Diversity & Inclusion

Businesses That Design Cultures to Heal Divides Will Be Most Profitable

By Jason Korman, CEO of Gapingvoid Culture Design Group

Even as health officials encourage businesses to maintain measures to stem the spread of Covid-19, the fact that more than half of U.S. adults have now at least started the vaccination process is a very good sign that big change is coming. In the months ahead, more and more businesses will start to welcome back employees on site.

How many of these workers will choose to keep working from home remains unclear. Surveys suggest that between a quarter and a third of workers will do so at least some days each week. While that would mark a profound shift from pre-Covid days, it still suggests that the overwhelming majority of people will choose to return to their work sites.

When that happens, organizations will face a major cultural challenge -- the biggest they’ve seen in many years. But it will also be an opportunity.

While millions have been holed up at home during the pandemic, America has changed. Protests for racial justice and equality developed into a new, lasting movement, reaching a crescendo with the guilty verdict against Derek Chauvin in George Floyd’s killing. Along numerous lines including responses to the pandemic, the nation’s partisan divide has also deepened. The most bitter election of our lifetimes took place. Insurrectionists stormed the Capitol.

When people return to work, they’ll almost inevitably come face-to-face with people on the other side of the divide. This may lead to tension, frustration and anger -- all of which can destroy morale. That, in turn, hurts profitability and stock performance as well.

But there’s a lot businesses can do to turn the return to work sites into an opportunity for positive change. Businesses can be the primary incubators of understanding and lead the way in healing divides. An expansive study found that “diverse workplaces—because they restrict individuals' opportunities to act on tendencies towards homophily more than other social units—have a particularly strong potential for integration.”

Establishing shared norms

The key is for businesses to design cultures around shared norms. But this is much more complex and scientific than it sounds.

All too often, executives believe that simply making broad statements about acceptance and getting along will make a difference. But human behavior shows otherwise. We’re hyper-social, complex beings and will always behave in complex ways. People don’t change behaviors simply because their organization made a statement.

Many businesses also invest huge sums of money in training on diversity and unconscious bias aimed at helping people understand each other. But these virtually always fail, and sometimes even backfire. Training can provide knowledge, such as how to operate machinery or execute an equation. But changes in social behavior come about through social learning. People copy what they see, adopting the behaviors around them.

Executives and managers set an example. When they operate daily in ways that show everyone is to be treated as members of a single team, with listening, respect, openness to different perspectives, psychological safety and willingness to be challenged, they send a powerful signal. They show that “this is how things are done here.” They make clear that a set of beliefs lie at the core of the company.

The process is furthered along through semiotics, the use of signs and symbols. These can be powerful in reinforcing ideas and norms. This is why culture walls filled with images and statements of corporate beliefs can make an important difference -- and why the same kinds of images can also influence behaviors when used as virtual backgrounds online. (For example, we use an image that shows inclusion leading to better ideas, better collaboration, and better outcomes.)

These steps help design and spread culture throughout the organization.

Shareholder rewards

Workplaces with well developed belief systems that are broadly understood and socialized create what I call High-Purpose Cultures. In a meta-analysis, my team analyzed years of data. We found that organizations that engage employees through a High-Purpose Culture system have higher shareholder returns; better customer satisfaction; increased employee retention; greater innovation, and overall greater competitive advantage.

We also found that CEOs of these companies get higher compensation, positive media coverage and increased respect in their industries as indicated by their presence atop lists of “most admired CEOs.”

So the opportunity ahead offers a win-win across the board. Companies that design and manage cultures that speak to this moment will have greater success. They’ll also offer a better contribution to society.

Designing a High-Purpose Culture is an investment in the future. It is a way of signaling to your stakeholders: We have a vision of where we are going and what our identity is. And at this moment, it’s a way of telling your employees that the organization is committed not only to financial success post-pandemic, but also to building a stronger, more unified society.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.