Why is diversity important to your company? For more reasons than you might think, Morgan Stanley’s Carla Harris argued persuasively in her recent fireside chat with Procore’s Chief Talent Officer Pat Wadors at Groundbreak 2021.
In addition to being valuable in itself, diversity is a crucial ingredient of a successful workforce and organization. Especially now, as the transition to a new generation of construction professionals accelerates.
Harris served on the National Women’s Business Council under President Obama, so when she says that diversity has gone from desirable to fundamental, she knows what she is talking about.
A new holy grail
Harris explains that the present moment is completely different from what many leaders in the industry grew up with.
It’s no secret that having a culture of inclusivity is more important than ever before, but Harris says that this trend runs deeper than anyone thinks.
“While we have had corporate cultures where people could certainly exist, this idea of belonging, which I would argue is the holy grail, was never right in view for leaders. Now, frankly, it is an imperative,” said Harris.
Belonging is a tough concept to describe satisfactorily, and one that’s simultaneously easier and harder to promote in a workplace. Certainly many companies have pursued a trivial sort of belonging by printing logo hoodies and emphasizing office social functions. But, the feeling referred to by Harris, that one is truly in a place where they belong, isn’t about free swag or a tap in the kitchen, it’s about understanding and taking action within a new cultural framework.
Wadors pointed out that this feeling of belonging is an unmixed positive and has measurable impacts.
“If we have a strong sense of belonging, we’re actually healthier humans,” she said. “The Mayo Clinic studied it, I know I studied it while at LinkedIn, and I’m seeing it in every engagement survey — that if I know I’m on a team that cares about me, that I feel part of, my resilience goes up, my physical health improves. So: great on business, great on innovation, great on self, great on family,” explained Wadors.
The business imperative appears when you see the opportunities lost by not embracing that new framework.
“In order to truly innovate, you need the best minds. Those best minds, those great ideas exist in all kinds of people,” Harris said. “If you are a leader, or a culture, or an organization that does not embrace individual differences and celebrate those differences, they will not be able to attract and retain the best talent.”
In other words, diversity has become not just a contributor to but a necessity for success.
Origin of innovation
Harris asserted that for most companies, innovation is the “dominant competitive parameter.” And it’s hard not to agree. While many things factor into the fluctuations of markets and dynamics between competitors, ultimately it is innovation that wins in the long term. And innovation comes from people.
“You need a lot of ideas in the room because, after all, innovation is born from ideas,” she began. “If you need a lot of ideas in the room, you need a lot of perspectives in the room because after all, ideas are born from perspectives. If you need a lot of perspectives, you need a lot of experiences there because perspectives are born from experiences. If you need a lot of experiences in the room, you better start with a lot of different people in the room, because experiences are born from people.”
It really is that simple: people’s differing experiences give them the different perspectives needed to produce new ideas. Without different perspectives, the chain fails and innovation stagnates. If innovation is core to competition, it follows that diversity is core to innovation; the chain of supply, if you will, is clear.
“That is the business case — the business imperative around diversity,” she concluded.
When Harris graduated from Harvard Business School in 1987, she recalled that “excellence in corporate America looked like six white men at the top,” and no one questioned it, not even her.
“As a woman, and a woman of color, if I wanted to play, I had to be comfortable being the first and the only in many rooms,” recalled Harris. And she has shared the experience of those years in her book, Expect To Win, which she says she wrote specifically to help people in similar circumstances battle against feelings of isolation.
“Ah, but that is not the case today for millennials and Z-ers!” she said. “They have grown up in an environment where they have seen women lead. They have gone to elite schools where there’s a smart Black kid on the left, a smart Hispanic kid on the right, a smart Asian kid sitting in front of them, a smart Indian kid sitting behind them—that is what excellence looks like. If they don’t see that in the organizations that they are choosing to join, they won’t go… and if they go, they won’t stay.”
Leaving aside the unusual current labor market, it’s a plain fact that the younger generation of workers values a diverse, forward-thinking workplace not just as a perk but a prerequisite for pursuing a career. Because a diverse workplace no longer represents a pleasant exception to the rule of homogeneity in business — in fact, it’s the other way around: a non-diverse workplace sticks out like a sore thumb in the new world, an unpleasant reminder of a bygone and unmissed era.
