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If you had walked into the headquarters of many U.S. companies decades ago, you would most likely have felt a sense of deja vu with each new place you visited. Workforces were largely homogeneous: male, of a certain age and probably made up of people who had similar cultural backgrounds. Fast forward to today’s modern workplaces and you can immediately appreciate the many benefits that culturally diverse workforces have brought not only to employees, but to the success of the very businesses they are building.

The importance placed on workplace diversity has increased so much in recent years, and for good reason. Studies have shown more CEOs and corporate boards have made having a diverse workforce a growing priority, sparking benefits that have rippled throughout their workplaces. Ensuring diversity not only impacts employees – creating options for a more dynamic workforce – but also can expand a company’s capabilities and allow it to branch out into new places and reach new clients.

Simply put, cultural diversity means intentionally creating a workforce that includes a cross-section of people from different backgrounds. This includes diversity in race, religion, age, socioeconomic levels, education and even sexuality. Think of it as a gourmet meal with many different ingredients – each one has a job to do, but brings its own unique profile to be part of the whole. Diverse workplaces are much the same. Each person’s special skill set and background makes the larger company stronger.

Let’s take a look at the different ways cultural diversity benefits the workplace.

Different Perspectives

A major advantage of having a diverse group of people in a workplace is the array of different opinions and ideas they can bring to the table. In most companies, fresh ideas are valued. Innovation is rewarded. Having a mix of people from varied backgrounds ensures that everyone is bringing a different perspective when it comes to problem-solving or even brainstorming sessions. One way to make sure you’re taking advantage of this resource is re-evaluating your workplace’s small-group environments. If your company is set up in such a way that two or three people typically work together to tackle a task, or work with a particular client, seek out an opportunity to bring in a fresh face. Someone new might see the workload in a different way, or have an idea how to make the work more efficient.

Improved Performance

Cultural diversity in the workplace can pay dividends in more ways than one. In terms of employee morale, visible diversity makes people feel more included, no matter what their background. Good managers will send the message that they’ve been selected on the basis of their varied skills to be part of a successful team, and that each person is important.

Diversity can also be a big factor in a company’s bottom-line performance. A 2018 study by the Boston Consulting Group surveying 1,700 global companies showed that workplace diversity led to higher levels of innovation. In places where there was diversity among managers, companies showed a nearly 20% boost in revenue, largely due to innovative practices. This was especially true in industries where creativity is key, like tech companies and start-ups. This dovetails nicely with employee morale, because innovation increases when workers feel like they’re being included as part of a team.

Higher Productivity

A workforce made up of people from different backgrounds means more diversity when it comes to brainstorming and problem-solving. This equals a pipeline of more ideas and better solutions that can ultimately increase productivity among workers. It can also inspire a little friendly competition among co-workers that can drive productivity even higher. Workplace success in turn can boost morale and make people even more willing to work together effectively.

Inspires Creativity

Having a culturally diverse workplace means having a greater depth of creativity at your fingertips. A blending of people with various backgrounds, who have differing opinions, viewpoints and perspectives can inspire creativity as they work together on projects and come up with new ideas to meet clients’ needs. A workforce that is diverse ensures that employees can bounce ideas off of each other. People who have lived in different cultures and who have grown up in different generations will approach things from different paths, leading to a blend of approaches that likely would not have existed in a non-diverse environment.

Improves Decision Making

Want better, more efficient decision-making to be your company’s new standard? It’s another advantage of cultural diversity in the workplace. Employees from different backgrounds who are working together will approach challenges with a more complex mix of opinions, ultimately leading to well-informed and improved decision-making as a result.

One study that analyzed 600 business decisions made by companies during a two-year period showed that decisions made by diverse teams delivered 60% better results. These diverse groups also made decisions twice as fast, and with just half the meetings. Now that’s a time-saving strategy employees and managers can all get behind.

Cultural diversity pays off in a myriad of ways. Whether the goal is boosting morale or raising productivity, creating a workplace that values people’s varied backgrounds and perspectives is a key component to success. Employees and companies both benefit when strengthening cultural diversity in the workforce is a priority.