Blending Leadership and Diversity With Dr. Stefanie K. Johnson

Hello, my friend, and welcome to another exciting episode of Negotiate Anything. Thanks for joining us today. With over 10 million downloads and listeners from more than 180 different countries, it's dedicated listeners just like you who have made Negotiate Anything the number one negotiation podcast in the world. I'm your host, Kwame Christian. I'm a business lawyer, mediator, author, and the proud CEO of of the American Negotiation Institute. Now, before we get into today's insightful conversation, I have a golden opportunity for those of you who recognize the power of negotiation in your professional lives. Have you ever found yourself wishing that you could navigate those high stakes conversations with more confidence? Or perhaps you're looking to empower your team with the art of persuasion and conflict resolution? At the American Negotiation Institute, we've crafted specialized keynotes and workshops tailored for those very needs. We've transformed the negotiation skills of professionals worldwide, and we're eager to do the same for you. We believe the best things in life are on the other side of difficult conversations. And our goal is to help you improve your lives and the lives of those around you, one difficult conversation at a time. Don't let another challenging conversation leave you second guessing. Click the link in the description to discover how we can help you find confidence in conflict, negotiate better deals, and have stronger relationships. Because in the world of business, every conversation counts. And now, without further ado, let's jump into the interview. Steh, thanks for joining us today.

Thank you so much for having me, Kwame.

Yeah, it is our pleasure. So how would you get us started? By telling us a little bit about yourself and what you do.

Yeah, absolutely. So I am a college professor at the University of Colorado Boulder's lead School of Business, and I study the intersection of leadership and diversity. So kind of what that means is I study how people view leaders of different backgrounds. So women leaders, leaders of color, LGBTQ leaders, men leaders, just all leaders. And look at how different identities affect the way leaders are seen. And that's like, maybe half the equation. And the other half is looking at what leaders, regardless of the identities that they hold, can do to create a more diverse and inclusive workplace. And I wrote a book about this. It's called Harnessing the Power of Uniqueness and Belonging to Build Innovative Teams. That came out in June 2020 from HarperCollins, and it shares many of these strategies that leaders can use to particularly drive inclusion.

This is great, listeners. You know, oftentimes I have to bring the swag for our humble guests. So this wasn't just any book. This was a Wall Street Journal bestseller. So kudos to you on that. And there'll be a link in the description if you want to check that out to listeners. So I want to make sure you get that credit because that's not easy to do.

Thank you.

Yeah. So this is really interesting. Today we're going to talk about the business case for diversity. But before we do that, I actually want to dig a little deeper into your focus at the University of Colorado because it's really interesting, the intersection of leadership and diversity. And for a lot of people, this might be a completely new concept for them. And so when you think about the intersection of leadership and diversity, why is that something that is worth exploring?

Absolutely. I mean, that's a great question. And I've been doing this work for over 20 years when, starting at a time when it was a very surprising intersection to look at, I would say today people really care a lot more about this topic. And, you know, there's awareness about the lack of, say, women CEOs and Fortune 500 companies. And same thing. If you look across race, there's, you know, the vast, vast majority of CEOs, senators. Pick any type of leadership role in the US and you'll see it's disproportionately occupied by majority group members. And so why do I study this topic? I am a woman and I'm Mexican American. So maybe it's because of my own identity that I bring that caused me to study it. But I don't know if that's really true. I think the real answer is I don't think it's possible to study leadership without looking at race and gender. Because if you are a researcher and you collect data about how leaders are evaluated or what leaders can do to be successful, you will inevitably find differences across race and gender. And I say inevitably because when I started doing this work, maybe way back in graduate school, I actually tried not to study gender or race or diversity. And this is like, horrible. I feel bad saying it now, but because I wanted to because I am a, you know, Mexican American, first generation college student, female, in like a very masculine field. I wanted to do something that was like mainstream because I think people would doubt me if I did. You know, if I studied diversity, people might think, oh, well, she's not as serious of a academic. I'm fully ashamed of having felt that way. But I think it was kind of true at the time. But nonetheless, every study I did on the topic of leadership, I would find gender differences. I wouldn't find race differences as often because I Usually didn't have enough diversity in my data to really find race differences, but there's always gender differences. The same behavior that predicts success for male leaders predicts failure for female leaders. Right. So you can't ignore those differences if you're a serious scientist. You can't just pretend they don't exist. And so I had to study that. That topic. And then over time, it really became the most interesting thing that I study. I think it's the most important thing that I study. And after, maybe after tenure, it doesn't really. I don't care as much if people question whether I'm the most serious scientist or not. I think what I'm doing is the most important topic out there.

