LUKE VISCONTI: What led you to be a supporter of diversity and inclusion? How has it impacted the success of your business units?

DAVID EPSTEIN: There are two drivers for me. One is that I grew up in an atmosphere my parents created where people are people, regardless of whether they’re male, female, from any given country, religious background or sexual orientation. I’m interested in what a person can contribute, what their unique experiences are.

The second driver is that, back in 2000, Dr. Daniel Vasella [Chairman and former CEO of Novartis AG] gave me the opportunity to run Novartis Oncology, a global business unit. For the first time in my career I ran discovery, development and commercialization. We operated in more than 70 countries. I had the opportunity to build that team from scratch. I picked people based on their experiences and how I felt they treated other people. My philosophy is that you treat others in the way you expect to be treated.

I ended up with a team that came from all over the world. We had phenomenally productive discussions. At the beginning, it was very difficult because we had different cultural backgrounds and the norms within which we communicated were different, but after a while I saw the power of people with different backgrounds and what they could contribute to business ideas. Once we got that group working as a high-performing team, we were able to accomplish feats that nobody thought were possible.

The business more or less didn’t exist when I was asked to create Novartis Oncology in 2000. We pulled together what oncology products and pipeline we had within Novartis, which represented about $1.5 billion in sales. We had three products, two of which were not robust: one was going generic, and the other was a licensed product but the license was coming to an end. The business was about to disappear.

We built, over 10 years, a $10-billion business, the No. 2 oncology business in the industry. More importantly, people who work in that business say there is a unique focus on creating the environment and the atmosphere, which drives people to do what’s right for customers and patients. An environment that brings people together in a way that’s unique: People can be open, be themselves, and passion fuels what they do together.

Now, I’m trying to create that here in the bigger Pharma business. We’re making progress: You see a much more open, a much more inclusive atmosphere. You see that we’re increasingly hiring people of varied backgrounds. You’re seeing more women in management, more people from emerging markets sitting on the leadership team. It’s starting, but it’s a long road. It takes years and commitment.

Authentic Leadership

VISCONTI: When I interviewed Dr. Vasella, he said, “I love other cultures.” Do you think it was his influence, his leadership that was an inspiration? 

EPSTEIN: Daniel influenced me in a lot of ways; I found him to be a very authentic leader. I take great pride in my authenticity. When I speak, there is no hidden agenda. People around me know what I think. They know that I will listen, that I will debate. I might be the guy who makes the decision, but they’ll know where I’m coming from. It engenders a lot of trust.

If you have weaknesses as a leader, you should be willing to discuss those with your team. If you make a mistake, you should admit it, whether it was a business decision you made, the wrong person you hired, or how you treated someone.

The second thing I owe to Daniel is that he believed in me. He gave me some unique opportunities, such as running the Oncology business or being chosen as head of Pharma. If he hadn’t made that choice, I never would have had the opportunity to grow and become more worldly, more diverse, more inclusive.

VISCONTI: How do you translate the Novartis values across different cultures while respecting local traditions? 

EPSTEIN: It’s not about everybody being in the same place at the same time or having to do everything exactly the same everywhere. For me, it’s a journey. Everybody is moving along that journey to become more inclusive, to put together the best possible team, to get their teams to operate in a high-performing way. Yes, you may have to do it uniquely in China versus Japan versus somewhere else. I think that’s OK.

Sitting still is not acceptable. Having a team that all looks and sounds and thinks the same is not acceptable. How you do it will vary and, being a global company, we’re fairly adept at making those changes. Sometimes there’s friction and you have to have a discussion.

VISCONTI: I’ve heard it put that this work is fatiguing at times—a good fatigue—but that it’s also very invigorating.

EPSTEIN: For me, it’s not fatiguing. I get great satisfaction from developing people and seeing teams do great things that no one thought was possible.

You can have lots of people that look and sound like you and your organization will work fine, but you will never be great and you will never capture the upside. Or you can decide to go for a more diverse and inclusive atmosphere. If you don’t do the work, don’t have the right leadership skills and those people don’t work together, it may actually be worse than having a homogenous team. You just don’t get anything done.

On the other hand, when you lead a very diverse group of talented people and have created the right atmosphere, you’re unbeatable. So it’s worth it. As a leader, you have to have your sights on that far-off horizon.

