How much can diversity and inclusion drive innovation? A lot, it turns out.
Materially improving gender, ethnic and cultural diversity, particularly within executive teams correlates with a wide range of successes – specifically being able to recruit top talent and improve employee satisfaction and decision making.
Diversity can also help drive technological innovation and disruption. Consider Montreal-based Lightspeed, one of Canada’s most successful tech start-ups.
The software firm launched in 2005 by Dax Dasilva and a group of LGBT+ colleagues, and has grown in size to now include 600 employees in eight offices around the world.
A culture of inclusion was essential. So, too, was a recognition that innovation through diversity is as much evolution as revolution.
“Company culture is just as important as code,” Lightspeed’s CEO and founder Dax Dasilva told RBCDisruptors, our monthly event looking at innovation and how technology is changing the world around us.
The purpose of these two organizations is to build up leaders. You can’t make change in the world without having everyone see themselves as a leader.
Dasilva stressed that companies need to iterate in order to innovate.
As part of Pride Month, RBCDisruptors profiled Dasilva, a leading voice for the LGBT+ community in business and technology.
After Dasilva founded Lightspeed, he developed a mantra to ensure that everyone, regardless of gender or sexual orientation, had a seat at the table.
“That gave everybody the freedom to help us to grow the way that we wanted,” he said. “It allowed anyone at the company to be themselves and who they wanted to be.”
Lightspeed’s growth has soared since its start in a converted Montreal home and has become one of Canada’s most successful tech start-ups in recent years after its latest financing round in October that values the company around $1 billion. The company makes a cloud-based point-of-sale system that runs on tablets and computers aimed at for independent retailers and restaurants who annually process $15 billion worth of sales in over 100 countries.
Several recent studies that examine the business impact of LGBT-positive workplaces conclude that inclusiveness results in a more innovative and productive workplace. A study published in the journal Management Science in 2016 found that companies in U.S. states that are considered to be more gay-friendly are actually significantly more innovative, specifically producing higher rates of patents.
On average, companies based in U.S. states that passed laws that prohibit discrimination based on sexual preference or gender identity experienced an 8% increase in the number of patents and an 11% increase in the number of patent citations, compared to states that did not pass such a law.
And yet, LGBT+ people are among the most marginalized employees, according to a recent report by Diversio, a Toronto-based firm.
Diversio surveyed 2,100 people in 20 companies in Canada, the U.S. and Britain and found that LGBTQ2+ employees felt more at risk of workplace harassment, and were twice as likely to feel their opinions were not sought out or valued by their employers.
Dasilva shared an example in which he encouraged Lightspeed’s management to focus on diversifying the company’s data science team to gain additional perspectives.
“If we only build certain predictive models, it’s a self-fulfilling prophecy that creates a certain set of solutions. As great as the AI community is in Montreal, we have to have other viewpoints work on that data science and find new and different angles.”
Supporting LGBT+ inclusion also makes better business sense. A 2017 report by the Center for Talent Innovation concluded 71% of LGBT respondents and 82% of LGBT-supportive allies are more likely to purchase from LGBT-inclusive companies. Even more importantly, LGBT+ inclusiveness drives market innovation as teams with members whose sexual orientation matches the target consumer are much more likely to understand the market, the report found.
“We’re all looking for sources of innovation,” Dasilva said, stressing that one of his goals in technology is creativity. “All of the best of us is when we’re involved in something that’s creating good.”
After Dasilva launched Lightspeed, he discovered he had created a “monoculture” by hiring people from his own network of friends and acquaintances. It limited the company’s growth. “You have to own up to your mistakes and widen your circle,” he said. “You have to get out of your comfort zone of the people who are like you.”
In addition to managing Lightspeed ahead of a possible IPO next year, Dasilva also runs Never Apart, a Montreal-based non-profit organization that encourages social change through cultural programming. He understands that his role at both groups is to foster and build leadership, in the corporate world and within the LGBT+ community.
“The purpose of these two organizations is to build up leaders. You can’t make change in the world without having everyone see themselves as a leader.”
As Senior Vice President, Office of the CEO at RBC, John Stackhouse is responsible for interpreting trends for the executive leadership team and Board of Directors with insights on how these are affecting RBC, its clients and society at large. Prior to this, John was editor-in-chief of The Globe and Mail (2009-14), editor of Report on Business, the newspaper’s national editor, foreign editor and its foreign correspondent based in New Delhi, India (1992-99).
By John Stackhouse
June 21, 2018