Investing in the future: how DEI empowers SMEs to thrive

Investing in the future: how DEI empowers SMEs to thrive

Diversity, equity and inclusion (DEI) should be the norm at all businesses. But what can SMEs do to ensure they recruit a diverse workforce? Amy Lynch, Head of DEI at Thoughtworks, a global tech consultancy, discusses how SMEs can invest in DEI efforts.

The UK tech industry is booming, from AI start-ups to fast-building FinTechs. But the UK is still struggling to attract and retain a diverse workforce to power this level of innovation.
The data speaks for itself. A 2023 report by BlackRock found that companies with the most diverse workforces outperformed their country and industry group peers with the least-diverse workforces in terms of return on assets by 29% per year, on average. Similarly, research from global non-profit, Catalyst, revealed organisations with inclusive cultures see a 59% increase in innovation, creativity and openness. Imagine the untapped potential and the groundbreaking ideas waiting to be born from a wider range of perspectives.

Unfortunately, the current landscape presents significant obstacles. According to the Tech Talent Charter, only 9% of tech workers come from lower socio-economic backgrounds. The lack of access and opportunity creates a substantial barrier to achieving true diversity in the industry. That said, some companies resort to performative DEI initiatives that offer the illusion of progress without addressing the systemic issues that hinder real inclusion.

By investing in DEI efforts today, SMEs can unlock the full potential of their workforce, drive innovation and build a competitive edge in the ever-evolving tech landscape. At Thoughtworks, we prioritise genuine, data-driven approaches and remain committed to dismantling barriers to foster a culture of equity and belonging.

Mind the gender gap: a persistent challenge

Studies by Deloitte Global show that companies with strong gender diversity have a significant profitability advantage (21% higher). The tech sector, however, struggles to achieve this diversity. According to analysis from BCS: the Chartered Institute of IT, in the last quarter of 2020 women made up 19% of the UK IT industry. This lack of representation not only hinders innovation but also perpetuates a culture that discourages women from pursuing tech careers. Here at Thoughtworks, over 40% of our tech roles are occupied by women or gender diverse colleagues. Whilst we’re proud of what we’ve achieved, this is still much to do.

Further amplifying this challenge, new research by BT Group reveals a concerning gender gap in self-perception for tech careers among 11- to 17-year-olds in the UK. Nearly double the number of boys described themselves as ‘very well suited’ for tech compared to girls (25% vs 13%). This suggests that societal perceptions and self-belief starting at a young age can contribute to the underrepresentation of women in the tech workforce later.

Beyond headcount: building a culture of inclusion through actionable steps

Creating an inclusive environment goes far beyond numbers and celebratory awareness days. While increasing the number of women and underrepresented minorities in tech roles is crucial, it’s merely the first step. True inclusion requires fostering a culture that values diverse perspectives, experiences and backgrounds.

● Tackling unconscious bias: Unconscious biases, often stemming from societal norms and stereotypes, can creep into hiring and promotion practices, hindering diversity efforts. Equipping teams with the tools to identify and mitigate these biases is essential for creating a fair and equitable workplace.
● Expanding the hiring lens: Traditional interview panels often lack diversity of thought, limiting the candidate pool. By including a wider range of voices in the hiring process (e.g., individuals with non-traditional backgrounds or from underrepresented groups), companies can attract the best talent based on their skills, not their background. Additionally, considering candidates from broader hiring pools to attract more diverse talent ensures the hiring process is inclusive.
● Clear policies, clear path: Having clear and transparent guidelines for promotions, compensation and performance reviews ensures fairness in the workplace. Ambiguous policies can create opportunities for bias and hinder career progression for diverse employees. Having progressive inclusive policies that support colleagues throughout every part of their life, from Gender Inclusion and Transitioning at Work Policy, fertility policy and enhanced parental leave is another vital addition to organisational policy strategy,

Building trustworthy tech: ethical AI for a diverse workforce

The rise of AI has the potential to revolutionise the tech industry. However, concerns regarding bias in AI algorithms are valid. If not developed and deployed responsibly, AI can perpetuate existing societal biases, further marginalising underrepresented groups within the workforce. These concerns underscore the need for responsible AI development.

Thoughtworks’ Consumer AI research data shows this is a shared concern. A significant portion of consumers (47%) express anxieties about ‘human societal bias’ influencing AI. Additionally, according to a study conducted by Resume Genius, three in four said using AI in the recruitment process by employers should be forbidden by law.

The potential for bias in AI algorithms is especially concerning when applied to HR technologies. Imagine a resume screening tool that inadvertently prioritises resumes with certain keywords or phrasing, potentially filtering out qualified candidates from underrepresented groups. This can lead to discriminatory hiring practices and perpetuate existing inequalities within the tech workforce. This not only hinders diversity and inclusion efforts but also deprives companies of a broader talent pool, potentially missing out on the perfect candidate for the role.

Equipping SMEs with the tools and knowledge to combat bias in HR Tech

When selecting HR technologies, SMEs should prioritise tools that go beyond basic keyword matching and utilise skills-based assessments. These assessments can evaluate a candidate’s problem-solving abilities, critical thinking and other relevant skills, offering a more holistic view of their potential.

By equipping SMEs with both the right tools and the right knowledge, we can empower them to select HR technologies that promote diversity and inclusion within their tech workforce. This not only benefits underrepresented groups but also unlocks the full potential of innovation within the tech industry as a whole.

Innovation thrives with fostering an inclusive culture

The tech industry stands at a crossroads. While innovation thrives, a lack of diversity hinders its true potential. By embracing genuine DEI efforts, SMEs can unlock a wealth of talent, fostering a culture of creativity and driving measurable business success.

Investing in DEI isn’t just the right thing to do; it’s a smart business decision. Studies show a clear correlation between diversity and innovation, profitability and a competitive edge. By fostering a truly inclusive tech workforce, SMEs can unlock their full potential and play a leading role in shaping the future of technology.

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