Diversity strategy and business strategy go together like a hand in a glove. The strategies should be built simultaneously, and it helps if there is a committee or two built from stakeholders throughout the business to help set policy and guide direction.
by Kellye Whitney
December 11, 2014
Companies that excel at strategic diversity management understand three things:
First, diversity strategy and business strategy should not be separated. At least, they shouldn’t if leaders want the former to feed and enhance the latter.
Second, to ensure diversity translates into inclusion, and is a functional part of an organization’s culture, mission and values, leaders must model a commitment to diversity, they must champion it and build it not just at the top, but at all levels of the organization.
Third, to prove that diversity can have a marked influence on the business, organizations must collect metrics: attrition, diverse recruitment slates, promotion rates, demographic data, pulse surveys to ascertain culture and morale, and more. Then, organizations must use the data to make decisions. The following three companies — Towers Watson & Co., a global professional services firm; The MetroHealth System, a Cleveland-based nonprofit health care system; and Sidley Austin, a corporate law firm — do all of these things.
The Transformative Power of Diversity
By Sarah Kimmel
Diversity Value Index, or DVI, aims to assess diversity’s effectiveness on organizational transformation and business outcomes. It was created to focus attention on excellence and best practices in how diversity is managed, expanding the scope of diversity benchmarking beyond measurement of workforce diversity. The DVI uses an evidence-basedframework model to benchmark seven critical areas of the diversity and inclusion function that have been demonstrated to deliver organizational value through innovation and continuous improvement. Each dimension is evaluated in terms of how well an organization represents diversity, recognizes its value and uses it to create business value. The dimensions of the DVI benchmark include:
Now in its second year, the Diversity Value Index continues to attract organizations with a keen interest in developing diversity and inclusion as a function of organizational growth and innovation. With participation in the DVI more than doubling this year, it is clear there is a need for anindependent program that provides a benchmarking service to the industry andaggregates best practices for the diversity function.
Numerous organizations applied to better understand how the DVI evaluates their diversity and inclusion functions. Organizations that complete the full application are working to mature their D&I functions while providing a valuable service to the industry through improved D&I benchmarking. Looking ahead, the Diversity Value Index will continue to expand industry understanding of the D&I function, helping participating organizations and others learn from the best practices the industry has to offer.
Sarah Kimmel is the director of research and advisory services at Diversity Executive. She can be reached at editor@talentmgt.com.
How do you set your diversity strategy?
All of our diversity business strategy comes from directives from theboard of trustees’ diversity charter. We have a diversity advisory group in the board of trustees who gather quarterly, and they put together guidance and principles for us to follow. We’re responsible for recruitment and retention, supplier diversity, training and development, community engagement, and, under the purview of all those areas, there’s of course leadership engagement.
—Lourdes Negron-McDaniel,manager for diversity and inclusion, The MetroHealth System
Our diversity strategy engages our values and is aligned with our new business strategy, which we call Towers Watson 2020. That specifically calls for our organization to be more diverse,inclusive and innovative while attractingretaining and developing our top talent. If you think about all the demographic shifts that are happening, we flex our diversity strategy to mirror the ever-changing needs of our clients and our talent. As our clients are more global, we have to think about our global approach for diversity, and we do it through our globaldiversity councils. One large part of our strategy is it engageseveryone and strongly focuses on inclusion more than diversity. As opposed to counting the numbers, it’s really about making the numbers count.
—Christal Morris, global head of inclusion and diversity, Towers Watson & Co.
We are very conscious of not just the things the executive committee has said we need to be doing, but the way those things tie back to the firm’s overall mission and strategy. [Setting diversity strategy is] a long process. It usually takes from the end of October through February. The first part, the data collection and analysis piece, is what I do with the staff here. The lawyer committee gets involved early in the year assessing what we’ve given them, sometimes asks for more and then provides strategic guidance about what we should be doing. Our lawyer committees are extremely active. We have partner and associate committees on the diversity committee side, and we have associates involved in our women’s committees as well as partners, counsel and other people of different employment status. If it were just a staff thing, we wouldn’t get a quarter of the work done.
—Sarah Olson, chief diversity officer, Sidley Austin
How can diversity executives cultivate leadership commitment? Can you build it or should it be there already?