For the person who comes into a job and thinks they’re only going to be there two or three years, it might not seem worth it. In every job I’ve taken, I have adopted the mind-set that I will be here forever. I want to leave a legacy of an extremely well-functioning organization that is delivering unique value to patients. That’s ultimately what drives me. I take personal pride in seeing people be successful.

VISCONTI: How has Novartis made efforts to address diversity in drug trials? Has this approach changed over time?

EPSTEIN: If you look back 10 years, we were a very U.S.– and Euro-centric company. That’s where the business was. That’s what we knew how to do.

Over time, we began to realize a couple of things. One is that one size does not fit all. A drug for every patient with a given disease doesn’t exist anymore. Medicine is more personalized, which forces you down the road of understanding differences in people—these differences can be genetic, dietary, about lifestyles, or many others.

Second, the world has shifted. Much of the growth opportunity in healthcare comes from emerging markets. Patients in these markets need to be included in trials to make sure we are developing the right medicine for them. About six years ago, for example, we started a project in Japan. We typically launched in the United States and Europe, and five to seven years later, we’d launch in Japan. We wanted to get to the point where that gap was down to one or two years. This year, we have a drug that was approved first in Japan, the U.S. and Europe a bit later.

In the U.S., we are trying to better adapt to the needs of various ethnic groups, and we’re increasingly doing clinical work that includes them. We need to see the data for an African-American patient or a Latino or a Japanese person living in America. We look at women versus men, we look at different age groups, so all these things are being incorporated into our business. Companies that do this work have an advantage in the marketplace. They can talk with the customer and make a different kind of connection.

VISCONTI: Do you see ultimately being able to give people pharmaceuticals customized to their genetic type?

EPSTEIN: If you look at what’s in our portfolio right now, I would say close to 90 percent of the medicines moving from discovery into the clinical-trial phase are targeted based upon a person’s genetic makeup.

Our new medicines will come along with an assay, which will become a diagnostic in the marketplace. If we have three patients in the room that have a given disease—whether it be breast cancer or rheumatoid arthritis—we will be able to tell in advance, thanks to a genetic test, which patient is likely to respond. Then all the clinical trials are done with those responding patients. You can imagine how it changes the health-economics benefit. There’s no more waste. There are no longer expensive, long trials with groups of patients who simply will not benefit from a certain drug.

In our company, we’re investing in R&D and we’re driving innovation and it becomes a competitive advantage. Some companies have chosen to be more focused on short-term commercial opportunity and have not continued to evolve their innovation capability. This creates a bigger gap between us and them.

VISCONTI: Can you connect the company’s focus on diversity and inclusion, cultural awareness and cultural competency with your philosophy on research and development?

EPSTEIN: There are a couple of connections. One is we can recruit people, the best people, from anywhere in the world, which is a major advantage. And when you start to recruit these people, they bring in even more people from those regions or those backgrounds.

Working with diverse cultures and backgrounds, you’re also more likely to design your clinical trials in a way that looks for subgroups or different patient characteristics

It’s largely about talent. It’s about getting the very best people in the door and then making the investment to get them to work together in a high-performing team. That means training your leaders to be inclusive—and we do have inclusive leadership training. We just rolled out a program called Leaders as Coaches. It teaches people specific coaching skills as leaders—for example, how to have a conversation with your team members so challenges and options can be addressed openly and in a reflective manner. We also do high-performing team training where the leader and their direct team work together on a multitude of things.

When you first explain to people that we are going to do this, you get the classic reaction: “I have to take two or three days out of my schedule to do this? I have to think differently?” After they’ve been through it, something interesting happens: They say, “This has made me a better leader and it’s had an immediate impact on how we all work together and what we can achieve.

Our strategy is to win in primary care, specialty care and oncology. We want to become the best pharmaceutical company by 2016. There are four major pillars: growth, innovation, productivity and people. The people pillar is very clearly spelled out as becoming more diverse and inclusive, to invest heavily in high-performing team workshops and education so that we can bring out the best in people. We’re very explicit about it.

The post Novartis’ David Epstein: A Diverse Team Can ‘Accomplish Feats Nobody Thought Possible’ appeared first on DiversityInc.

Lechleiter accepted Lilly’s award as DiversityInc’s Top Company for Working Families at our October event in New York City. Go to www.DiversityInc.com/2012specialawards for the full video. Also view our digital edition to read this article and other CEO Interviews.

Luke Visconti: You’ve publicly stated the importance of diversity to Lilly’s mission and to its business goals. How did you come to this realization and why has it become an increasing focus of your tenure as CEO?

