How can inclusion and diversity help solve our supply chain issues?

I would like to thank Reggie Romain for contributing to this post.

“I’ll have an eight-pump Chai Tea Latte with caramel drizzle. No water. No foam. Extra hot. With almond milk, please. Thank you!” 

“I’m sorry Tchicaya, but we have no caramel drizzle today, we are out of stock.”

You probably have similar experiences too. The news cycle these days is replete with images and reports of backed-up shipping ports working around the clock to move stuff in and out. The ports are still not keeping up with demand.

A big reason for stock shortages is a global supply chain broken by a pandemic.

But according to research I’ve been conducting over the past year, there is another reason: a lack of inclusive work cultures.

Let me tell you why.

I am an experience researcher. I study talent trends and how those trends affect workers and customers.

My sweet spot is the intersection of employee and customer experience. This is why I am sharing my latte routine. People leaving the workforce, due in part to the great resignation, has a lot to do with why I can’t always get my customized latte order.

Is it really a supply chain issue—or an inclusive culture issue?

The first thought is to blame “out of stock” and “dining room closed” signs on the supply chain crunch. But the supply chain issue isn’t really about a shortage of goods. There’s a huge increase in demand. In addition, there’s a shortage of workers to connect the goods with the customers who need them.

Anthony Klotz, the psychologist who coined the term “the great resignation,” suggests that “events like the pandemic make people step back and rethink their lives.” Work is one thing that people are thinking about differently. Am I happy? Am I fulfilled? Is this what I want to be doing for the rest of my life? Or even for the next six to 12 months? Should I start that business I’ve been thinking about? Should I take time off to pursue my passion?

Wait, so it’s a labor shortage issue?

At the onset of the pandemic, from March 2020 to April 2020, the unemployment rate skyrocketed 10.3 percentage points, from 4.4% to 14.7%  in the United States.

For women, the impact was even more dramatic, rising by over 12 percentage points from 4% to 15.5%.

Hispanic/Latino and Black workers suffered the most; rates jumping to 18.9% and 16.7%, respectively.

Workers historically excluded from equitable economic participation were unable to provide for their families, and that contributed to a $560 billion shortfall in GDP.

What’s driving the labor shortage?

Like Professor Klotz, I believe the pandemic gave people a chance to step back and evaluate the meaning of life—and their lives.

Luckily for some, expanded jobless benefits (and/or decent savings) allowed people the opportunity to take a breather. They used the time to decide what’s most important to them and their families.

It seems that opting out of work is the new cool. Or maybe it’s a new form of self-care. Work as we know it seems to have lost its mojo. There are multiple contributing factors, including an overarching focus on emotional, mental and physical health. Front-line workers are concerned with safety, burnout and low wages. Those who have escaped the rat race, and found themselves enjoying life on the sidelines, need a new value proposition for work because it’s no longer the centerpiece of identity that it once was.

Does the exodus have anything to do with how people are being treated at work?

It’s possible. I investigated this hypothesis in the Better to Belong research that I recently led. We learned that leaders need a new playbook — one that helps them convince workers that they belong back at work.

There’s just one problem. They don’t!

We found that over a third of employees feel like they don’t belong. In our study, belonging means workers:

• have influence over decisions;
• are respected by their peers and managers;
• feel comfortable speaking up; and
• are supported by senior leaders who help them advance and grow in their careers.

To combat the biggest labor shortage in 10 years, leaders must quickly pivot and triple down on creating inclusive cultures where everyone belongs.

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As Christie Smith, global talent and organization/human potential lead at Accenture, described in a recent forum, “There is an enormous gap between intent and action and this is particularly true when we talk about culture. Culture is often used as the inertia that stymies  action.”

To me, this means that fixing culture is not a "check-the-box activity." It must live and breathe from the senior-most leaders in the organization to the most junior. And it must happen every day for every person.

You can create an inclusive culture too

Culture change doesn’t happen overnight. But small steps in the right direction will lead to bigger steps, and real change. Here are some ideas.

1. Meet your people where they are—and focus on their wellbeing

Since the start of the pandemic, many executives have learned that, amid the rough transition to becoming fully digital, the only constant was their people. Deep down, leaders knew they had to find creative ways to nurture talent. But they didn’t really know how, and some weren't sure of the value of doing so.

The Care to Do Better research by Accenture found that when leaders meet people’s fundamental human needs at work, their company can gain up to 5% in revenue growth. There are five specific practices that the C-suite must implement:

• enable continuous learning;
• listen to what your people need at the front lines;
• use technology to enable flexible work arrangements;
• champion workforce well-being and equality; and
• set and share people metrics.

2. Prioritize tech adoption

When the global economy shut down in early 2020, business leaders grabbed their toolkits and revisited their playbooks. They also activated their people and architected the fastest digital transformation ever. In fact, leaders who got it right doubled down on tech adoption and grew 5x faster than laggards.

Leaders have proved they can compress digital transformation and accelerate growth five-fold in just two years in response to a situation completely out of their control. Imagine what they can do in situations they can control. The ability to create inclusive cultures where everyone feels they belong is within reach.

3. Hold yourself accountable

Assess what talent is missing from the table, at the most granular level. Then go find them where they are, hire them with equitable pay, and provide them with equitable access to advancement opportunities. Oh, and then hold leaders accountable for doing so. As the old saying goes, if you can’t measure it, you cannot manage it. I would take it one step further and say, therefore, you cannot change it.

We can make The Great Return possible

Creating an inclusive and welcoming culture should be part of the end-to-end employee experience, from onboarding to exiting your organization. Between those critical moments, there are many levers that leaders can pull to maximize people’s potential. For example, empowering your people is one of the four essential people skills. The more people feel empowered, the higher their human potential.

Engaging people with empathy and transparency is another everyday lever that will make coming back to work a choice that more and more people make. Using tech-enabled platforms to build community will support people’s ability to thrive at work. This applies whether employees are in the office, fully remote or hybrid. 

When the right people are at the table (diversity) and they have access to equitable experiences (inclusion), all people will experience a culture of belonging.

The next time you are faced with decisions that might affect the resolution of your supply chain issues, consider this for a moment: It might not be a supply chain issue at all. It might be how you make your people feel. 

Show that you value them by taking care of their basic needs. Their needs are emotional, physical, relational and financial, as well as having purpose and being employable. Your people will be net better off because they work at your company.