Resonant Leadership for All Leaders

Dr. Patricia Arredondo
President,
Arredondo Advisory Group

Emotional intelligence and cultural competency are integral to leadership in organizations. With heightened conversations and plans to centralize DEI efforts in organizations, theoretical foundations also matter. The people leading the way require a mindset for transformation and possibilities but also means to engage the majority to come along. DEI efforts are often controversial because they create new learning curves and emotional discomfort, thus leaders require effective ways to communicate about priorities, approaches to change, and expectations of the workforce.

Cultural Competency

Models of cultural competency present a tripartite approach to DEI leadership: cultural self-awareness, knowledge of others, knowledge of contextual factors (i.e., societal and political), and how these contribute to responsive behavior in a diverse workforce. For example, 2020 introduced an interplay of societal conditions that differentially affected individuals. Women assumed more work and family responsibilities, persons of color in service roles became unemployed sooner and had greater health risks, and younger workers faced threats of unemployment because they were the last hired. Leaders must be aware of these scenarios, how they think and feel about them, and the behavioral approaches they will take to support and make the necessary changes for their organizations through a DEI lens. 

Resonant Leadership

The model of emotional intelligence is applied widely in organizations and often related to inclusive leadership. The four tenets are self-awareness, self-management, social awareness, and relationship management, aligning well with a cultural competency mindset. Leading inclusively in a diverse workforce of individuals with intersecting identities requires a heightened attention to relationship management. A resonant leader attends to relationships, is people-centered and skilled in listening and expressing empathy. Although often considered soft skills, because relational matters are often attributed to women, when it comes to leadership, everyone requires social awareness and empathy to create a fair, respectful, equitable, and inclusive work environment. In my study of Latina leaders, I learned that their leadership was resonant, based on their values, social awareness, empathy, and relationship management.

Inclusive Leadership though a DEI Lens

The DEI spotlight in organizations has introduced terminology about inclusionary practices. What we know is that inclusive leadership practices require intentionality with plans for transformation informed by all sectors of the internal organization and other constituencies. At universities, student voices matter; hospitals need to hear from their patients as well as their employees; city governments have to know how services are delivered and their equitability to different demographic groups; and  corporations need to take a pulse of their diverse customer base. Inclusive leadership through a DEI lens is not about delegating but about participating, modeling, and demonstrating that collective energy and efforts are needed to advance equity and inclusion plans for the immediate and the long-term.

Chicago State University Researchers Sheds Light on Structural Inequality Precipitated by An Equal Opportunity Coronavirus

Derrick Collins
Dean,
College of Business, Chicago State University

Abstract

Empirical analysis performed by economic and financial researchers, Drs. Ernst Coupet and Dr. Ehab Yamani, in their recent study, Economic Report on the Impact of the Coronavirus on the African American Employment in Chicago, predicts inequitable unemployment impacts on African Americans and Latinos in the City of Chicago as a result of the onset of the novel coronavirus,Covid-19. Moreover, this predictability of unequal impact aligns with long-held anecdotal beliefs common in the African American community.

Since the Age of Enlightenment, the arc of human progress has been advanced by the analysis of empirical data, however, four centuries later a biological contagion serves as a catalyst of reason.

A novel coronavirus with the utilitarian name, Covid-19, revealed in stark relief the structural inequity undergirding U.S. employment practices and the predictable negative consequences of this behavior.  A companion pair of research essays conducted by two finance professors from Chicago State University, correctly predicted that African Americans will suffer disproportionately as a result of a virus which, itself, exhibits no racial bias.  Dr. Ernst Coupet and Dr. Ehab Yamani co-authored the, “Economic Report on the Impact of the Coronavirus on the African American Employment in Chicago” for the purpose of examining “the effect of the virus may have on the state of inequality among the African American labor community.” 

What is so striking about the Coupet/Yamani research compilation is the sheer predictability – the fact that racial bias in the U.S. is so pervasive, and so persistent, it can be mathematically modeled.  A set of actions and reactions that are ugly and cold, but nonetheless are orderly, predictable, systemic and thereby can be reduced to an algebraic equation.  Such a dynamic is the definition of structural bias.  The second-most striking thing about this body of research is that the data analysis provides empirical evidence for some common axioms, regarding race, which African Americans have quoted for decades.  This “common knowledge” was provided quantitative support by the Coupet/Yamani study, as it validated the insight of generations of elders in the African American community.

“When White Folk Catch Cold, Black Folk Get Pneumonia”

The researchers studied the employment impacts caused by the September 11, 2000 terrorist attack and the 2007 – 2008 recession, and used this history, combined with higher-order mathematics, to illuminate a clear racial bias in the U.S. and Chicago labor markets.  The rationale for studying these two events to predict the impact of Covid-19 on employment is that these events were unplanned and sudden external shocks to the economy in a fashion similar to the sudden onset of the coronavirus on the country.  In both cases, the national unemployment rates for African Americans were higher and more volatile.  The 2007–2008 “Great Recession” was quite an impactful event as the African American unemployment rate peaked at 13.56%, in contrast to the white unemployment rate which peaked at 7.44% during the same time period.  Moreover, African Americans experienced more volatility during this time period as reflected in a standard deviation of 2.75%, while the standard deviation of white unemployment was 1.75%. Again, a disproportionate impact on black folk during a painful economic time period.  

African Americans in the City of Chicago during this time period suffered a more acute impact as evidenced by a mean unemployment rate of 13.90% and standard deviation of 3.92% – roughly double the white unemployment rate of 6.28% and standard deviation of 2.20%.

“Last Hired, First Fired”

Delving deeper into this analysis of unemployment following the exogenous economic shocks of 9/11 and the Great Recession, the data appears to show that there is an actual preference for white employees over African-Americans and Latinos.  In general, African American unemployment rises quicker and higher, and lasts longer, than white unemployment following an unplanned and sudden “shock event” similar that of a 9/11 or Great Recession.  The researchers found that the data indicates, “a long-run association between white unemployment and African American unemployment, in the sense that unemployment is first decreased in the white sector, followed by a lagged unemployment decrease in the African American labor market.  This finding suggests that most of the unemployment in the white sector are of the structural and frictional forms, while the African American unemployment is largely cyclical in nature.  Put differently, the African American labor market appears to serve as a secondary labor market to the white sector that fills in during expansionary times but suffers great losses during economic downturns.”

“It’s Not What You Know, But Who You Know”

When discussing unemployment rates and race, the impact of education is usually invoked as it has been proven to have a significant impact on employment and income.  The researchers acknowledge the longstanding academic literature that correlates educational attainment with earnings – generally speaking, the higher the educational attainment, the higher one’s earnings.  However, the Coupet/Yamani study validates that beyond education, the factor with the most impact on unemployment continues to be race.  In the subject study, the researchers compared 24 specific community areas on the South/Southeast sections of Chicago which are primarily African American and Latino to the 77 neighborhoods that comprise the entire city.  In 2019, the mean unemployment rate for the City of Chicago was 8.5%, whereas the South/Southeast sides’ rate was 12.6%, which is 48% higher than the city, as a whole.  Similarly, the mean of median household income for Chicago during this time was $53,392, as compared to the South/Southeast side result of $37,477, which is 30% lower than the overall city result.  

