Why Building a Culture of Diversity, Empathy—and Women—Is Critical to Business Success

Purpose Readiness Work Culture

Preeminent women business leaders and women’s leadership advocates Kate Byrne and Kathy Krumpe discuss hiring for inclusion, why culture dictates financial success, and how women are uniquely affected by diversity in the workplace.

BY FUTURE STATE

It’s fair to say the women’s equality movement has seen some successes over the past year. From the recognition of longstanding sexual misconduct in high-powered industries to the historic Women’s March, women in the United States are standing up to gender-biased policies and attitudes that have been accepted as the norm for decades. And while we celebrate that progress, the world of business still has work to do. In organizations today, women still aren’t paid the same as men for equal work; we make up less than 20 percent of board members on Fortune 1000 companies; and on a recent list of the world’s 100 best-performing CEOs, only two (yes, two) were women. All this despite the fact that a mountain of research indicates that having more women in leadership is directly correlated with better business outcomes, including employee satisfaction and financial profitability.

Chief human resources officers (CHROs) are cultural gatekeepers at most organizations and, as such, they help define company makeup, attitudes and diversity. Here, two pre-eminent women business leaders share their insights into hiring for diversity, inclusion, innovation and bottom-line success. Kate Byrne is the vice president of business development, partnership & membership at Watermark, the Bay Area’s largest membership organization dedicated to increasing the number of women in leadership positions; Watermark’s sold-out 2018 conference lineup includes Amal Clooney, Jodi Kantor, Elaine Welteroth and Reese Witherspoon. Kathy Krumpe is the chief operations officer at the women-owned, purpose-driven, Oakland-based management consulting firm Future State, and a dedicated advocate for women’s leadership.

To attract top talent, leading companies today focus more and more on transparency and reputation. How does that impact hiring, performance and workplace culture? 

Kate Byrne: Culture is a shared experience—one that the leaders of today’s companies need to literally embody in their actions and words. Today’s employees have a bit of a gig mentality. They want to know they’ll be learning as well as getting recognized for their efforts, and they want to be in an environment where the executive team is also accountable, for its actions and inactions alike.

Kathy Krumpe: Transparency and visibility around leadership strategies and priorities are a big part of creating an engaging company culture. In one survey, 70 percent of employees said they’re most engaged when senior leadership continually updates and communicates company strategy.

Also, employees now have direct access to information about company culture and employee experience through LinkedIn, Glassdoor and other apps. That means in the race to find and retain the best employees, building a trusted and transparent culture becomes paramount.

How does diversity in the workplace, especially at the executive level, impact reputation and relationships?

KB: Today’s talent enters into prospective employment conversations asking themselves, “Can I see myself here? Is there anyone I want to be/admire?” If they can’t recognize themselves in someone at the top, more often than not, they will pass on the opportunity. When they witness a senior leader demonstrating respect, curiosity and self-awareness, potential employees understand that this is a transparent work environment where they can contribute and be heard.

KK: There are just so many reasons to actively recruit for and embrace a culture that is inclusive. A Forbes Insights study showed that maintaining a diverse workforce is crucial for attracting top talent. It also found that diversity in the workplace is a key driver of innovation and is a critical component to success on the global scale.

KB: Yes, and there’s also a growing body of research that reveals that having women in senior positions benefits the overall bottom-line, and enhances the quality of work by both men and women. Companies that incorporate diversity and inclusion into the workforce see 27 percent higher profitability and 22 percent less turnover.

Inclusive leadership is a key enabler of creating more diverse and creative workplaces. How do companies support a sustainable leadership mentality? How does diversity play in?

KB: Companies need to operationalize their values to set the tone that this is an inclusive environment where the needs of many types of people are recognized. Emotional intelligence plays a much bigger role today than it did in days gone by. Practices such as sabbaticals recognize an individual’s need for self-care, while maternity and paternity leaves demonstrate a support of the employee as a whole person. On-site daycare, flexible work schedules and gender-neutral bathrooms all help demonstrate that many different types of workers are valued. Cross-team workgroups and project-based learning create opportunities for better communication and empathy, which leads to enhanced productivity and often operational cost savings. Pepsi has a terrific practice the organization calls “Leaving Loudly.” When executives need to leave early, they make sure many are aware of it, thereby demonstrating that it’s okay to take care of life needs outside work.

