Diverse teams create a strongerbusiness.

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Ensuring diversity and inclusion among your credit union'semployees and leadership it not just the right thing to do, itdelivers measurable business results. Companies that rank aboveaverage for diversity have greater returns from innovation, highermargins and improved customer-centric service and market awarenessthan less diverse peers.

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Diversity involves the intrinsic traits that you were born with,such as gender, ethnicity, age and sexual orientation. It alsoencompasses characteristics that one acquires through experiencelike disciplines studied, industry background, career path andforeign work experience, where one learns to greater appreciatecultural differences. When leadership teams have a mix of inherentand acquired diversity, results happen.

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Diverse teams are better able to unlock innovation that drivesmarket growth. Nonlinear thinking and adaptability are needed morethan ever in today's fast-changing business environment, and smartleaders will tap into the power of diversity and inclusion to sparkthis growth. A recent BCG study found diverse management teams weremore innovative than less diverse teams, as evidenced by theportion of revenue from products and services launched in the lastthree years. For the 1700 companies surveyed of varying sizes andwith differing global locations, above-average diversity translatedinto greater innovation revenue (45% of total) than for companieswith below average team diversity (26%) – a 19% innovation-relatedbenefit. Just as importantly, overall financial performance wasbetter. A study published by the Harvard Business Reviewfound EBIT margins were about 9% higher in companies with morediverse management teams than for those with below-averagediversity. Those companies with the highest levels of digitalinvestment exhibited the strongest link between diversity andinnovation revenue.

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Diversity helps employees uncover market opportunities. Membersof diverse teams regularly see things in a differing light, aremore in tune to different ideas and arrive at novel solutions toproblems. They may see unmet needs in the market, especially formarket segments that have demographics similar to the non-majorityteam member. And, a single diverse perspective benefits the wholeteam. A 2013 HBR study reported when at least one team membershares a client's ethnicity, the entire team is better able tounderstand the client than those teams in which no member has thatbackground.

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A culture of inclusion is a must to harness the dynamism thatdiversity brings. Trying to “recruit diversity” is virtuallyimpossible if the organization does not have a culture thatsupports a diverse employee base. All employees must feel valued,included and empowered. Fair employment practices are a basicprerequisite. These include a strong non-discrimination policy,equal pay practices and a welcoming work environment where allvoices are heard – where people feel safe to propose new ideas andideas are considered regardless of age, background or experiencelevel. Outside perspectives and diverse voices get airtime.Innovative twists on old and new problems are considered. Agility,risk-taking, bold thinking and action orientation are rewarded.Decision-making authority is shared. Feedback is clear, actionable,and has a real focus on what is working well and going right.Leaders and the teams share credit for successes. Furthermore, whentraditionally underrepresented groups achieve a level of criticalmass, it is easier for all to feel included. This all means thatemployees are free to contribute to their full potential.

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A successful diversity and inclusion strategy starts at the top.The CEO must own it, promote it and live it as a businessimperative. It takes courage to proactively foster diverseviewpoints and perspectives throughout the organization. Fororganizations that have had traditional hierarchical administrationthat was comprised primarily of white men, such a change feelsdisruptive. Leadership must drive impact, invention and innovation,even if uncomfortable disruption is required. Change comes when allemployees find senior management goes to bat for compelling ideasregardless of the source and when leaders model behaviors ofinclusivity and promote actionable ways in which employees can feelan integral part of the team. Committed leaders demonstrate theyvalue diversity and inclusion through words and action. Theyimplement practices and procedures and supply the resources to helpdiverse teams engage and flourish. Management tools like trainingand technology are deployed. A culture of innovation, which isbuilt upon a diverse and inclusive workforce, is integrated intothe compensation system. Budgets, communications, managementsystems, and metrics that track diversity and inclusion all reflectthis priority.

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Give your organization every opportunity to perform to its peakpotential and strengthen your organization by making diversity andinclusion a strategic priority.

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Stuart Levine

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Stuart R. Levine is Chairman and CEO for Stuart Levine &Associates and EduLeader LLC. He can be reached at 516-465-0800 [email protected].

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