This is great. And so I want to highlight a couple of things because the persuasion and negotiation nerd in me cannot help but do this, but you in particular are a very compelling person to have this message because you were reluctant to carry the message like that in itself is really persuasive because as you're having these conversations with other people and they are skeptical, you can truly empathize with them and say, listen, I get it. I didn't want to do this, but after being confronted with the data, I had to do it. And I think it's really telling the fact that you found those discrepancies between men and women in your data and you didn't see those same discrepancies as it relates to race, mainly because there wasn't enough of a significant sample size to come to a conclusion, which is an important data point in itself. So I just commend you for leaning into that and having. And kind of leading this because it's really important.

Oh, thank you. And today I would say there is more racial diversity. Maybe there's, you know, as much racial diversity as there. There is gender diversity. I think it's just still harder to examine because for genders, you know, we have maybe in most, you know, most of the world, you have two, maybe three genders that people identify with. And it's primarily, you know, most often two. But for race, unless you want to collapse people into, you know, white, non white, which is like, ridiculous, right? It becomes a much more complicated because you might have white, Hispanic, white, Hispanic, black, you know, black, African American. Like, there's just many, many more races. And so too. And they're not all treated the same. Right. And the stereotypes and prototypes people have for different races are so different. And then add on top of that, the intersectionality with gender, because the stereotypes we might have for black men are different than those for black women. And so it becomes a lot more complicated. It doesn't make it any less essential to do that work. It's just. It's just a lot harder research to undertake, and there are people doing a really good job with it. My studies are much fewer on that get that nuanced into the intersection of race and gender. But it's a super important topic for researchers out there. For any bold people who want to take that on, I applaud you.

Absolutely. Now, this is great. And so now we're talking about the business case for diversity. And this is something that we run into a lot of times when we're working with leaders, diversity, equity, inclusion within companies. They say, all right, hey, we want to bring you in to do these trainings. We want to bring you in to help us navigate change within our organization. But we've been struggling to get buy in. People don't believe this is important. And so what often comes up is the business case for diversity. There are a lot of different cases for diversity, why we should have more diversity or focus on diversity, equity, and inclusion within a company. But the business case is a unique angle when it comes to persuading people of the value. So let's break down what you mean when you think about the term business case for diversity.

Yeah, absolutely. In 2016, maybe 2018, I think I spent all my time talking about the business case for diversity. And even as I wrote Inclusive, the first, you know, lots of pages talk about the business case for diversity. And I'd be curious to get your input on this or experience around this. But I feel like it's kind of changed a little bit since 2020, since the murder of George Floyd, maybe even the MeToo movement. I think around gender has created greater awareness around the importance of gender equity. But I think the Black Lives Matter movement and. Or resurgence thereof in 2020, I think people, mostly the vast majority of people, buy in to diversity for the sake of diversity. But nonetheless, the business case for diversity, it's just a nice thing to have in your back pocket to explain. And if there's those naysayers out there or if you're working on a communication plan or a strategy for really how you're going to implement it, I think it's useful to have kind of these facts and figures to back you up. The biggest thing I always say is you have to start any strategy with your own company, values, vision, mission, whatever it is, and explain why this is important to you in your context. And so I think that's just across the board so people can make sense of it and understand why. Not why this should be done, but why this should be done by us.

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So I want to, I'm going to jump into the business case for diversity in a second, but before I do, I want to ask you, have you seen the same thing that more and more people are willing and interested in diversity for the sake of diversity? Are they still really asking you? Come on, Kwame, convince me. Why do I have to do this?

Yeah, well, this is a great question. And so let's break down when we think about the term, just saying the phrase diversity for the sake of diversity. I think when we say that, what we're implying is that people understand that people, it's important for people to feel included, that they can express themselves authentically and be appreciated and respected for who they are. That's one aspect. And then just an understanding that decision making will improve when we have diversity of thoughts. So if people come from different backgrounds, different experiences, those type of things, it gives us a multitude of perspectives that we can use when making decisions. And I agree, I think a lot of people are starting to see that more organically as much of a need to actually use more tactical and strategic approaches to persuasion. And what I'm realizing is that every once in a while, when it comes to that point where we're saying, all right, we're going to show that we care or we're going to show that this is a priority by allocating time, money and resources to that, that's when a little bit of resistance comes into play because the person will say, yes, let's say it's a leader of an organization, people come to them and say, hey, we have an issue with dei. And then the person says, hey, start a task force. You, you and you, you care about it. Start that task force. Come up with something. Have fun. Okay, now we have some events and things like that. And then let's say the task force comes back and says, you know what, we've been looking into it and actually we need to do xyz, which will take time, which will take money, and it'll take resources. And the leader says, wait up. Listen, I believe that what you're talking about is important, but I'm not sure if it's important enough for me to pull the trigger and spend money on it. Convince me, really. The business case of diversity for diversity comes up after the fact when we're saying, all right, now I need to prove that there is going to be some level of return on investment. Because if I'm going to ask this organization to spend tens of thousands, hundreds of thousands of dollars, then they need to know that there is going to be some kind of return that is valuable for them.

