Understanding organizational barriers to a more inclusive workplace

McKinsey’s research has shown that diversity can help organizations increase innovation, reconsider entrenched ways of thinking, and improve financial performance.¹Vivian Hunt, Dennis Layton, and Sara Prince, “Why diversity matters,” January 2015; Vivian Hunt, Lareina Yee, Sara Prince, and Sundiatu Dixon-Fyle, “Delivering through diversity,” January 2018. Organizations can take full advantage of the perspectives of a diverse workforce only if leaders and employees enjoy a sense of inclusion,²Sandra Sancier-Sultan and Julia Sperling-Magro, “Taking the lead for inclusion,” November 2019. which we define as the degree to which an individual feels that their authentic selves are welcomed at work, enabling them to contribute in a meaningful and deliberate manner. We also know from our work that individuals’ sense of inclusion is influenced by their experiences with the organization as a whole, the organization’s leaders, and peers or team members.³We will explore these three levels that affect inclusion in a forthcoming publication. For our recent McKinsey Global Survey on the topic,⁴The online survey was in the field from September 10 to September 20, 2019, and garnered responses from 1,920 participants representing the full range of regions, industries, company sizes, functional specialties, and tenures. The survey was also sent to McKinsey’s networks of LGBTQ+ senior leaders and garnered an additional 110 responses among those groups. To adjust for differences in response rates, the data are weighted by the contribution of each respondent’s nation to global GDP. we approximated inclusion by combin­ing survey respondents’ reported feelings of authenticity, belonging, and comfort participating in the workplace.⁵We define respondents as feeling “very included” based on responses to four statements tested in the survey: “My organization is an inclusive place to work,” “I belong at my organization,” “I feel comfortable raising my opinions or ideas,” and “I am able to be myself at my organization.” Respondents answered these questions on a five-point scale, and we scored “strongly disagree” or “not at all” responses as a 1 and “strongly agree” or “entirely” as a 5 before averaging individuals’ responses to these statements. An average score higher than 4 is considered “very included.” Our survey research finds that respondents of all backgrounds encounter barriers to feeling included—and that women, respondents who are ethnic and racial minorities, and those who identify as LGBTQ+ encounter additional challenges.⁶LGBTQ+ refers to lesbian, gay, bisexual, transgender, and queer individuals, and those of other sexual orientations and/or gender identities.

Analysis of the survey results, which were collected before the COVID-19 pandemic and before events in the United States spurred conversations around the world about racial justice and equity, shows that respondents who feel very included in their organizations are nearly three times more likely than their peers to feel excited by and committed to their organizations. What’s more, respondents from all demographics say they have taken organizations’ inclusiveness into account when making career decisions and would like their organizations to do more to foster inclusion and diversity. While leaders may have shifted their focus to urgent strategic needs amid the pandemic, organizations can consider using this time of historic disruption and heightened discourse about injustice to advance inclusion and diversity rather than allowing these priorities to recede. For those seeking to create a more inclusive workplace, the survey results point to specific factors that organizations can address.

Many do not feel a strong sense of inclusion and report barriers to achieving it

According to our latest findings, many employees have considered organizations’ inclusiveness while making career decisions, yet almost half of all respondents do not feel very included at their organizations. Most respondents, regardless of their gender, race, ethnicity, gender identity, or sexual orientation, say they encounter barriers to a sense of inclusion.⁷We also analyzed the results of respondents who were male, non-LGBTQ+, and not ethnic or racial minorities, and their inclusion-rate findings were consistent with the overall sample’s.

A look at demographic segments of the workforce suggests that certain employees are especially prone to feeling less included (Exhibit 1). Entry-level employees through senior managers make up one such group; they are much less likely than senior leaders to report a strong sense of inclusion. Also, the women who responded to our survey are less likely than the men to indicate that they feel a strong sense of inclusion. While LGBTQ+ respondents’ degree of inclusion appears to be a bright spot, this finding is likely influenced by that sample skewing toward more senior employees.⁸We sought to bring additional LGBTQ+ leaders into the sample. As a result, the sample of LGBTQ+ respondents has more senior leaders than other groups. Fifty-five percent of the LGBTQ+ respondents are senior leaders, whereas 41 percent of all other respondents are.

1

A sense of inclusion is strongly linked with employee engagement. Respondents who feel very included are much more likely than others to say they feel fully engaged—that is, excited by and committed to their organizations. Among respondents who feel very included, nearly three-quarters say they are entirely engaged. By comparison, just one-quarter of respondents who do not feel very included say they are completely engaged with their organizations. Furthermore, respondents who feel very included are 1.5 times more likely than others to believe their career advancement is outpacing their peers’.

