Corporate America was once criticized for its alleged culture of conformity and tacit support of “glass ceilings” preventing minority advancement. Now, a day hardly goes by in any corporate setting without mention of the importance of “diversity.” Nearly all major companies name diversity as among the central values of their corporate philosophies—PepsiCo strives to “Win with diversity and inclusion,” while American Express declares that “Diversity is our business formula for success.”
The word “diversity” often brings to mind desirable things. In biology, diversity of a population makes it more robust in resisting disease. As consumers, we benefit from a diversity of choices in the products and services we buy. In business, a company needs a diverse collection of knowledge and skills to accomplish its mission—human resources, finance, engineering, marketing, management, and others are all critical to its success. It would seem that diversity is indeed something worth promoting as a central corporate value.
But there is a subtle yet important difference between the kind of diversity just described and the kind so zealously sought after by the corporate world today. The term “diversity” simply means difference or variety; for a group of things to be diverse means to be different in some way. The significance of that difference depends upon the context and standard. Owning a portfolio of stock in different companies, for example, serves the goal of minimizing financial risk. But having a diversity of strong and weak players on a football team does not serve any valid goal, and is therefore a strategy for defeat.
“Diversity” per se is thus not necessarily a value—it can be good, bad, or irrelevant, depending on what the goal is. In the context of business, we should ask: what is it that PepsiCo wants to “win”? What is the nature of the “success” that American Express seeks to achieve?
The fundamental goal of any corporation is to profit by offering a quality product or service to its customers. If it fails in this goal, it will cease to exist. Achieving profitability is a difficult and continuous process. The people involved need to identify and research markets—to develop, produce, and sell products—to market and deliver services-to maintain and improve systems. To accomplish all this, especially in the globally competitive business world of today, a company’s workforce must possess a vast array of knowledge, skills, and personal traits like intelligence, diligence, and creativity.
In their efforts to “win with diversity”, however, the corporate world is seeking a diversity not of talents and knowledge, but of genders and skin tones. Companies like Verizon and Xerox tout the number of minorities in executive positions, and General Motors has been praised for choosing its suppliers not based strictly upon price or quality, but also upon the number of the supplier’s black employees. As one leading “diversity expert” put it, “If the diversity program is not effective in producing a diverse racial, gender, ethnic workforce, then it’s not worth the paper it’s written on.”
Such actions reveal that companies are using “diversity” as a basis for making basic business decisions like hiring and purchasing. But such a standard offers no legitimate guidance in these areas. For example, there are many important questions to be asked when choosing a new company executive or supplier. Does the individual have the drive and experience to lead a division? Is the potential supplier cost-efficient and reliable? The answers to such questions determine whether the prospective employee or supplier will advance the company’s ultimate goal. The race and gender of the people involved, in contrast, should never have reason to enter the discussion, since those traits have no bearing upon the fundamental issue: an individual’s ability to do what needs to get done to make the business productive and profitable.
Martin Luther King, Jr. was right to argue that everyone “not be judged by the color of their skin but by the content of their character.” By highlighting traits like skin color and gender, corporate diversity programs achieve exactly the opposite: an environment where important character traits are valued less, while insignificant traits are treated as essential.
If companies want to succeed by encouraging and rewarding talent and productive achievement, the proper goal is not to promote diversity, but to make it irrelevant—to make the corporate office a place where one’s abilities and virtues are what counts, and one’s race and gender are beside the point.