12 diversity practices of high-performing organizations executive summary

7/31/2019 12 Diversity Practices of High-Performing Organizations Executive Summary

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12 Diversity Practices ofHigh-Performance Organizations

Executive Summary

Strategy Leadership Talent Culture Market


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Peers R esear ch

Technology

Strategy

Leadership

Culture Talent

i4cp Network

Market

Tools

Peers R esear ch

Technology

Strategy

Leadership

Culture Talent

i4cp Network

Market

Tools

About i4cp

i4cp enables high performance in the worlds top companies.

i4cp is the world's largest vendor-free network of corporations focused on building and

sustaining highly productive, high-performance organizations. Through a combination of

peer networking, human capital research, tools and technology, we enable high

performance by:

Revealing what high-performance

organizations are doing differently

Identifying best and next practicesfor all levels of management

Providing the resources to show how

workforce improvements have

bottom-line impact

Over the last 40 years, i4cp research has

revealed the five key human capital

domains that companies leverage to drive

performance. Our members - many of thelargest and most respected companies in

the world across a wide spectrum of

industries - use this research, i4cp's

expertise, tools, technology and vast

network of peers to improve productivity

and drive business results.

Revealing what high-performance

organizations are doing differently

Identifying best and next practicesfor all levels of management

Providing the resources to show how

workforce improvements have

bottom-line impact

Over the last 40 years, i4cp research has

revealed the five key human capital

domains that companies leverage to drive

performance. Our members - many of thelargest and most respected companies in

the world across a wide spectrum of

industries - use this research, i4cp's

expertise, tools, technology and vast

network of peers to improve productivity

and drive business results.


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About the ReportThis report combines the key findings from the Diversity Practices Surveywith excerpts of interviews

conducted with diversity executives to lend additional practitioner perspective. It focuses on the 12

findings identified in the survey that highlight the diversity program practices that differentiate

higher-performing organizations.

The Institute for Corporate Productivity (i4cp) conducted the Diversity Practices Surveyin September

2009 in conjunction with its Diversity Accelerator. A total of 249 respondents participated in the

survey. Full results and interactive data are available on the i4cp website in the Diversity Practices

Survey Portfolio.

About the Market Performance Index (MPI)The MPI is based on self-reported ratings to four questions about a companys current performance

in the areas of revenue growth, market share, profitability and customer satisfaction as they

compare to the companys performance five years ago. The average of these four responses

determines a companys MPI score. Companies are then separated into roughly equal thirds and

listed as higher performers, mid-range performers and lower performers.

The following is a breakdown of respondents by MPI score.

The following is a breakdown of respondents by organization size.

Authors and ContributorsMary Ann Downey Lorrie Lykins

Eric Davis Joe Jamrog

John Gibbons Eric Davis

David Wentworth


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Contents12 Diversity Practices of High-Performance Organizations ....................................................... 0About i4cp ...................................................................................................................................... 1About the Report ............................................................................................................................ 1About the Market Performance Index (MPI) ................................................................................. 1Authors and Contributors .............................................................................................................. 1Contents ......................................................................................................................................... 2Executive Summary ....................................................................................................................... 3

The role of diversity effectiveness .................................................................................... 4Key Findings ................................................................................................................................... 5

1) 1) Higher-performing organizations are more likely to build the business case fordiversity on the need to reflect their customer base and community demographics ..... 5

Demographics ................................................................................................................................ 72) What is your current title? .................................................................................................... 73) What department do you work in? ...................................................................................... 74) Within which sector does your organization primarily work? ............................................ 85) Describe your organizations type of operation: .................................................................. 8

i4cps Diversity Accelerator ........................................................................................................... 9

Use of all results, analysis and findings require explicit permission from i4cp.


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Executive SummaryAs the global economic downturn reached a critical mass, i4cp, working closely with the diversity

professionals that comprise its Diversity Accelerator, fielded a comprehensive survey of

organizational diversity practices. Economic turmoil was forcing some organizations to shift focus

and resources to surviving the recession, lending even greater urgency to the question of what

diversity and inclusion success looks like and what it means in terms of the bottom line. This

impetus lent a keen edge to i4cps focus on the practices of higher market performing organizations.

The business case for diversity has been clearly established in most organizations. Demographic

change and globalization are here to stay. People of divergent races, genders and beliefs are

redefining the workplace as well as the meaning of success. Organizations must be well-studied on

the markets they want access to and the broad talent pools that exist, which not only bring skills to

the table, but provide inlets to those markets.

Though many diversity practices are logically tied to factors such as organization size and global

reach, companies with higher market performance scores noticeably place more emphasis on

specific aspects. By combining analysis of those behaviors with other demographic variables, this

report identifies those practices that link effective diversity initiatives to higher market performance.

The 12 findings from i4cps Diversity Practices Surveyare based on the practices of higher market

performing organizations and those who report greater diversity success. This report details how

these organizations:

1. Are more likely to build the business case for diversity on the need to reflect their customer

base and community demographics

2. Make diversity an important consideration in developing their succession plan

3. Place more importance on framing diversity as a business relevant issue and on creating

accountability

4. Have a more inclusive definition of diversity

5. Are less likely than lower performers to sponsor employee resource groups that are based on

traditional diversity labels or categories

6. Are more likely to specifically budget for diversity initiatives

7. Are more likely to assign responsibility for leading and executing the diversity strategy to the

executive team

8. Place greater emphasis on diversity recruiting and are more likely to concentrate training on

diversity skills

9. Do not attempt to calculate the ROI of their diversity investments

10.Monitor diversity success by looking at both their applicant pools and their ability to retain

once the talent is in the door

11.Are less likely than lower performers to compare diversity metrics against minority

representation in the community

12.Are more likely to conduct an annual CEO review and to tie results to compensation


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To assess areas where market performance and perceived diversity effectiveness cross paths,

respondents were asked, How effective is your organization in leveraging diversity strategies

and initiatives to meet business goals? Twenty-five percent reported that their organization is

highly or very highly effective in this area. Seventeen percent had both high performance

results and highly effective diversity practices, making these 35 organizations of particular

interest when determining best practices. In several instances where market performance

alone shows little differentiation, the addition of this effectiveness result shows a clear

preference among these organizations.