Responses suggest that an inclusive environment, in which employees feel strong positive bonds that enable better performance, is an important con­sideration for employees as they plan their careers. Thirty-nine percent of all respondents say they have turned down or decided not to pursue a job because of a perceived lack of inclusion at an organization (Exhibit 2). LGBTQ+ and racial- or ethnic-minority respondents are more likely than others to report choosing not to pursue a job for this reason. Even still, among respondents who do not identify as LGBTQ+ or as ethnic or racial minorities, 38 percent say they have made such a decision.

2

Overall, respondents often indicate that their organizations should do more to build inclusion in the workforce. Thirty-five percent of respondents say their organizations put too little effort into creating a diverse, inclusive environment. By comparison, just 6 percent say too much is being done.

The results also point to several issues that might hinder respondents’ sense of inclusion. One is a disconnect between the individual capabilities that employees value most and their perception of which capabilities matter most to their organizations. When asked to identify the leadership competencies they and their organizations value most, 37 percent of respondents say the one that is most important to them is not among the three most valued by their organizations. This mismatch is associated with feeling less included, but primarily among women. Women respondents are much less likely than men—and also less likely than respondents in the other demographic categories—to feel very included if they view their top competency as not being among those their organizations value most (Exhibit 3).

3

Additionally, the survey found that 84 percent of all respondents have experienced workplace micro­aggressions, which are everyday slights rooted in bias. In every subgroup—by gender, gender identity, minority status, or sexual orientation—more than eight in ten respondents report these indignities. For example, more than a quarter say they have needed to correct others’ assumptions about their personal lives. Those who say they aren’t sure whether they have experienced any of the microaggressions we asked about are significantly more likely to feel very included than respondents who report experiencing one or more. Respondents who have experienced more than one of these microaggressions are even less likely to feel included than those who report just one.

Women, minority, and LGBTQ+ respondents face additional challenges

Women and ethnic- or racial-minority respondents are likelier than others to say their careers have advanced more slowly than their peers’. These respon­­dents, as well as LGBTQ+ respondents, also report experiencing more microaggressions at work than other respondents (Exhibit 4). For example, respondents in each of these demographic cate­gories are much more likely than others to say they have been excluded from social events and have heard derogatory comments or jokes about people like them.

4

It’s also common for these individuals to say they have felt uncomfortable discussing identity-related topics in the workplace—and research demon­strates that feeling unable to speak openly or share ideas with team members and peers without a risk of judgment or ridicule can hinder an individual’s experience of inclusion and their performance.⁹Joy Burnford, “Building authentic courage: The essential foundation for successful diversity and inclusion,” Forbes, February 1, 2020, forbes.com; forthcoming McKinsey research. Thirty-seven percent of LGBTQ+ respondents say they have had an uncomfortable experience coming out—that is, sharing their LGBTQ+ identity—to colleagues in the past month (Exhibit 5).

5

Among racial- or ethnic-minority respondents who indicate they discussed identity-related issues at work in the past month, four in ten say they have felt at least slightly uncomfortable in such a situation.¹⁰This finding does not take into account responses from the 12 percent of ethnic- or racial-minority respondents who identify as LGBTQ+ and who were not asked this question.

A similar share of nonminority, non-LGBTQ+ women say the same about discussing gender. More than one-quarter of racial- or ethnic-minority respondents and a similar share of women respondents say they have avoided talking about these topics when they would have liked to discuss them, largely because they were unsure how colleagues would respond or they didn’t want to be seen as different.

Four tested factors most associated with employees’ inclusion

Compared with respondents who say too little is being done to increase organizational inclusion and diversity, those who say their organizations devote the right amount of effort are 1.9 times more likely to feel very included. Responses also suggest which factors matter most for creating inclusive environ­ments. The survey tested 26 organizational practices and employee experiences to see which factors are strongly linked with an individual’s sense of inclusion. The factors that stand out primarily involve the identity and actions of organizations’ leaders (Exhibit 6).¹¹The survey analyses tested these analyses using multivariate weighted linear regressions.

6

1. Diverse, inclusive leadership

Responses suggest that both the presence of diverse leaders at an organization and an organiza­tion’s focus on inclusive leadership (for example, leaders empowering others) are correlated with indi­viduals feeling included. When respondents say leaders at their organizations are diverse, they are 1.5 times more likely than peers from organizations without diverse leaders to feel very included. Furthermore, regardless of whether an organization has achieved diverse leadership, its leaders’ actions can nurture inclusion. At organizations where leaders focus on inclusivity through acts such as building team cohesion, respondents are 1.7 times more likely than those at other organizations to feel very included.

2. Meritocracy and initiatives to increase fairness in performance evaluations

A meritocratic company culture is strongly associated with a sense of inclusion. When respondents say that a culture based on merit has been a top-three factor in their career advancement, they are 1.3 times more likely than others to feel very included. Initiatives to increase fairness in performance evaluations have a similar link to inclusion: people who report these initiatives are 1.4 times more likely than others to feel very included.

