The Business Case for Diversity & Inclusion in Healthcare

Evolving healthcare trends — from shifting patient demographics to skyrocketing staffing shortages — require forward-thinking executives to recognize the undeniable connection between diversity, equity, inclusion, and business success.

So in this guide, we’ll explore why it’s no longer just a moral imperative to cultivate diversity in healthcare but a strategic necessity.

Our research shows that prioritizing inclusion in healthcare, particularly in leadership roles, is a powerful driver of unrivaled performance, profitability, retention, and more.

Let’s dive into the compelling business case for reaching your DEIB goals and then discuss the best tips to get started today.

Why diversity & inclusion in healthcare matters

Beyond being a social responsibility, DEIB in healthcare delivers tangible benefits for your workforce, patient outcomes, and bottom line.

A CNBC survey revealed that 80% of people want to work for a company that values DEIB efforts. And each component of DEIB is a catalyst for business growth:

Diversity enhances care for underserved patient populations

Gallup defines diversity as “the full spectrum of human demographic differences.” It means your organization has a place for people of every race, age, gender expression, sexual orientation, religion, socio-economic status, and physical and mental ability.

A healthcare workforce that represents its community:

• Provides more culturally competent care
• Understands unique patient needs
• Effectively communicates with patients from different backgrounds

Receiving personalized care that respects their values, beliefs, and preferences improves health outcomes and patient satisfaction for underserved populations.

Equity empowers employees

Equality means all employees are treated the same. Equity requires leaders to consider each employee’s unique background and experiences to understand disparities created by systemic inequalities that help certain groups while putting others at a disadvantage.

Research shows that employees in equitable workplaces are:

• 8x more likely to look forward to going to work
• 3x more likely to have pride in their work
• 4x more likely to remain with their company

An example of equity in the workplace might be offering different types of training for neurodivergent healthcare workers to empower everyone to succeed.

Inclusion gives all employees a voice

Inclusion means actively embracing employees from diverse backgrounds, experiences, and perspectives.

Inclusive workplaces encourage teams to bring their whole selves to work. They should feel welcome, safe, valued, respected, and excited to contribute ideas and advocate for their patients.

Studies show that organizations with an inclusive company culture are 81% more likely to achieve high customer satisfaction scores. Their employees are also 45% more likely to stay.

If inclusion focuses on the actions and behaviors that foster an inclusive environment, belonging emphasizes employees’ emotional and psychological experiences within that environment.

Belonging builds a sense of community & shared company culture

Belonging refers to the experience your employees have when they find a deep sense of connection, acceptance, and appreciation within your organization. Then they’re more likely to feel like their work contributes to a shared sense of purpose and mission.

If inclusion sets the stage for belonging by actively inviting and embracing diversity, belonging signifies your team’s genuine integration within that inclusive space.

Diversity advocate Verna Myers said, “Diversity is being invited to the party; inclusion is being asked to dance.”

Building on this metaphor, Industrial/Organizational Psychologist Ludmila N. Praslova believes belonging is being able to reveal that you can’t dance and still be included in the fun.

Research reveals that a high sense of employee belonging results in:

• Higher employer happiness, engagement, and retention
• Improved job performance
• Fewer employee sick days
• Reduced turnover risk

Now, these reasons to prioritize DEIB focus on the humanistic side of your organization. Unfortunately, because it’s harder to quantify the return on investment DEIB initiatives bring, they’re often the first to go when budgetary pressures hit organizations.

So let’s talk about:

The business case for diversity in healthcare

Surveys demonstrate that more than half (62%) of workers consider DEIB an essential factor in their company’s ability to drive success.

And 71% of leaders view their DEIB ROI as very positive due to their organization’s enhanced competitive position, agility, innovation, and brand perception.

Just consider this: McKinsey research uncovered that global GDP could increase by $13 trillion if the global workforce became equally diverse by 2030.

The following data also confirms that investing in DEIB pays dividends in:

Innovation & problem-solving

A lack of diversity results in a homogenous company culture that’s more like an echo chamber than an incubator for innovation. Diverse perspectives and strengths bring more novel ideas and problem-solving, which presents opportunities for exploration, learning, and growth.

