5 Steps to Build a More Inclusive Culture and Retain Talent

Jane Yrenaya

As many companies assess their diversity efforts, they may realize that their successful goals of attracting and hiring more diverse talent have had very little or no impact on decreasing their voluntary turnover. This bodes two questions: how well are companies doing in their inclusion and development efforts to retain their current talent? Are they sustaining a psychologically safe culture in which people feel that they belong, are valued, and can contribute their best and whole selves? By not having a climate free from bias, fear, and judgement, companies are coming to realize the limiting effects this can have on their business, resulting in disengagement and employees leaving out the back door.

Peter Drucker is attributed to have said that, “culture eats strategy for breakfast.” This implies that no matter how effective a recruitment strategy is, if a culture is not healthy, employees will not be motivated, happy, nor give their very best. People have the power to choose. Without psychological safety embedded into a culture, people can choose to hold back their talents and contribute just enough to keep their job, stifling progress for themselves and the company. Ultimately, top performers can reach a point where they leave in search of more fulfillment.

According to Glassdoor, the average company in the US spends about $4,000 to hire an employee, taking up to 52 days to fill a position. If you multiply the expense by the number of new hires in a year, plus factor in the cost of lost productivity during the interim, the investment can be significant. Hiring right and retaining talent should be a top priority.

If an organization wants to attract and retain a diverse workforce that contributes to the organization, an inside-out approach should be taken by developing a culture of inclusion first, so hiring efforts do not go to waste.  A culture that is inclusive and that fosters growth, is a psychologically safe culture where diversity thrives. Although there are many ways to cultivate psychological safety, here are five things to consider:

Make Building Trust a Priority

In a high-trust organization, people tend not to be afraid. Fear activates the pain centers of the brain and forces employees into a defensive mode. When people are in this mode, they will protect themselves. When an organization practices high-trust behaviors, they will see that people will give wholeheartedly, communication will be more open, and people will thrive. And when people thrive, the organization will thrive.

Model Safe Behaviors

Everyone has heard that “it starts from the top.” “If you want to change the culture, change the collective behaviors of your leaders.”  That is true, but it doesn’t stop there. Anytime there are groups intersecting and socializing with one another, there will always be some level of interpersonal risk. There is no higher interpersonal risk in most workplaces than the one that exists between boss and employee. Helping teams cultivate psychological safety shows up best when leaders model the behaviors they expect.

Model psychologically safe behaviors by admitting to your own mistakes during team meetings, having open 1-on-1s, and respectfully delivering feedback. Saying things such as, “Thank you for your input. It has led me to consider other options that I did not think of,” or “Larry, you always have an interesting perspective on such matters, would you mind sharing with us what your thoughts are?” Modelling behaviors based on respect, dignity, and appreciation will help make it safe for people to share without the fear of being judged.

Elevate Leadership Skills and Behaviors

Strong leaders of people are those who have high emotional intelligence, effective interpersonal skills, and who understand that results are achieved through others. Leaders who understand this communicate more clearly and take time to coach their team. They naturally become more patient and empathetic and give feedback regularly. It is important to note that psychological safety is not about just being nice, but about being compassionate and caring enough to help the team succeed, even if it means giving tough feedback.

Select and Promote for Psychological Safety

A person’s effectiveness in creating psychological safety should be part of the criteria when selecting and promoting talent, especially for leadership roles. A lot of leaders are promoted because of their technical ability or their individual results. How effectively leaders connect with others and create psychological safety is not always top of mind. If results are achieved through the talents of their people, then having the emotional intelligence to create safe conditions is essential. If there is a skill gap in this area among your leaders, make sure to incorporate psychologically safe behaviors into your leadership development program and training. 

Be a Learning Organization

A learning organization is a psychologically safe organization where employees feel free to ask questions and make mistakes. Learning is an act of vulnerability and in the absence of psychological safety, people will hold back and stop learning to just “play it safe.” A safe culture where people can learn, grow and fully engage in the learning process can help them reach their full potential and contribute their best work.  When people don’t contribute their best talents, the success of any company can be threatened.


Cultivating psychological safety is about creating a climate where people feel accepted, valued, and that they belong. Inclusion, development, and wanting to contribute are human needs. When these needs are met, people will give wholeheartedly. Not only will this benefit the health of an organization, but it will also positively impact the lives of the people in that organization.

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