Yes, okay, I agree with that. I think you're right. I feel like there's less resistance to. Sure. Starting an employee resource group, have social events, celebrate whatever holidays you want, and oh, wait, now you want money. So explain to me why I should spend this money. And I think that's where these kind of data come in really handy. And I can think of maybe two sides of that coin. The first one is really about turnover. So 2021, record numbers of voluntary quits in organizations. I think the best estimate is that 47.4 million Americans quit their job in 2021. And that's voluntary quits. That's not even turnover for cause or layoffs. Lots of those people have gone back and found other jobs. But we still have a huge gap in the labor pool of people who just haven't returned to work. And that's primarily women who have exited the workforce. So what does that mean? You can count really quickly the dollars and cents that that costs organizations when people are leaving. So if you want to run that ROI calculation, you can look at, you know, there's lots of data out there. I have some on my website@drsteffjohnson.com I'm sure we can link to that in the chat. But on how much more likely people are to stay in your organization if they feel like they belong, if they feel valued, if they feel like there's an opportunity to get ahead. And so by changing those aspects of those are really more inclusion than diversity. But you can increase retention of your employees. And then if you dive a little deeper into those turnover data, we also see that women and women of color and people of color have disproportionately left their jobs compared to white men, compared to men and compared to whites. So what does that mean? Well, part of the reason people are leaving is they don't feel valued and respected. And that's more true for those who have marginalized or minoritized identities. So women are leaving. Like, I don't think I can get ahead in this company. Other companies are boasting their inclusion and commitment to diversity. I can go find one of those companies. And so it's really become a war for talent. There's people can quickly leave their jobs, they can go anywhere else if they don't feel as connected to their organization. Maybe. I think some of this is remote work. I can work from anywhere. I can easily leverage a different job opportunity. And so you can. Why should you do this? Simple answer, just. The cost of any one diversity initiative is going to be a lot less than losing valued talent, because the cost of replacing that talent is 40% average of that person's annual salary. And there's these great studies that show a phenomenon called turnover contagion. And that is when someone leaves, those around them start to say, hmm, where did they go? Did they get a better offer? Could I get a better offer? I all of a sudden have a lot more work to do because they left. And so I may also see what else is out there. And so if you can, the 40% is probably an underestimate of the cost of any one employee leaving if they start a contagion of other employees leaving. And I think one in three women in the last year has seriously considered leaving her job. That's a lot of, you know, 51% of labor market is women. So that's a lot of people that organizations need to be focused on keeping them and saving that turnover cost. Okay, that's only point one. I don't know if you do you disagree?

Oh, no. I love these statistics because they're so clear. They're so clear in that, first of all, we have a cost. There's a significant cost. I didn't know about turnover contagion, but it makes sense. My workload is heavier and I might not be particularly enjoying myself here. And so I'm going to take a peek to see where my colleague went to. Is that better? Is the grass greener? That's always a good question. And I would assume when you think about persuasion in general, in marketing in general, we want to show images of people who look like us, think like us, those type of things and say, hey, you know that Kwame looking guy over there he is drinking Coke. Maybe you should, Kwame. That's the thing, right? And so if I see somebody who looks like me or has a lived experience like mine, and those people are leaving at a higher percentage going to notice that, and then I'm going to question whether or not I should, too. And what I like about this, and I know we're just scratching the surface of the data, is that what we're realizing is that somebody who is just a pure capitalist, let's say, they do not care about diversity at all. They don't care. That is not something that's on their radar. It's not something that moves them. But if they care about the bottom line, then they can realize even if I don't care is having an impact on the financial future of this company. I remember one of the things when I was helping a DEI leader within an organization persuade the leadership to take action. After the meeting, what the person said was this, because I asked them, hey, when you look at your website, how much diversity is there on the website? Okay. When you look at your competitor's website, how much diversity is on the website? Okay. There's more. Have you lost any clients? Because they've said, we don't feel like you're representing our interest because you don't have the diversity that we would want to see. So, yes. And so just asking those questions, then the person thought for a second, and then they said, if we do not solve this problem, it will be an existential threat for our firm. And then they made all those changes. That's right.

Yeah. And that is not an uncommon story where, you know, accounting firms and law firms who go in to pitch services with a very homogenous pitch team, get the feedback that, you know. Well, I'll tell you, one specific firm said that they walked into the room, this is an accounting firm, and the client, who's a global company based in Asia, said, I'm sorry, we're not going to listen to your pitch today. And in this case, the team was predominantly white and male, and they're pitching a client in Asia. They said, please, we'll give you another opportunity to pitch, but we'd like you to send in your A team.

