Building Stronger SME Teams: How to Leverage Diversity for Better Business Results

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In today's competitive business landscape, SMEs face unique challenges in attracting and retaining top talent. One key advantage SMEs can leverage is building diverse teams that foster innovation, resilience, and enhanced problem-solving capabilities. Here are practical strategies SMEs can implement to assemble high-performing, diverse teams.


Why Diversity Matters for SMEs


Diverse teams consistently outperform homogeneous ones, bringing varied perspectives, creative solutions, and improved decision-making. SMEs benefit substantially from diversity, as it allows them to innovate faster, respond better to market changes, and attract a broader customer base.


Practical Tips for Building a Diverse Team


1. Expand Your Recruitment Channels


Relying solely on traditional recruitment channels limits your access to diverse talent. Expand outreach through:

  • Specialized Job Portals: Utilize platforms dedicated to diverse hiring, such as Jopwell, DiversityJobs, or RemoteWoman.
  • Community Partnerships: Collaborate with local community organizations, professional associations, and educational institutions to reach underrepresented groups.


2. Craft Inclusive Job Descriptions


Inclusive language in job postings helps attract a diverse applicant pool.

  • Use clear, accessible language and focus on essential qualifications rather than exhaustive requirements.
  • Express a genuine commitment to fostering an inclusive and equitable workplace.
  • Consider using tools like Textio to identify and eliminate potentially biased phrasing.


3. Adopt Structured and Bias-Free Interviewing Processes


Implement structured interviews to standardize questions and evaluation criteria across candidates, reducing unconscious bias.

  • Ensure diverse representation among interview panels.
  • Focus on competency-based assessments rather than subjective opinions.


4. Prioritize Inclusive Workplace Culture


Building diversity is only effective when paired with genuine inclusivity:

  • Establish mentorship and sponsorship programs.
  • Conduct regular diversity and unconscious bias training sessions.
  • Foster open dialogue and feedback channels to address concerns proactively.


5. Use Flexible Working Models


Flexible work arrangements make your workplace accessible to individuals from diverse backgrounds, including caregivers, individuals with disabilities, and those from different geographic locations.


Real-World SME Case Studies


1. Avtar Group (India):

Avtar Group, founded in 2000 in Chennai, India, is a human resources consulting firm specializing in promoting workplace diversity, equity, and inclusion, with a particular focus on creating second career opportunities for women. They launched a job portal (myAvtar.com) as India’s first diversity job portal, which caters to women, LGBTQ+ individuals, person with disabilities (PWD), veterans, and seniors.[1]The portal hosts job fairs, upskilling programs, and events for underrepresented groups. Within the company’s first year of operation, they hosted three job fairs exclusively for women, which attracted over 6,000 registrations, over 50 employers with 1,000 interviews set and over 500 shortlists.[2] Avtar has influenced corporate inclusion policies and increased workforce participation for women in Tier I-III cities in India.


2. Findings from Reports and Studies:


  • How Diverse Leadership Teams Boost Innovation (Boston Consulting Group, 2018): a study which surveyed over 1,700 companies across eight countries found that companies with above-average diversity in management teams reported 45% of total revenue from innovation (new products/services), while companies with below-average diversity reported 26%.[3]
  • Diversity Matters Even More (McKinsey, 2023): a study of global companies revealed that firms in the top quartile for both gender and ethnic diversity in executive teams are 9% more likely to outperform peers financially. The study also found that companies with top-quartile gender diversity on boards are 27% more likely to outperform financially than those in the bottom quartile. For ethnic diversity, top-quartile firms 13% more likely to outperform.[4]


Measuring Success


Continually assess the effectiveness of your diversity initiatives:

  • Regularly track diversity metrics across your workforce.
  • Conduct anonymous employee surveys to evaluate inclusivity.
  • Refine your approach by analyzing insights gathered from feedback and performance outcomes.


Building diverse teams provides SMEs with essential tools for sustained innovation, effective decision-making, and a robust competitive edge. By proactively implementing inclusive hiring practices, fostering welcoming workplace cultures, and continually evaluating their diversity initiatives, SMEs can build stronger teams that drive sustained business success.