Although mid-range performers were far more likely to identify as highly or very highly effective

at leveraging diversity to meet business goals, this does not mean that leveraging diversity

effectively isnt supportive of higher market performance. Other factors identified in this

report, such as the business case driver, help to explain this finding. After all, a compliance-

based business driver has much different business goals than a talent-based driver; as well as

goals that are easier to achieve and to measure. Although longitudinal tracking is necessary

for verification, its also possible that an effective and long range talent management initiative

like diversity will reap market benefits only after it has matured and evolved.

Many of the practices identified in this report are also dependent on, or related to, other

practices. A business case driver centered on compliance or the presence of a more

integrated talent management function can influence what other structures a higher-

performing organization might need to make their program effective. Several of the key

findings in this report elaborate on those relationships, with the primary goal of highlighting

performance enhancing practices. Some common practices even among higher performers

are not causally related to performance, and these are highlighted as well. Though this

approach doesnt equate to a magic bullet for diversity success, it does create a roadmap to

the interlocking highway of strategies that can be found in higher-performing organizations.


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Key Findings

1)Higher-performing organizations are more likely to build thebusiness case for diversity on the need to reflect their customer

base and community demographics

Companies at all performance levels seem to agree that diversity is integral to their business

strategy. But higher performers are more likely to say diversity is a way to reflect customer

base/community demographics (26%) than are mid-range (12%) and lower performers (10%). And, in

a kind of mirror image, high performers (6%) are less likely than lower performers (18%) to say they

concentrate on diversity because it's the right thing to do or a legal compliance requirement.

Because this question required respondents to make a choice rather than select all that apply, one

can conclude that the results reflect the companies relative priorities rather than an explicit

measure of whether or not they support any number of the statements in the question. As is

consistent with other i4cp survey findings, higher performing and highly effective organizations are

almost always more likely to anchor their efforts in a solid business strategy. While still maintaining

compliance and ethical standards, these organizations surpass those basic needs by implementing

initiatives in a way that contributes to overall organizational success.

Higher performers Mid-range performers Lower performers

To reflect customer base / communitydemographics

It is integral to our business strategy

To attract top talent

To support the organizations cultureand branding efforts

To strengthen relationships with globalpartners and customers

It is a contract requirement withsuppliers, customers or contractors

It is a legal compliance requirement

Its the right thing to do

To enhance public relations / image

Other

2.9%

5.7%

5.7%

5.7%

8.6%

11.4%

11.4%

22.9%

25.7%

6.7%

13.3%

1.7%

1.7%

8.3%

16.7%

16.7%

23.3%

11.7%

7.7%

5.1%

17.9%

17.9%

5.1%

7.7%

5.1%

23.1%

10.3%


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Seeking to reflect customer base and community demographics is a solid business practice among

high performers that demonstrably helps to open talent pools and markets, supporting a host of

other talent and growth goals. The second highest response for high performers, identifying the

business case as integral to the business strategy, was a more generally focused driver selected by

23% of organizations overall and was the top driver for mid and lower-performing organizations.

Attracting top talent and supporting culture and branding are the next highest drivers selected by

higher performers, at 11% each. These drivers also support larger talent management initiatives and

business goals.

To become a member, contact your account

representative or go to


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Demographics

What is your current title?

What department do you work in?


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Within which sector does your organization primarily work?

Describe your organizations type of operation:

Other

Government

Business Services

Health Care

Industrial Manufacturing

Financial Services / Banking

Insurance

Education

Energy & Utilities

Consumer Products Manufacturers

Automotive & Transport

Telecommunications

Food / BeveragesComputers

Pharmaceuticals

Retail

Not For Profit

Membership Organizations

Aerospace & Defense

Chemicals

Construction

Leisure

Media

Real Estate

ElectronicsEnvironmental Services & Equipment

Metals & Mining

Consumer Services

Securit Products & Services 0.4%0.4%

0.8%

0.8%0.8%

1.2%

1.2%

1.2%

1.2%

1.2%

1.2%

1.6%

1.6%

2.0%

2.8%

2.8%2.8%

3.2%

3.2%

4.0%

4.8%

6.0%

6.4%

6.4%

6.8%

6.8%

7.6%

9.6% 11.2%


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i4cps Diversity AcceleratorThis survey is a product of the i4cp Diversity Accelerator group. Formed in April 2009 to focus on the

myriad issues and challenges with which organizations are confronted in approaching diversity, this

group was comprised of representatives from the following organizations:

Amway Deloitte

Federal Reserve Board ING

Pelco TECO Energy

YMCA of Atlanta YMCA of Greater Seattle

Based on the groups initial meetings, which included identification of issues, brainstorming and

individual interviews, a survey instrument was developed to further explore the issues that were

identified.

We at i4cp would like to express our gratitude and appreciation for the individual contributors in the

accelerator group whose dedication to the field of diversity and inclusion made this research project

possible. Their time and expertise have been essential in the production of the initial survey

instrument and in the final analysis of the data that was produced.


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