One Forbes Insights survey highlighted that diversity is a key driver of innovation in the workplace. Other statistics confirm that:

• Companies with diverse employees have up to a 20% higher rate of innovation and 19% higher innovation revenues.
• Organizations with the most diverse teams report an average 11.7% gain in market share.
• Diverse workforces are 70% more likely to capture and penetrate new markets.
• Cognitive diversity can enhance team innovation by up to 20%.

Hiring duplicates of your employees will only result in more of the same rather than forging new paths to success.

In healthcare, this innovation can help your team implement new ways to motivate patients to follow treatment plans, make non-emergency appointments, and achieve better outcomes.

Employee productivity and performance

Diverse workplaces breed greater employee motivation, engagement, job satisfaction, and productivity. Employees from different backgrounds and experiences learn from each other, grow in their roles, and make meaningful contributions to their organizations.

Research shows that:

• Employees who feel included within their organizations are ~3x times more likely to feel excited by and committed to their company’s mission.
• A strong sense of belonging results in a 50% lower risk of turnover and a 56% increase in job performance.
• Racially and ethnically diverse companies are 35% more likely to perform better.
• Organizations with above-average gender diversity outperform their peers by up to 58%.
• The most gender-diverse companies outperform the least by 48%.
• A diverse and equitable culture is correlated with a strong safety culture, which also impacts patient care outcomes.

The even better news?

Employees with a greater sense of belonging and inclusion at work achieve 167% higher eNPS scores, making them more likely to recommend their companies as great workplaces.

Revenues and profitability

Healthcare providers operating on slim margins may be tempted to slash DEIB funding. But these statistics prove there’s a fiscal case for keeping them:

• 83% of global executives recognize that multigenerational teams perform better and generate higher revenue.
• Top-quartile companies for ethnic and cultural diversity outperform those in the fourth quartile by 36% in profitability.
• Companies with highly diverse teams earned a significant increase in cash flow: 2.5x per employee.
• 36% of companies with the most diverse teams beat their most current fiscal year revenue expectations by more than 10%.
• 75% of organizations with diverse and inclusive decision-making teams are projected to exceed their financial targets.
• Organizations with an inclusive culture are twice as likely to indicate they’ve met business goals every year for the last three years.
• Companies in the top quarter for employee engagement are 23% more profitable than those in the bottom quarter.

The positive ROI DEIB efforts yield is worth paying attention to. And they’re even more significant when organizations prioritize diversity in leadership.

Leadership outcomes

It’s hard to believe that over a third of companies don’t have any women on their executive teams. But this lack of progress is evident across all industries and in most countries.

Data demonstrates that over 75% of all managers are white. The senior manager level is 83% white, and the executive level is 85% white. And just 5% of companies on the Fortune Global 500 list are run by women.

These companies are at a significant disadvantage, as research shows that:

• The greater the representation of women executives, the higher the likelihood of company outperformance.
• Companies with executive levels comprised of over 30% women are 48% more likely to outperform companies with less gender diversity.
• Organizations with more than 30% of board seats occupied by women or non-white directors delivered higher year-over-year revenue than less diverse counterparts.
• Companies in the top quartile for gender diversity on executive teams are 25% more likely to have above-average profitability than those in the fourth quartile.

These numbers prove that advocating for greater DEIB at your organization makes social and financial sense.

But, as you might expect, studies show that organizations with the most mature DEIB programs experience the highest returns on their investment. So that means getting the ball rolling sooner than later is imperative.

How healthcare providers can improve DEIB

Even relatively diverse healthcare organizations can do more to achieve their DEIB goals. See how many of these tips your team is currently following and which you should start incorporating:

1. Set SMART DEIB goals & discuss them often

SMART Goals (Specific, Measurable, Achievable, Relevant, and Time-bound) empower your team with a framework to make progress. They focus your team on a realistic goal with a hard deadline. For example, hiring 15% more bilingual employees by the next quarter.

After identifying areas with systemic inequities and setting your SMART DEIB goals:

Outline performance indicators. Setting quantifiable DEIB goals and measuring your team’s progress should be no different from budgeting or forecasting profitability.

Using our example, an indicator of success would be hiring 5% more bilingual employees in one month. Or interviewing 50% more bilingual candidates for a new position.

Keep evolving your goals and strategies. Dynamic goals evolve with your organization and healthcare trends, consistently improving and re-focusing your efforts. Don’t get complacent with static goals that don’t move the needle enough.