Leadership commitment is integral to achieving long-lasting impact. With the right structure in place, it can be built. Leadership commitment depends on each individual leader. There will always be leaders who are advocates, but who may need some guidance on how to accelerate their involvement and support of the process. Then there are leaders who don’t quite know what to do but would like to learn more. The diversity executive has a role to play with each of these leaders. With the right support and advocacy from the CEO and board of directors, inclusion and diversity can have a significant impact on growth and revenue. So, yes, it can be built, leader by leader. It’s one conversation at a time.
—Christal Morris, global head of inclusion and diversity, Towers Watson & Co.
In a system this size, you will find there are already champions here. It behooves a diversity leader to identify those champions first, then build the case, if you will, about the importance of the diversity and inclusion initiative. You also have to cultivate that in leadership, in middle management as well, and you do that in one-on-one conversations. Through a consultative approach, you can meet and discover what’s working and what’s not working in your area, and in a customized, individualized way you can work with leaders to identify inclusion and diversity needs for each of the respective areas of the orgaanization.
—Lourdes Negron-McDaniel, manager for diversity and inclusion, The MetroHealth System
We've created an inclusion and diversity council of leadership from around the hospital. Each of those individuals on that council, they’re champions in their area, viewpoint or their particular aspect of diversity, bringing them all together makes it more powerful. That’s relatively new within our system, and it has the potential to transform the institution to make it a more inclusive and diverse place.
—John Corlett, vice president of government relations and community affairs, The MetroHealth System
On one level good leaders understand it is important to find commonality and to embrace and use the diversity of talent that they have. But it’s also a learned skill. Everybody, not just diversity leadership but executive leadership and people who work in companies generally, can cultivate an understanding of different cultures and [what is] important to people of different cultures to create better work teams and better work environments. We all have an obligation to do that because we’re in a thoroughly multicultural society. If you look at societies around the world, the ones that seem to work the most smoothly are the ones where people on an individual basis have taken responsibility to cultivate an understanding across difference.
—Sarah Olson, chief diversity officer, Sidley Austin
How do you prove that diversity has an effect on your business?
We designed an inclusion index that consists of 13 questions embedded into our associate engagementsurvey. After we started our associate resource communities, or business resource or affinity groups, we saw an increase in favorability against our 2012 inclusion index in every single question. We also monitor promotion rates, attendance in inclusion and diversity courses, diversity of recruitment slates for certain designated roles, and standard metrics like turnover and new hires. We look at that across gender, LGBT — which is not mandated by law, but it is something we consider — as well as ethnicity.Because we’re a global company, it’s been important this past year for us to define what underrepresented means to each of our three regions. Across all regions, we’re already seeing an enhanced understanding of the positive impact of inclusion, which we consider a really important driver of change.
—Christal Morris, global head of inclusion and diversity, Towers Watson & Co.
We have aspirational goals for the next three years starting in 2014. When the board of trustees created the council, our identifiable spend was less than 1 percent. … The aspirational goals starting in 2014 is 5 percent diverse and local spend. In 2015 it will be 10, and in 2016 it will be 15. Without divulging hard numbers, I’m really proud to say we are going to hit our aspirational goals for diverse and local spend for 2014.
—Carole Becerra, supplier diversity and vendor relations manager, The MetroHealth System
We look at a lot of metrics. We look at our own demographics, the demographics of the teams that we field for clients. We can measure increases or decreases in the population of groups of lawyers, attrition and comparative attrition rates, how long people stay with the firm. In any large law firm, there’s going to be attrition. But if you find that certain groups of people are leaving at different points in their career much quicker, and others are staying longer, there’s a disparity of experience; there’s something happening there that needs to be paid attention to. We can look at who’s being promoted to partnership, who’s bringing in business, who’s going out on pitches and RFPs [requests for proposals] when potential clients approach us to put in a request for information. We can track are women being offered up as the partners who will work on or lead matters, are lawyers of ethnic or racial diversity going out on these pitches? With that information we go back to the leaders in the firm and say, ‘This is what’s happening. Do you know that?’ We hold up a mirror and encourage more intentionality in those business functions that make a difference for individual lawyers’ careers.
