Diversity of opinion Featured

7:00pm EDT January 31, 2008

Tony Anderson has seen the world of business change during the last 30 years, and he likes it.

With building diversity becoming a more common theme on the lips of executives, Anderson, vice chair and managing partner for

the Midwest region of Ernst & Young, feels ahead of the curve with the large impact he’s made in his territory with the 3,500 employees under his charge.

That’s because Ernst & Young, the juggernaut professional financial services firm with more than 120,000 employees in the U.S., is looking to integrate its culturally evolving staff. Anderson estimates that Ernst & Young will hire more than 20,000 people across its U.S. regions in the next year, with only 30 percent being white males.

“If you think about those numbers for a second, think about what work force you just created,” Anderson says. “Your ability to integrate that work force into the different aspects of the business is what’s going to make the difference between having an inclusive, engaged group of professionals or if you are just going to have representation.”

Building diversity has long equaled the realization of many company’s value systems, but Anderson says that few are adapting to the cultural change in business by really valuing new talent. He wants to make the integration process a business benefit for Ernst & Young so that the new work force can be a boon instead of an attempt to meet representation goals without substance.

“It’s about how you engage them and how you involve them in all the different activities we have in the firm, and that’s where we need to take the lead,” he says.

So he’s changed the strategy to one that constantly thinks about that changing work force for the Midwest region of Ernst & Young, a portion of the business that does more than $1 billion in annual revenue. Anderson went to his team with the business value of building a diverse team and then built systems to not just create jobs for new employees but ensure that they have an active role in the company. Beyond that, he has a hiring policy that values life experiences to ensure that the best candidates get jobs, regardless of their background.

Understand the business imperative

As much as Anderson would love to believe everyone out there would attack business with more morality, he knows the key to changing people’s minds on diversity is to address the business imperative.

“I think for a long time there were people talking the talk but nobody willing to walk the walk,” Anderson says. “And, in a lot of ways, you could argue that there was no reason to, there was no business imperative, there was nothing compelling other than doing the right thing. Today, things are different, and they’re different because you have a work force that is changing, so that’s a big thing.”

Not only has the work force changed but so have the expectations of the industry. In order to survive in the modern world, Anderson says you have to know that clients and customers will require a modernized staff from your company.

“On the other side of the coin, you have clients that are increasingly demanding a level of diversity in the way we serve their account,” Anderson says. “Now you have that business imperative, and that’s been the evolution in the last 30 years that has had a big impact on this.”

That understanding is how you start building the cause at your company. Anderson regularly plays off that evolving dynamic in conversations about diversity at Ernst & Young.

“The way I talk about it and deal with it is I go to the heart of the business issue and make sure everybody understands it,” he says. “We’re all accustomed to business issues and problems, so I bring it back to, ‘OK, here’s the dynamic in the market, here’s the dynamic in sources of talent; it doesn’t take a rocket scientist to figure out we better get this inclusion thing right.’ I always go back to that. We can talk about doing the right thing, and that’s an important element, but nothing hits home more than the business reality.”

When you start that dialogue with senior leaders, Anderson says you will find that you’re not the only one who has thought about how important changing your thinking will be to the future of the company.

“The interesting thing about this is, broadly across the firm, people are being touched by one of those two things: Either their client has asked for it, or they’re seeing the different people that are going to be on their account look different than they do,” he says. “So there are a lot of places where people are starting to be personally touched around the issue and the importance of the issue, and that’s the revolution that we’ve had.”

Think inclusion

Anderson is polite-natured, but he will tell you very sharply that if you really want to change the framework of your company, you’ll have to lose the word diversity.

“You use the term diversity, I want to use the term inclusiveness, and I think they are very different,” Anderson says. “I always get concerned when we talk about diversity that we’re talking about representation, we’re talking about hiring, and I don’t think that makes the difference in an organization’s culture. It’s how people are valued, how people are engaged when they are here because you can have a lot of representation and they can all feel pretty angry about being there.”

That means the first step in inclusion is thinking about the fact that a different work force requires different means. Today, it’s the job of the employer to think about what employees will need to be successful instead of holding up blanket standards for everyone. For many companies that means considering flexible hours for employees with children or ensuring that minority employees are hired with the message that they will be encouraged to move up the ranks.

