…Having a diverse team and treating it well leads to less turnover, which saves your company money. According to Korn Ferry, a global organizational consultancy, a whopping 84 percent of the 700 respondents to their executive survey in 2015 said “a lack of attention on diversity and inclusion contributes to employee turnover.” If you’re worried about “white flight” in a diversifying workplace, you can stop. This UC Berkeley study of 800 firms found “no consistent evidence that diversity itself increases turnover.” Rather, the study’s authors found that employees from groups in the minority in a workplace were more likely to leave the less represented their group was.
As a part of our series about “How Diversity Can Increase a Company’s Bottom Line”, I had the pleasure of interviewing Ned Staebler.
Ned Staebler serves as the CEO of TechTown, Detroit’s most established business incubator and accelerator and Vice President for Economic Development at Wayne State University. He leads both organizations’ efforts to strengthen the Detroit region’s neighborhoods, businesses and leaders, overseeing a range of activities around innovation and entrepreneurship, business development and attraction, talent retention, transit and mobility, and placemaking.
Staebler previously served as the Vice President for Entrepreneurial and Capital Services at the Michigan Economic Development Corporation. In this role, he was responsible for the oversight of the Michigan Strategic Fund Board and the 21st Century Jobs Fund, a $2 billion, 10-year initiative to transform Michigan’s economy. As part of these efforts, Staebler led the investment and management of $600 million of state funds into entrepreneurial companies, venture capital and private equity funds, and strategic service providers.
Staebler also spent nearly a decade in the private sector, working in both startup and Fortune 150 environments. He served on the management team of the Helios Group, a technology-based, startup financial services firm that he helped grow from 30 to 130 employees. After Helios was acquired in 2000 by Bear Stearns, he spent the next three years in the company’s London, England office as an Associate Director.
A Detroit native, Staebler is a graduate of the University of Detroit Jesuit High School and Harvard, and he received a master’s degree from the London School of Economics and Political Science. He serves on various boards, including NextEnergy, Midtown Detroit, Inc., the Detroit Historical Society, MichBio and the Ann Arbor Local Development Finance Authority.
Thank you so much for doing this with us! Our readers would love to “get to know you” a bit more. Can you share your “backstory” with us?
I’m a native Detroiter with a strong family legacy of public service. I went to a local Jesuit high school with the motto “Men for Others” and planned to follow a path of service in my career. But, even before the craziness that is 2020, life showed it had lots of surprises in store. I was in college in the early 1990s during the Clinton versus Bush Sr. debates. I remember thinking that these were two guys seriously out of touch with average Americans and reflecting that if I was going to influence public policy, I should try to get a better understanding of how that policy impacts real people. So, I decided to go out into the “real world” (or a 20-year-old’s version of it) and spend a couple of years (a 20-year-old’s notion of how long it takes to understand anything) working, paying taxes, and building something.
I took a job with an early stage FinTech, helped grow it from 30 to 130 people and woke up in London nearly 10 years later working for a Fortune 150 investment bank. Needless to say, things had not gone according to plan. So, feeling disconnected from home and my mission, I quit the banking world, went back to grad school, and discovered “economic development.” In 2005, I moved back to Michigan and started working for the state’s economic development agency, putting both my passion for public service and my professional experience to work.
Can you share the funniest or most interesting story that happened to you since you started your career? Can you tell us the lesson or take away you took out of that story?
Really early on in my career, I was at a bachelor party for one of my firm’s senior people. I was still a clerk, trying to get noticed and promoted. I was talking with another senior leader who expressed interest in my progress, and he told me that he heard from my boss that I was struggling in my role. He offered to help.
I was shocked. I had gotten nothing but positive feedback from my boss and thought I was ahead of the curve. I immediately tracked down my boss (who was also at the party) and confronted him. He immediately ’fessed up and admitted that he had only told the leadership team I was struggling so that they wouldn’t poach me away to work for the managing partner. I was irate, but I managed to turn it into a raise and a fast track for a promotion. I also got him to clear my name at the company.
