Why DEIB Will Never Likely Produce a Competitive Advantage

DEIB - Diversity, Equity, Inclusion, and Belonging.

I was asked on the GEMS podcast if I felt that organizations who effectively implemented DEIB programs would gain a competitive advantage in the marketplace by doing so.

It’s a very interesting question today when many organizations are pushing to be relevant in terms of their commitment to diversity, equity, inclusion and belonging.

Here’s my take on what DEIB involves:

Diversity — The organization values and strives for a mix of ethnic, gender, sexual orientation, age and life experience among its employee group.

Inclusion — The organization values, accepts—not just tolerates—and celebrates differences among employees.

Equity — The organization provides various levels of support and assistance to employees depending on their specific needs or abilities.

Belonging — The organization creates an environment where people within the organization have positive relationships. I suspect that sense of belonging goes up when the organization succeeds in being recognized for its diversity, inclusion and equity values.

The question is, notwithstanding that DEIB seems to be the template organizations are trying to implement these days, does being a ‘DEIB Practitioner’ organization create a strategic advantage for the organization adopting the practices to be the DEIB best in class?

Put another way, do the values ascribed to DEIB have a strong enough pull with customers to have them choose one organization over its competition, and generate revenue growth for its practitioner?

I think not.

It’s not that DEIB values are not important. They are in terms of describing what ‘the inside’ of an organization should look like as a mirror of societal challenges and changing personal values.

It’s just that I don’t believe they are overwhelmingly compelling and relevant to a consumer’s choice when it comes to deciding who to do business with.

Advocates state that DIEB values will stimulate innovation and sustainable growth that would otherwise not occur.

I don’t know. I’m not there.

It’s always seemed to me as a leader that the job is to get the best people available to execute the organization’s strategic game plan.
If DEIB is the most effective way to get there, ok.
But it becomes a means to an end not an end itself, and the education system needs to produce the skills employers need.

DEIB speaks to aspirations and organizational values rather than competitive advantage.

Product fit, price, the service experience and technology, for example, are among the elements that typically find a more influential role to play and take a higher priority in purchase decisions rather than whether the company salutes DEIB.
(As a side note, I see many employers aspire to be the one who checks all the DEIB boxes, but relatively few actually successfully put them into practice.)

Furthermore, as more and more organizations move to a DEIB culture, it won’t represent a difference among them to cite as a reason consumers should do business with any one of them.

If everyone’s doing DEIB, how’s an organization getting an advantage by putting the values forward as reasons to buy from them and not others?

The DEIB herd confers no advantage on any member of the herd.

The final test of whether or not DEIB values contribute to the competitive advantage of an organization is to look at how these values fit within the customer facing—marketing, sales and service—imperatives of their strategic game plan.

If, for example, you’re going to target your scarce resources on the boat dealers in Laval Quebec, Canada, you need to know whether DEIB expression is a mandatory purchase criteria for those dealers.
I suspect it’s not, but you would need to confirm it one way or another.

The internal capabilities an organization chooses to develop—like DEIB—should be based on what is needed to execute its business plan including how it intends to compete and win the markets it intends to serve.

All other things being equal on the factors at play in choosing a supplier, if one company was DEIB-centric and another is not, the DEIB organization may very well get the business up for grabs.
Someone may decide that the two organizations under consideration are equal in every aspect, and decide to go with the DEIB company because at a higher level they believe in the intent of DEIB.

But all things are NOT always equal, so I doubt DEIB will likely ever be a determining factor in a consumer’s purchase decision.

DEIB is a commendable aspiration for any organization, but it’s not a tool to gain competitive advantage.

Related: 3 Audacious Moves You Can Make When You Don’t Have a Business Plan