Small Business Diversity Makes a Big Impact

• Committing to diversity in your business requires self-examination.
• Achieving true inclusion won’t happen in a single step.
• Creating internal metrics to gauge success is key.

When big businesses decide to ratchet up their diversity efforts, they deploy money, well-staffed HR departments and teams of consultants to help them get it right. But what happens when the smallest businesses commit to diversity? Where should they start?

It’s a challenge thousands of entrepreneurs face as diversity rises in importance alongside the tasks of marketing, hiring and accounting. While figuring out how to keep their companies successful, business owners have to answer new questions: Will customers think my business is inclusive based on my marketing materials? How do I recruit a diverse staff for a small number of jobs? Is this something I need to think about now?

Lawrence Sturkey had to answer those questions when he founded Community Electric LLC in 2016. The 38-year-old master electrician previously worked for 16 years for a major contractor, where the lack of diversity among leadership convinced him he’d never get a better opportunity unless he created one.

Sturkey says he knew his firm had to include diversity across racial, gender and generational lines to be successful in the multicultural Atlanta neighborhoods he serves. But, with only four positions on his staff, he had no blueprint to create the team he wanted.

“Diversity is huge,” says Sturkey. “But it’s tough; I had to figure out how to start a company, buy equipment and keep it running, and have a team that can do it all. I feel like in order to do that, you have to have perspectives from all people.”

Around the country, small businesses are being challenged to create diversity efforts from scratch. Even entrepreneurs who have long considered diversity key to their success are creating new plans, hiring consultants and examining their operations from top to bottom.

“What we’ve observed since last summer is a lot of smaller businesses asking for the first time how they can go about addressing diversity, equity and inclusion within their workforces,” says Kelly Yeates, Vice President of Service Operations at Insperity, which provides administrative services to small businesses.

“Prior to 2020, smaller businesses felt like diversity was kind of a big-company issue—you had to have a certain scale of employees to be at a point where you needed to address things like diversity, equity and inclusion,” says Yeates, who focuses on HR operations. “That pivoted very quickly last summer. Within a month to six weeks [of George Floyd’s death], we really saw the pivot there in that smaller space.”

Melanie Miller, an Atlanta-based diversity strategist, offers business owners seven steps to guide their diversity journeys, regardless of company size: examine your own biases; distinguish between personal preferences and business imperatives; invite a diverse group of people to vet your business practices for inequities; seek diversity education for all employees; be aware of cultural blind spots; routinely examine hiring practices; and know the difference between company culture and strategy.

“It’s about ensuring that people get what they need to thrive, which is different from everyone getting the same thing,” Miller says.

At Guided by Good, the Atlanta-based parent company of three small creative services firms, implementing diversity from scratch meant putting pen to paper. Founded in 2016, the firm created an action plan for building an equitable workplace, and each year, it carries out an internal diversity audit of its hiring and operations, which it makes available to the public. The most recent audit reported that the company’s workforce is 75% white and 24% people of color (a category it further broke down into specific racial and ethnic categories).

“None of this happens overnight,” says Janis Middleton, Guided by Good’s Executive VP and Executive Director of Multicultural and Inclusion Strategy. In order to make progress on diversity, companies have to “be OK with the mistakes that you are going to make, and also have to be open about that and let your staff know, ‘I’m not always going to get this right,’” she says.

Though they differ in approach, Guided by Good and Community Electric embody the small-business diversity trend described by Yeates. Both companies were aware of the need for diversity from their beginnings, but implementing a diversity strategy to fit their individual businesses took them along different paths. Sturkey determined that his team would be diverse along ethnic, gender and age lines in order to reflect the company’s customer base and to develop a feedback loop for the firm’s leadership. Guided by Good brought Middleton, a longtime diversity consultant, in-house to oversee its diversity and inclusion program, which tracks the company’s hiring and promotion practices as well as its creative, business development and client service processes.

Tiffany Bussey, Executive Director of the Morehouse Innovation and Entrepreneurship Center at Atlanta’s Morehouse College, says that although most companies start diversity conversations by looking inward, business owners should remember that the end result should always reflect a greater commitment to customers. 

“Successful businesses really answer the pain points of their customers, and who better to understand that diverse customer set than a diverse set of workers?” she asks. “Getting better at serving the customer will improve the business, and when a company sees its bottom line increasing because of the things that they are doing, that’s what’s going to stick.”

Learn More:
• Eight Ways to Effect Change After Diversity Training (Chief Learning Officer)
• Understanding Racism and How to Defeat It (TED)
• Unlearning What You’ve Been Taught About Racism (Harvard Gazette)

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