Designing and Implementing a Business-Aligned® Diversity Strategy

The Business-Aligned® Diversity and Inclusion Strategy
Peter Bye
President, MDB Group, Inc.
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Let’s imagine that you are the Director of Diversity at XYZ Corporation, and you have just finished briefing the CEO on your proposed diversity plan. You know that the CEO is keenly focused on creating shareowner value as well as positive quarterly results. You also know that XYZ has a culture that values innovation and team effectiveness.

The CEO reflects for a moment and then responds: “Sounds interesting; let me tell you what’s running through my mind. How does this add value to our business? We’re really going all out to meet the 2002 sales and expense targets; can we afford the time for this? Also, this sounds like a long-term project. If we proceed, how would we communicate to leaders and employees? How would we measure our progress and know when we’re done?”

What would you say? While you certainly should have answers to these questions, it’s even better to develop your plan in a way that builds in the answers right up front. This article introduces a six-step process you might use. We’ll also consider some of the obstacles that you might confront (and suggest some ways around them!).While the wording assumes that the strategy is for an entire for-profit company, the process is easily adapted to one part of a company or a not-for-profit by thinking about how business is done in your organization.

Step 1. Form a diverse team and establishing it as a diversity council.

Diversity is a culture change that must be tightly linked to business need and that takes sustained commitment within the company. Your human capital management processes (e.g., performance management and succession planning) need to encourage this. So, you need team members who can drive this type of change.

For your first step, you need to select people, form a team, and focus the team on the company’s diversity strategy. Who should participate on the team? Typical functions to consider include: the CEO or President; Senior Leadership Team (CEO direct reports or Business Unit leaders); Vice Presidents/Senior Leadership of Human Resources, Public Relations, and/or Employee Communications; selected employees; and the Chief Labor Attorney.

While the team must be representative and diverse in many respects, it’s best to limit membership to about fifteen people so that you can move forward expeditiously. No, you don’t need everyone listed above. However, here are some ways to keep the team manageable while still being inclusive:

• Include the CEO and one or two senior leaders. Keep the rest of the senior leadership team apprised of your progress and give them periodic opportunities to provide input.
• Identify core team members and a close set of “allies” who provide input through a core team member.
• Consult with your labor attorney periodically rather than having her/him on the core team.

For employee members, there are several options. If a significant part of your workforce is unionized, it is important to involve union leadership. If you already have employee affinity networks, the group leaders are excellent candidates for team membership. Ask human resources and line managers to identify key employees who are respected amongst their peers.

It’s very important to consider how the people you select will come together as an effective team. The people on the team need to develop strong relationships so that the conversations can “go deep” while remaining respectful and productive. Consider a team formation meeting with the following agenda:

• A diversity-related icebreaker to get people talking with and starting to know each other.
• A strong personal charter by your CEO or President about the business and competitive advantages of diversity and the importance she/he attaches to this work. (Best done when the CEO or President is on the team or commits to meet regularly with the team.)
• Develop agreement on how the team will work together (e.g., be on time, fulfill commitments, be open, address issues sincerely, don’t hurt others, respect and consider everyone’s opinions, focus on the good of the company).
• Check if there are any key areas or functions that are not represented on the team
• Brief the team about diversity and its linkage to business results. You might do this using your business case research. Or you might bring in an outside speaker—someone from another company or a consultant.
• Agree on a work plan and a tentative schedule.

If your company is just starting on diversity, it may be important to build awareness within your team. The diversity briefing might become a full day session. At this point, you will have formed a team, focused it on diversity in a way that aligns with business need, and agreed upon a work plan. Step 2. Assess Current Work Environment

The action plans to come will be based on your overall strategy, the current situation in your work environment, and your desired operating state. In Step Two, the team develops an understanding of the current work environment in the company. Take the time to make an honest inventory for an inclusive work environment:

• What is working well? Where is there room for improvement? >
• Does the representation of people of color and women in our workforce compare favorably to the U.S. Civilian Labor Force or some other suitable benchmark? What about in our executive workforce and particularly in the key operating positions?
• Do people of color and women leave our workforce in proportion or out of proportion (high or low) to representation?
• Does everyone have equal access to developmental opportunities and assignments?
• Does everyone see an equally supportive work environment regardless of background?
• Are there workplace tensions that limit peoples’ ability to work well together? >
• Do people have the awareness and skills they need to work well in diverse teams?
• In teams, are everyone’s ideas fully heard and considered?
• Do we emphasize doing business with minority, women, and veteran owned businesses? Is it easy for them to register and do business with us?
• Do external organizations regard us well? (Social change or community groups, regulatory bodies, media, peer companies/organizations.)
• Do we effectively design, market, and sell our products for different market segments?

Where does the team get this type of information? More than you suspect may be waiting for a chance to be helpful (i.e., gathering dust on shelves). To the greatest extent possible, I encourage you to use existing sources. Some information will be very sensitive; this may have only limited availability. For example, you will want to consider information gathered from employee opinion surveys, information from exit interviews, assessments or reports from local diversity councils, customer and supplier satisfaction surveys, workplace complaints and requests, and the like.