These statistics appear unsurprising at first glance, until the context of educational attainment is considered.  Citywide, 16.2% of Chicago households have less than a high school diploma, as compared to the 15.1% of South/Southeast households, which fared approximately 7% better than the city’s results.  City households with a high school diploma and some college coursework comprise 51.2%, as compared to the South/Southeast side where 58.4% of households attained the same level of education, which equates to a 14% better level of attainment than the overall city households.  Chicago households with a college degree represent 32.7%, compared to 26.4% of South/Southeast households.  Thus, the educational attainment of households in African American and Latino neighborhoods in Chicago is better at all levels other than a modest differential in college attainment.  This brings the analysis back to race to explain the disparities in the categories that really matter, such as employment and income.

“Lift Every Voice”

Sometimes data can be shocking – this is one of those times.  Numbers are typically dispassionate, sterile, and cold to the touch.  However, on rare occasions, a sequence of digits will glow like embers – illuminating objects in close proximity, while emanating heat and invoking passion.  Most people, with a basic sense of fairness and logic, understand that a random collection of numbers can show almost anything – once, maybe twice.  However, something is terribly amiss when the dice are thrown and the combination of digits add up to the same seven or eleven for white individuals, while the dreaded “snake eyes” is the reliable and consistent result for black and brown folk.  Every. Single. Time.  This is not only unfair – it’s unproductive and suboptimal.  The strength of diversity is just that – strength.  It has been empirically proven that the inclusion all builds a stronger whole, nevertheless, more work is needed to make this a realistic norm.

The analysis performed by this diverse team of researchers (African American of Haitian lineage and Egyptian) illustrates the systemic – alas, predictive – disparities in the U.S. employment sector.  This structural inequity must be addressed with a structural process that makes awareness of diversity a positive element, as opposed to being a trigger for negative response.  To make this happen will require the intervention of awareness and education to remove the structural inequities and improve the outcomes of diversity, equity, and inclusion (DEI) among all citizens.  Given this need, the work of DEI professionals will only become more important, more impactful, and more necessary as we seek to move mindsets, and a country, forward into a more diverse, equitable and inclusive existence.

Reference

Coupet, E. & Yamani, E. (2020).  Economic Report on the Impact of the Coronavirus on the African American Employment in Chicago.  Chicago, Illinois; Chicago State University.  Downloaded from: https://www.csu.edu/news/documents/ECON_COVID_Report.pdf

No Excuses: WFH Means It’s Time to Accelerate Diversity

By Ed Kopko
CEO & Publisher, Bold Business
Chief Technology Strategist
Diversity MBA Media & Diversity Learning Solutions

Prior to the pandemic, 17% of the workforce worked from home. That number jumped to44% in 2020 1, and recent surveys reveal that 74% of companies plan to make certain aspects of that workforce shift permanent.2 Why? Because the transition to work-from-home (WFH) life was nearly seamless, which showed that, regardless of where employees live, a good Internet connection ensures businesses can go on as usual, and even thrive. In fact, a recent study by Hubspot found that 91% of remote workers say they are more productive than when working in their office.3 This bodes well for productivity, and it also means that by breaking down the “distance barrier” and taking geography out of the equation, there is virtually nothing standing in the way of companies expanding the diversity of their workforce. WFH reduces location bias, increases job accessibility… reduces excuses!

“Work From Home has radically altered the diversity hiring equation by reducing location bias and expanding job access for all across the diversity spectrum.”      -Edward Kopko

Recruiting and hiring has long been done by plumbing the depths of the local talent pool. If a company’s office was in Manhattan, NY, or Miami, FL, or Billings, MT, then employees came from within commuting distance. If a city lacked diversity, the company was somewhat off the hook in terms of finding a diverse workforce. How could they find BIPOC candidates if there were none within range of car, bus or subway? It was one of the top reasons companies cited for not meeting diversity goals. This geographic impediment to diversity hiring is a form of location bias, and as per Recruiting Daily, “remote work helps defeat location bias… and opens the door to new and transformative opportunities.” 4

With WFH more prominent and viable, companies can tap into a talent pool that extends throughout the world. A workforce logging in from home means nearly limitless job accessibility, and “[b]y embracing remote work, companies can take on all types of workers they would otherwise miss out on.”5 This broadening of the diversity spectrum means more qualified candidates who would otherwise be excluded based on gender, disability, or more. Global hiring also means companies can accelerate their diversity by working with partners with international footprints. After all, global hiring gives the added benefit of true cultural diversity (and transforms managers with culturally-homogenous management skills to those with true cross-cultural leadership ability).

In addition to opening up the talent pool, WFH means a far easier implementation of tools used for diversity hiring. As per Ideal.com, “Diversity hiring is hiring based on merit with special caretaken to ensure procedures are free from biases related to a candidate’s age, race, gender, religion, sexual orientation, and other personal characteristics that are unrelated to their job performance.” 6 The tools of diversity hiring include blind hiring, in which a candidate’s personal information is scrubbed to reduce unconscious bias, and intelligent shortlisting, which utilizes automated software to screen qualified candidates.

According to Diversity Jobs, “beginning in September of 2020, women were forced out of the workforce at four times the rate of men.” 7 With women worldwide shouldering the bulk of homecare responsibilities, it’s no wonder that they’ve departed from the workforce in such numbers. However, this expansion of the gender gap–which is an enduring impediment to workforce diversity–can be fixed. “Despite the challenges of homecare duties, there are studies that have shown that WFH’s flexibility allows mothers to continue working normal hours after childbirth–if they wish–letting them maintain well-paying jobs and remaining in the workforce even in more demanding times for their families.” 8

Prior to the pandemic, I wrote in the Diversity Business Review that “[w]hen enterprises go global, diversity is inevitable. The simple act of engaging in commerce beyond the borders of one’s own country will expose a company to a wide range of people who might not share the same social values and beliefs. That’s just the nature of global business.” 9

Thanks to WFH, every company can go–and should already be–global. Which means that there is nothing truly stopping a workforce from getting a healthy dose of diversity.

Don’t forget diversity (or equity and inclusion) during this time, especially if it feels like your business is in limbo because every employee is working from home. A WFH posture opens up a world of possibilities when it comes to making a workforce more diverse. And if you need guidance in navigating these waters, there are consultants and training videos available to help you, courtesy of Diversity MBA and Bold Business.

The bottom line is that WFH reduces excuses and expands possibilities. With working from home, it’s time to accelerate DEI initiatives!

 

ABOUT THE AUTHOR

Edward Kopko currently serves as CEO and Publisher  Bold Business LLC, , a  global outsourcing and technology solutions company that operates on an international level, with offices in New York City, St. Petersburg, FL, Raleigh, NC, the Philippines and India.  Ed previously served as chairman and CEO of Butler International for 23 years, overseeing a wide array of worldwide offices and sophisticated assignments. While there, he witnessed firsthand the importance of diversity and inclusion for long-term business success, and managed a global workforce of over 4000 that encompassed a multitude of diversity dimensions, ultimately supervising the integration of employees with extremely disparate backgrounds. In addition, he was the CEO and publisher of Chief Executive Magazine, a publication geared towards providing insight for and on C-level executives. His articles have appeared in the Wall Street Journal, Forbes and numerous other media outlets. He is a graduate from Columbia University with a Master’s degree in Economics. For his work promoting DEI issues, he was given the 2019 Diversity Impact Award, and his book, PROJECT BOLD LIFE: The Proven Formula to Take on Challenges and Achieve Happiness and Success, has been described as a “must read text for those facing diversity and inclusion challenges.” Ed is a firm believer in the notion that no true measure of business accomplishment on a global scale is possible without diversity, and that once inclusion enters into the equation, success will follow.

