Ahead of the curve or behind the times:
Are tech giants paying the price for a lack of inclusion?
As tech companies begin to dominate the global market, the innovative nature of their work demands that they appear forward-thinking and progressive. It’s all part of the image.
Amazon experiments with drones, Tesla accelerates into the future with driverless cars and Apple have created a phone you can unlock using your face. Silicon Valley giants are well-known for their exciting inventions and avant-garde products but what is becoming increasingly well-documented is their disregard for the importance of human capital.
Indeed, a recurring theme in several high profile tech companies is that while their products promote an image of progressiveness, this is often undermined by a toxic corporate culture which stifles inclusion. Crucially, recent examples have shown just how devastating a lack of inclusion policy can be to their share price.
The way in which inclusion is inextricably bound to value has been highlighted by ride-hailing company, Uber. Started back in 2008, the app has grown beyond all expectation into one of the biggest companies in the world. Recently however, the company’s reputation has become mired by multiple accusations of sexual harassment and inequality. Most notably, a scathing account of entrenched sexism by former employee Susan Fowler ruptured the company’s image as a progressive, future facing employer. This blog post published in February 2017 was followed by the resignation of two top executives who found themselves at odds with the company’s underwhelming commitment to inclusion. This series of events saw Uber’s value to fall significantly from $60bn down to $50bn, in just a matter of months.
One year on, and Uber have announced that they have appointed their first chief diversity and inclusion officer. This begs the question: why did it take so long?
It is likely that the answer lies at the heart of start-up culture.
Immediacy is an element which seems to pervade the DNA of tech start-ups. Often their product is born out of 21st century demand for instant gratification. Want a lift? Uber it. Want an answer? Google it. Want to share your thoughts? Tweet it.
This desire for immediacy, however, appears to have manifested itself in the business model of tech companies. There is an expectation of immediate and exponential growth in order to placate shareholders and satisfy experts that this is a business with legs. The new pressure placed on start-ups is evidenced by the creation of terms like “supergrowers”- companies with growth worth above 60% when they reach $100m in revenues- and “unicorns”- companies valued at over $1bn.
When it comes to tech, growth trumps all, and this leaves little room to consider other crucial aspects of business. This is perhaps one of the reasons why companies like Uber, who enjoy a wonderful start to life, run into problems further down the line. When the dust has settled on an explosive new business, focus can turn inwards and the things which were overlooked in the heady rise to prominence, suddenly come to the fore. Had Uber’s founder- Travis Kalanick- considered from the beginning the benefits of an inclusive workplace, he would have saved himself an untold amount of criticism and would still be in charge of the company he built.
It is remiss though, to view inclusion merely as a “trap” which can be negotiated by enforced quotas and box ticking. Inclusion represents an opportunity for businesses. A study revealed that organisations which have greater gender diversity are 15% more likely to deliver better financial resuls than their competitors. Therefore, not only does an inclusive culture lend itself to better morale and productivity- it is also good for profit. Focusing on inclusion early on, can pay dividends which come in the form of long-term stability and retention of employees.
Indeed, within the tech industry, a transient workforce is becoming an expensive problem. A report by the Kaport Centre for Social Impact has calculated that unfairness-based turnover costs the industy $16bn a year.
Instead, the difficulty exists in addressing the issue and mapping out how to deal with it- this is what defines a successful company.
Identifying poor inclusion practices needs to be high on organisation's strategic agenda. To achieve this, a business must be equipped to accurately measure levels of inclusion. Through accurate measurement and detailed understanding, leaders can plan appropriate actions to deal with any issues in their workforce - this is what defines a successful company.
Using workforce analytics, companies can track hard data relating to inclusion, and from this build a healthy corporate culture.
For more details about our Include offering, to help accurately measure inclusion in your organsition please download the solution overview below.