Debunking diversity Featured

8:00pm EDT March 26, 2009

The million-dollar question about making an investment in diversity is: Will it pay back?

While experts say diversity in the work force is a business imperative, defining diversity by employees’ physical attributes won’t foster a functional or profitable environment.

In fact, the definition of diversity is always evolving. Twenty years ago, the word spurred thoughts of gender issues since men held a high majority in the work force, while today the gender gap is narrowed and is less of a concern. Diversity’s definition has expanded, and diversity of thought, education, socioeconomics, religion and life goals are only a few of the seemingly endless list of terms people use when defining the term for themselves. These differences in your employees can make or break your business. If you foster an inclusive environment, where all employees can contribute thoughts and plans to improve your product or service in confidence, you will improve your bottom line.

A February 2009 Groundbreakers report by Ernst & Young defines diversity as an equation for success and notes that research has proven diverse groups outperform homogenous groups even in cases where the nondiverse groups have heightened abilities. Scott Page, a professor of complex systems at the University of Michigan at Ann Arbor, created the diversity prediction theorem, which says the collective ability of any crowd is equal to the average ability of its members plus the diversity of the group, claiming diversity is a sure way to attain a strategic advantage.

“Any business will be a richer organization with a variety of diverse perspectives,” says Randi Menkin, director of global work force diversity for UPS. “It’s a business imperative to tell people that you believe in what you do or customers won’t want to do business with you. If you add diversity throughout your business, you will have a better shot at understanding all of your customers needs and predict what they want.”

Still, the return on investment is the hard evidence you want to justify devotion of time and money. Some say it’s difficult to quantify diversity ROI, but metrics are attainable. If you start with a plan that establishes your company goals and maps out a strategy, you can document the benefits and obstacles of a diverse team’s functionality that will best benefit your business.

Why it’s important

Since the country’s demographics are continually changing, a failure to branch out and move past your comfort zone when hiring and communicating with employees will ultimately result in financial punishment for the business.

“You have to push yourself to be in front of opportunities,” says Monica Maldonado, president and CEO of Interprint Communications Inc., a Decatur printing company. “As a Hispanic woman, I’ve had to reinvent the wheel each time I have pitched my services to a new company. New relationships can be difficult at the start. I think businesses can be leery of what and who they aren’t accustomed to working with. In the past, doing business with diverse groups of people wasn’t an aspect you couldn’t do business without. But today, if you want to expand, you have to learn to get past pet peeves.”

U.S. Census Bureau reports show Hispanics are the fastest-growing population, with an increase of 121 percent since 1999. The Asian population nearly doubled since 1990 and the African-American population is predicted to increase to 65.7 million strong by 2050, an increase of 15 percent since 2008.

“When recruiting employees, you need to cast a broader net to allow for a wider range of candidates to apply,” says Jennifer Melton, EEOC/diversity management consultant for F&H Solutions Group. “But proper management is needed — affinity groups and employee resource groups are helpful.”

Affinity networks — employer-recognized employee groups who share a common race, gender, national origin or sexual orientation — are a great way to attract and retain diverse employees. Networking by affinity groups reduces turnover and gives companies insights to consumers they otherwise may have never understood.

General Motors Corp.’s People with Disabilities Affinity Group has been a consistent resource for providing input and support relative to accessibility of products and services. The group played a role in helping OnStar develop the addition of TTY capability, the text telephone for the hearing impaired, for OnStar-equipped vehicles. Another example of diversity was witnessed in PepsiCo Inc.’s Hispanic professional organization called Adelante. Its Hispanic employee network provided insights that resulted in the development of the guacamole chip. In the first year of distribution, PepsiCo’s Frito-Lay division sold $100 million in Lay’s guacamole chips.

“Diversity allows everyone to understand others’ lives,” Menkin says. “This knowledge helps everyone keep rolling in the same direction.”

What you need to know

Diversity isn’t about being politically correct; it’s about keeping your business competitive.

“Effective diversity isn’t about meeting quotas, it’s about functionality and making your business better through understanding, taking action and creation of a desirable product,” Melton says. “You must do this tactfully. Recruit for core competencies with consideration to all of the candidates’ abilities. Think about how they can make you stronger.”

Keep in mind the customers who you want to attract and then investigate opportunities in markets in which you want to expand or improve business. If you’re interest is in attracting a broader customer base, employees should mirror the communities in which you want to expand. Forge relationships with diverse community organizations and let them know about opportunities in your organization. Sponsoring events that interest diverse groups makes your company more attractive to diverse candidates. For example, host events in coordination with Cinco de Mayo, Chinese New Year or Disability Awareness Month, and make your business’s diversity interests and job openings known.

If you’ve established affinity groups within your company, they can also help with recruiting. They may be able to give you suggestions that will help your business attract more diverse candidates and offer ideas of where to post positions.

Starting an affinity group is easy.

“Initiate employee resource groups by providing the resources, such as the facility or work hours, in which they can meet,” Melton says. “Employee resource groups can give a better idea to employers as to where women, for example, or Latinos may look when seeking employment. If you are posting job openings in one newspaper or on one Web site, those might not be sources in which diverse groups are seeking employment. Job fairs are an excellent place to recruit. Post new openings on local Web sites, (and at) colleges historically known to have minority or diverse students.”

Hiring managers also need to keep in mind how to motivate and manage their staff as part of a recruiting plan. Experts encourage incentives for staff contributions to a diverse work force, considering employees’ job satisfaction can be your best advertising.

“In order for companies to compete in a global and multicultural economy, they must understand and leverage diversity in all areas of their business,” Maldonado says. “The diversity of their marketplace should be reflected in the workplace as well as the supply chain. There must be an investment toward diversity efforts. Not investing in diversity because you feel you have a diverse work force is like not investing in a financial department because your finances are currently in check.”