Permanent DE&I progress—how ‘intelligent failure’ can unlock industry growth

Unfortunately, but predictably, most DE&I programs fail. But what if we had a better relationship with failure that allowed us to make sustained improvement? Principles of intelligent failure offer a framework for embracing small but transformative changes, writes Harvard Business School professor Amy Edmondson in her new best-selling book, “The Right Kind of Wrong.” Also read: DE&I in advertising—why real progress has been made Edmonson, who has been a guest on the video series “System Overload,” lists four conditions of intelligent failure: By resetting our outlook on failure as experiments—a game strategy rather than a sport of blame—individuals at all levels can take meaningful, incremental steps toward diversity, equity and inclusion. Edmondson offers three types of failure: complex, basic and intelligent. Complex failures include multiple system breakdowns; basic failures involve mistakes that are generally preventable (e.g., human error); while intelligent failures are praiseworthy because they produce insight and risk little (e.g., experiments). Ad Age Leading Women Luncheon Join us Aug. 7 in New York as we recognize this year’s honorees Buy your ticket today In 2023, the Supreme Court put a spotlight on a DE&I failure in academia—the attempt to impose equitable outcomes—but not without teaching a valuable lesson: Organizations should instead create equal opportunity, says U.S. Equal Employment Opportunity Commissioner Andrea R. Lucas. So, what does an equal opportunity look like? I teach at Columbia University—built in 1754 before both the United States was a country and the federal court system was established—a school required to comply with DE&I-related protections such as Americans with Disability Act (ADA). One such protection includes ramps that remove long-time physical barriers to access. Today, it’s almost impossible to distinguish the architecture of inclusive infrastructure such as ramps that enable one group of people opportunity and another group ease. For DE&I to succeed, we need more intentionally inclusive infrastructure architected into organizational systems—practices, processes, policies and programs. When considering processes, “small bets” could address WARC’s 2023 Future of Strategy report finding that only 6% of agency briefs from clients contain KPIs or objectives related to diversity, equity or inclusion: The way forward Experimentation in DE&I training—by continually recalibrating programs based on intended behavioral outcomes—has been suggested by University of Pennsylvania professors Adam Grant, Angela Duckworth and Katherine Milkman, who all specialize in organizational design and/or behavior change. Meanwhile, Princeton University professor and MacArthur fellow Betsy Levy Paluck—whose 20 years of work includes studying 13 interventions related to prejudice reduction—found training is the least effective. What works best, Paluck discovered, is envisioning prejudice as happening to someone who you know so the topic is tangibly relatable. In other words, activating DE&I for change management and growth requires it to become concrete, individual and relative to the position and outlook of each employee. The business value of failing forward What are our choices for a pathway forward: Operate with a 10X mindset—a practice that has always attracted the advertising industry (e.g., M&A, new departments)—or greenlighting an approach of small, incremental changes for an annual 1% improvement (e.g., changing employee engagement surveys and/or performance reviews)? Generally, our industry has been attracted to 10X solutions, but these can overlook incremental changes that close feedback loops to improve system function for desired future outcomes. This is where James Clear’s philosophy in “Atomic Habits” becomes particularly relevant to the next phase of DE&I as a function of change management. U.S. CEOs are generally overconfident in their handling of ESG issues, compared to how their boards rate company efforts, according to the Conference Board’s 2024 C-Suite Outlook. In 2020, Edelman’s Trust Barometer revealed the fallacy of waiting for C-suite action to fix DEI. Specifically, people most distrust CEOs on issues such as racism and racial injustice; experts, teachers and activists ranked the highest. While 10X solutions may make great public announcements for attention, they rarely translate into permanent inclusive infrastructure. The new principle-practice gap, as highlighted in Georgetown Law School professor Jamilah Bowman Williams' research, points to a significant disconnect between commitments advertising leaders make versus those they execute. Inclusive infrastructure such as evolving the creative brief process is a small bet to permanently close the gap. The best and worst Super Bowl ads Ad Age reviews the Big Game commercials Click here Getting the balance right between issues employees face (racism, bias, health disparities) and those they embody (well-being, mental health, fulfillment) has three business benefits: profitability, business resilience and reduced employee disengagement cost. Since 2015, McKinsey has quantified the positive business results of DE&I efforts, and in 2023 affirmed the positive impact of creating a collaborative environment. Based on the experience of 1,800 organizations in 15 countries, McKinsey found that organizations balancing “people” (i.e., caring and encouraging) with “productivity” (i.e., goals-oriented and top-down) were 28% more profitable, had a four times higher likelihood to maintain financial performance over a 10-year period and had more revenue resiliency during the pandemic. According to Gallup’s 2024 workforce study, employee disengagement cost organizations more than $1.9 trillion annually—about $15,000 per disengaged employee. There’s a cost to inaction. DE&I pledge We need intentionally inclusive infrastructure for sustainable DE&I progress. The way to meaningfully fail forward is by making diversity and inclusion a part of every conversation, decision and action related to business growth—and taking the DEI pledge as a well-crafted intelligent failure. By signing up at www.DEIpledge.org, you are not just making a statement; you are supporting a movement for responsible business. Signing the pledge affirms you’d like your organization to add one open-ended, optional question to employee engagement surveys and performance reviews: What have you done to advance diversity, and equity and inclusion at this organization recently? Through collective action, advertising and public relations can activate Edmonson’s principle of intelligent failure as the industry ventures into the new territory of permanent progress through small bets. May your failures be spectacular. #LetsGetToWork Coming this month: A report on the intersection between DE&I, “popular culture” and sales with insights from Mellody Hobson, Marcus Collins, and Kristen Cavallo. Sign up for Ad Age newsletters From influencer marketing to agencies, get the latest news and analysis delivered to your inbox Click here

Permanent DE&I progress—how ‘intelligent failure’ can unlock industry growth

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