Why Diversity and Inclusion is the Answer to the Digital Skills Gap

In today’s fast-paced, interconnected, and digitally driven world, the digital skills gap is becoming an increasingly pressing issue. According to the World Economic Forum, by 2025, 85 million jobs may be displaced due to a shift in the division of labor between humans, machines, and algorithms. 

The same report suggests that 97 million new roles may emerge that are more adapted to this new task distribution. How do we bridge this gap and adapt to the changing labor market needs? The answer lies in promoting diversity and inclusion.

The Power of Diversity and Inclusion

In 2023, it is now increasingly evident that a diversified and inclusive workforce is a strategic asset to navigate the digital skills gap. But how, you ask? Let’s dive in.

Diversity and Inclusion Pays Off

According to a McKinsey report, companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective national industry medians. For gender diversity, this probability is 15%.

Similar reports show that among top-performing firms, female business leadership corresponded directly with higher profits. In fact, firms are 33% more likely to experience industry-leading profitability if their executive teams represent more cultural and ethnic minorities.

That’s why companies are investing large amounts of money into programs to increase diversity, especially in upper management—not solely because it’s altruistic, but also because it is more financially beneficial.

Fresh Perspectives

Diversity and inclusion aren’t just about fairness or ethical responsibility – they’re also a strategic advantage to companies looking to foster fresh perspectives, and uncover innovative new ways to approach learning, teaching, and the application of digital skills.

Fostering Innovation

Fresh perspectives often lead to out-of-the-box thinking. Employees with varied backgrounds, experiences, and worldviews can challenge the status quo, leading to innovative solutions and products. Innovation, in turn, often equates to market leadership and increased revenue.

Enhanced Problem-Solving and Better Decision-Making

A diversified team brings a wide array of solutions to complex problems. Rather than a singular approach, a multifaceted team can see issues from multiple angles, ensuring a more comprehensive and effective solution.

This can lead to cost savings and improved efficiency. In fact, a study by People Management found that diverse teams are 87% better at making decisions. What’s more, compared to individual decision makers, all-male teams make better business decisions only 58% of the time, while gender diverse teams do so 73% of the time.

Tapping into New Markets

Employees with diverse backgrounds can provide insights into markets that the company may not have previously considered. This opens up opportunities for expanding customer bases, thereby potentially increasing sales and revenue streams. In fact, a Harvard Business Review study found that diverse companies are 70% more likely to capture new markets.

Improved Employee Retention and Attraction

Companies that value diversity and fresh perspectives are often seen as more attractive workplaces. This not only helps in retaining talent but also in attracting the brightest minds. Higher employee retention results in decreased hiring and training costs.

Enhanced Reputation and Brand Image

Modern consumers are increasingly valuing businesses that prioritize diversity and inclusion. By showcasing a workforce rich in fresh perspectives, businesses can improve their public image, potentially leading to increased customer loyalty and brand trust.

Risk Mitigation

A diverse team with a variety of viewpoints can foresee potential risks and pitfalls that might be overlooked in a more homogenized environment. By identifying these risks early, companies can take steps to mitigate them, saving potential future costs.

Increased Productivity

When employees feel valued and included, their engagement and productivity often increase. Fresh perspectives can also introduce new tools, technologies, and methods that can streamline processes and boost output.

Untapped Talent Pools

Before COVID-19, few businesses questioned the mantra that location incubates talent and that you could only perform at the highest level if you were present at the office every day. The pandemic has proven that most work doesn’t have to be done in person and, in fact, can be done from anywhere in any time zone.

This opens companies up to significant populations that are underrepresented in the digital industry, including women, ethnic minorities, people with disabilities, and those from lower socioeconomic backgrounds.

Accessibility for People With Disabilities

Traditional office environments, despite the best intentions and accessibility laws, can sometimes be restrictive for people with certain disabilities. Remote work eliminates the need for daily commutes, navigating public transport, or facing physical barriers in office spaces. At home, individuals can tailor their workspaces to their unique needs, ensuring they’re as comfortable and effective as possible.

