Deloitte Human Capital. She is based in London, United Kingdom.

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i Endnotes

THE
DIVERSITY
& INCLUSION
REVOLUTION
page 82

1. Based on data from the SCE.Qantas, Shaping our named most attractive employer in Australia, with
future: Qantas annual report 2014, 2014. aviation named top sector,” May 5, 2017.

2. R. Gluyas, “Alan Joyce pay soars as happy days 8. Qantas, Qantas annual report 2017, 2017; Terence
return to Qantas,” The Australian, September 16, Duffy, “Why Qantas shares have been one of the
2017. best performers this year,” MoneyMorning, June 8,
2017.
3. Qantas, Qantas annual report 2017: Positioning for
sustainability and growth, 2017. 9. Jackson Hewett, “Alan Joyce says management
diversity was key to getting Qantas through turbu-
4. Qantas, Qantas Investor Day 2017, May 5, 2017, p. lent times,” The Australian, March 4, 2016.
6.
10. Alan Joyce, presentation at Deloitte Australia part-
5. Awarded by AirlineRatings.com. See Sinead Pear- ners’ meeting, 2017.
son, “Airline safety: World's safest airlines named
in annual airline safety rankings for 2017,” Travel- 11. Hewett, “Alan Joyce says management diver-
ler, January 6, 2017. sity was key to getting Qantas through turbulent
times.”
6. Qantas, Qantas Investor Day 2017, May 5, 2017, p.
63. 12. Juliet Bourke, Stacia Sherman Garr, Ardie van
Berkel, and Jungle Wong, “Diversity and inclusion:
7. Awarded by Randstad. See Randstad, “Qantas The reality gap,” in Rewriting the rules for the Digital
Endnotes ii

Age: Deloitte 2017 Global Human Capital Trends, pp. 17. Deloitte Australia’s research shows that personal-
107–118. ity styles—e.g., introversion and extraversion—are
not linked to cognitive diversity.
13. Juliet Bourke and Bernadette Dillon, Only skin
deep? Re-examining the business case for diversity, 18. Bourke, Which Two Heads Are Better Than One?
Deloitte, 2011; Juliet Bourke and Bernadette Dil-
lon, Waiter, is that inclusion in my soup? A new 19. W. Sean Kelly and Christie Smith, What if the road
recipe to improve business performance, Deloitte to inclusion were really an intersection?, Deloitte
and the Victorian Equal Opportunity and Human University Press, December 11, 2014.
Rights Commission, 2012; Juliet Bourke and Ber-
20. Bourke, Which Two Heads are Better than One?
nadette Dillon, Fast forward: Living in a brave new
world of diversity, Chartered Accountants Australia 21. Bersin by Deloitte, High-impact diversity and inclu-
and New Zealand, 2015; Juliet Bourke, Which Two sion: The new maturity model, 2017; Bourke and
Heads Are Better Than One? How Diverse Teams Dillon, Waiter, is that inclusion in my soup?, 2012.
Create Breakthrough Ideas and Make Smarter Deci-
sions (Australian Institute of Company Directors, 22. Findings from Deloitte Australia’s analysis of inclu-
2016); Juliet Bourke and Bernadette Dillon, The six sion measures (fairness and respect, value and
signature traits of inclusive leadership: Thriving in a belonging, inspiration, and confidence) based on a
diverse new world, Deloitte University Press, April survey of 4,100 respondents in four organizations.
14, 2016; Juliet Bourke et al., Research summary: With respect to managers, 72 percent of the most
Toward gender parity: Women on Boards initiative, included employees (the top 25 percent of scorers
Deloitte, 2016; Juliet Bourke et al., Missing out: The on overall inclusion) reported high levels of inclu-
business case for customer diversity, Deloitte and sive manager behaviors, compared to just 2 per-
the Australian Human Rights Commission, 2017. cent of the least included (the bottom 25 percent).
With respect to senior leaders, 72 percent of the
14. Deloitte Review, along with the current article, is most included quartile of employees reported high
an independent publication and has not been levels of inclusive senior leadership, compared to
authorized, sponsored, or otherwise approved by just 2 percent of the least included quartile.
Apple Inc.
23. For example, Deloitte Australia’s research shows
15. Apple Inc., “Open,” accessed October 3, 2017. that inclusive leaders have a stronger effect on
women’s feelings of inclusion in male-dominated
16. Bourke, Which Two Heads Are Better Than One? See
workplaces, on LGBTI (lesbian, gay, bisexual, trans-
also Juliet Bourke, “How to be smarter and make
gender, and intersex) employees in heterosexual-
better choices,” filmed 2016 at TEDxSouthBank,
dominated workplaces, and on people who solve
Brisbane, Australia, video, 13:07, April 25, 2016.