Wadors pointed out that, perhaps unsurprisingly, 81 percent of Procore customers say they have a hard time hiring talent. Harris had a ready answer for why young folks aren’t calling back.
“No appetite, Pat,” she said simply. “No appetite to be the first or the only, because remember, they have grown up with a sense of community. If they’re in an environment where there is no community, they’re not apt to go, and you will not be able to get the talent and the labor that you need.”
Preventing “organ rejection”
As two tips to improve this, Harris suggested lateral recruiting and hiring leaders who are both like-minded and open-minded.
“It takes 10 years to grow seasoned talent. You don’t have 10 years,” she pointed out. “Which means you must engage in lateral recruiting as a tool in order to get representation, but if you engage in lateral recruiting, you have to be aware of organ rejection.”
Invited to explain this metaphor, she said that when receiving a new organ, doctors prescribe a dozen proactive remedies to keep your body from rejecting it.
“When you’re bringing somebody into your organization from the outside, you must over-invest in their success to retain them, especially if you need them to be able to attract different talent,” she said.
Having built inclusive organizations herself, she had three ways in which she recommended over-investing.
“The first thing is representation. When you’re working in a dynamic, competitive, fast-paced environment, we all are vulnerable to unconscious bias. None of us realize how easy it is to keep going with the familiar,” she said, and noted that she herself has fallen prey to it. The solution is being deliberate and challenging your own tendencies.
Second is making sure that the people you’re hiring are okay with challenging their own biases and blind spots. The younger generation, she said, is remarkably good at embracing the point of view of another and learning from it.
And third, is recognizing that hiring is just the first step in a long-term investment in your team.
“Just because you get a diverse team, just because you get people who are thinking in the same way, as the leader your job is to stay ahead of the game,” said Harris.
“I would add that the extra scaffolding support we put around these individuals as they enter our organization, you don’t treat everybody the same. You meet them where their needs are,” said Wadors. “We’re not all the same and we might need a little help, and that is an inclusive act.”
Listen, act, repeat
Part of that process, Wadors noted, is understanding and manifesting allyship — a familiar concept but another that is difficult to pin down, especially when it comes to everyday practices.
“I love this question,” Harris said. “If you want to be a good ally, here’s the recipe: Listen, act, and repeat.”
Here the different experiences and perspectives of different people come to the forefront once again, since the best (sometimes the only) way to learn someone’s perspective and consequently their needs is to ask and listen carefully.
Acting as an ally is simply responding to the situation with this perspective in consideration.
“Most allies have the power to act in a way that the person who is speaking does not,” Harris explained. Using that power could be as simple as giving that new perspective more exposure, or taking concrete actions to create change. Then, of course, repeat this all by listening again.
“I think that’s why I’m in talent,” remarked Wadors. “I am the ally for every employee. I love this space — I care so deeply and I have the privilege to act and learn. People don’t understand that you actually get smarter as a leader with a diverse team. I learn all the time — I love it.”
A virtual, but level, playing field
And for anyone worried that the increasingly isolated remote work era will reduce opportunities for workplace conversations like these, in fact Harris believes the opposite is true.
“Contrary to the popular business press,” she said, “I actually think this has been an amazing time to create an inclusive environment.”
The traditional workplace is full of complex flows and influences, social norms and expectations that produce groups as people unconsciously or consciously exclude and include others. The virtual workplace, Harris said, eschews these influences, making all communication highly voluntary and directed.
“In this environment, your opportunity to build a relationship with people that you need to be successful is purely a function of your own initiative and your own intentionality,” she explained.
“One of the things that I love doing, and I think is super important, is the power of storytelling,” added Wadors. “I know at Procore, I pursue it. The power of the story pulls you and I in together…the power of storytelling for me is super personal.”
This is a chance for every conversation to be one on one, for leaders to make a conscious and visible choice to communicate equitably, for individuals who felt excluded to feel positively included — a precursor to the holy grail of belonging.
“There’s so much opportunity to engage now,” she said. “For the first time in my life, Pat, I feel like we have a level playing field.”
For Harris, it’s clear that every challenge is an opportunity in disguise. Now it’s up to others in positions of leadership to recognize that as well, and then remember her mantra for allies: “listen, act, repeat.”