However, the data show gender-related differences in the impact of a meritocratic culture. Women senior leaders are less likely than their male counterparts to say they are helped by meritocracy at work. They are also more likely to attribute their success to other factors, such as respect for their educational background or prior work experience. While 40 percent of men say meritocracy has boosted their careers, less than one-third of women say the same.¹²Whether women miss out on the rewards of meritocracy or are just more cognizant of others’ support was not investigated.

McKinsey’s original survey research

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3. Sponsorship

Respondents who say colleagues at their organi­zations have gone out of their way to create professional-advancement opportunities for them also are more likely than others to feel a strong sense of inclusion. Respondents with at least one such sponsor are 1.6 times more likely than others to feel very included. The findings also suggest that individuals benefit from having more than two sponsors. While half of respondents with one or two sponsors feel very included, 72 percent of those with three to five sponsors feel very included.

Other findings indicate that sponsorship aids the career advancement of underrepresented employees. Senior leaders who are LGBTQ+ or ethnic or racial minorities are more likely than other leaders to say that sponsorship relationships have positively influenced their careers.

4. Substantive access to senior leaders

More than half of all respondents say that mean­ingful interactions with senior leaders have aided their career advancement. This exposure to leaders is linked with a sense of inclusion: respondents who say interactions with leaders aided their advancement are 1.2 times more likely than others to feel very included.

Not all employees are equally likely to report benefiting from access to leaders. Prior research has shown that women are less likely than men to have substantive interactions with senior leaders. When looking at what senior leaders who completed this year’s survey say most helped their careers advance, women’s responses differ from men’s. While 57 percent of senior leaders who are men indicate that interacting with leaders helped them progress, just 45 percent of women leaders report the same.

Diversity wins: How inclusion matters

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Looking ahead

Employees’ sense of inclusion can contribute to an organization’s performance and talent retention. Individuals who say their employers invest the right amount of effort into improving organizational inclusion and diversity are more likely than others to feel very included within their organization. Many respondents want their organizations to do more to create a diverse, inclusive work environment. As workforces acclimate to the next normal following the pandemic, organizations can use this time as an opportunity to make changes that build a highly inclusive culture—rather than allowing inclusion and diversity to take a back seat. Based on our survey findings, organizations and leaders can take the following actions to help employees feel a stronger sense of inclusion.

• Include all employees in conversations about inclusion. Removing barriers to inclusion requires that actions support all employees, regardless of their gender, gender identity, race, ethnicity, or sexual orientation. While many inclusion discussions effectively focus on underrepresented populations, our data suggest an opportunity to expand these conversations to recognize that inclusion applies to and can benefit all colleagues.

  Several approaches can help. Organizations can launch “allies” programs to encourage all employees to help combat microaggressions. They also can use tactical inclusion reminders, known as “nudges,” to influence employee behavior. These might include calendar notifica­tions to include quieter team members in group discussions or to acknowledge team mem­bers for their contributions. To assess their progress in creating a more inclusive workplace, organizations can run detailed employee-experience surveys at least annually, maintaining common questions to track improvements on inclusion and engagement over time.

• Build more representative teams. Increasing the share of diverse leaders starts with increasing and retaining the numbers of employees from underrepresented groups throughout the organization. Beginning with recruitment, organizations can set incremental goals for underrepresented groups by geography and population and can closely track progress toward those goals as they do for any other business objective. Tracking must also occur in the promotion process. Business units should put forward multiple candidates from underrepresented groups for each leadership opening and then report on advancement of employees in these segments. Formalized succession planning and sponsorship programs, too, can help increase the presence of underrepresented leaders.

  Reducing bias in the hiring and promotion processes can lift the numbers of employees from underrepresented groups. One action that can help counter bias is appointing “bias watchers,” respected leaders who are trained to call out unconscious bias in talent-related discussions. Because effective leader­ship takes many forms, it can also help to formalize clear criteria for leadership positions, including leadership competencies that are less traditionally recognized, such as relationship building, along with criteria such as entrepre­neurship. These criteria can be used in feedback conversations and performance reviews to ensure organizations value a wide range of competencies.

• Adopt inclusive behaviors. Given our survey data suggesting that feelings of inclusion often stem from inclusive leadership, it is important that individual leaders demonstrate inclusive behaviors. These can include participating in “allies” programs that support underrepresented groups, hosting open and honest conversations about people’s unique identities, calling out microaggressions when they see them, and posting signs of visible support for those groups in leaders’ offices. Regardless of whether a formal sponsorship program exists, leaders can serve as sponsors, recognizing rising talent from underrepresented groups and ensuring awareness of and access to professional-advancement opportunities for these individuals. Leaders can also help underrepresented colleagues develop mean­ingful support systems by creating opportunities for connectivity, which can improve retention. Finally, it is impor­tant that leaders commit to edu­cating themselves on diversity, inclusion, and bias by attending trainings and reading the latest research, just as they would approach any other core responsibility at work.