KK: As Kate mentioned, it all starts from the top. To truly lead inclusively means working in new ways and questioning previous best practices. Take recruiting: It’s moving away from selecting new hires based on credentials and pedigree to focus on interviewing and hiring for talent that fits with the culture, and brings the right emotional intelligence, creative thinking and problem-solving abilities to bear. This creates a more level playing field and inherently builds a more diverse, talented and innovative team.

KB: I agree. And then there are the less-tangible parts of culture. Encouraging a shift from a failure mindset to one of learning—which encourages play—results in more innovation and greater product creation.

KK: Yes. To truly foster a culture of inclusion, leadership and managers must both demonstrate and champion it. This value needs to be embedded into all aspects of the business, from corporate success metrics and corporate communications to benefits, training, development and more.

Are women uniquely affected by organizational diversity? 

KB: Women play an interesting role in the overall culture of an organization. Recent research conducted by The Center for Creative Learning and Watermark revealed that having a higher percentage of women in an organization predicted more job satisfaction, organizational dedication, more meaningful work and less burnout. Both men and women stated more positive organizational outcomes with female management.

More accurate, reliable and quick analytics is critical in a rapidly changing workforce. How do you see the role of analytics shaping key HR priorities such as performance improvement, leadership development, and diversity and inclusion? 

KK: The opportunity is huge to bring better metrics and analytics tools to HR leaders. The best HR leaders are strategic in creating an inclusive and transparent culture, hiring more diverse talent and building programs that embed these behaviors. The analytics they need go beyond cost-management to data that supports employees and gives insights into the employee experience, enabling HR leaders to better support the workforce and drive desired business outcomes.

KB: Instead of having to wait weeks or months, HR leaders can now access data in real-time. Empty positions are costly. On average it takes a recruiter 52 days to fill an open position with a quality candidate. Big data can change this, by not only securing a higher-caliber hiring pool, but then measuring the outcome of the individual once hired.

CHROs can use predictive analytics to better determine which employees are more likely to achieve goals, why, and how best to reward them for doing so, thereby ensuring greater overall employee satisfaction and organizational success.

KK: I agree. In an informal survey we did on CHRO needs, easier metrics and tools around measuring and improving diversity stood out. Few HRIS systems give leaders insights into their workforce in ways that help support investment in diversity and inclusion programs. Better data, leveraging AI and a deeper focus from the HR function can gather those insights and turn them into better leadership decisions for the workplace.

KB: We haven’t yet adjusted our “successful measure” lexicon to be congruent with today’s shifting workplace. As companies implement data analytics and train employees to use these programs, they need to focus on strategic use of data. This goes beyond acquisition and retention and into developing an open learning environment—which is shown to drive innovation, empathy and communication, all of which leads to increased efficiencies. Today’s workplace and workforce demand depth and potency, not just scale and speed.

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Kate Byrne is vice president of business development, partnership and membership for Watermark. Marrying her interest in technology and its ability to advance publishing, drive revenue and promote social good, Kate has put her expertise to work in both public and private blue chip brands, playing executive leadership roles at the Tides Foundation, George Lucas Education Foundation, Future LLC, BusinessWeek, Fast Company, SF Gate and Inc.

She’s passionate about education and women and girls empowerment, having led efforts at Global Girl Media and World Pulse, as well as founding Girls Gone Global, a budding social enterprise charged with igniting girls’ voices, social impact, media and financial literacy skills.

Kate was named to the Folio: 40, a media industry top honor, and recognized as one of the 40 most influential top industry performers. She graduated from Stanford with a BA in Psychology.

Kathy Krumpe is the chief operations officer at Future State, a women-owned, purpose-driven management consulting firm in Oakland, California. Kathy is passionate about helping clients and team members reach their biggest goals in meaningful ways. Kathy delights in engaging the challenges and puzzles that emerge in complex business environments and working with her team and clients to find ways forward. A longtime consultant and former recruiter, Kathy aims to be a partner to all in solving problems big and small, achieving success in ways that support companies, teams, communities and the planet.

Kathy is also passionate and active in the world of women’s leadership, where she sits on the board and volunteers with multiple organizations and nonprofits, including Watermark. She finds joy in using her love of learning to help create opportunities for all people to grow and be inspired to great things.