You know how whenever we talk about DEI the woke bros tell you that, really, diversity-based hiring is good for business, it brings different perspectives, and it's helpful for success?
Well, a lot of times when they use evidence they're citing 4 widely used and well-known McKinsey studies.
The problem? A new study published in Econ Journal Watch shows the results were not repeatable.
Meaning that "diversity is our strength" is not a hard and fast rule.
(Pentagon hardest hit!)
Over the past few years, McKinsey has released at least 4 studies claiming a positive relationship between DEI and firm performance.
A new paper published today in Econ Journal Watch finds these results can't be replicated.
"Our inability to [replicate] their results suggests that ... they should not be relied on to support the view that US publicly traded firms can expect to deliver improved financial performance if they increase the racial/ethnic diversity of their executives.''
Poor Mark Cuban!! He's essentially used this as a foundation for all his arguments supporting DEI the past few months!
Diversity is NOT our strength. Common sense wins out again.
And, my oh my, how I wanted to straight up steal this headline:
Well, with Chris Brunet's permission, here I am. Writing this story.
McKinsey and Company is the oldest of the "Big Three" consulting firms. They're multi-national and their studies and recommendations are considered the gold standard for businesses of all kinds.
What they say has a tremendous impact on the business world, to say the very least.
And they clowned themselves big time with this one.
Here's a little sample of Jeremiah Green and John R. M. Hand's journal article debunking the "diversity is our strength" myth.
In conclusion, our results indicate that despite the imprimatur often given to McKinsey's 2015, 2018, 2020, and 2023 studies, McKinsey's studies neither conceptually (in terms of the correct direction of causality) nor empirically (in terms of their set of large US public firms) support the argument that large US public firms can expect on average to deliver improved financial performance if they increase the racial/ethnic diversity of their executives.
The journal article gives the methodology used in the new study and shows the authors attempting to replicate the results of McKinsey's initial studies that are used as a sledgehammer in the corporate world to force DEI values.
They couldn't replicate them and they even showed diversity of skin color doesn't make a lick of difference.
A 2023 study that Brunet also shared shows that McKinsey didn't just misread the data, they cherry-picked examples to falsely support the results they desired.
Here is a study from 2023 on the same subject, which concludes that McKinsey's DEI data is so cherrypicked that it's useless.
''McKinsey's panel data is not sufficiently representative for conclusions to be derived from an analysis based on companies within the dataset. Consequently, McKinsey's conclusions are unreliable and cannot be generalized."
Yet generalized they were. They were treated as the holy grail of diversity in business findings.
We all knew this was happening. We all knew that the studies were political and largely made up. But now there's proof.
It's all political. It's all agenda-pushing. Always.
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