 

References

1 Statista.com, https://www.statista.com/statistics/1122987/change-in-remote-work-trends-after-covid-in-usa/

2 Gartner.com, https://www.gartner.com/en/newsroom/press-releases/2020-04-03-gartner-cfo-surey-reveals-74-percent-of-organizations-to-shift-some-employees-to-remote-work-permanently2

3 Hubspot.net,https://cdn2.hubspot.net/hubfs/443262/TINYpulse_What_Leaders_Need_to_Know_About_Remote_Workers.pdf?t=1462203875281

4 Recruiting Daily,https://recruitingdaily.com/why-remote-work-is-the-best-opportunity-for-diversity-inclusion-yet/

5 Seekout,https://blog.seekout.io/remote-work-diversity-recruiting/

6 Ideal.com,https://ideal.com/diversity-hiring/

7 Diversity Jobs,https://www.diversityjobs.com/2020/10/how-working-from-home-gender-inequality/

8 Diversity Jobs, ibid.

9 Diversity Business Review,https://www.diversitybusinessreview.com/global-diversity-and-inclusion-and-the-perils-of-ignoring-local-norms/

Coaching as a Catalyst to Build Executive Presence in the DEI Space

By Dr. Linda A. Liang,
President,
Organizational Resources, LLC

I was 26 years old, one year in my job as a statistician at a non-profit in downtown Chicago. Relatively new to the professional world, I was promoted to the Manager of the exam unit, now leading a team of 9 employees, with two degreed professionals. My promotion was a surprise tome, even though I had recommended myself for the job. I asked the Director why I was promoted, and she said, “you look like a manager.” Another way to describe what she said is “executive presence”(e.g.,neat, professional clothing, and well-spoken)

After coaching more than 300 leaders, including over 100 leaders from diverse backgrounds, I find that Individuals often seek coaching to increase their career opportunities, executive presence, power, and visibility at work. Performance is comprised of two major components: How you are perceived and what you produce. We tend to focus on what we produce, but research shows(Hewlett, 2014) that to be considered for positions of authority you have to display executive presence, in other words how other people perceive us, e.g., the ability to command a room, be noticed and attract others. Make no mistake, performance matters.

Executive presence is comprised of three components: gravitas(how you engage others),communication(how you speak)and appearance(how you look).How you look is comprised of being polished and groomed, physically attractive, simple stylish clothes such as those needed for the next level up, being tall, and displaying energy. Of course, the workplace norms also playa part of what is expected in terms of physical appearance. For women, Hewlett’s research study indicates that having visible, but not too much makeup is associated with being a leader and having moderate makeup is associated with being trustworthy (Hewlett,2014).One must wear clothing that is neat in appearance, pressed and appropriate for the audience. Note that this may vary depending on the individual, and usually our instincts are our best guides.

Coaching is a powerful tool in which you and a coach “co-create” your path and progress. The coach is there to guide you, you are there to do the work. The coach provides a safe sounding board, to take risks, try on new ideas, so that you can be completely honest with yourself and focus completely on yourself and your priorities. Coaching helps you to identify your leadership strengths and blind spots, to enable you to fully utilize your gifts and talents. In the diverse workplace, we need to attend to ourselves and the individuals with whom we engage. Following is an example, based on a composite of my coaching clients, of how coaching can empower you to be more visible and present.

I was coaching an African-American leader who had been selected to be a representative of her organization on a national committee. She did not recognize her leadership strengths, and felt unqualified, and reluctant to attend the committee meeting. She completed a 360-degree review of her strengths and was surprised to learn that she had many leadership skills,(e.g., teamwork, empathy, strategic thinking, etc). She decided to attend and just listen. She feared that her ideas would be different, and that she did not really know how the committee worked–who were the power players and what were the expectations. By discussing with me all the “what ifs”, why she had been selected, what her strengths were, and what, perhaps, she might be able to contribute, she realized that she had a place there, and could contribute to the results of the meeting. She attended, spoke up and was soon tagged as a “leader” for her different point of view and diplomatic way of leading the conversation. She was soon asked to chair a more highly visible and powerful committee. If she had been quiet, as she had planned, her talents and contributions would have been lost. Note that this example is a composite example of individuals I have coached. One of the lessons learned is that a coach can guide you to address self-doubt and affirm your capabilities. This guidance can be a catalyst to strengthen your executive presence and opportunities.

References:

Hewlett, S.A., Allwood, N., Sumberg, K. et.al.,2014.Cracking the Code: Executive Presenceand Multicultural Professionals. Center for Talent Innovation. https://coqual.org/

Hewlett, S.A.(2014).Executive Presence.New York, NY:Harper Collins Books

Dr. Linda Liang is a leadership expert and executive coach, (certified by the International CoachFederation). She has spoken often on Building Power and Executive Presence, and Power andInfluence. She holds a Ph.D. In Industrial/Organizational Psychologyand coaches leaders forpresence, power, passion, and prosperity. She is the President of Organizational Resources,LLC. www.orgresources.com. To continue the discussion, contact her at Linda@orgresources.com

Focus on the NEXT!

By Diana Starks,
Vice President of Diversity, Equity, Inclusion, And Opportunity
Federal Reserve Bank of Cleveland

 

The work of diversity, equity and inclusion (DEI) is integral to successful outcomes in a variety of disciplines and industries, none the least which include business, education, healthcare, service and hospitality. The pandemic required many industries to reimagine how they would operate, while others were unable to survive and have since closed their doors. The strain and impact of hundreds of thousands of hospitalizations and deaths amid seems like a growing anxiety among many, impacting for some their psychological safety. The global pandemic was a precursor to a next pivotal moment in history–civil unrest and attention on over four hundred years of systemic racism. Amid the turbulence, there arose a surge of career opportunities for DEI professionals. For-profit corporations began to see the need as integral to their market share. For others, the outcry of their employee base and stakeholder interest began to drive an increased focus on DEI. Despite the interest and heightened attention, those that are looking for an immediate remedy need to focus on transformative change to address short-term needs that lead to long-term sustainable gains. These are not just improvements related to business profits; the need is for gains that are grounded in principles and values of justice, access, and equity for all.

So, what is NEXT?

I appreciate the opportunities to talk with other thought leaders and advanced DEI practitioners as it is another foundation for birthing ideas that may lead to sustainable actions. During one conversation in early December the concept of looking for the NEXT prompted an explanation of the acronym–New Engagement to Xchange Together. NEXT is the new experience to collaborate and work together. Industry thought leaders and DEI advanced practitioners are not dwelling in the past or pre-pandemic conditions; they are looking ahead to the NEXT. Our focus is on the opportunities that are hidden and those to birth amid uncertainty. We can achieve more together than we can individually.

This is the call to action: Look beyond what was; look to what needs to be in every area to ensure equity for all.

The opinions expressed here are solely those of Diana Starks and are not the official statement of the Federal Reserve Bank of Cleveland.

The Federal Reserve Bank of Cleveland is one of 12 regional Reserve Banks that along with the Board of Governors in Washington DC comprise the Federal Reserve System. Part of the nation’s central bank, the Cleveland Fed participates in the formulation of US monetary policy, supervises banking organizations, provides payment and other services to financial institutions and the US Treasury, and performs many activities that support Federal Reserve operations Systemwide. In addition, the Bank supports the well-being of communities across the Fourth Federal Reserve District through a wide array of research, outreach, and education activities.

