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These days, cultural fit is a key component of many hiring decisions. It’s understandable why: Workers who align with the cultures of their companies tend to be more satisfied with their jobs, and therefore, they are more likely to stay with the company for a longer time and produce superior work.

But culture-fit hiring is not without its downsides. Key among them is the fact that hiring for culture fit can often lead to a lack of workplace diversity. When you consistently hire people with the same personality types and cultural preferences, you prevent your organization from accessing new and innovative viewpoints. Limiting diversity can lead to groupthink, which can be highly detrimental to organizational performance.

Because of the potential drawbacks that come with hiring for culture fit, some organizations choose to hire for inclusion instead, emphasizing a diversity of perspectives over strict alignment with culture. That can come with its own challenges, including effectively managing a team of people with varying views and values.

Which approach leads to the best organizational outcomes? To answer that, we first have to take a closer look at each one.

Hiring for Cultural Fit

“Culture fit” refers to how closely an individual aligns with the core values and collective behaviors of an organization. What makes for a good culture — and therefore a good culture fit — depends on the organization and its employees. Some might like a competitive environment, while others might prefer to collaborate. When hiring for culture fit, the aim is to find someone who fits the organization’s specific culture, whatever it might be.

A good example of a hiring process that puts culture fit first comes from Amazon, which makes hiring decisions according to its 14 leadership principles, including things like “customer obsession,” “bias for action,” and “ownership.” When hiring, Amazon evaluates how well a candidate embodies these principles. The process even includes a “Bar Raiser,” whose whole job is to determine whether a given candidate has the right leadership principles for the role at hand. Top companies like Virgin Group, Southwest Airlines, and Zappos also cite culture fit as the most critical factor in evaluating potential hires.

Many employers prioritize culture fit because it promises an array of benefits. For example, Koya Leadership Partners founder Katie Bouton cites a 2005 report that “employees who fit well with their organization, coworkers, and supervisor had greater job satisfaction, were more likely to remain with their organization, and showed superior job performance.”

Because employees who fit your culture are more likely to stay for longer periods of time, culture-fit organizations often enjoy higher retention rates. In turn, that can reduce recruiting expenses, cut training costs, and increase productivity in the long run.

Some companies also hire for culture fit for more practical reasons. For example, hiring for culture fit can be a way to proactively protect employee morale. Hiring a bad culture fit can harm team cohesion, so it makes sense that many organizations would prioritize cultural alignment when bringing new employees on board. Skills can be taught, but it’s much harder to teach someone to adopt a new set of values.

A culture-first recruiting process can also help organizations attract and retain the right talent. When a company communicates its culture to candidates ahead of time, candidates get a better understanding of what would be expected of them. This helps them make more informed decisions about whether a company would be right for them. We also know that talented people look for organizations with great cultures, so those candidates who do self-select into your talent pipeline are more likely to be top performers.

Some companies are more wary of hiring for culture fit. They believe prioritizing culture fit essentially gives hiring power to our conscious and unconscious biases, resulting in a homogeneous organization. After all, if you consistently recruit team members who exhibit the same particular values your company espouses, you’re likely to keep hiring the same kinds of people over and over again.

Another potential drawback is that a culture-first hiring process often spends more time analyzing a candidate’s personality than their critical skills like problem-solving. It’s important to keep in mind that a candidate who shares your principles doesn’t necessarily share your goals or methods. Values are just one part of what a person needs to really fit in at an organization.

Hiring for Inclusion

Inclusive recruiting focuses on hiring a diverse group of people in order to bring varying perspectives and opinions to an organization. Inclusive recruiting is more dynamic than simply making hires based on race or gender: It considers candidates as whole people and looks at the new ideas they could bring to a company.

In recent times, more and more businesses have begun to emphasize inclusion over culture fit. These organizations recognize the tremendous advantages that a diverse workforce can offer, including improved productivity, creativity, and innovation.

Johnson & Johnson is a good example of a company invested in hiring for inclusion. The organization has built employee resource groups, mentoring programs, and even a “Diversity University” that helps employees to understand the benefits of working in a diverse environment. Furthermore, the chief diversity officer reports directly to the CEO and chairman, which means high-level leaders are directly involved in diversity and inclusion efforts. As a result of these efforts, Johnson & Johnson has won accolades including being recognized by U.S. Veterans Magazine and appearing on Working Mother‘s 100 Best Companies list for 34 consecutive years.

A lot of concrete research into diversity at work shows that hiring for inclusion can directly impact company performance. SocialTalent reports that every 1 percent increase in gender diversity correlates with a 3 percent increase in revenue, and increased levels of ethnic diversity can boost revenue by 15 percent.

Hiring for inclusion can also be a powerful way to increase a company’s talent pool. As Richard Koroscil, CEO of the Ontario Chamber of Commerce, told Pierpoint, when companies expand their talent pools to include more diverse candidates, they will have more skilled people to choose from: “Business[es] will see improvements in productivity, increased engagement with employees, less turnover, and reduced costs to training” when hiring diverse employees.

Balancing Culture and Inclusion

It’s important to hire employees who share your company’s values, but at the same time, making hiring decisions based on prejudice — conscious or not — is never okay. Similarly, it’s important to bring a wealth of experiences and viewpoints into your organization, as this leads to more innovative thinking. However, you still need to find a way to maintain team cohesion when people’s attitudes and ideas don’t totally overlap.

When it comes to hiring for culture fit or inclusion, it may be a false dilemma. The best approach may be to hire for both.

Rather than looking at whether a candidate’s personality fits the company culture, perhaps the better option would be to assess how a candidate’s professional aims and experiences align with the role at hand. Will the new recruit excel in the role while still facing a healthy amount of challenge? If a candidate’s objectives match the objectives of the role, they can be a great fit even if they don’t behave like everyone else at the company. This can be a great way to bring more diverse voices into the organization while still ensuring your employees share your company’s ethos.

Anjan Pathak is a cofounder and CTO at Vantage Circle and Vantage Fit.

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