What did I learn? Well, here was this senior guy who I thought was looking out for me by taking me under his wing, but he had basically stabbed me in the back. I learned very early on about the importance of recognition. People doing the work need to know that they are seen and valued both inside the company and with external stakeholders. Sometimes this can be reflected in money or titles, but frequently the recognition itself is compensation enough.
What advice would you give to other CEOs or founders about how to manage a large team?
First, it’s a skill set. Just like anything else you do in life, you can’t expect to be great at it right away, but you must be intentional about getting better at it. You need to study other leaders — hopefully you had some good examples on the way up the ladder — and you need to practice, practice, practice. Read the books and try different tactics until you find a set of strategies that work for your leadership style and team.
Remember, you will make lots of mistakes in this process and, even when things are “running on all cylinders,” not everyone in a large team will be happy all the time. People bring lots of things to the table that are way beyond their leader’s ability to control. Whether they’re facing a tough home situation, are struggling financially, or caring for an elderly parent, that becomes something that affects a team and, therefore, something that the leader will have to create room for at the office and support the team member through.
What advice would you give to other CEOs or founders to help their employees to thrive?
That’s easy. Care. Care about your employees. If you don’t care about them as people — as individuals — you will be a bad leader. That doesn’t mean you sacrifice results and the bottom line, but it does mean that to support your people, you often you have to make short-term decisions that would make your instructor in business school pull his hair out. That’s OK. In the long run, it will pay for itself and more.
And, you can’t fake this. Putting up signs that say “We care about you” while implementing policies that don’t reflect that is a surefire way to have high turnover, low morale, and lousy culture.
What do you think makes your company stand out? Can you share a story?
My company stands out because we actually walk the talk. We teach entrepreneurs to be nimble, make sure they’re meeting market needs and are constantly evaluating their product offerings and customer experiences. So, we try to do the same.
The perfect example of this is when COVID-19 hit Michigan back in March. We saw it coming throughout February, realized that there would be zero coordinated national response, and planned accordingly. So, in the first two weeks of March, we were able to take all of our services virtual, move our own administration to remote environments seamlessly, and begin to assess what our clients (aka Detroit’s small businesses) would need. Over the weekend of March 14, we talked with them about the impending shutdown and discussed the impact on their already-weak cash positions. By Tuesday, March 17, we announced a grant relief program, started taking applications by March 17, and had money going out the door within two weeks. Over the next few months or so, we supported 700 small businesses with $1.2 million in grant support to tide them over until the state and federal authorities were able to respond.
Are you working on any new or exciting projects now? How do you think that might help people?
We are ALWAYS working on new things. The most important one is around rebuilding our main street businesses in an inclusive and equitable way. COVID-19 has absolutely devastated small businesses across the country, with at least 20 percent of them saying they’ve closed for good. A recent NY Fed report placed the number of Black-owned business closures at closer to 40 percent. So, how do we rebuild and make sure that BIPOC and women-owned businesses get access to support in a time when resources are scarce?
Over the past decade, we’ve built out the nation’s most inclusive and diverse pipeline and pathway for small business support. We’ve identified and removed barriers for thousands of entrepreneurs as they’ve moved from ideation to launch to growth, and we do it for businesses regardless of whether they’re selling medical devices, donuts, haircuts, gourmet dinners, environmental consulting or custom-designed jeans. We’ve become the nation’s leading authority on equitable small business support, and we’re getting asked by people from Honolulu to Providence to help them set up similar ecosystems.
Ok. Thank you for that. Let’s now jump to the main part of our interview. This may be obvious to you, but it is not intuitive to many people. Can you articulate to our readers five ways that increased diversity can help a company’s bottom line. (Please share a story or example for each.)