The Cleveland Fed, with branches in Cincinnati and Pittsburgh, serves an area that comprises Ohio, western Pennsylvania, eastern Kentucky, and the northern panhandle of West Virginia. For more information, go to www.ClevelandFed.org or follow us on Facebook, Twitter, Instagram or LinkedIn.

Collecting Social Needs Data to Drive Equity and Performance

By Knitasha Washington
President & Founder
ATW Health Solutions

Abstract

This article suggests that a data-driven approach to diversity, equity and inclusion (DEI) is essential when companies are seeking a global workforce and consumers. The diverse needs of both the workforce as well as consumers need to be considered in strategic plans to improve DEI. When it comes to equity, health equity plays a role in business and demands the attention of DEI business leaders. A health equity strategy can be interwoven into all businesses—from the factory floor to the office cubicles all the way up to the board room—to address causal factors effecting health outcomes such as housing, food, transportation, and financial needs. Achievement of business outcomes and revenue targets require the integration of human and operational factors that drive the entire ecosystem in a global marketplace. Business leaders are increasingly acknowledging employees’ social factors affects their health, which in turn affects multiple business factors including employee and business productivity, benefits, and insurance costs; all of which affects the organization’s financial performance. People’s social factors impact80% of their health outcomes and are known as the social determinants of health. These social determinants of health become more significant in communities that are geographically located in urban or rural areas that employ a disproportionate number of lower-income workers. This article highlights the social determinants of health and the use of an innovative e-tool to capture data as part of an equity strategy to improve the health of workers and consumers to drive organizational performance.

Key words: equity, health equity, social determinants of health, data collection, health care quality

Collecting social needs data to drive equity and performance

Research shows social determinants account for up to 80-90% of a person’s health outcomes (Magnan, 2017). Whether an employee is struggling with transportation to work or is living in a food desert, the focus on capturing real-time data to identify and address social needs is pivotal to improved productivity. Achievement of business outcomes and revenue targets require the integration of human and operational factors that drive the entire ecosystem in a global marketplace. Understanding diverse cultures, communications and communities is an imperative to ensure business success. Organizations ranging from large private commercial entities that are self-insured to smaller community-based organizations, business leaders need data-driven interventions that support the workforce as well as the consumer and local community. Within health care institutions, this is further complicated when geographically located in underserved communities that reside both the workforce and the patient populations.

To define many of the social factors that impact health outcomes, the World Health Organization (n.d.) refers to them as social determinants of health (SDOH) as “the conditions in which people are born, grow, work, live and age and the wider set of forces and systems shaping the conditions of daily life.” The SDOH includes housing needs, food and clothing insecurity, lack of money or resources for medications, utility bills etc. Health inequity, also referred to as health disparities, is defined by the Institute for Health Equity (n.d.) as, “Unfair distribution [of power, money and resources] creates avoidable health inequalities…”

In the United States rural, low-income and racial/ethnic minorities experience decreased access to high-quality healthcare as evidenced by decades of research citing health disparities, and policy decisions that had a disregard for social determinants.

The Robert Wood Johnson Foundation reports that the social determinants of health(SDOH) account for as much as 80% of health outcomes (Manatt & Phillips, 2019, p. 1).These factors negatively affect State Medicaid programs (the U.S. safety-net insurance program) and their ability to control the cost of healthcare delivery. According to the Centers for Medicare and Medicaid Services (CMS) (2019), healthcare is one of the largest vertical business markets in the United States and accounts for $3.8 trillion and17.7% of the gross domestic product. This further magnifies the importance of DEI business leaders to understand and recognize the importance of capturing and addressing social needs of employees.

Health inequities account for millions in annual losses to the U.S. economy each year. According to Turner (2016, pp. 20-29),

“Healthier workers have fewer sick days, are more productive on the job, and have lower medical care costs. A healthier population saves everyone in insurance premiums and health-related public spending. Beyond the toll in avoidable human suffering, we estimate disparities in health in the U.S. today represent $93 billion in excess medical care costs and $42 billion in untapped productivity, for a total potential economic gain of $135 billion per year.”

A recent example of the application of social determinants of health intervention is illustrated by UnitedHealth’s recent purchase of apartments near Phoenix, AZ for 60 former homeless persons enrolled in Medicaid, to lower the cost of healthcare by taking care of their members’ social needs. UnitedHealth is America’s largest health insurer with a market capitalization of $240 billion ranked 7thon the 2020 Fortune 500. This demonstrates the organization’s understanding that an individual, whether an employee or patient, social needs cost the healthcare system a significant amount of money and decrease revenues for their business.

States can mandate business leaders of Managed Care Organizations (MCOs) to integrate social support into health plan care management and address the social needs of their members as part of their healthcare management obligation. Clearly, this has a financial impact that demands attention and creates an opportunity for CDOs to leverage a culturally and linguistically appropriate strategy to address equity. Currently, 24 states require MCOs to perform social determinant screening for their beneficiaries as part of their care management recognizing that addressing the social needs of their constituents has a positive effect on health outcomes.

Historically, the United States healthcare payment system was driven by a fee-for-service payment model which pays a medical provider for the amount or volume of medical services provided. Therefore, most physician offices have a medical model of care that does not actively address social needs of patients. New policy reform is now driving payment based on quality of care, referred to as value-based payment, which can result in shared savings payments to providers. Value-based payment models pay for quality care which requires providers to achieve targets specific to a defined set of health outcome measures. The shift from fee-for-service payments to value-based payments makes screening for social determinants imperative, especially for those beneficiaries with high-costs and high-needs. However, many solo and small practices are challenged to integrate the requirements to transition to value-based care because of the lack of technology, qualified, well-trained staff, unreliable revenue cycles, private vs. public insurance mix and high percent of unpaid receivables from uninsured patients.

The Issues

Business leaders are increasingly acknowledging employees’ social factors affects their health, which in turn affects multiple business factors including employee and business productivity, benefits, and insurance costs; all of which affects the organization’s financial performance. Therefore, capturing SDOH data for vulnerable patients who may also be members of the workforce improves health as well as business outcomes. Additionally, the shift to value-based payments for health care providers creates a business case for collecting this data. SDOH data provides a more holistic view of patients by looking at factors that influence well-being in tandem with medical care to decrease costs and improve quality.

Given the profound impact social determinants have on health outcomes, it is also important to understand the issues related to data collection and integration into ambulatory workflows and electronic medical records. Healthcare providers today are becoming increasingly aware of social determinants for health and the need to utilize both individual and population health aggregate data to assist in understanding the underlying challenges at the point of care. While many providers express concern that social determinants are not within their span of control, acknowledging the need to collect and use SDOH data to better understand the challenges patients face is widely accepted. Limited results have been documented supporting the collection of SDOH data and the integration of both social and medical data to improve outcomes.

HealthCare Dynamics International (HCDI), a healthcare management and technology firm committed to quality improvement, leveraged its experience, began to address this issue in collaboration with CMS’ Transforming Clinical Practice Initiative (TCPI), a large-scale quality improvement project to improve outcomes in ambulatory care environments. HCDI focused on working with clinicians and medical practices across the country through a pilot program to prepare their business for alternative payment models by implementing an e-tool, called Caring for Your Health (CFYH), for SDOH data collection. Since research shows patient outcomes are significantly influenced by SDOH, one of the CFYH e-Tool integration goals was to make SDOH data collection and utilization easier to integrate into a clinical workflow in the ambulatory medical practice setting. The purpose of using the CFYH SDOH e-Tool for the pilot program was to understand challenges and successes in workflow redesign and real-time data collection to capture actionable social needs that supports person-centered care coordination of SDOH support services. The primary objective of the pilot was to identify the SDOH issues that patients were experiencing and develop strategies to integrate patient’s needs into their care plan thus addressing health disparities.

