Critical Factors for Effective and Rapid Transformation
The practice of diversity and inclusion has evolved significantly since it began. For the most part, approaches, concepts and practices of the early years are no longer effective in today’s workplaces. Awareness was the focus; transformation and D&I competence is today’s necessity. With the increase of organizations becoming global, serving increasingly diverse customers, collaborating with suppliers and multi-cultural strategic partners, D&I initiatives now include multi-cultural, multi-lingual and multi-generational employees with significantly more diverse perspectives, needs, and challenges.
In our consulting practice, we define Diversity in the broadest sense; a vast array of human similarities and differences, inclusive of everyone. The qualities that for the most part will not change for individuals, include race, age, gender, physical abilities, sexual affectation/orientation, and ethnicity. Differently, the qualities we can more easily modify include work background, religious beliefs, political beliefs, military experience, geographic locations, marital status, parental and family status, language, income, and education. We define Inclusion as a sense of belonging – feeling a meaningful level of commitment from the organization that may manifest as ‘being heard’ when your perspective is different, ‘being supported’ when your needs are different or ‘being invited’ to participate in meaningful dialogues or projects because your perspective or skills may be different.
It is important to understand that an organization can have diversity without inclusion or inclusion without diversity. Successful customer acquisition and retention, collaboration as well as innovation typically requires both. Attaining higher levels of both diversity and inclusion has challenged most organizations for decades.
A Compelling Business Case
Diversity and Inclusion initiatives that are more successful are planned culture shifts, anchored in the business strategy – they are NOT simply focused on recruitment, employee relations and training. To succeed, the organization must be able to articulate a clear and compelling business case for D&I. It can be either simple or complex. Its leaders need to embrace and champion the initiative. While an initiative may start as a grassroots effort, it will not become a fully engaged initiative until the organization’s leadership take accountability for its potential.
A simple business case might be rooted in desired behavioral change such as improving teamwork due to changing workforce demographics. At a more complex level, it may start with a customer-driven business strategy, based upon rapid growth, globalization, or the pursuit of emerging markets where needs may include new products, marketing platform and tools, sales and customer service competence, and/or different employee demographics that mirror customers.
An effective business case must include:
- internal and external drivers;
- a legacy that plans to reflect customers of twenty years into the future;
- knowledge of your customers, ensuring you know who is influencing or approving your immediate customer’s decision;
- blocks and barriers which need to be removed (e.g. the talent we have today does not have the cultural competence to engage the emerging market customers we wish to acquire);
- analysis of products and services by examining the various arrays of your customer segments (e.g., different health services for different ethnic groups); and
- reasoning behind how diversity and inclusion will support the organization’s objective to achieve high performance.
For example, we were brought into a financial service Fortune 100 national accounts group’s leadership to ignite motivation as well as focus on D&I. The group had been resistant to D&I conversations since they were bringing in 80% of the organization’s revenue. They believed they were tremendously successful and didn’t see a need to embrace or venture upon a D&I initiative, one to which the rest of the organization had committed. By providing the group with clear data and experiences to see how they were leaving significant market share and revenue on the table, we were able to quickly guide them to realize that pursuing D&I would bring them much greater success. Our work with them led them to earn the Chairman’s Award later that year.
To be successful in D&I, in addition to a clear and compelling business case, an organization needs to have in place:
- Senior and mid-level champions;
- An accurate and effective organizational platform;
- Internal D&I orientation;
- D&I competence and modeling by managers;
- External D&I orientation;
- Rewards that encourage D&I behaviors; and
- D&I proficiency and modeling by HR.
The senior and mid-level champions must be cohesive and consistent in their commitment to ‘raise the bar,’ understanding that their planned change will require:
- More than five (most typically 8-10) years to achieve and require alignment with vision, mission, strategic plan, values and operating principles;
- Their personal modeling of inclusive behaviors;
- Alignment and integration with employees, customers, suppliers, regulators, the community and non-governmental organizations (NGOs); and
- Special coaching and mentoring programs for the organization’s leaders as well as for learning partners who represent an array of differences during this culture shift.
The organizational platform starts with the business case and includes an accurate assessment of the organization’s current cultural state as well as an assessment of the degree to which the organization needs to achieve inclusion. Once these basic elements are determined, specific desired behaviors, goals and measures are identified. Then, thoughtful attention to a planned response to anticipated resistance needs to be developed.
As far as internal D&I orientation is concerned, most organizations tend to look first to talent acquisition. However, first and foremost, development, inclusion and retention of existing talent representing diversity needs to occur. Many organizations have been thrilled when they have succeeded in recruiting diverse talent only to become crestfallen when they realize they have created a revolving diversity door and an increasingly poor reputation ‘on the street’ in retaining those who are different among diverse talent sources. Another example of a similar trend is to increase sales within the diverse marketplace, only to lose the customers due to lack of appropriate customer service skills and sensitivity. Getting customers back after a poor experience is an extremely difficult and costly customer acquisition process. An effective organizational platform also includes the need for products that match different customer segments’ needs or desires. As one of our clients learned, the significant revenues realized due to the sales of products in one store, failed miserably in another where customers instead valued products associated with different ethnicity. Once they customized the product array to the demographics of that store’s community base, revenue and community appreciation increased meaningfully.
D&I competence and behavioral modeling by managers as well as by leaders, is key. Mid-managers and front-line supervisors are the organization’s “glue.” These managers are critically important in ensuring that key messages and behaviors are transferred to individuals who touch customers and suppliers. Consistently, employees have told us that they rely more on what they observe in managers and leaders rather than what they hear them say. That trend will continue to escalate with increasing GenY staff.
An organization also needs to take stake in their external D&I orientation – their relationships and accountabilities with customers, suppliers, regulators, the community and NGOs. A classic example of external D&I orientation gone awry is when a group of college students learned that Taco Bell, the nation’s largest buyer of tomatoes, was buying tomatoes from distributors who bought tomatoes from growers who employed illegal, undocumented workers and paid them poor wages. They developed a national tour and internet campaign which brought tremendous pressure on the organization to place stringent requirements upon their suppliers to ensure fair wages. Many consumer products companies now require their suppliers to commit to Fair Trade practices.
Whenever behavioral change is desired, including for D&I initiatives, careful evaluation of intrinsic and extrinsic rewards also needs to be conducted – examining which behaviors are incented and which are discouraged. For example, demonstrating active communications utilizing a variety of styles and languages or speaking up when people are excluded should be rewarded. Conversely, conveying offensive jokes or remaining silent when you hear offensive jokes or statements will need to be discouraged.
HR as D&I AcceleratorsSM
Lastly, a methodology we developed to accelerate D&I culture change is the role of HR as the Accelerator in Diversity & Inclusion. This role is a specialized consulting role that includes responsibility for diagnosis, support, alignment, and integration. It requires that HR effectively engage the right work with the right process at the right time to achieve transformational success in Diversity and Inclusion culture shifts. It helped accomplish an internal and external, 3.5-year culture transformation within an organization of 2,000 employees to enable an aggressive, five year, sustained rapid market expansion for a well-known retail organization.
By Regan MacBain Traub, CPC, Founder & Managing Principal