Let’s be clear, because I know that some bottom line-focused leaders question why we need all of this diversity stuff in the first place. Well, it’s simple. Diverse teams produce better financial results. There’s ample data that proves this out. This McKinsey study, for example, found that “Companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians.” So, if you like a better bottom line, you need more diverse teams.
- Why? Well, for a start, diverse teams make better decisions faster. You’ve likely sat in a meeting flipping through your Instagram feed while two senior “decision makers” (who were both white males) thought their way to an idea you knew was destined to fail or they butted heads and egos while putting off a decision until the next regularly scheduled meeting. According to this study by Cloverpop, “inclusive teams make better business decisions up to 87 percent of the time,” and “teams that follow an inclusive process make decisions 2 times faster with 1/2 the meetings.” Who couldn’t use a world with fewer meetings!
- Also, diverse teams are vastly more likely to better understand your customers. This helps you design products and services that have a more solid product/market fit — a key component for success. The presence of more women in R&D (research and development) teams, “is positively related to radical innovation,” and more diverse leadership teams “are more likely to introduce new product innovations than are those with homogeneous ‘top teams.’” Innovative products + better product/market fit = more revenue.
- Diverse teams can keep you out of trouble. You know that old saying that any publicity is good publicity? Cancel Culture has cancelled that saying. The last thing your company wants to do is run a racially insensitive ad like the infamous Pepsi commercial where Kendall Jenner cures racism with a soft drink. Clearly, they needed some BIPOC representation in that process. JWT India posted draft Ford Figo ads that featured famous people driving around with scantily clad women bound and gagged in the trunk of one of their cars. I’m guessing no women were involved in making that decision.
- Talent. Everyone is talking about the global war for talent. The number one request I get from businesses is, “Can you help me find talent?” Before COVID-19, the competition for talent was fierce, and with WFH (Work From Home), it’s ramped up even more. And, talent IS diverse and WANTS to be around similar diversity. Top performers are too savvy to be fooled by an inspirational poster or an annual event. If your leadership is all male and your team is homogeneous, you’re going to struggle to attract top talent.
- Finally, having a diverse team and treating it well leads to less turnover, which saves your company money. According to Korn Ferry, a global organizational consultancy, a whopping 84 percent of the 700 respondents to their executive survey in 2015 said “a lack of attention on diversity and inclusion contributes to employee turnover.” If you’re worried about “white flight” in a diversifying workplace, you can stop. This UC Berkeley study of 800 firms found “no consistent evidence that diversity itself increases turnover.” Rather, the study’s authors found that employees from groups in the minority in a workplace were more likely to leave the less represented their group was.
Bottom line? If you care about the bottom line, you need an intentional strategy for being more inclusive at every level of your organization.
How have you used your success to bring goodness to the world?
Public service remains core to my daily life. I’ve helped found a giving circle at a local community foundation. I’ve served on numerous public boards and authorities like the Regional Transit Authority for Southeast Michigan and the City of Detroit’s Commission for Sustainability. And I’ve contributed thousands of hours to nonprofit boards and political issue campaigns to improve public health outcomes, protect the environment, and secure voting rights and legal protections for all Americans.
Can you please give us your favorite “Life Lesson Quote”?
“I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” ⎯ Maya Angelou
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are?
As cheesy as it sounds, I’d like to thank my mother, Sally Schwartz. After my parents split up, she busted her butt to be a great single mother. She worked incredibly hard and still never missed a basketball game. She helped with homework and was always there to inspire my dreams and support my goals.
We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US, whom you would love to have a private breakfast or lunch with, and why? He or she might just see this 🙂
I love to read biographies and history. But Abraham Lincoln and Teddy Roosevelt are no longer with us. So, I’ll pick Michelle Obama. I recently read Becoming, and she would be a fascinating person to share a meal with. She has been a part of some of the most transformative events in recent history, yet she still seems incredibly in touch with what makes people human.
Ned Staebler of TechTown Detroit: “Here Is How Diversity Can Increase a Company’s Bottom Line” was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.