Method & Procedures

HCDI piloted a patient-facing social determinants screening e-tool, the Caring for Your Health (CFYH) SDOH e-Tool, across multiple medical practices to identify and address social determinants of health and health equity. The CFYH SDOH e-Tool was initially designed by HCDI in its work supporting primary care small business practices to address the social needs of patients with diabetes. HCDI’s CFYH SDOH e-tool was designed to capture real-time social needs that impact patient and population health and supports implementing data-driven, targeted interventions aimed at improving health and wellness. The CFYH e-tool captures up to 23 data fields organizing patient level data that can be easily mapped to ICD-10 Z coding system (CFYH Tool and Z codes: Z55-Z65 persons with potential health hazards related to socioeconomic and psychological circumstances). This pilot study was not an IRB approved research study but data collected with a rapid-cycle improvement project for the purpose of learning and sharing.

SDOHData Collection and Utilization

During the pilot program, HCDI partnered with medical practices across the United States implementing CFYH SDOH e-Tool for data collection and utilization. The licenses for the CFYH SDOH e-Tool were provided at no charge to the pilot participants. SDOH data related to housing, access to food, access to medication and transportation resources was collected from patients in clinic settings using three primary source points: 1) an iPad 2) integration with a patient portal via an electronic medical record (EMR) or 3) paper surveys. For each SDOH data element, validated questions were asked to assess underlying factors influencing chronic conditions. After SDOH data was collected, information including patient demographic data such as Race, Ethnicity and Language (REaL) data was compiled by the care team along with the patient’s location, chronic health conditions and community resources utilized.

Research was conducted regarding the availability of Government and community resources for the pilot program sites. Information about these resources were grouped using categories of temporary housing, food resources, transportation services, health insurance enrollment, county resources, utility assistance, veteran services, referral services, and easy access pharmaceutical needs. Phone calls were made by the care team to confirm the legitimacy of the resources identified as well as the qualification process for the patients to receive services. Once confirmed, the information was then categorized into sub-sections for care team member’s use with patients who screened positive for SDOH needs.

Members of the care team known as care coordinators contacted patients and provided literacy and navigation assistance and a plan to access community resources. A timeline was established to give patients an opportunity to engage and obtain the resources provided to close the gaps of specific social needs. A follow-up call was implemented by the staff to ensure the patient followed through with the given resources. Prompt communication and frequent follow-ups were part of the support process to successfully close each identified gap.

Results

A total of 3,510 patient assessments were made using CFYH SDOH e-Tool during the pilot period across four physician practice networks. More than 45% of the patient population in each participating pilot site reported at least one SDOH and one site reported 90% of the target population reporting at least one SDOH. While the top reported SDOH’s varied by site, food insecurity was consistently identified as one of the top three SDOH concerns.

Gap closures for the targeted population averaged 30% of all cases. The lack of sufficient updated patient contact information was cited as a concern and limitation to increasing the number of gap closures. Examples such as the incorrect patient phone numbers, disconnected phone service, or full voicemail boxes, made it challenging to reach the patient.

Improved outcomes for the clinical practice sites were also demonstrated. Table1summarizes the results of one of the four participating sites that reported promising results in three performance measures including,

  • a decrease of 10.34% in non-emergent emergency room visits (NER),
  • inpatient utilization (IPU), down nearly 25%, improving performance from <25 to25th compliance rate percentile, and
  • an increase of nearly 6% in 14-day follow-up visit after inpatient discharge(FU14).

Discussion

Optimal strategies to improve employee and patient health outcomes are ones that are well informed with data rooted in human centered, actionable and real-time data collection. This enables a comprehensive strategy that best meets the needs of the workforce who then are best equipped to serve the needs of the consumer and the community. This builds good will and business brand. In the TCPI pilot, the CFYH SDOH e-Tool demonstrated its effectiveness in capturing real-time actionable data from patients in a medical practice. The CFYH SDOH e-Tool provides one example of a way in which SDOH data can be collected that minimizes administrative staff time and preserves the integrity and privacy of the consumer patient.

It is hypothesized after a continued process of consistent screening for social determinants, patients’ social concerns will be improved as well as overall clinical health outcomes. With results showing that up to 80-90% of health outcomes are a result of social, behavioral and economic factors, identifying and understanding social determinants of health has the potential to drastically improve quality outcomes.

The ease of application of the CFYH SDOH e-Tool within medical practices with low resources suggest its purpose can be applied across multiple business types to capture real-time social needs data on a workforce in multiple locations. In light of the trend of working from home due to COVID-19, the CFYH SDOH e-Tool may be privately deployed for employee assistance programs to glean data to support employees achieving greater work satisfaction. Creating an atmosphere that offers employees the opportunity to share their social needs builds staff loyalty and retention. The CFYH SDOH e-Tool questions may be customized to address specific needs unique to an organization’s workforce due to the geographic location, industry, season of the year or health needs.

Efforts must be made to better understand the underlying factors that influence health disparities as well as health outcomes. The collection and use of SDOH data is a promising practice that can be used to improve overall health outcomes. The implementation of the CFYH SDOH e-Tool alone raised awareness of the pervasiveness of issues related to patient outcomes. The use of care team members to collect community level data and perform patient follow-ups created a systematic approach to the work by eliminating or decreasing social concerns which resulted in health improvements. This is a critical element required in a value-based care delivery and payment environment.

These efforts are a start but are not enough. If all States mandate MCO’s to help low-resource providers address social needs this would be a step in the right direction for addressing health disparities, equal access to high-quality care and lower costs. U.S. policymakers need to confront the real and perceived barriers to healthcare and find systemic solutions to provide equal access to quality healthcare for all. Chief Diversity Officers leading organizations across a broad spectrum of industries are summoned to drive health and well-being in an equitable data-driven way for a growingly diverse workforce.

Summary and Recommendation

As healthcare continues to transition to a value-based care system, the CFYH SDOH e-Tool aligns with a systems approach to collecting SDOH data and addressing social needs that impact health outcomes. Doing such not only improves patient outcomes but also performance outcomes in medical practices providing a return on investment. Improving both patient outcomes and organizational performance can ultimately have a positive downstream economic impact as well.

Whereas the CFYH SDoH e-Tool was initially piloted in medical practices, it can also be used for staff in non-medical organizational settings. It is proposed that by electronically screening for and addressing social determinants, people have a higher probability to achieve improved health and well-being. Due to the significant influence social determinants have on overall health outcomes, this can translate to improved worksite productivity.

References

Centers for Medicare and Medicaid Services. (2019).National Health Expenditure Accounts. https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical

Institute of Health Equity. (n.d.)Action on the Social Determinants of Health. http://www.instituteofhealthequity.org/about-our-work/action-on-the-social-determinants-of-health-

Magnan, S. (2017). Social Determinants of Health 101 for Health Care: Five Plus Five. NAM Perspectives. Discussion Paper, National Academy of Medicine, Washington,DC. https://doi.org/10.31478/201710c

Manatt, P., & Phillips, L. L. P. (2019).Medicaid’s Role in Addressing Social Determinants ofHealth. https://www.rwjf.org/en/library/research/2019/02/medicaid-s-role-in-addressing-social-determinants-of-health.html#:~:text=Often%20referred%20to%20as%20%E2%80%9Csocial,services%20not%20covered%20by%20Medicaid.