2. Embed DEIB goals in your company culture & discuss them often

Employees should have a transparent overview of what you’re trying to achieve and how they can help. For example, if your workforce knows you’re looking for more bilingual healthcare workers, they’ll know whom to extend employee referrals to.

To show your workforce you’re committed to DEIB:

Share your goals and initiatives often. Discuss these with new hires to improve new employee orientation and routinely during all-hands meetings to reinforce inclusive workplace practices.

Provide cultural competency training. Employees must address implicit biases with their coworkers and subordinates. But they should also receive ongoing training related to:

• Your organization’s largest patient populations.
• Health disparities affecting those populations.
• How aspects of a patient’s culture, background, beliefs, preferences, etc., influence their attitudes around treatment, medications, and overall health outcomes.

Add DEIB goals to performance reviews. Hold your team accountable for maintaining your company culture, enrolling in diversity and inclusion training, etc.

Establish Employee Resource Groups (ERGs). Affinity groups help foster belonging. These bring together individuals to find community, support, and mentoring opportunities. For example, ERGs for women in healthcare, LGBTQ+ employees, etc.

Assess your efforts with anonymous employee and patient surveys. Ask about things that are working and those that need to improve. Connecting with your staff and patients gives them a voice. Iterating on their suggestions builds trust and shows that you value their opinions.

3. Optimize & standardize your job listings & interviews

In our guide on How To Streamline Interviews To Improve Hiring Outcomes, we shared several ways to improve your recruiting and hiring for diversity. Here’s a quick recap of some of those tips:

Audit your hiring process for unconscious bias. Implicit Association Tests help your team understand roadblocks preventing inclusive hiring.

Aim for inclusive language in job descriptions. Inclusive language increases applications by 30% and brings in more diverse candidates.

Assemble a diverse interview panel. Interviewers from different backgrounds provide multiple perspectives on candidate viability and minimize hiring bias in decision-making.

Always use structured, standardized interviews and unbiased scorecards. This allows applicants to be assessed on the same criteria, creates alignment across HR and department leaders, and ensures legal compliance.

4. Hold leadership accountable

Research proves DEIB initiatives hinge on leadership buy-in. Without accountability at the top, employees can easily forget the goals your organization is striving to achieve.

According to statistics:

• There is a 25% increase in the odds of team members viewing DEIB favorably when reporting to a manager who views DEIB favorably.
• There is a 52% increase in the odds of a white team member viewing DEIB favorably when reporting to a manager of color who views DEIB favorably.

Have leaders pledge their support. Whether by holding DEIB training sessions or signing a commitment letter to display in their office, employees and patients must know that leadership takes these goals seriously and is committed to them.

Enroll managers in inclusive leadership training. Education about implicit bias, microaggressions, equity in performance reviews and promotions, etc., will help your leaders better advocate for your mission.

Evaluate your promotion processes to ensure equity. Only 87 women, and 82 women of color, are promoted for every 100 men who are promoted to manager. So if you notice candidates become less viable for a promotion at a certain level, implement changes to advocate for your staff.

5. Take a new approach to source diverse candidates

Over 76% of job seekers say a diverse workforce is important when evaluating companies and job offers.

Our comprehensive guide of Tips to Attract & Retain Healthcare Talent contains all the strategies your team needs to recruit for healthcare retention, including how to:

• Write job listings that stand out to diverse candidates
• Develop creative sourcing strategies and partnerships
• Streamline your application, interview, and hiring process

Since we can’t cover all those tips here, we encourage you to add that article to your reading list.

Recruiting for diversity & inclusion with relode

Beyond the social justice imperative, the business case for diversity and inclusion provides organizations with a distinct and well-studied competitive advantage. It raises employee engagement, productivity, profitability, patient outcomes, and more to enable the success of your organization.

But relying on small TA teams and the same watering holes to recruit talent may not help your organization source the truly diverse candidates you need to achieve these benefits.

Rethink your healthcare recruiting

Recruiting for diversity and inclusion in the workplace requires an innovative approach to sourcing only Relode delivers. We leverage human expertise, AI, and automation to give healthcare providers access to diverse candidates not found on the typical job boards and scraped databases.

In our article covering The Future of Recruiting for healthcare providers, we dive into how the Relode process works and why our approach and subscription model are optimized for hiring success, cost-savings, and scalability. Click the link to learn more now.