Recently, there was a controversy sparked by Trade and Industry Minister Chan Chun Sing when he made a parliament speech on Singapore’s economic growth and job creation has benefitted citizens more than foreigners.
Unsurprisingly, this resulted in a robust online discussion which developed along the lines of “Us” versus “Them”, “Foreigners” versus “Locals” and “Singaporeans” versus “Permanent Residents”.
I currently work as the Marketing Manager of TeamSpirit Singapore, a SaaS solution company headquartered in Japan, which serves more than 235,000 users and 1,300 companies.
At TeamSpirit Singapore, our workforce is pretty diverse—we have seven nationalities in our Singapore office of 19 people. And I love the diversity, not just in thought and competence. In particular, I appreciated how kindness, humanity, and culture are expressed when I am working with a bunch of good-hearted people.
This provides the context as to why I am writing this post today, on the three benefits diversity in the workforce can improve your startup culture.
Benefit #1: Diverse teams help generate greater innovation
In 2018, research from Boston Consulting Group strongly suggested that companies with more diverse leadership teams reported higher levels of innovation and innovation revenues, up to 19 percentage points. This was extensive research that involved a sample size of 1,700 different companies across eight different countries, involving a range of industries and company sizes.
This is hardly surprising because whenever we bring together talented and competent individuals from all walks of life, backgrounds, experiences, and cultures, they will each have their special way to improve the company’s products and services. This leads to possible blind spots being addressed, and also introduces new ideas and perspectives to different ways of doing things.
Benefit #2: Diverse teams work symbiotically
It is clear that a diverse team feeds on good work culture, and contributes to it. Coupled with good management, there are significant results to this symbiosis: Higher employee engagement, more efficient talent recruitment and lower turnover rates.
When we have a diverse workforce in terms of culture and ethnicity, employees are naturally engaged with each other when they have opportunities to interact with each other.
For example, at TeamSpirit, we have a snack corner which is filled with food from all over the world whenever someone returns from holiday from their home countries, or from work trips.
And because we have seven nationalities in our office, that is at least seven distinctive types of snacks to be enjoyed periodically– and what better way to bond than enjoying food together on our sunny island!
Also, when colleagues find it safe to share their interpretations of life with each other over lunch, trust is built within the organisation. People become more open as people start to see and appreciate the beauty of being human.
Various research has also indicated that job seekers are often attracted to and wish to stay in companies with progressive work values that celebrate diversity because it is open that such companies do not engage in employment discrimination.
One other technology company that does diverse team retention very well is Muvee– The average employees typically stay for at least four to five years, a significant length of time in the fast-moving IT industry.
Benefit #3: Diverse startups have higher investments and profits
Evidence is overwhelming that diverse startups enjoy higher investments and profits. A 2015 report by McKinsey involving 366 public companies posits that companies in the top quartile for racial and ethnic diversity are 35 per cent more likely to have financial returns above their respective national industry medians.
In addition, according to the World Economic Forum, diverse startups have yield better ROI for investors. In 2018, BCG did another five-year study which indicated that for every dollar of venture capital invested, female-led or female co-founded startups generated 78 cents of revenue, while male-led startups only generated 31 cents.
It is clear that there is a strong positive correlation between diverse startups and profits/ ROIs. There are many possible reasons for this phenomenon: For one, a diverse workforce can reach out to their respective diverse subgroups of customers, bringing in more new streams of revenue for the company. Another reason could be that diverse startups showcase more resilience and stronger problem-solving skills as compared to non-diverse startups.
All about leadership and safe spaces
Ultimately perhaps, the discourse on diversity is built on the premise of good leadership and safe spaces. How can a leadership team create a safe space where good and competent people of any and all backgrounds can thrive? Truly, a company’s values, culture, and its safe space have to be guarded as first priority no matter what happens, because these decide the essence and spirit of all other activities.
And perhaps, nationality is not entirely correlated to how engaged or identified an employee feels with the values of a company.
It is my ardent wish as a Singaporean to shift the current discourse from “foreigners” vs “locals” to “how a company can implement healthy boundaries, of who to let in and who to keep out”.
The polarity and fear-mongering narrative of “us” vs “them” reduces foreigners to one-dimensional caricatures who are necessarily feared, a notion that does serve our nation’s interests at all, for xenophobia is the last thing we want to encourage in Singapore.
At the end of the day, it is shared values that bind us all– not our skin or flag colours.
The article was first published on e27, on Jan. 22, 2019.