Turner, A. (2016). The business case for racial equity.National Civic Review,105(1), 21-29. https://www.jstor.org/stable/10.1002/ncr.21263

World Health Organization (n.d.).Social determinants of health. https://www.who.int/health-topics/social-determinants-of-health#tab=tab_1

Critical Success Strategies for Diversity, Equity, and Inclusion (DEI) Initiatives

Tamika Curry Smith
DEI Strategist and President, The TCS Group, Inc.

Abstract

This article examines corporate Diversity, Equity, and Inclusion (DEI) efforts, exploring the issues that may be unintentionally impeding companies’ desired progress.  It considers evidence that demonstrates a consistent gap in representation and other outcomes for underrepresented groups, like women and people of color, in Corporate America. This article leverages research and professional insights to highlight a DEI approach that can be utilized to make more substantial inroads within organizations. The principles and focus areas outlined here can help organizations make the necessary pivots to honestly assess their efforts to date and change their approach to DEI work. This article will be helpful to Chief Executive Officers (CEOs), Chief Diversity Officers (CDOs), and any leaders within companies who are looking to drive DEI progress and achieve sustained results over time.

Keywords: diversity, equity, inclusion, strategies, results

 

Critical Success Strategies for Diversity, Equity, and Inclusion (DEI) Initiatives

The data and research are clear: diversity drives innovation and creativity and leads to better business outcomes (Picincu, 2020). McKinsey & Company noted that “diverse companies are better able to attract top talent; to improve their customer orientation, employee satisfaction, and decision making; and to secure their license to operate” (Hunt et al., 2018). Catalyst research (2020) also affirmed that diversity and inclusion are key to healthy businesses in areas such as talent, innovation and group performance, reputation and responsibility, and financial performance. Most business leaders acknowledge the research findings. 82% of CEOs in a recent survey stated they believe the data that links diversity to positive business results such as profitability, return on investment, and innovation (The Moxie Exchange, 2018).

However, the pace of change in the Diversity, Equity, and Inclusion (DEI) space in Corporate America has been slow. White men held 96.4% of the Fortune 500 CEO positions in 2000, and still held 85.8% in 2020 (Zweigenhaft, 2020). Furthermore, since most of the seats lost by white men were gained by white women, 92.6% of the Fortune 500 CEOs were still white in 2020 (Zweigenhaft, 2020). In addition, the boards of the 3,000 largest publicly traded companies remain overwhelmingly white. Underrepresented ethnic and racial groups made up 40% of the U.S. population, but just 12.5% of board directors in 2020, up from 10% in 2015 (Jamali, 2020). Additionally, in 2020, nearly 10% of public boards had no women (Jamali, 2020).

In the wake of the murders of George Floyd, Breonna Taylor, Ahmaud Arbery, and others, there has been a flood of job postings and new appointments of Chief Diversity Officers (CDOs). While it is encouraging to see more organizations focusing on DEI, if they want to see true progress and results, it is time to take a different approach. Simply adding a CDO role or changing the person in that role will not be enough.  Without a true paradigm shift in the DEI space, CEOs and CDOs run the risk of once again failing to make the progress they desire and have committed to. By altering their approach and adopting the following strategies, organizations, CEOs, and CDOs will position themselves to achieve real change.

 

Taking a New Approach: Strategic Focus Areas

In this section, I identify several critical strategies for driving successful DEI initiatives. The strategies are based on data and research, as well as the collective experience of numerous DEI leaders who have shared their success stories and lessons learned. Some of these strategies will require a different mindset, organizational structure, and approach to DEI work; however, it is important for organizations to revisit old DEI paradigms and make intentional pivots to achieve lasting results.

 

Show the Commitment from the Top

Although most CEOs say they believe the business case for diversity, only 32% of CEOs in a recent study reported DEI being a top five strategic priority in their company (The Moxie Exchange, 2018). If organizations want to have impact in the DEI space, making DEI a priority to the Board of Directors, CEO, and the entire executive team, and taking concrete actions are necessary to drive change (Cox and Lancefield, 2021).

Having a proactive, long-term mindset as it relates to DEI rather than reacting to external events (e.g., George Floyd’s murder) is vital to achieve ongoing and lasting change. When organizations step up their DEI efforts in response to external pressure or litigation issues, it leads to a short-term mindset that DEI is only helpful if an organization is dealing with acute challenges.

Truly making DEI a top priority will require companies to move away from a “legal compliance”, “nice to have”, or “as needed” DEI mindset. Instead, a strategic shift to link DEI to an organization’s business strategy, performance goals, culture, and values is essential, so it can be leveraged as an enabler to help achieve its mission and vision (Cox and Lancefield, 2021).

Given that CEOs are responsible for the overall operations of a company, ownership for DEI progress and outcomes also should ultimately reside with the CEO. Furthermore, it is important for the CEO and executive team to be visible in their support of DEI, actively engaged in the organization’s DEI initiatives, and communicating about DEI to their teams on a regular basis. The CDO cannot be the only one out front advocating for DEI.

Recommended Actions:

  • Make a long-term commitment to DEI and make sure the commitment is sustained over time regardless of business results and external events.
  • Join CEO Action for Diversity & Inclusion (https://www.ceoaction.com). This CEO-driven business commitment to advance diversity and inclusion in the workplace was launched in 2017 and now has pledges from nearly 2,000 CEOs.
  • Include DEI as a regular topic at executive team and board of director meetings. Discuss company progress throughout the year, with a detailed deep dive at least semiannually.

 

Adopt a Holistic DEI Mindset

For decades, DEI efforts have been viewed as the right thing to do, a moral imperative so to speak.  In most cases, DEI reports to human resources, and many business leaders view the work as solely an HR function.  By placing DEI within HR, organizations unintentionally may be undermining their efforts because it provides leaders and employees with an easy excuse to absolve themselves of responsibility and puts the onus on HR for “fixing” DEI issues. In addition, organizations often focus their DEI initiatives solely on employee-related topics that fall within the realm of HR.  That is a myopic view of true DEI work, which transcends HR.

Research supports that DEI is a driver of profitability and other positive results (Hunt et al., 2018). Several studies also confirmed that diversity leads to increased productivity, innovation, better decision making, increased employee satisfaction and lower turnover (Picincu, 2020). While DEI certainly is the right thing to do, an important shift is necessary to position DEI as a “yes…and” endeavor. By highlighting DEI as a growth driver and business imperative that creates competitive advantage, organizations will be able to get more cross-functional support, engagement, and partnership.

According to Cox and Lancefield (2021, para. 17) writing in the Harvard Business Review, “D&I is far more than an ‘HR issue’. It should be a core ingredient in the design and execution of business strategy and embedded in the activities of the organization day in, day out.” A holistic DEI strategy should be enterprise-wide and encompass both end-to-end people and business matters. DiversityInc (n.d.) utilizes a comprehensive framework to determine its Top 50 Companies for Diversity and it can be leveraged as a guide for all organizations on how to effectively position DEI initiatives.

For all the reasons outlined previously, it is a best practice for DEI to report directly to the CEO. If DEI does reside within HR, then, at a minimum, it should have a strong dotted line reporting to the CEO or someone else in the C-suite. When CEOs do not directly oversee the DEI function, it will be even more important to engage leaders throughout the organization and embed DEI into the company-wide goals and expectations for leaders and managers to drive action and accountability outside of the HR function.