“The way I think about it is, have you created for those different kind of groups a culture where they can succeed?” Anderson says. “If you think about women, they have a lot of different challenges, so are we going to be engaging on those issues, or are we going to

ignore them? If you think about minorities, they often come with a completely different background, so are you going to embrace that background and let it be something additive to what we do, or are you going to ignore it?

“We need open dialogue with the issues, so this will be talked about in our leadership meetings, and it will be talked about with all of our people directly.”

Beyond that discussion, Anderson knows you might have to give some people a little push in the right direction. At Ernst & Young, giving those opportunities is tied to managers’ performance reviews. Though Anderson is happy to let each manager figure out the best way to involve everyone, he ultimately sets goals for inclusion so the issue must be addressed. By surveying employees and finding out where they fit in with the team, he is able to ensure that everyone is getting a chance.

“You have to get granular here because this goes all the way down to how we do performance reviews of people and what they do every day,” he says. “I’m a real big believer in accountability — that if we decide we’re going to do something, then we ought to hold all of us accountable for making sure it happens. I set out very specific goals, not hiring goals, but how we are going to engage this topic and build it into the way we’re going to evaluate the performance of our people.”

By creating those opportunities, you not only exceed the evolving expectations of customers, you also get a happier employee. Anderson has seen the direct effect of these opportunities.

“You have to provide outstanding opportunities for people,” he says. “People are hungry to learn to grow, and if you have an environment that breeds those two things, I think it creates incredible loyalty. The other thing is creating opportunities for people to advance. If you have great opportunities for people, you create a significant amount of loyalty. We have the highest retention we’ve ever had in the firm today, and why do we have that retention? It goes back to engagement.”

Anderson says that a different employee base comes up with the innovation needed for the future.

“Like anything else, if you have different people talking about an issue that are thinking about it differently, chances are you are going to come up with a better solution,” he says.

Hire by talent

For all Anderson’s talk about including different groups in Ernst & Young’s future, he doesn’t hire with any numbers in mind. Instead, he says that you have to hire like you always hired — so long as you are giving everyone an equal chance to earn a seat at the table. That means opening the doors to all candidates, and not having a fit in mind for a position but instead focusing on what type of values and experiences you want from a candidate.

“On the hiring side, I have always had a philosophy of hiring the best athlete,” Anderson says. “I’ve always believed you can do a lot if you have incredibly talented people. Now, the only modification to that I would make is if you have an incredible athlete that doesn’t believe in that value statement, I don’t think you can hire them.”

When Anderson sees that someone has the talents fitting of the position he’s interviewing for, he spends more time checking in on the candidate’s value system to make sure he or she aligns with the future Ernst & Young is building.

“I talk to people, and as I engage with them, I’m always thinking about looking for whether or not that person’s value system is aligned with ours,” he says. “So, it’s the best athlete that has value systems consistent with ours.”

In that conversation about values, he can get to the heart of another matter that helps him sort out the best candidate: experiences. Whether he is hiring someone straight from college or another senior leader, Anderson says experiences don’t come by gender or background but by how you handled the lot you were given.

“I typically go at it by talking about the experiences that they had, so I ask what they did, why did they do it, and how they did it,” Anderson says. “It tells me a lot about their value system. So I don’t ask them directly about their value system, I pick at it from understanding the things they’ve done in their career or their college experience, and when you talk about the what, when and how, that’s how I build my own thinking around the value system.

Not only does the explanation of experiences and the value system help you get a better feel for the employee’s fit for your company’s culture, but Anderson has noticed that it helps weed out candidates who can talk a big talk without having the credentials to back it up.

“That’s where the art of interviewing comes in because people can mislead, and I think that’s where you come in and really have to be inquisitive about the things they’ve done,” he says. “And if you find inconsistencies that should raise flags, then you match that up with whatever feedback you get externally and look for inconsistencies to find out if they really are what they say.”

HOW TO REACH: Ernst & Young, (312) 879-2000 or www.ey.com