In February 2013 I spoke with a class of Harvard undergraduates who were about to graduate. They were seeking career advice. My supposition going into the meeting was that I would offer some thoughts from my career and answer their concerns about the ‘real world’. The reality was that they were much more in touch with aspects of the real world than I was.

They had tracked various companies on social media (and not only through their ‘official’ sites). They were up-to-date on how various minority groups viewed the different organisations and what they said about working there. Having experienced diversity during the college years, they are loath to now give it up. The new reality is that the many graduates will actively seek ‘diverse’ organisations because they associate them with creativity, stimulation and fun. They are therefore initiating a virtuous circle of talent and diversity, which firms need to tap into if they want to hire them.

Klaus Schwab, Founder of the World Economic Forum, has spoken of the move from capitalism to ‘talentism’.15 Demographic shifts mean that the best talent doesn’t necessarily look like it used to – if an organisation is not appealing to diversity then it will lose out. The talent pool is increasingly international and increasingly diverse. The Corporate Leadership Council has undertaken research on the Employee Value Proposition (EVP) and The Real Business Case for Action found that with a strong EVP, companies can avoid paying a premium to attract the right talent. When most of the new entrants into labour markets in North America and Europe are minorities, the EVP needs to be diverse. Generation Y, for example, wants 40 days’ holiday per year.16 Generation X is more concerned with medical coverage. And since recruitment happens overwhelmingly online now, through LinkedIn, apps and tagging, it’s per- sonal. Since people are infinitely diverse, diversity is in the ascendancy now, irrespective of whether recruiters are switched on, like it or ‘get it’.

As well as the personalisation of recruitment, the same dynamics apply to retention. Employees want an ‘effective ecosystem’. As well as safety and security, people want to participate in a fulfilling career, to do ‘something more than the individual’. In this sense, real inclusion becomes critical in terms of employee engagement.

If we are seeking to recruit and retain the best talent, we need to appeal to the individual (infinite) diversity characteristics of individual employees. Through adopting real inclusion policies LOCOG achieved employee engagement scores among minority groups that exceeded the average for all employees (which were already very high). This was captured in the regular YourSay staff survey and based on 20 diagnostic questions broken down by diversity monitoring. The fact that employees who identified with a minority group and who ‘traditionally’ would score less on equivalent surveys scored higher on this one strongly suggests LOCOG was effective in capturing discretionary effort.

Real inclusion is good for employee recruitment and retention. Consider the market for talent, which is in flux as never before; the top 10 in-demand jobs in 2010 did not even exist in 2004.20 The US Department of Labor estimates that the average current student will have 10–14 jobs by the time they are 38 years old. One in four current workers has been with their employer for less than one year.

In this mobile market staid organisations will not be able to attract or retain the right talent. Ten years ago, a top bank, law firm or government agency had to compete among themselves for the best and the brightest, as they perceived them. Today, the best talent is empowered by technology and information to enter different sectors (technology being the obvious one), to be more discerning in their choices, or to start up their own business. Why would a talented young person choose a discriminating, or even just homogeneous, environment when they have all these other options to choose from where they can be themselves?

The consulting firm McKinsey launched their now seminal ‘War for talent’ report in 1997.22 It positioned increasing competition among organisations for talent as a key driver of organisational success or failure. As The Economist noted in 2006,23 many in HR are unclear about the definition of talent, but it is clear that in increasingly global, increasingly flexible labour markets, diversity is emerging as a key differentiator in attracting such talent.

The recruiter Ann Marie Dixon Barrow has evaluated new research based on evolutionary ecosystems that suggests that diversity is essential for future success. If evolution is the result of two forces – variation (diversity) and selection – then diversity (or choice) is a prerequisite of growth. With- out choice, the best cannot be selected and therefore growth (amplification) is limited. We are in a time of ‘punctuation’, when the world is changing rapidly and survival depends on being able to adapt. Variation, selection and adaptation are critical to success.

One of the insights in Laura Liswood’s book The Loudest Duck (2010) is that many corporations seek to build a ‘Noah’s Ark’ of diversity, with two of every kind represented to check all the boxes. Savvy jobseekers see through that now. Whereas Diversity 101 or 2.0 programmes may recruit said ‘couples’, if they are the only ones in the Ark they may well feel iso- lated and non-included and leave. Real inclusion is about throwing open the doors beyond token recruitment efforts, or segregated ‘initiatives’ to systematise the recruitment machine. Only then will a minority have more chance of finding they are not the only one in the house and the tipping point is reached sooner and more comprehensively.

Real inclusion is not only a transparent way to recruit diversity; it is also a risk-mitigating way to retain people. Real inclusion can help attract, retain and motivate employees effectively as well as ensuring that all talent pools are aware of the organisation and no talent self-selects out, without the organisation even knowing.

So in order to maximise customer market penetration and to maximise talent recruitment and retention, organisations should consider adopting Inclusion 3.0 programmes.

This article is derived from Stephen Frost's new book, "The Inclusion Imperative: How Real Inclusion Creates Better Business and Builds Better Societies."