Recommended Actions:

  • Ensure the CDO reports to a C-Suite business leader (ideally the CEO or COO), instead of the CHRO. If there are valid reasons why the CDO reports to the CHRO, she/he/they should also have a strong dotted line to the CEO.
  • Elevate the CDO to be a true C-Suite leader by providing her/him/them with a seat at the table and including her/him/them with the rest of the executive team in key business and people decisions.
  • Develop a robust DEI strategy whose scope includes workforce (employees), workplace (culture), marketplace (business), and community.
  • Talk about and position DEI as a business initiative that is championed by the CEO, executive team, and senior leaders, as well as HR.

 

Invest in DEI

Cutter & Weber (2020), writing in the Wall Street Journal, noted that the average tenure for CDOs is three years. They attributed the high turnover to lack of resources, unrealistic expectations, and inadequate support from senior executives. To minimize this costly turnover, companies need to do their homework before appointing a CDO.  Organizations should first determine their goals and think through what success looks like when it comes to DEI.  Then it is critical to assess their current efforts to ascertain what is working well and where they have opportunities to improve.

In addition, it is crucial for organizations to understand the competencies and professional experiences that are important for CDO success. Russell Reynolds Associates, the global leadership advisory and executive search firm, highlights many of these areas, including previous experience in HR and DEI, a business background, communication skills, strategic execution experience, ability to both influence and disrupt, savviness with data, and others (Shah Paikeday et al., 2019). By investing the time to go through an evaluation in advance of filling the CDO role, CEOs have a better chance of appointing the right person to get the job done.

Many organizations also do not provide their CDO with the resources to be successful. Putting a CDO in place is not a silver bullet and thinking that alone will advance your efforts is not realistic. DEI work is challenging and multi-faceted, and one person cannot do it on their own. New initiatives that businesses roll out always require resources. Just as companies invest in other business strategies that are tied to their success, CEOs being intentional about investing in DEI is a critical success factor.

CDOs have many responsibilities, yet nearly half said they are not resourced to fulfill them. 47% of CDOs in a recent survey stated limited staffing and budgetary constraints are the biggest challenges to achieving DEI goals (Weber Shandwick et al., 2019). Structure follows strategy, so once CDOs have developed the DEI strategy, CEOs should ensure all DEI efforts are adequately resourced by allotting headcount and budget based on the company-wide remit.

Recommended Actions:

  • Appoint experienced CDOs to drive your efforts. DEI work requires competence and subject matter expertise, like other functional areas.
  • Allocate headcount to build the DEI team and expand it over time as the strategy is rolled out.
  • Set aside an appropriate enterprise-wide DEI budget that will enable the desired impact.
  • Bring in external DEI consultants and partners as needed to help with additional expertise and capability.

 

Focus on Systemic Change

For years DEI efforts have centered on increasing diversity and fostering a culture of inclusion. Both goals are fundamental to DEI, but many organizations have failed to focus on the “E” in DEI: Equity. DEI is not about merely putting programs in place to prove you are “doing something”. It is not about having window dressing to look good or simply managing risk. DEI is about driving systemic change, which means organizations making a commitment to peel back the layers of the onion to examine what is happening within their walls, then actively working to address any inequities is paramount.

To accomplish this, organizations focusing on structural inclusion (processes, polices, practices, etc.), working to remove systemic barriers, ensuring bias-free decision-making, and intentionally building equity across the enterprise is key. According to Human Resource Executive, the purpose of structural inclusion initiatives is to “build equitable and transparent structures, processes and practices that work for all employees and customers” (Polonskaia & Royal, 2019).

Equity work is truly a cross-functional effort, which is another reason why having CDOs report within HR can be problematic.  From an internal equity perspective, CDOs need to work closely with all HR functions, employee relations, legal and other key constituents to review and assess systems across the entire employee life cycle (i.e., talent acquisition, compensation and benefits, onboarding, learning and development, talent management, departures, retirement, etc.). The role of a CDO is to help identify and address inequities that have existed in those HR systems for years, and that can present a conflict of interest if she/he/they report up through the HR pipeline. In addition, CDOs need to take a similar equity-based approach with business leaders across the company that are driving marketplace initiatives, including products and services, operations, sales, marketing, customer service, communications, etc.

Recommended Actions:

  • Have an external firm conduct a DEI audit to identify areas of inequity and opportunity, and then act based on the findings.
  • Empower the CDO and the DEI team to do work across the enterprise to drive towards equitable outcomes.
  • Form a cross-functional DEI Council with leaders from key areas to ensure DEI continues to be addressed and embedded throughout the organization.

 

Redefine the Meaning of Leadership

In many organizations, there is a disconnect between their words and actions regarding leadership.  Companies say they are people-first, but then reward leaders who are business-first and give them a pass when they do not focus on people. Organizations say they value inclusion, but then fail to act when engagement survey data and qualitative information show leaders are not inclusive. For DEI efforts to bear fruit, it is vital for organizations to evaluate the gap between intentions and outcomes and to change the way they define leadership.

Inclusive leadership is a relatively new approach to leading and it has a unique application to DEI efforts. According to Chalk & Cheese Consulting (2019), inclusive leadership “is demonstrated when an individual’s belief in the social and economic importance of diversity motivates them to focus energy on adapting to and empowering diverse talent, as well as harnessing people’s differences to create value.” Inclusive leaders create an environment where authenticity thrives, where belonging is possible, and where business outcomes are amplified.

The Inclusive Leadership Compass (Chalk & Cheese Consulting Pty Ltd., 2019) is one of numerous frameworks that can be leveraged to infuse inclusive leadership skills into an organization. The four-prong framework highlights the actions required of leaders to drive inclusion for themselves, others, teams, and organizations. The goal is to embrace difference, empower diverse talent, enable diverse thinking, and embed DEI across the organization. As the focus on inclusion and belonging becomes more widespread, organizations need to shift their mentality and set new expectations about what represents leadership.

Recommended Actions:

  • Carve out time and space for the CEO, executive team, and senior leaders to educate themselves about critical DEI issues and inclusive leadership so they can walk the talk.
  • Embed inclusive leadership measures into your performance evaluation processes (e.g., mid-year and annual reviews, etc.) and feedback mechanisms (e.g., engagement surveys, 360° surveys, etc.).
  • Hold leaders and employees accountable for inclusion and belonging and act when individuals fail to exhibit inclusive behaviors.

 

Align Internal and External Efforts

Driving workforce and workplace DEI strategies is paramount for organizations to achieve true change internally. However, many times organizations become so focused on their internal efforts that they neglect to extend their efforts externally. Companies need to include initiatives like supplier diversity and DEI-focused philanthropy in their DEI strategy. Supplier diversity efforts have shown to help address economic inequality in underrepresented populations and philanthropy and volunteerism are critical to help uplift underserved communities.

Younger generations care about Corporate Social Responsibility (CSR), and they want the chance to do good while they are working. For example, 75% of Millennials indicated they would take a pay cut to work for a socially responsible company (Taylor, 2019). There is a war for talent and candidates and employees have almost unlimited opportunities in today’s distributed world. They expect organizations to give back to and support the communities in which they operate.