You may be told that some of this information, especially workplace complaints, has no merit and is not worth consideration; however, these pieces do represent peoples’ perception of the work environment. Regardless of merit, they may represent the opportunity to make the work environment more supportive, help reduce the future number of complaints, or help “zero in” on the real source of the dissatisfaction.

Despite the list above, sometimes there simply is not enough information already available for the assessment. Before you come to this conclusion, ask yourself if you’re getting “analysis paralysis.” Avoid the tendency to over-collect data in order to generate the “perfect” plan. Collect enough for a reasoned assessment, and move on. With these caveats, here are some ways the team can collect new information for its assessment:

• Focus groups. Consider running focus groups (approximately 10 employees each) in different parts of the company. Develop a consistent set of open-ended questions so that you can look at responses across the groups. (The list at the beginning of this section is one starting point.)
  
  
• Interviews. The interview explores more deeply than a focus group. Since they require more effort and typically are done individually, you may reach relatively few people. Interviews can be used to gain a better understanding of recurring issues raised in focus groups. Now the team has a pile of data. Look for recurring themes. Rank order them with a combination of “magnitude of issue,” “importance to business results,” and “ease of change.” Issues that score highly in all three dimensions are clear candidates for immediate focus.

Step 3. Determine Stakeholders Most Important to Your Company
To be effective, the diversity strategy must be tightly linked to business purpose and help achieve business results. In this step, the team develops a list of the people or functions most important to your company’s business success. You will probably create a long list that will need scaling back—I suggest aiming for about three or four key sets of stakeholders. Possibilities include:

Internal

• Individual contributors
• Middle managers
• Team leaders
• Employee union leaders
• Affinity group leaders
• Senior leaders
• CEO/President and COO

External

• Shareowners
• Union leaders
• Suppliers
• Community organizations
• Prominent community leaders
• Regulatory authorities
• Legislative or executive branch of federal, state and local governments

Develop your “short list,” keeping Steps Four and Five in mind. Pick the critical few stakeholders whose perspectives about how the company is doing are most important to your business success.
Step 4. Develop a Picture of What Success Looks Like

What would it look like at your company if your key stakeholders felt that you were leveraging diversity successfully? Start with your primary business drivers. For a corporation, these may be revenue, expense, and company/ brand reputation. Your goal is to improve these business drivers and better position your company as an employer of choice and as a company that values diversity. The inclusive work environment questions in Step Two are a starting point to develop this picture.

Of whom do you ask these questions? Practicality is a factor here. You certainly can go to internal key stakeholders. Assuming that you have external people or organizations on your list, can you go directly to them? If so, that is the best approach. If not, use other sources close to them. For example: Instead of getting input directly from customers, you might go to your consumer marketing team, customer satisfaction surveys, or industry-wide rankings. Other possible sources include the media “best” surveys (e.g. 50 Best Companies for _______) and benchmarking studies.


Step 5. Establish Long-Term Goals and Initial Objectives

You now have a good sense of what you need to achieve. How do you get there? This is the time for benchmarking to obtain the following types of information:

• The business impact of working on diversity
  
  
• How other executives focus their time and energy on a diversity initiative
  
  
• Best practices and practices to avoid
  
  
• How other companies have addressed the processes important to you (i.e., recruiting, performance management, mentoring, career development, compensation, etc.)
  
  
• Timelines other companies have followed
  
  
• Sources of effective training, development, and consulting expertise
  
  
• How other companies have communicated to their employees about diversity
  
  
• How companies measure their progress.
  
  

Step 6. Monitor Progress, Communicate, and Adjust as Needed

Develop a scorecard for your annual objectives and show your progress towards them. Fit this on one page, and back it up with charts and other supporting information. Monitor some goals quarterly (e.g., profile representation, recruiting, supplier diversity results) and others annually, based on how often you think you’ll see meaningful change and the speed with which you want to adjust tactics if you’re not achieving the needed results.

Keep everyone aware of the strategy, progress, and results. Frame all your communications in the perspective of identifying the need, the overall plan, and the specific topic or results under discussion. I call this “communicating in the context.” There is tremendous value in continually reminding everyone of the big picture and your continuing focus on diversity. Assume that you must communicate at least every six months, and preferably more frequently, about your diversity initiative to keep it fresh in the minds of your audience.

Your communications plan needs to engage everyone. Your best communication tools: sample annual objectives, briefings with local diversity councils, tools to enhance team effectiveness, recruiting aids and the like. Always consider the sensitivity of the information you are about to communicate: some aspects of profile representation data, staffing decisions, and corporate policies and positions may be too sensitive to communicate widely. Confer with your labor attorney and your HR policy and public relations strategists when in doubt.

You will need to adapt the plan because (a) you will make progress, (b) the needs of your business will change, and (c) the expectations of your primary internal and external stakeholders will evolve. I suggest that you re-examine Steps Four and Five annually. Hopefully, you will find that your long-term goals remain fairly stable. Feel good about changing your objectives. It’s a sign that you’re making progress and that you’re staying in tune with business needs.

This article originally appeared in the March/April 2002 issue of Profiles in Diversity Journal
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