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Why Diversity Initiatives Should be Linked to Strategic Business Objectives
Bill Woodson  window)

The business world is entering its third decade of diversity initiatives. Almost without exception, Human Resources professionals, corporate leaders, and organizational development consultants can offer a few cogent phrases about the significance of inclusion and the need to embrace women and minority professionals, customers, and suppliers.  Most will proudly point to specific activities, milestones and metrics within their own organizations or consulting practices.

The corporate HR professional will speak to the diversity initiatives that their organization supports.  Targeted recruiting is often a highly visible corporate commitment. Attendance at venues like National Black MBA Association, Society of Hispanic Professional Engineers, and the National Association of Black Accountants brings rapid credibility to an organization’s reform efforts.  Penetration at the board level by women and minorities takes longer, and if present, is quickly and frequently referenced as an indicator of progress.  There are a range of additional indicators, including diversity training days for employees, and social events sponsored by affinity groups reflecting a rainbow of colors and even alternative sexual orientation.

So everyone gets it now, right? Diversity is a good thing, and everybody knows it.  The war is over, and the good guys won — isn’t that it?

Not so fast!  The widespread noise, activity, and excitement around diversity camouflage a deeper, more fundamental series of questions.  Such as, just what is Diversity?  Why is a more diverse organization a Good Thing?  Above all, how can diversity help an organization achieve its goals and return value to shareholders and stakeholders?

Brushing past these critical, fundamental questions with simplistic, off-the-cuff truisms; such as "It’s the right thing to do" or, "We are a progressive organization committed to creating a fair and inclusive environment," is a common, and completely inadequate response.  Stakeholders and share holders deserve better answers.  But, who would argue with being fair and progressive? Why would you want to? Isn’t taking issue with fairness in American society almost like arguing against motherhood and apple pie?

Rather than getting caught up in social constructs and values, let’s stay focused on simpler, more clear-cut matters.  Such as business results, as in how does diversity relate to a company’s financial performance?  Or execution, as in how can diversity maturity help a company more effectively utilize scarce resources to accomplish specific objectives?

The unfortunate reality is that, while most Fortune 500 organizations can document efforts to improve their diversity performance, none can claim "victory."  For most organizations the progress to-date has been more evolutionary than transformational.  An even more serious deficiency is the degree of uncertainty surrounding the sustainability and long-term impact of current efforts.  Why the lack of results? Simply put, it’s because diversity is a goal that appears to be unrelated to core organizational goals of profitability and long-term differentiation in the market.  "Wait a minute," you might ask at this point.  "Does this mean we should abandon diversity efforts because they don’t contribute to the bottom line?"

My response may surprise you.  My capitalistic convictions tell me that an organization should not fund activities that do not bring value to customers, stakeholders, and shareholders.  But I further contend that when diversity efforts fall short of that standard, it is because those efforts were not properly integrated and aligned with the organization’s strategic business objectives. Furthermore, I would suggest that sustainable, long term transformation of organizational ability to access the potential of diverse employees, customers, and suppliers will only come when organizations integrate their diversity activities into a diversity strategic plan that is in turn tightly integrated into their strategic business plan.

Let me say it a different way. Lasting impact in an organization will come only when diversity tactics are integrated into an overarching diversity strategy. And organizations that have an overarching diversity strategy, a strategy that is tightly aligned to their business objectives, will consistently outperform those that don’t.

The factors underlying Corporate America’s current interest in Diversity Initiatives are deeply rooted in American culture, and, more broadly, in human behavior.  Human beings are biologically and socially predisposed to distrust, dislike, and marginalize "outsiders."  The average U.S. citizen tends to question the intelligence and ability of anyone who does not speak English or whose accent suggests a first language other than English.  Men are inclined to believe that women have less control over their emotions and are more inclined to change their minds.  Women feel that men have less ability to be nurturing and are more likely to refuse to ask for help, even when lost.  Whites feel that blacks are more likely to have an attitude of entitlement to benefits or privileges they have not earned. Blacks throw the accusation of entitlement right back at whites and add that whites smugly assume that theirs is the superior culture, especially when contrasted with non-Western values.  Whites and blacks together believe Asians frequently display strong analytical skills, but are less likely to be effective team leaders.  People of all ethnic backgrounds may be inclined to distrust homosexual men around their young children, or assume that an obese coworker will be jovial, but lazy.  And on and on it goes.

This context of Western socialization and culture renders standalone corporate efforts to foster a more diverse workplace futile.  Why?  Because powerful, deeply embedded cultural values are not going to yield to workplace posters promoting Black History Month or a few new diverse recruits picked up from a minority career fair.  Companies reflect the culture of the people who work there and the country they reside in.  Regardless of race or gender, we all bear the marks of societal values that marginalize the performance potential of various segments of our society.

In order to drive lasting change within the individuals who make up an organization, that force for change must be powerful enough to overcome a lifetime of cultural brainwashing for every person within that organization.  Achieving that kind of profound transformation requires the clarity of purpose that comes from the realization that diversity performance drives organizational performance.  Organizations that tap into this opportunity are the ones that are responding to what James Rodgers calls "The 100% imperative: Getting 100% from 100% of your people, 100% of the time."¹  In the New Millennium, nothing less then this will do.

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¹ James O. Rodgers and Maureen Hunter – Managing Differently, 2004

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