Many companies tend to shy away from disclosing details about their DEI efforts because they recognize they are not where they want to be. However, it is important for organizations to be transparent and communicate externally about their DEI initiatives.  The world is watching, and companies are coming under increased scrutiny from the media, customers, investors, and other stakeholders for organizational practices that used to be hidden from the public (Lee Yohn, 2018). For example, in the summer and fall of 2020, many organizations made external statements in support of the Black Lives Matter movement, only to be criticized for failing to address the inequities Black employees face internally.

In addition, environmental, social, and governance (ESG) criteria are an increasingly popular way for investors to evaluate companies in which they are considering investing (Chen, 2020). Even if organizations are not pleased with their progress, being upfront in sharing where they are, but more importantly, outlining their plans to close the gaps can help build trust and credibility.  At the end of the day, organizations’ internal and external DEI efforts feed each other and therefore must be in alignment.

Recommended Actions:

  • Visibly show your commitment externally through supplier diversity, community, and philanthropic efforts.
  • Keep a pulse on current events and be ready to respond thoughtfully. Leverage employee resource groups to better understand what is happening externally.
  • Balance your internal and external DEI efforts. Do not become too insular or conversely allow your marketing to be disconnected from the reality inside.

 

Drive Measurement, Accountability, and Transparency

All organizations have business goals, whether they be related to revenue, profit, market share, customer satisfaction, etc. In addition, all leaders have quantitative goals that they are measured on and held accountable for. Unfortunately, the same rules often do not apply to DEI. As it relates to DEI progress, Richard Kerby, general partner at Equal Ventures said, “You’re not seeing movement because it’s not being tracked or monitored – there’s no incentive alignment for someone to improve on the numbers” (Rooney & Khorram, 2020). The facts back up his assertion.  According to a recent CEO survey, only 31% stated that increasing diversity and inclusion is a performance objective for someone on their executive team (The Moxie Exchange, 2018).

Progress in terms of representation has been slow in corporate America and even in organizations with metrics in place, only incremental gains have been made. In 2020, McKinsey & Company and Lean In (2020) reported that white men represented 35% of entry level positions, but 66% of C-Suite positions. According to Bari Williams, former executive at Facebook, “…companies are data-driven, but if people are not hitting their diversity metrics, where’s the downside? You have metrics, but no consequences.” (Rooney & Khorram, 2020, para. 11)

Like any critical business area, achieving DEI results requires data and analytical rigor. It is important for organizations to put metrics in place, build DEI dashboards, regularly share DEI data with HR and business leaders, and most importantly, drive accountability just as they do for other business initiatives. As the saying goes, “You get what you measure and what gets measured gets done.” In addition, organizations need to improve communication on their DEI progress both internally and externally via annual reports, websites, and other communication mechanisms.

Recommended Actions:

  • Build a strong data-analytics function that partners with DEI to review, analyze, and report DEI data throughout the organization.
  • Set DEI workforce, workplace, marketplace, and community goals and hold leaders accountable for key metrics as part of their performance review.
  • Focus on and develop a plan for improving the diversity of the executive team and board of directors in terms of race, ethnicity, gender, and other dimensions of diversity.
  • Provide regular internal updates on your DEI progress and report externally annually.

 

Summary and Implications

As this article demonstrated, Corporate America is at a crucial crossroads when it comes to DEI. Statistics reviewed in the article highlight that despite having the best intentions, many organizations have failed to make substantive progress with their DEI efforts as it relates to people and business outcomes.  Creating and executing an effective DEI strategy is no small feat and requires strong, sustained, and inclusive leadership. The recommendations outlined here include positioning DEI leaders at the C-suite level, building a strong partnership with human resources, investing in DEI team headcount and budget, ensuring all initiatives incorporate an equity lens, and driving measurement and accountability. These strategies can be viewed as a roadmap for organizations and leaders with a commitment to DEI. Companies that alter their approach and follow the guidelines shared here have a real opportunity to achieve their desired outcomes and create competitive advantage.

In the wake of the murders of George Floyd, Breonna Taylor, Ahmaud Arbery, and others, maintaining the status quo is no longer an option. Unless and until organizations, CEOs, and CDOs make an intentional pivot in the way they approach and resource DEI efforts, change will continue to be slow and substantive progress will continue to be fleeting. The business case for DEI is clear. The time for change is now.

 

References

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Chalk & Cheese Consulting Pty Ltd. (2019).Navigating inclusion as a leader: introducing the inclusive leadership compass. https://hrnet.forumbee.com/media/download/80m43s/Introducing%20the%20Inclusive%20Leadership%20Compass_May2019.pdf

Chen, J.(2020, November 3).Environmental, social, and governance (ESG) criteria. Investopedia. https://www.investopedia.com/terms/e/environmental-social-and-governance-esg-criteria.asp

Cox, G. and Lancefield, D. (2021, May 19).5 strategies to infuse D&I into your organization. Harvard Business Review. https://hbr.org/2021/05/5-strategies-to-infuse-di-into-your-organization

Cutter, C. and Weber, L. (2020, July 12).Demand for chief diversity officers is high. So isturnover.The Wall Street Journal. https://www.wsj.com/articles/demand-for-chief-diversity-officers-is-high-so-is-turnover-11594638000

DiversityInc. (n.d.).About the DiversityInc top 50 process. https://www.diversityinc.com/about-the-diversityinc-top-50-process/

Eavis, P. (2020, September 15).Diversity push barely budges corporate boards to 12.5%, survey finds. The New York Times. https://www.nytimes.com/2020/09/15/business/economy/corporate-boards-black-hispanic-directors.html

Hunt, V., Yee, L., Prince, S., & Dixon-Fyle, S. (2018, January 18).Delivering through diversity. McKinsey & Company. https://www.mckinsey.com/business-functions/organization/our-insights/delivering-through-diversity

Jamali, L. (2020, March 5).A push to get more women on corporate boards gains momentum. NPR. https://www.npr.org/2020/03/05/811192459/a-push-to-get-more-women-on-corporate-boards-gains-momentum#:~:text=Among%20the%20largest%203%2C000%20largest,10%20boards%20have%20no%20women

Lee Yohn, D. (2018, September 26).Reminder: customers care how you treat your employees. Harvard Business Review. https://hbr.org/2018/09/reminder-customers-care-how-you-treat-your-employees

McKinsey & Company and Lean In. (2020).Women in the workplace. https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2020.pdf

Picincu, A. (2020, July 6).What are the advantages of a diverse workforce? Chron. https://smallbusiness.chron.com/advantages-diverse-workforce-18780.html

Polonskaia, A. and Royal, M. (2019, December 10).How the world’s most admired companies drive D&I. Human Resource Executive. https://hrexecutive.com/how-the-worlds-most-admired-companies-drive-diversity-and-inclusion/

Rooney, K. and Khorram, Y. (2020, June 12).Tech companies say they value diversity, but reports show little change in last six years. CNBC. https://www.cnbc.com/2020/06/12/six-years-into-diversity-reports-big-tech-has-made-little-progress.html

Shah Paikeday, T., Sachar, H., & Stuart, A. (2019, March 1).A leader’s guide: finding and keeping your next chief diversity officer. Russell Reynolds Associates. https://www.russellreynolds.com/insights/thought-leadership/a-leaders-guide-finding-and-keeping-your-next-chief-diversity-officer

Taylor,C. (2091, April 30).What makes a CSR message resonate with millennials and generation-z? Forbes. https://www.forbes.com/sites/charlesrtaylor/2019/04/30/what-makes-a-csr-message-resonate-with-millennials-and-generation-z/?sh=57891ea27fc7

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