www.deloittereview.com
iii Endnotes

problems with a more people-oriented approach An open conversation,” Telstra Exchange, Novem-
in an outcome-dominated workplace. ber 3, 2013.

24. Based on Deloitte Australia’s analysis of 105 32. Bourke, Garr, van Berkel, and Wong, “Diversity and
leaders as assessed by 600 raters against the inclusion: The reality gap,” pp. 111–112.
six signature traits of inclusive leadership and
performance outcomes. 33. Rachel Feintzeig, “More companies say targets are
the key to diversity,” Wall Street Journal, September
25. Bourke and Dillon, The six signature traits of 30, 2015.
inclusive leadership.
34. Australian Workplace Gender Equality Agency,
26. Conference Board Business Diversity Council, Targets and quotas, 2016.
“Middle managers: Engaging and enrolling the
biggest roadblock to diversity and inclusion,” The 35. Male Champions of Change, Our experiences in
Conference Board, April 2007. elevating the representation of women in leadership,
2011.
27. Jonathan Byrnes, “Middle management excel-
lence,” Harvard Business School Working Knowl- 36. Sam Turner, head of diversity and inclusion,
edge series, December 5, 2005. Westpac Group, personal communication to Juliet
Bourke, October 3, 2017.
28. Variants of this graphic are frequently cited as a
powerful concept. At the time of print, the creator 37. Dr. Rohini Anand, senior vice president, corporate
remains unknown to Deloitte. responsibility and global chief diversity officer,
Sodexo, personal communication to Juliet Bourke,
29. Frank Dobbin and Alexandra Kalev, “Why diver- October 13, 2017.
sity programs fail,” Harvard Business Review, July–
August 2016. 38. Men Advocating Real Change, “About MARC,” ac-
cessed December 4, 2017.
30. Iris Bohnet, What Works: Gender Equality by Design
(Harvard University Press, 2016); Iris Bohnet and 39. 30% Club website, accessed December 4, 2017.
Jeni Klugman, Behavioural insights and gender
40. CEO Action for Diversity and Inclusion website, ac-
equality, VicHealth Promotion Foundation, Mel-
cessed December 4, 2017.
bourne, Australia, May 1, 2017.
41. Male Champions of Change, “About the Male
31. David Thodey, “Accelerating change for women:
Endnotes iv

Champions of Change,” accessed December 4, 48. Bersin by Deloitte, High-impact diversity and inclu-
2017. sion, 2017.

42. DigitalSynopsis.com, “Hearing Hands - Touching 49. Bersin by Deloitte found that 42 percent of or-
Ad By Samsung,” video, 2:45, March 3, 2015. ganizations are at level 1 maturity (compliance-
focused maturity), and 31 percent of organizations
43. TV2Danmark, “TV 2 | All That We Share,” video, were at level 2 maturity (programmatic). Bersin by
3:00, January 27, 2017. Deloitte, High-impact diversity and inclusion, 2017.

44. Ross Kohan, “Check out Nike’s new ‘Equality’ com- 50. Australia Male Champions of Change and Chief Ex-
mercial,” video, 1:31, February 13, 2017. ecutive Women, In the eye of the beholder: Avoiding
the merit trap, 2016.
45. Lloyds Banking Group, Reflecting modern Britain? A
study into inclusion and diversity in advertising, 2016. 51. Bersin by Deloitte, High-impact diversity and inclu-
sion, 2017.
46. Defined as people belonging to a noticeable faith,
LGBTI people, or people with a disability. 52. Charles Dickens, A Tale of Two Cities (Chapman &
Hall, 1859).
47. Juliet Bourke et al., Missing out: The business case
for customer diversity, 2017, p. 28. 53. Bourke, Garr, van Berkel, and Wong, “Diversity and
inclusion: The reality gap,” p. 107.

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