Increased Flexibility

Many people with disabilities require flexibility in their schedules for medical appointments or periods of rest. Remote work often comes with the added advantage of flexible hours, allowing employees to work when they’re most productive or when it’s most convenient for them.

Eradicating Geographic Limitations

Historically, the best job opportunities have been concentrated in urban centers, often requiring individuals from lower socioeconomic backgrounds to either relocate or face long, expensive commutes. With remote work, companies can tap into talent from any corner of the world, giving those in economically depressed areas an equal shot at high-quality jobs.

Reducing Ancillary Costs

The expenses associated with traditional jobs—like professional attire, daily transportation, and meals outside—can be a significant burden for people from lower socioeconomic backgrounds. Remote work reduces or eliminates many of these costs, making it more financially viable for many individuals.

Skill Development Opportunities

The digital revolution has brought along a slew of online courses, many of which are free or relatively inexpensive. Those from lower socioeconomic backgrounds can harness the power of the internet to learn new skills and land remote jobs that might have previously been out of reach.

Cultivate a Culture of Continuous Learning

Diversity and inclusion often lead to a culture of continuous learning and growth. This culture, characterized by openness and collaboration, can encourage team members to learn from each other’s unique skills and experiences. By promoting such an environment, organizations can enable their workforce to acquire and hone digital skills from one another, thereby addressing the skills gap from within.

Reaping Diversity’s Benefits

For many organizations and IT staffing consulting companies, diversity might be seen as a buzzword, a checkbox to tick. But diversity, in its true essence, is a game-changer for the IT industry. It’s not just about optics or fulfilling a moral obligation; it’s about driving results, fostering innovation, and ensuring a sustainable future.

Broader Range of Ideas and Solutions

Different backgrounds, cultures, and experiences give rise to a plethora of perspectives. When you have a team that represents a mix of ethnicities, genders, ages, and experiences, you’ll inherently have a wider range of ideas. This results in solutions that are more innovative and comprehensive, catering to a broader audience.

Improved User Experience and Product Design

The global user base of IT products is diverse. By having a diverse team, companies can ensure they’re designing products and services that cater to the needs, preferences, and cultural nuances of varied user groups. This can drastically reduce biases in AI systems, improve the cultural relevance of apps and platforms, and boost user satisfaction.

Higher Financial Returns

Multiple studies have shown that companies with diverse leadership and teams perform better financially. A McKinsey report, for instance, found that companies in the top quartile for gender or racial and ethnic diversity are more likely to outperform those in the fourth quartile.

Enhanced Reputation and Brand Image

In the era of social media and instant communication, reputation matters more than ever. Companies that are seen as embracing and championing diversity often benefit from a positive brand image. This can help in customer acquisition, partnerships, and talent attraction.

Better Decision Making

Diverse teams make decisions faster and are more likely to consider all available options and risks. The varied backgrounds and experiences prevent groupthink, leading to more thorough and well-considered decisions.

Future-Proofing

The world is becoming increasingly globalized. As markets expand, a diverse workforce helps companies adapt and cater to these new markets. Diversity prepares organizations for the future, ensuring they remain relevant in a changing world. This is where the Hire Train Deploy model, and Hire Train Deploy companies like Smoothstack stand out.

Employed by private and public sector organizations in the IT and tech sectors, HTD enables an organization with a steady stream of trained professionals ready to fill specific roles from day one.

This HTD model can be especially beneficial in sectors where there’s a rapid growth and demand for specific skill sets, but a shortage of ready-to-deploy talent. By investing in training, companies can build a workforce tailored to their exact needs.

Challenges & The Way Forward

Despite the benefits, achieving diversity is not without its challenges. Many companies face obstacles like unconscious biases in hiring, retention issues, and difficulties in creating an inclusive culture.

Regardless of the challenges, embracing diversity is more than just a moral imperative; it’s the logical business decision. As the IT industry propels forward, only those companies that embed diversity in their DNA will be best positioned to lead and innovate their way across the digital skills gap.