Blog Post

Three Ways Not Practicing Inclusive Leadership Can Hurt Your Company

June 23, 2023

There are many ways that not practicing inclusive leadership can hinder the success of your company. We’ve shared the increase of innovation that happens within inclusive environments. Companies with above-average diversity produced a greater proportion of revenue from innovation (45%) than from companies with below average diversity (26%). Forbes Still, there are three key areas that organizations must be aware of to prevent devastating consequences. 

 

The first consequence of not practicing inclusive leadership is it increases the turnover rate. Inclusive leaders build connected and engaged environments. When employees do not feel supported by their manager or connected to their co-workers, they find it easier to leave and look for a place where they can experience more belonging. This lack of leadership will create a revolving door that will be difficult to overcome. The humility we spoke of earlier still rings true here. Inclusive leaders admit they have biases and work to increase their awareness. 

 

Inclusive leaders address their personal bias and understand the impact it has on how they interact and respond to others. It's easier to refuse to view differences as relevant to the individual, but it is detrimental to clump everyone into the right same group, with a colorblind approach to leadership. There is a false belief that this colorblind mindset is objective and fair; easier to not factor in how culture is an important personal diversity factor. The inclusive leader understands that no one wants to be viewed as neutral; negating all their uniqueness. 

 

The next reason that not practicing inclusive leadership will hurt your company is it causes low morale. When employees believe there is no one in leadership they can identify with, they are less likely to feel like they can have a trusted mentor or future in the organization. Mentorship boosts morale, strengthens the pipeline of future leaders and offers direction and support to employees with little expense to the company. Employees excel where they feel valued, and this increases their excitement about the work they do.   

Thirdly, fear of failure and taking strategic risks are issues employees will battle if the culture is not managed by inclusive leaders. Employees who do not feel valued will struggle to make decisions because they sense a lack of support. They will be concerned with backlash and being ostracized if they make a mistake. When employees feel like they belong they are more confident in taking the initiative and following through on their ideas because they do not worry about rejection or negative consequences. 

 

In addition to these three derailers to productivity, engagement and innovation, when inclusive leadership is lacking, organizations open themselves up to legal risks. Legal risks can include discrimination lawsuits that can be extremely costly to your organization's profitability and credibility. If you are not investing in building inclusive competencies across all team members and holding leaders accountable for inequitable practices, you are creating a leaky culture that’s costing you more than you know. 

High turnover rates, low morale and fear of failure create a trifold effect that can hinder the results you desire to see. If you want to be proactive in these areas to avoid gaps in your culture, it's time to build the urgent case for inclusive leadership training in your organization. 

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