Mike's Musings

Diversity is not About Finding Unicorns

For a long time, I considered diversity a "nice to have" element. I supported it in principle, but always with the caveat, "if we can find the right person." As I saw it, diversity was a goal to be pursued as long as it didn't compromise the strength and cohesion of the team. I considered myself fortunate when finding a candidate from another background who (as I saw it) was able to meet our high standards for performance – a unicorn.

Recently I came across two articles which have entirely changed my perspective. In the first Guess Who Doesn't Fit In at Work, Lauren Rivera from the Kellogg School of Management looks at the role of cultural fit in hiring practices. She points to a survey indicating that 80% of employers worldwide named cultural fit as a top priority. Yet what does that mean in practice? Research by Rivera and others indicates that "fit has become a catchall used to justify people who are similar to decision makers and rejecting people who are not." Not surprisingly, hiring people like ourselves will reduce demographic and cultural diversity; beyond that, it turns out to be a poor predictor of performance. Just as people are notoriously bad at spotting liars, it is easy for hiring managers to mistake rapport for skill. As I look back on my own hiring decisions, there is no question in my mind that I have fallen into this trap at times.

A second article How Diversity Makes Us Smarter, I found even more challenging to my assumptions. The authors point to several studies showing the impact of diverse teams on company performance. For example, Deszo and Ross studied the S&P 1500 and found that "female representation in top management leads to an increase of $42 million in firm value." In 2006, the author and a team set out to study "the impact of racial diversity on small decision-making groups...where sharing information was a requirement for success" (sounds a lot like today's workplace). Given the task to solve a murder mystery, they found that groups with racial diversity significantly outperformed the racially homogeneous groups. These results have been supported by other studies and apply to other types of diversity such as disabilities and even political orientation.

Yet the authors have another surprise in store: the improved performance of diverse teams is consistent regardless of the skills and experience of the members. In other words, the improvement is not a function of finding diverse members who meet certain criteria, but rather comes through group dynamics. "When disagreement comes from a socially different person, we are prompted to work harder. Diversity jolts us into cognitive action in ways that homogeneity does not." Simply being in a diverse group makes the members drop their predefined assumptions, work harder, and maintain a more open-minded stance. This in turn leads to improved results.

Taken together, these articles make a powerful argument. First, that hiring managers are generally bad at assessing talent, and that their judgments will be heavily influenced by their social and cultural affinity for the candidate. Second, that a diverse team will outperform a homogeneous one across a wide range of collaborative activities, independent of their background and qualifications. In other words, pursuing diversity shifts from a demographic argument to one of enlightened self-interest.

Of course, one may reasonably ask what diversity means in a relatively homogeneous region like Eastern Washington. To attempt an answer, I looked at two data sets for the seven counties served by EHF: U.S. census estimates from 2014, and public school data from 2016. Here is a summary:

If indeed children are our future, then our region will undergo significant changes in the coming years. Note in particular the growth in the percentages of those identifying as Hispanic and two or more races.

Through a demographic lens, we may view this as a challenge for enterprises to reflect the future makeup of their community / customers. More powerfully, there is a rising wave of talent which, if engaged, will strengthen our teams and organizations. At EHF, we are in the process of integrating diversity into all aspects of our work; not just because it is the right thing to do, but because it is the smart thing.

-Mike Yeaton, Chief Strategy Officer for Empire Health Foundation


The Peril of Good Intentions

Recently our President Antony Chiang shared a blog post, "It’s Time To Restore A Sense Of Mission To Mental Health," by Octavio Martinez, CEO of the Hogg Foundation for Mental Health. The author argues that reason and knowledge are insufficient to face the most pressing challenges of our time: "Without an old-fashioned sense of shame at the suffering we allow to endure through neglect and selfishness, we don’t have the motivation to act. Without a shared sense of values, about who we are and what we care about, we won’t know where and how to act even if we can mobilize a sense of moral urgency."

