Three ways for companies to succeed in the 4.0 Industrial revolution
Miki Tsusaka is a senior partner and managing director of BCG Boston Consulting Group’s Tokyo office and the author of this feature
“As a Japanese woman, living in Japan, and a mother of three, the topic of diversity in the workplace strikes close to home for me. But diversity is not just a construct designed to right an imbalance. It is an untapped superpower that all businesses have the potential to access.
Diversity offers two major benefits: it buffers change, by avoiding the riskiness of monocultures, and, more importantly, it creates the platform upon which innovation and adaptation operate. Individuals with varied backgrounds approach business challenges with fundamentally diverse points of view, leading to better innovation and stronger business results.
Research backs this up. A Catalyst report found that companies in the top quartile for board diversity outperformed those in the bottom quartile, with 53 % higher return on equity, 42 % higher return on sales, and 66 % higher return on invested capital. These performance gains hold true for nearly every industry across the globe. A separate study found that boards need a critical mass of about 30 % women to outperform all-male boards. I am proud to say that BCG’s executive committee, of which I am an elected member, recently reached this 30% threshold.
While the business case for diversity is clear, execution occasionally misses the mark. In recent years, we have seen a wave of publications and pronouncements on the merits of diversity, but as a 2015 B Team report showed, efforts can backfire if the spotlight is focused exclusively on just hitting the numbers. Well-intentioned organizations make a mistake when they promote unqualified candidates for the sake of diversity.
While it can be easy to get swept up in the drive to increase numbers, quality trumps quantity every time. It takes time to recruit and promote top talent. Those who get it right will reap the rewards.
To win in this new business environment, where entire systems of production, distribution, and consumption are transforming before our eyes, a change in mind-set is needed. What got companies where they are now will not necessarily serve them well going forward. The status quo is no longer a comfortable place to be.
Throw the laurels to the side. Surround yourself with top talent. Set a bold course, and get ready to reinvent yourself. It is coming sooner than you think.”
This commentary was originally published by the World Economic Forum in Davos, Switzerland in January.