It’s not news to anyone that there is a diversity problem in the U.S. workforce. Just 5% of Fortune 500 CEOs are women, and only six companies in the 500 have three female top execs.
Even more dismal, with only three black CEOs in the Fortune 500, we’re seeing decreases and the lowest concentration of black leaders since 2002. According to the EEOC, the proportion of black men in management increased just slightly — from 3% to 3.3% — between 1985 and 2014. Black women fare even worse, with just 1.5% representation among senior management in the Fortune 500. This pipeline translates to a nearly nonexistent path to the C-suite for black people. These data points highlight just some of the underrepresentation problems, and statistics like this exist across many identity groups including Latinx, LGBT and others.
This problem needs solving, not only because equality is simply the right outcome for all, but also because studies show that diversity is good for business. Diversity increases levels of innovation, financial returns and market share.
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Despite major attention to the problem, many companies are applying unproven solutions, leading to concerning outcomes. Not only are these programs ineffective, but they spur company leaders to pat themselves on the back for checking the box on diversity without thinking more critically about the systems and structures that led to the problem in the first place.
It may appear counterintuitive to not implement diversity programs, but companies should nix surface-level programs with zero ROI. These common corporate approaches to tackling the diversity problem lack the deep thought required to address inequitable systems and structures. The three approaches below are samples of the “bad” diversity strategies companies tend toward, followed by improved alternatives.
When companies make the decision to focus on diversity and inclusion, they often form a task force of cross-functional people and, with the best of intentions, brainstorm a giant list of events and partnerships they could throw. They measure success on how quickly they execute on ideas. Employees experience a burst of events and focus, and a newfound dialogue that the company lacks the structures and resourcing to fully support.
Instead, be thoughtful and intentional. Assess where the company is, identify goals and ensure executive sponsors and stakeholders are ready to put real dollars and time behind these efforts. This ensures that the dialogue triggered by events is resourced by professionals who can support evolved employee needs. If you don’t have an internal expert who knows how to build a successful focus, consider investing with a consultancy focused on inclusivity in the workplace, such as Vaya Consulting or Paradigm.
Whether intentional or not, Starbucks likely had better ROI on their PR efforts compared to their internal diversity outcomes. Studies reveal diversity training programs are ineffective, and in many cases harmful to a culture of inclusion. These isolated programs without an ongoing dialogue about the real issues that matter can trigger feelings of ‘otherness’ in underrepresented employees.
Instead, invest money into opt-in community inclusion programs such as employee resource groups, which increase feelings of belonging for underrepresented employees and new hires.
The Rooney Rule was originally implemented as an NFL practice to increase the hiring of diverse coaches, and many corporate businesses jumped on the bandwagon. However, the Rooney Rule does not impact outcomes and is not always taken seriously. Many ignore the status quo of a homogenous executive team when they have checked the box on their hiring practices, despite lack of results.
Instead, have a real conversation about the importance of diversity in the C-suite. Identify structural and root causes leading to the problems on your team. Identify emerging leadership inside your organization, and invest in them. Be serious about your expectations with recruitment firms in terms of the kind of diversity you expect to see. At Rainforest QA, they use the Mansfield Rule, and in the past two years they have moved from a 100% white male executive team to a 33% white male executive team.
There is no magical 10-point checklist that results in diverse and inclusive companies, and companies that look at diversity as a box to be checked will fail. It takes real investment from senior leadership over a sustained period of time to look at the root causes of the issues and develop the cultural shift that will bring success — slowly, but surely.
