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naraburns  nihil supernum  2yr ago (text post)   33478 thread views

Culture War Roundup for the week of February 13, 2023

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There exists an entire consulting industry that performs research on the benefits of DEI training, the benefits of a more diverse workforce, the success of organizations which have more women/LGBT people in leadership positions, etc. Here is the consulting company Accenture's summary of the benefits of DEI to companies and organizations that adopt their practices.

I am of the belief that it is people's knowledge, experience and competence that determines whether or not an organization will be successful in its goals. It seems extremely unlikely to me that any problem corporations are interested in solving becomes easier the more members of your project team possess a uterus. Likewise, it seems unlikely your organization will gain magical insight into any real problem of interest by virtue hand-selecting team members whose ancestors have a specific continent of origin. And I have a hard time believing there is a benefit to adding more members of your team who are sexually aroused by humans who share their same sex organs (or adding members of your team who wish to change their sex organs via surgery or chemical sterization).

My priors are stacked so incredibly hard against studies which demonstrate that there is actually a benefit to structuring teams based on hand-selecting people who are LGBT, people from Africa, or adding more women. Indeed, it feels like if you lower qualifications to hire people from these groups, it can only result in organizations which are less qualified.

I'm wondering how it is possible that these consulting companies succeed in designing studies that show the opposite of (what I believe to be) reality. Is it all publication bias and p-hacking? My intuition says that it is. But there are some pretty powerful-looking studies that seem to be hard to explain via that explanation alone. Looking at an example of one of the studies done by McKinsey in the above link:

Earnings Before Interests and Taxes (EBIT) margins

McKinsey & Company’s global study of more than 1,000 companies in 15 countries found that organizations in the top quartile of gender diversity were more likely to outperform on profitability—25% more likely for gender diverse executive teams and 28% more likely for gender-diverse boards. Organizations in the top quartile for ethnic/cultural diversity among executives were 36% more likely to achieve above-average profitability. At the other end of the spectrum, companies in the bottom quartile for both gender and ethnic/cultural diversity were 27% less likely to experience profitability above the industry average. Researchers measured profitability by using average EBIT margins

What is the plausible mechanism behind which research that shows these kind of results are created? Are they measuring something that is real (i.e. does a more diverse workforce actually make companies more money)? Or are the brilliant people at McKinsey meticulously hand-selecting the companies to design studies which will show the opposite of reality?

I can see some cases where ethnic diversity would genuinely help in gaining access to new markets.

I know a Chinese Malaysian girl who came to Australia 10 years ago. Reasonably proficient in English, but fluent in Mandarin and Malay. She has an understanding of business hustle that is far beyond what many people from the local Australian culture have (which is based on going to uni and getting a good career; as compared to starting your own business.)

Because of this, she has years of experience in sourcing manufacturing direct from Chinese factories and an understanding of the tastes and predilections of consumers in Malaysia. Australian born executives in the major retailer that shes contracted to had no idea how to directly commission products, or organise drop shipping from factories in China. She also has a better understanding of the scalability of eCommerce platforms in larger markets (Australia is a small market at ~25 million people compared to many countries in Asia. There are big profits to be made if you posture yourself correctly, but who knows how to do that when the culture and language are so different?)

tldr; People from other countries and ethnic backgrounds can have knowledge that is unavailable in a homogeneous society.

But would this apply to women, LGBT, people with a disability etc? Probably not beyond their tastes and needs as consumers/users. And would it work at scale? Would more than 1 person from Malaysia be able to provide more information? Would a person from Nigeria be able to provide the same value with knowledge of African markets and customs?

Edit: added a bit more info.

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