John Lechleiter: I’ve been CEO just over four years. The importance of diversity as an underpinning of our business success today and for the future has become more clear to me and more evident. There are a number of reasons why diversity has sprung to life as an important business issue and been magnified in my mind during this time. One is the opportunity I’ve had to travel even more around the world to meet so many willing people and so many of our customers who reflect different backgrounds and different cultures.

Secondly, it’s the increased diversity of our scientific workforce. As we recruit the very best scientists and physicians from universities and medical schools around the world, we see an increasingly diverse population among the group of individuals who really form the core of our company, based as we are on innovation. And the way that our business is shifting in terms of serving different populations and different segments of different populations than we have in the past, both here in the U.S. and in emerging markets, has brought me, and the whole company, a greater awareness of how different we are with respect to the way in which medicine is practiced, the way in which treatment is sought, the way in which people understand disease and approach therapy.

Visconti: You’re coming off of patent on a couple of things. How are you seeing this subject applied to innovation at your company, considering how important it is for you to develop new products?

Lechleiter: We’re in a very interesting place right now in this industry where the promise of the science and all of this knowledge we’ve accumulated about the human genome and about disease pathways is sitting there in front of us, sort of tempting us, waiting to be exploited. Yet so many of our companies are finding it difficult to really innovate in a way that is affordable, that is timely, that ultimately hits the target.

We believe that among the best approaches is to really enhance the innovations, to make sure that we’re able to effectively integrate the ideas, the energies, the passions of Lilly people around the world—Lilly people who come from all sorts of different backgrounds, who bring their diversity with them to work, who are proud of that, who really make their different perspectives and their different backgrounds work for us in terms of literally making that whole greater than the sum of the parts. We can harness that, really harness that; it gives us a real competitive advantage.

Visconti: Is there a personal reason that diversity is a subject that’s important to you?

Lechleiter: I’ve been here almost 33 years now. I joined Lilly as a scientist, and you could say I came from a nontraditional background in terms of going from that entry-level position as a chemist to becoming CEO. There have certainly been times along the way when diversity and the implications of diversity for the company have been really brought home to me.

About 20 years ago, when I was in my first executive management job, I had lunch with a group of gay and lesbian employees who happened to work in the area that I was responsible for. Leaving that lunch, I felt like I really had stepped into someone else’s shoes and recognized just how subtle and how almost imperceptible some of these issues are that magnify themselves and become really big deals for people who are not like most of the people they happen to be working with. I have never forgotten that. It really opened my eyes, and opened my ears as well, to listen better, to try to figuratively, if not literally, put myself in people’s shoes to try to understand their stories and their journey more completely, and then to try to deal with some of the things that represented obstacles for them, that kept them from realizing their potential, that made them feel maybe just a little less significant in the scheme of things because of the ways they might be treated or things that were said, opportunities that didn’t open up for them.

Visconti: You’ve put Shaun Hawkins, a line executive, in the role of chief diversity officer. What led you to this decision and how is it paying off for your business?

Lechleiter: That reflects our view that diversity needs to be owned and led and driven by our people in the line. This is not HR’s job, it’s not strictly the CEO’s role. The message here is that we picked one of our best and brightest to serve as the catalyst. While I’m proud of the progress that we’ve made—we were tremendously proud to join DiversityInc’s Top 50—there’s never been a time when we don’t see the opportunity for more progress to be made. We’re never going to be satisfied.

Visconti: What place do metrics have in diversity management?

Lechleiter: My view is we can’t zero in on any one metric and say that achieving that represents the epitome; it has to be looked at as a composite. I pay particular attention to retention rates. We have proven time and again that Lilly is able to hire many of the best and brightest from schools and companies all over the world.

But that’s just the first step. We want to retain these talented employees that we hire. We want, through that metric, to see a clear indication that this is a place people like to work, where they want to build a career, where they want to raise their families, where they feel valued and where they feel like they can make a contribution. Even at a challenging time for Lilly, those things that we can control, we’re making the kinds of progress that we expect and are pleased to see.

Visconti: You personally are chair of the diversity council. Why take such an active role, and how do you hold your senior executives and council members accountable for results?