Sources:


[1] https://www.myavtar.com/services/diversity-hiring

[2] https://hr.siliconindia.com/vendor/myavtar-refurbishing-the-comprehensiveness-of-the-indian-recruitment-industry-cid-18481.html#google_vignette

[3] https://www.bcg.com/publications/2018/how-diverse-leadership-teams-boost-innovation

[4] https://nsga.org/wp-content/uploads/2024/02/McKinsey-Diversity-Report-December-2023.pdf

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In June 2020, Wirecard AG, once a celebrated German fintech company, collapsed after revealing that €1.9 billion was missing from its accounts, a sum that likely never existed. [1] This event marked one of Europe's most significant corporate frauds, highlighting critical lessons for SMEs and scale-ups about the importance of internal controls and independent audits. How The Fintech Giant Crumbled Under Scrutiny Founded in 1999, Wirecard grew rapidly to become a leading player in the digital payments industry. By 2018, it was valued at €22–24 billion and had secured a spot on Germany’s prestigious DAX 30 index. [2] Its share price soared from €17 in 2013 to a peak of €135 in 2018 [3] , reflecting strong investor confidence. Yet beneath this apparent success lay an intricate web of fraud. A series of investigations that took place between 2018 and 2020 revealed that Wirecard had been inflating its revenue and assets through fictitious transactions and non-existent cash balances. A significant portion of its reported profits from 2016 to 2018 could not be substantiated. [4] The Unfolding Scandal On June 18 th , 2020, Wirecard admitted that €1.9 billion (around a quarter of its total balance sheet) was missing [5] . This cash was supposedly held in trustee accounts in Asia, but auditors couldn’t verify its existence. The company quickly filed for insolvency, making it the first DAX 30 company to ever do so. [6] Wirecard’s share price collapsed by more than 98%, falling from over €100 to less than €2 within days. [7] CNBC reported an over 60% crash in share price immediately after the announcement. [8] On 26 June 2020, shares opened at €2.35, marking a 97% drop since news of the fraud broke. [9] The scandal exposed significant failures in corporate governance, audit, and regulatory oversight. Wirecard's long-time auditor, Ernst & Young (EY), faced criticism for not detecting the fraud earlier. A review found that EY's audit work was marred by "grave" and "repeated" violations of professional duties. [10] In 2023, Germany’s auditor supervisory authority APAS fined EY €500,000 and imposed a two-year ban from accepting new audit mandates for public interest entities in Germany. Lessons for SMEs and Scale-Ups The Wirecard collapse wasn’t just a corporate failure—it was a systemic breakdown. It reminds us that growth without guardrails is dangerous. Four key takeaways: Internal controls aren’t optional : Rapid expansion must be matched by rigorous internal systems. Weak oversight creates room for misconduct. Auditors must be truly independent : External audits are only as effective as they are objective. Independence, competence, and skepticism are non-negotiable. Transparency builds resilience : Clear, consistent financial reporting isn’t just good practice—it’s a defense against deception and a signal to investors that management can be trusted. 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Virtual CFO services like Pilot offer monthly reviews and external oversight without the overhead of a full finance team. It’s the kind of objective input that catches issues early. Stay on top of risk. Vanta, LogicGate, BoardPro—they make it easier to manage compliance, prepare for audits, and keep your board in the loop. Governance doesn’t need to be complicated, but it does need to exist. Track what matters. Dashboards from Fathom, LivePlan, and Jirav help you keep an eye on burn, liabilities, and cash flow. Not every red flag is obvious—until it is. Wirecard wasn’t lacking in resources—it was lacking in rigour. That’s the part every growing business should pay attention to. It’s not about playing it safe. It’s about building something that can stand up to scrutiny. Sources: [1] https://www.straitstimes.com/business/banking/wirecard-whistleblower-tipped-german-watchdog-in-early-2019 [2] https://www.reprisk.com/insights/case-studies/wirecard [3] https://leap.luiss.it/wp-content/uploads/2022/09/WP5.21-The-Wirecard-scandal-and-the-role-of-Bafin.pdf [4] https://www.wirecard.com/uploads/Bericht_Sonderpruefung_KPMG_EN_200501_Disclaimer.pdf [5] https://www.bbc.com/news/business-53132953 [6] https://leap.luiss.it/wp-content/uploads/2022/09/WP5.21-The-Wirecard-scandal-and-the-role-of-Bafin.pdf [7] https://www.aidf.nus.edu.sg/wp-content/uploads/2021/05/Wirecard-The-Rise-and-Fall-of-a-Fintech-Giant-in-Asia-BT.pdf [8] https://www.cnbc.com/2020/06/18/wirecard-shares-plummet-as-payments-firm-postpones-annual-report.html [9] https://www.ig.com/sg/news-and-trade-ideas/how-wirecard-erased-nearly-all-of-its-market-cap-in-one-week-200626 [10] https://www.mcmillanwoods.com/2024/04/16/german-watchdog-finds-eys-wirecard-audits-grossly-negligent/