Oh, my. Oh, my goodness. What? Oh, my God.

Yes. And their feedback was that they want to see a diverse team come in and do this pitch. And if you're sending in a homogenous team, we don't believe that you sent us the best people on your team.

Wow.

And it sounds, like, really harsh, but it's like, if you're sending. If all the people on your pitch team comprise, you know, come from 30% of the population, which is the white men in the US Then you probably haven't tapped the very, very best talent. Unless you believe all talent resides in that 30% of the population. You've kind of limited your scope on recruiting to a small fraction of potential talent out there. So I think that's, you know, you got to send in the A team. That means today, I think the way people are seeing it in a global economy is that means that team should be diverse.

That's so interesting because to that point, because you could, because somebody could listen to that and say, wow, that's offensive and that's racist. And then they could say, well, hold up, hold up, hold up. If, if they sent in a team of all black women, there should be that level of skepticism too. All black men's team of skepticism. That level of skepticism too, you know, because I think about, I remember one leader saying that sometimes he would make a decision in a board meeting and everybody agrees with him and they expect to move on. He's like, well, we have to stop now because there is no way you all agree with me. We need some diversity of thought here. And the point you're making here is that, yeah, I mean, it is almost a statistical impossibility that everybody who is the very best looks exactly the same. That's a really interesting perspective.

Yeah, no, it's. I mean, I think it's important for people to hear this and know that this is, I mean, this is the market today. And then consider now, if you're trying to replace people who left. And to your point, your website doesn't look very diverse. The people in the office don't work look diverse. They're very homogenous. People doing the interviews are homogeneous. So now you have to replace 47.4 million employees. And that population is diverse. Because if you're looking at millennials and Gen Zs, I mean, obviously women have always been more than half the population. But today, among people under 30, more than half of the U.S. population identifies as a person of color. White, Hispanic, black, Asian, and other races as well. But that means how are you going to replace your current staff if you don't increase diversity? And so just think of the like, think of the implications here. You're losing, if you're losing women and people of color and women of color at a higher rate. And now you can't attract women and women of color and people of color because you don't have any because they've left. Who are you going to fill those jobs with?

Wow.

It becomes a real challenge, or what were the words used? An existential crisis for companies just to keep enough people in operating roles to keep the business going. I think that should be enough for the business case for diversity.

I think I do, too. I think it makes a lot of sense because what we're realizing is that in the marketplace we're seeing that there are problems and businesses are all about solving problems. And it sounds like diversity and inclusion done right, can be the solution to many of these problems that we're facing.

That's right. And I think it's more than a problem. I think it's an opportunity. So let's take the flip side of you're not the company who has massive turnover and can't recruit new people because you did invest in diversity and inclusion initiatives. When Kwame came in and said, hey, we should do this thing, you didn't say, oh, tell me the business case. You said, all right, where I got the checkbook, Tell me, what do I need to do? So then, rather than turnover and an inability to attract new talent, you've retained your talent. And if you have diversity already and you bolster inclusion to create an environment where people are willing to share their views, you know, when they're different, they're willing to speak up and be heard. There's the psychological safety that people are willing to take a risk, even if it's. They don't risk being humiliated if their ideas out there. Then what you see, data wise, is when you have diversity and inclusion, you see increased innovation, improved decision making, you're less likely to make a terrible decision based on groupthink. Like that board example you gave of, oh, everyone agrees, red flag, that if everyone's quickly agreeing, this could be one of those decisions that people will look back on and say, what were they thinking? Because clearly no one's thinking. Because there's no idea out there that everyone should agree. Right? You should always have some dissension in there, or maybe people just aren't considering all of the risks and opportunities. So there's all those positive benefits. Who's going to be able to create new target markets and reach markets that you haven't been able to reach in the past. You need people with different perspectives if you're going to be able to successfully do that. So the business case for having diversity and inclusion and maintaining the diversity you have and retaining top talent is also really clear. Like, you can run the ROI calculations. There's one study on innovation showed that companies that were more diverse, I think it's also important that they're inclusive, but they didn't measure this on average created two new products per year compared to companies that were less diverse. These are real bottom line results as well from having diversity and inclusion in your organization. When you put those together, I think it's a pretty strong business case right there.

Steph, this is really, really helpful. We really appreciate this. Before you go, I want to give you an opportunity to remind them about your awesome book and your website and how they can get in touch with you.

Yeah, absolutely. Everywhere. On the socials, on LinkedIn, on my website, DrStephJohnson.com My book is Inclusify and has a corresponding website, Inclusify.com Steph, thanks.

So much for joining us. We really appreciate it.

Thank you for having me. Have a good day.

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