5 ways hiring diverse talent will dictate startups fate in COVID
Startups are hiring again after the initial shock of COVID in April. Demand for web designers and developers skyrocketed 15.5% in July compared to June. Cybersecurity has been the fastest growing UK startup sector in COVID and UK startups that are hiring during COVID include AR startup Poplar, FinTech startup Revolut, transport startup City Mapper and banking startup Banked. However, who startups hire will have a much bigger impact than anticipated on their fate in COVID. The impact of new hires on the business is significant because startups have smaller teams and every new talent can literally dictate the destiny of early-stage startups. Hiring top diverse talents will make or break startups in COVID and here are 5 ways diverse hiring will impact startup success:
1 - Hiring diverse talents in startups increases engagement and maintains productivity in remote-work
2 - Hiring diverse talents in startups improves cultural appreciation and mitigates racism and sexism
3 - Hiring diverse talents in startups increases innovation for changing consumer needs in COVID
4 - Hiring diverse talents in startups is critical for business recovery post COVID
5 - Hiring diverse talents in startups increases sound decisions
Sign-up to our webinar: 7 ways to boost diverse hiring in tech roles amid #BlackLivesMatter and #MeToo.
1 - Hiring diverse talents in startups increases engagement and maintains productivity in remote-work
Startups that actively hire diverse talents in COVID have higher team collaboration and higher team commitment than non diverse and inclusive startups.
CEB, now part of Gartner, found workers in highly diverse and inclusive organizations result in a 26% increase in team collaboration and an 18% increase in team commitment.
Additionally, employees who are part of organizations with high levels of diversity report a seven percent higher intent to stay than their peers in organizations that have low levels of diversity. Higher employee engagement helps startups maintain productivity in remote-work and stand out from competition. Higher employee engagement means that teams go beyond expectations which makes the difference in COVID because most teams are now disengaged in remote-work. In COVID, startups that hire diverse talents will stand out from their competition.
2 - Hiring diverse talents in startups improves cultural appreciation and mitigates racism and sexism
Startups that actively hire diverse talents create opportunities for employees to spend more time with individuals from different backgrounds, which increases their appreciation for different cultures and ways of thinking and reduces negative thoughts like racism and sexism. In the context of Black Lives Matter and Metoo, startups will particularly benefit from mitigating racism and sexism in the workplace by hiring diverse talents because the risks of employee lawsuits, bad publicity and brand damage due to racism and sexism are at an all-time high.
Many Tech investors now include #MeToo clauses in startup deals to prevent sexism and more startups now include anti-racism in their diversity and inclusion pledge like UK travel startup Pluto.
3 - Hiring diverse talents in startups increases adaptivity to build products for changing consumer needs in COVID
Diverse management teams are more innovative than less diverse teams, confirmed Boston Consulting Group after surveying 1700 companies.
Companies with above-average diversity produce a greater proportion of revenue from innovation (45% of total) than from companies with below average diversity (26%).
Members of a diverse startup see things in a variety of ways, they recognize new market opportunities and they can better identify unmet market needs, which is especially critical in COVID where new consumers' needs are rapidly emerging. Startups that actively hire diverse teams innovate faster and better than their competitors and will emerge from COVID stronger.
4 - Hiring diverse talents in startups is critical for business recovery post COVID
The ability to spot and seize game changers in a crisis like COVID is likely to be mission-critical, as reported by McKinsey. Strategic agility is stronger in startups that can draw on the full spectrum of diverse talent.
“Our research and the research of others suggest that when companies invest in diversity and inclusion, they are in a better position to create more adaptive, effective teams and more likely to recognize diversity as a competitive advantage. Meanwhile, other companies might struggle.” McKinsey reports.
Startups that prioritise hiring diverse talents will benefit from strategic agility which will position them for success in COVID.
5 - Hiring diverse talents in startups increases sound decisions
Recent research found that racially homogeneous teams are less rigorous in their decision-making and make more mistakes than diverse ones.
“One project demonstrated that when you tell students that they’re going to be having a discussion regarding a written article, they prepare more rigorously if they know that they’re going to have to debate in a more diverse group” said Apfelbaum, Career Development Professor of Management at the MIT Sloan School.
Startups hiring diverse talents increases the chances of sound, better decision-making, which will position them for success in a COVID world.
“Diversity winners that deploy a systematic approach to inclusion and diversity and don’t fear bold action to foster inclusion and belonging are most likely to reap the rewards. Now is the time to be even bolder.”
reported McKinsey in its May 2020 report ‘Diversity still matters’.
In summary
Hiring diverse talents will dictate the fate of startups in COVID. Startup founders who build a diversity-first culture will scale their business faster and in a more sustainable way that those who don’t. Take the first step to hiring diverse talents by signing-up to our upcoming webinar: 7 ways to boost diverse hiring in tech roles amid #BlackLivesMatter and #MeToo.