Luke Visconti’s Ask the White Guy column is a top draw on DiversityInc.com. Visconti, the founder and CEO of DiversityInc, is a nationally recognized leader in diversity management. In his popular column, readers who ask Visconti tough questions about race/culture, religion, gender, sexual orientation, disability and age can expect smart, direct and disarmingly frank answers.
Every business exists to make money. Profits are a return on equity. You see this in your own life as dividends at your bank. You put your money (equity) in the bank and they pay you a percentage of the profit they make (interest) when they reinvest your money in mortgages and car loans. Even not-for-profits must make money; without it, the work can’t be done.
Diversity management, properly implemented, drives profit. For most companies this shows up as decreased costs: Human-capital diversity efforts raise productivity, lower regrettable loss and increase recruiting efficiency. We call this Stage Two benefits. Human-capital gains are tangible, measurable and significant, but market-driven gains can quickly drive share price. There’s a reason why all of the Big Four accounting firms switched from having human-resources-based people to having revenue-driving partners be responsible for their diversity efforts over the past five years. There’s a reason why their CEOs have spoken at our events. It’s not about singing “Kumbaya,” it’s about profits.
Here are some “best practices” for diversity executives to successfully get budget:
- You must stay close to the revenue stream. If your presentations aren’t full of facts and figures—if they don’t speak the language of business—you’re going to fail.
- Don’t hang out with losers. Look closely at the people in your “consortium” or “council.” Do any of them have budget? You’re going nowhere if you share “best practices” with other people who can’t develop enough of a business argument to get budget from their respective companies.
- Demand to be measured. Get concurrence on setting goals and the accountability to achieve them.
- Being repetitively asked to prove “the business case for diversity” is a cue to find another job. Spending your life answering asinine questions from the obstinately oblivious isn’t going to ever be rewarding.
Let’s get back to “Kumbaya.” Success in diversity management is contingent on aligning values with actions. Diversity management is about building the ability to have strong, trusting relationships with people as they are—organizationally and personally. It’s about getting your organization to strip away the unproductive behaviors that block its ability to build meaningful relationships with internal and external stakeholders.
You can’t do that without an honest connection to the people around you both in your community and communities around the world. Now we’re talking about philanthropy and corporate citizenship. The most successful entrepreneurs I personally know are extremely philanthropic (see our article on Steve Colson, one of the biggest donors to the Rutgers Future Scholars).
DiversityInc Top 50 participants donate an average of 2 percent of their gross revenue, and nearly half of their donations go to multicultural groups. DiversityInc also donates 2 percent of its gross revenue.
Getting budget for your diversity program is directly relative to how your company values connect with the community. Philanthropy is an excellent leading indicator of corporate (and personal) intent. Diversity and profitability are about relationships. Making that connection is your key to getting budget for your diversity programs.