Developing Leadership Diversity: The Challenges and Opportunities

September 04, 2020

Case categories include: Founder’s Insights   Leadership   

Developing Leadership Diversity

By Paul Witkay, Founder & CEO, Alliance of Chief Executives

When I launched the Alliance of CEOs in 1996, I had a few guiding principles in my mind that would come to define our unique organization. I focused on creating “safe,” confidential environments where CEOs could speak openly and candidly about their most sensitive and strategic challenges with other CEOs who have a wide range of different perspectives, experiences, and ideas. We brought together CEOs who ran companies ranging from heavy industries such as steel, chemicals, agriculture, and paper with CEOs who led high-tech companies in biotech, enterprise software, interactive television, video games, and others.

I wanted to create a community of leaders who were life-long learners and would love to engage with leaders who would challenge their basic assumptions. We intentionally sought out leaders who grew up in different cultures around the world and brought experiences from virtually every industry and market sector.  

I’ve had the privilege of working with thousands of CEOs over the past 25 years and have seen time and again that the most innovative companies are those that make diversity a central principle. At the same time, I’ve also witnessed the challenges companies often face when integrating this concept into their culture.

As a result of these observations and in consideration of today’s unprecedented times, I’m inspired to share some of the learnings and experiences other CEOs have shared with me. Below are a few words of wisdom about the importance and value of developing leadership diversity and how to face some of the challenges involved.  

The Value of Intentionally Building Leadership Diversity in Your Organization

A common value among Alliance CEOs is that there is an intrinsic benefit in working with people of diverse backgrounds and from all walks of life. Frans Johansson wrote The Medici Effect, which discussed how the Renaissance was created by the groundbreaking force of divergent thinking. Artists, philosophers, writers, and scientists were brought together and exposed to different perspectives, strengths, and ways of thinking. It laid the foundation for Modernity and, in today’s business world, a collection of differing perspectives remains just as powerful.

But we need to think about diversity more broadly. If you focus solely on hiring a workforce to meet certain inclusiveness metrics, you may not achieve the full potential that many different minds can create. It’s important to build your team as a coalition of experiences, not just identities that tick a box, and then listen to them. You need to actually care about their perspectives and experiences. To succeed as an enterprise, you must value flexibility, agility, and innovation—and that requires people bringing their unique perspectives and experiences to the table.

The most successful CEOs I’ve engaged with invite questions, and even dissent, by surrounding themselves with people who think differently than them. If you wall yourself off in an echo chamber or surround yourself with like-minded leaders, you will be deaf to deep inquiries and breakthrough ideas. Enabling diversity of thought allows you to hear creative ideas, and leads to breakthrough moments.

That doesn’t mean it’s always easy, though.

3 Major Challenges When Developing Leadership Diversity

By building a coalition of individuals with varied understandings and skill sets, you can prepare your company to more readily address some major challenges later on. There are a few common challenges that make achieving this goal more difficult. Avoiding these early on is key to building a strong and resilient company. Let me share a few examples that other CEOs have experienced.

1. Implementing leadership diversity from scratch

A common tendency I’ve seen from start-up companies is that initial hirings revolve around a small pool of colleagues or classmates that are close to the founders. As you might expect, this can result in a rather homogenous group of people with regard to ethnicity, gender, economic background, and even academic experience.

In many cases, before these leaders even realize it, they’ve built a company of 100-1,000 people who think, act, and look the same. This phenomenon is not only bad for business innovation but for a healthy work culture as well. The lack of ideas cross-pollinating can hinder growth, both personal and professional, at every level of your company.

Of course, the best way to avoid this issue is to prioritize diversity—of people and ideas—from your company’s founding. Don’t look just to your inner circle when creating your startup team; build diversity into it from the beginning and develop a long term plan for maintaining it. However, for those businesses that need to enact changes after they’ve grown to a considerable size, intentionality and strategy are key. I’ve found that seeking out quality insight from other leaders who have overcome this challenge can be invaluable.

2. Working against industry culture

Recently, I was speaking with a fellow CEO of a leading industrial metals company. He told me that they’ve been trying to hire more women for years but that the field has historically attracted men, so recruiting is difficult. Although they’ve had minor success with efforts such as work-site visits, the reality is that they are working against decades of gender trends. These historic trajectories can be very hard to change.

While there aren’t any fast and easy solutions to this problem, we can make progress by moving upstream and reaching out to students and offering internships, scholarships, and building relationships. For example, STEM initiatives that empower young women and historically disenfranchised minority groups have started to change this tide. If we want to encourage diversity in our companies, we need to take steps to positively influence young minds and create opportunities.

3. Biases: conscious and unconscious

Of all the challenges the CEOs I’ve connected with have faced, biases might be the hardest to address. After all, our understanding of both conscious and unconscious bias is continuously changing and being deepened by sociology experts—and I am by no means an expert. However, I am a CEO, and I think it is irresponsible to ignore this issue just because it is a difficult one to address.

It is important to have open dialogues about these issues within your own company and with experts in the field. We need to create safe spaces for people of all backgrounds to feel that they are being heard, and establish diverse hiring practices and training programs that support our employees’ success. This means having an open mind to new modes of operation and finding faults in our current systems. After all, if we want to be serious about developing leadership diversity, we need to educate ourselves on what has stalled it in the past.

Creating meaningful change requires attentiveness and a willingness to reflect on challenging topics. This philosophy is especially true when it comes to building diversity into our core business values and operations. Often our biases get in the way of seeing past our own experiences, preventing us from allowing diversity into our business. However, fostering a culture based on learning from collective experiences within your company can challenge our assumptions and support business growth—a phenomenon I’ve witnessed first-hand through the Alliance of CEOs.

The Positive Impact of Diverse Experiences and Ideas Within The Alliance

Developing Leadership Diversity For decades, I’ve believed that retaining, promoting, and supporting diverse employees within an organization is critical to long-term success. As the founder & CEO of the Alliance, I’ve seen how being in a room full of people from all walks of life can be an incredibly illuminating experience. The powerful connections made between organizational leaders generate novel approaches to real-world problems, including how to develop leadership diversity.

We have intentionally built an environment within our Alliance community where CEOs can talk candidly about even the most sensitive issues. Since we come from all over the globe and specialize in such wildly different fields, the kinds of conversations we have open our eyes to many different opportunities and innovative ideas. Without the wide-ranging backgrounds of our members, I never would have been able to benefit from hearing their wisdom.

Participating in these exchanges has only doubled-down my faith that everyone benefits when more people are given a platform to speak. The most important thing that we can do is listen to each other if we’re ever going to get closer to finding solutions.

Developing leadership diversity can create a set of unique challenges. But you can get guidance and support from leaders when you need it. Contact the Alliance of CEOs today.