Lechleiter: This year, for the first time, I sent very explicit guidance to the 13 people who comprise the executive committee along with me about what I expected them to do in terms of their own leadership for diversity as we enter into this challenging period at Lilly we call Years YZ, where we’re going to lose these patents and we’re going to have some ups and downs in our business. At this time, any of us might be tempted to say, “Let’s not worry too much about diversity; we’ve got these clear business objectives we need to hit, we need to reduce our cost, we need to move our pipeline forward.” And I think that would be exactly the wrong approach to take. This is the time we need to engage people like never before; this is the time when we need to take full advantage of the power, of the intellects we have here and the people we have who are committed to this company, who want to see us move forward.

Our resource groups are absolutely a critical part of the overall fabric of diversity and are responsible for a lot of the progress that we’re making. I try to ensure that the individual executives who have been given executive-leadership or executive-liaison responsibilities with these groups really are engaged with them. I sit down with some regularity with people who comprise those resource groups and I ask about that, and I try to also understand at a first-person level what the Lilly experience is for them, how we can improve, what suggestions or recommendations they would have for me or for any of our executives in terms of how we can be more effective leading diversity.

When I meet with our resource groups—this is typically an hour-long lunch that is almost never over at the one-hour point—I learn an enormous amount. We have a resource group for veterans, a group for people with physical handicaps, a group for our gay and lesbian employees. Every time I sit down with any of these groups I learn a lot, my eyes are opened up. And these are not gripe sessions. These are, ‘Hey, John, did you know this, this is happening over here, we are driving this initiative there, things are getting better,” or, “John, progress is just too slow.”

I met with a group of our Indian employees a few years ago and they said, “When you walk in our lobby you have ‘Welcome to Lilly’ in eight languages, but our language isn’t there.’” Well, gosh, how hard is it to add “Welcome to Lilly” in another language? It was a small thing, but every time these folks walked into work, they were reminded they didn’t see their language up there.

Visconti: What do you see as the greatest value diversity and inclusion bring to Lilly’s ability to create and market pharmaceuticals?

Lechleiter: Our vision is improving outcomes for individual patients. We know that while medicines are necessary, they are seldom sufficient. If you have diabetes and you’re prescribed Lilly insulin, that’s not the end of the story. There’s a whole lot of other things that need to comprise your care for you to meet current treatment standards, in addition to using that insulin. So if we want improved outcomes for individual patients, and our medicines figure prominently in that, we really have to understand the patient journey. We have to understand how Hispanic patients are different from African-American patients, are different from a Caucasian woman who lives in New York City.

Sometimes we can do this at the genetic level—in other words, differentiate a disease based on a genetic factor. Cancer is a good example. Today we’re able to say you don’t just have this type of cancer, you have a subtype of this type of cancer, and we know how to treat that more effectively than we did 10 years ago because we can target therapy. That’s really exciting; that’s the ultimate improved outcomes for individual patients. But in between there’s a whole lot of knowledge we can bring to bear about how communities of people think and live and approach medical care. We’re getting better at that. We have a couple of programs we are running for diabetes, in particular one with African Americans here in the U.S. And we have growing knowledge of how certain disease states are approached and thought about within the Hispanic communities in the U.S.

Imagine what might be possible for us from a business perspective if we can become more relevant to the prescribing physician based on a more detailed understanding of the differences among people who seek care and use our products.

Visconti: What is your vision for Lilly for the immediate future and then longer term?

Lechleiter: Lilly the company needs to be representative of the people we aim to serve. There are still many things that remain to be done to get even closer to our vision of having the company comprised of diverse individuals who as a group are innovative and who ultimately can deliver on this promise of improving outcomes for individual patients.

One of the things that is fundamental is ensuring that we continue to create opportunity for everyone to gain access to quality education. We put a lot of focus in terms of the way our foundation supports K–12 education, on encouraging women and minorities to pursue careers in math and science. We want to see more African-American graduates from schools of engineering; we want to see more women and Hispanics graduating from Ph.D. programs in chemistry and biology. Also, creating opportunities for people to expand their responsibilities within the company, to be promoted, to be able to be in positions of leadership as diverse individuals, is something we monitor, measure and strive for.

Visconti: Lilly is significantly more philanthropic than even the DiversityInc Top 50 companies. You are at about 2.3 percent of gross revenue going to philanthropy; the average for the DiversityInc Top 50 is 1.6 percent and my estimate for the Fortune 500 is 0.5 percent.

Lechleiter: We recognize that the Lilly family who started this company were in their own way visionaries way back when. They had a deep-seated belief that a successful firm should give back to the community and should engage with the community that it is a part of—for us that’s been Indianapolis for 136 years. Giving back is really in our DNA.

