4 days ago
Three reasons why diversity gives small businesses in SA a competitive edge
Research shows that building diverse teams is so much more than a moral or ethical imperative. In an increasingly interconnected working world, diversity can translate into tangible business metrics.
Image: Charles Forerunner on Unsplash
There is a strong case for diversity and inclusion in business – and not just among large corporates. Given the vital role that small and medium-sized enterprises (SMEs) play in the South African economy, their potential to contribute to a more inclusive and diverse economic landscape should not be overlooked.
Research shows that building diverse teams is so much more than a moral or ethical imperative. In an increasingly interconnected working world, diversity can translate into tangible business metrics.
For example, in a study conducted by LinkedIn, 60% of respondents said that diversity within their sales team contributed to greater levels of success.
In this particular study, 'success' was benchmarked across a number of different metrics.
The study reveals that teams with more diversity were tied to higher sales conversion rates, higher revenue, better deal-making ability and better customer satisfaction.
More diverse teams have also been found to outperform their peers in terms of non-revenue related metrics, such as better decision-making, higher levels of innovation, better talent retention and more effective problem-solving.
Diversity in the workplace can also be a powerful way to expand and scale a business.
To this point, research by the Harvard Business Review found that employees at diverse companies were 45% more likely to report that their company's market share had grown and 70% reported that their company was able to expand into a new market.
Within a small business, having a diverse team can be a competitive differentiator, for these 3 reasons:
Representation unlocks real insight
Having a team that is representative of society can be the key to unlocking different perspectives – after all, if everyone sees the world through the same lens, how can you spot blind spots?
Diverse voices can help challenge assumptions, identify missed opportunities and create solutions that resonate with a broader audience.
In an e-commerce SME, for example, the ability to convert a digital lead into a sales conversion using a very targeted sales funnel is the ultimate goal.
Having a diverse team could help marketers tailor their messages and tone in a way that is inclusive and accessible.
They could also help the business understand the buying behaviour of niche audiences, providing proactive suggestions on which payment options would work best.
A diverse team would also be in the best position to interpret subtle language cues in customer reviews and use that feedback to improve aspects like customer service, product development and sales strategy. More relatability = more customer loyalty
Furthermore, having a diverse team can also be a key way to build trust with your target audience – the more customers can relate to your business and your brand, the more likely they are to choose you over your competitors.
This is particularly true within sales environments.
Consider how wider the reach of a business can be if its sales team spoke a range of languages. In South Africa, which has 12 official languages, being able to communicate with sales prospects in their own native tongue can be a game-changer.
Speaking someone's language – quite literally, can help break down barriers, create space and opportunity for open dialogue as well as foster a sense of familiarity and comfort. These are all important building blocks for trust.
Diversity increases reach
One of the most impactful ways that small businesses with diverse teams can contribute to society is by fostering an inclusive economy.
In South Africa, where large segments of the population are still underserved, SMEs driven by diverse teams have the influence needed to address this pressing need by bridging gaps to improve access.
This is especially true in underserved locations such as townships and rural areas.
Each of these areas represents an untapped market that could benefit immensely from a symbiotic relationship between providers of products and services and the unique needs and challenges of the community.
By involving local talent and perspectives in business strategy, small enterprises can create offerings that are not only more relevant and accessible, but also empower communities economically, while building trust, loyalty, and long-term sustainability in the process.
Jeremy Lang is Managing Director at Business Partners Limited.
Jeremy Lang is the managing director at Business Partners Limited.
Image: Supplied
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