The article struck a chord with our leadership team, with some asking questions like:

  • "How do we approach our work with a sense of mission?"
  • "Do we relate to our community authentically from the heart versus relying on theory and technique?"

It's a compelling argument. I believe that all of us are capable of moments of true moral clarity and sense of purpose, where the course of action seems clear and incontrovertible. I also believe this state is relatively rare for most of us. Why should this be? Why are we unable to maintain a clear-eyed view of the world, its needs and our proper role? Because along with passion, creativity and love lurk other human traits that can corrupt the purest of intentions. Here are three of my personal greatest hits:

Confirmation bias, or "the tendency to search for or interpret information in a way that confirms one's preconceptions, leading to errors." I have witnessed and practiced this in virtually every endeavor in my career. Once we have invested our time, energy and talents in a particular direction, it becomes almost irresistible to shape new data to fit our mental model. As John Kenneth Gailbraith put it, "faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy with the proof."

Fundamental attribution error, or the tendency to interpret our own behavior as a logical reaction to circumstances, while see others as driven by their particular character. When you see a homeless teen on the street, have you ever told yourself a story about how they got there? Did it involve a poverty, abuse, mental illness or other external factors, or did you focus on their failure to pull themselves up? This is not to say there is no individual responsibility, but rather that we cast more of that burden on others than ourselves.

Humans are herd animals and we breathe in our culture like air. The most telling example I've ever heard came from Nelson Mandela's autobiography: "We put down briefly in Khartoum, where we changed to an Ethiopian Airways flight to Addis. Here I experienced a rather strange sensation. As I was boarding the plane I saw that the pilot was black. I had never seen a black pilot before, and the instant I did I had to quell my panic. How could a black man fly an airplane? But a moment later I caught myself: I had fallen into the apartheid mind-set, thinking Africans were inferior and that flying was a white man’s job. I sat back in my seat, and chided myself for such thoughts." If it happened to him, it happens to all of us.

That's not to dismiss the value of moral clarity and conviction. For me those are treasured gifts that seem to come from somewhere beyond me. I can try and create the conditions that will lead to them, but I cannot will them to happen. And all the while, inner forces are at work trying to bump me off the path. 

Thankfully I am not alone, and there are ways to control for the effects of our faulty perceptions. Some of the ones we use at Empire in our work include:

Wisdom of Crowds: In 2004, James Surowiecki showed how groups tend to be consistently wiser than any individual member for problems ranging from making predictions to locating a lost submarine. This power can be hard to harness in teams, with uneven participation and a tendency toward 'groupthink' but there are ways to counter this.

Diversity of Teams: Recent research has demonstrated that socially diverse groups (race, ethnicity, gender and sexual orientation) are more innovative than homogeneous groups. Interestingly this effect has nothing to do with the individual attributes of the team - but rather "simply interacting with individuals who are different forces group members to prepare better, to anticipate alternative viewpoints, and to expect that reaching consensus will take effort."

Design Thinking: pioneered by David Kelley and colleagues at IDEO and the Stanford d.school, it helps us build empathy with those we are trying to serve, by experiencing their reality as closely as possible. It also encourages frequent prototyping with rapid feedback cycles, so we are continually adapting to the client's actual needs as opposed to our perception.

Lean startup: one of my favorite maxims from this approach (which drives much innovation in Silicon Valley) is the 'pivot.' Startups are encouraged to hold their business model lightly, and continually test their assumptions. We should expect that feedback will lead to significant changes in direction (the pivot) and that the willingness to sometimes dramatically adjust our course is perhaps the single greatest predictor of success.

On one level, relying on techniques versus moral clarity as a daily guide seems like a poor bargain. Yet the power of techniques like these lies in their ability to mitigate the impact of our own flawed perceptions. In the same way, free societies often feel unguided and disorderly, but tend to correct problems over time. As Winston Churchill put it, "democracy is the worst form of Government except for all those other forms that have been tried from time to time."

-Mike Yeaton, Chief Strategy Officer for Empire Health Foundation