There’s been a trend in recent years to engage our employees more in that. A very successful program—we’re now in the second year—is called Connecting Hearts Abroad. We give about 200 employees an opportunity annually to spend two weeks in one of eight or nine locations all around the world, working on the ground in some sort of community-related activity. It could be supporting an orphanage, helping to build a new irrigation system. That’s really brought home to our employees the company’s commitment to social responsibility, but to also creating shared value among the people who ultimately, like any of us, could be patients someday.

The post Eli Lilly CEO John Lechleiter: ‘Engage People Like Never Before’ appeared first on DiversityInc.

DiversityInc CEO Luke Visconti recently interviewed Pamela Eason, president and CEO of the Women’s Business Enterprise National Council (WBENC), and a former Pfizer executive. Here’s her agenda for this important organization, which works with corporations to increase supplier diversity and helps women-owned businesses succeed.

Luke Visconti: WBENC held its National Conference & Business Fair in June. Can you tell us about the event?

Pamela Eason: The event featured a plethora of speakers who were really focused on benefitting the WBEs. It was very engaging, with workshops that addressed WBE skills, WBE needs, as well as corporate and government requirements for doing business. We had about 2,200 women, and total attendance was right about 4,000, so we were very excited.

Visconti: What does your organization help women to do in their business lives?

Eason: Overall as an organization, we have a CORE value that we provide: C is for the certification, O is for the opportunities that we provide, R is around the resources and E is engagement. However, for our event specifically, the opportunity aspect is very rich. If women do their research correctly for the great businesses that are coming to our event, they can spend all their time prospecting at this event and not have to spend a lot of money to go around and prospect all year long. That’s a great value.

For our corporate members, being active in our event and meeting these women-owned businesses frees up the number of times they need to have individual meetings.

Visconti: Why should a supplier-diversity chief or other supplier-diversity executive go to this event next year? What experience and knowledge would they gain?

Eason: The supplier-diversity professionals, in particular, will find a plethora of WBEs that are anxious to do business with them. The good news is we’ve been teaching them to target, so they are going after the corporations that they are probably the best solution for and can meet those needs. Marketing individuals would find that the power of women and the buying power of women are a great business-case tie to what that corporation does. A lot of procurement professionals attend because they can learn a lot about how that benefits their company as well as the actual categories in which they’re looking to buy things.

Stop Making Excuses

Visconti: When talking to companies that have procurement that might not be centralized, they tell me that they have difficulty getting MBE and WBE spend through the different divisions. You ran procurement at Pfizer. Why is that an excuse?

Eason: In many cases, it is an excuse. If you think about it, those same companies and the divisions and the people who are saying that they can’t do it, they also have employees in those same areas. Those payroll systems are just as different as those procurement systems, but they’re getting everybody paid and they’re making sure that everything happens like it should.

Is it costly to make sure everything is integrated? Is it difficult to say this is a priority and make sure that that priority occurs? Absolutely. But if you make it a priority and you follow through on it, it will happen.

Visconti: If you’re giving advice to a supplier-diversity person who is telling you, “I just can’t get this done,” what do they need to ask their CEO for? What do they need to ask their vice president of procurement? What kind of authority or accountability is needed?

Eason: If I’m a supplier-diversity professional and I felt like I just couldn’t get it done, I would think that it probably wasn’t being reinforced at the closest levels. I’m a total believer in top-level support for diversity and inclusion, whether it be on the supplier side or the colleague side, but that needs to exist as a basic premise of what happens at a company.

It’s those managers closest to the work who are really key to the success. If I’m being held accountable for certain things occurring, then I’m going to make sure that those occur.

If you address more of what people are concerned about—whether they believe there’s no supplier out there, or they believe the suppliers are not capable, or they believe funding is not available, whatever that is—as you address it, you’re able to show that that in fact is not the case. Or if it is the case, you go and you develop that capability, then it pulls through and it is successful.

The Importance of MWBE Certification

Visconti: I’ve run into both MBE and WBE owners who are not certified, and they don’t think of it as being important. Why is it important?

Eason: It’s important for two very different reasons. The government is making some real efforts to try to ensure that they do more business with women. They seem to be taking it seriously. They want to verify that this business is in fact woman-owned, -operated and -controlled, and not a shell of any sort.

On the private-sector side, with corporations, if you are doing business as a government contractor, then you have some flow-down requirements, and some of those are for diverse and women-owned businesses. So again, if you’re doing business with a certified business, you know they are owned, operated and controlled by a woman.

Visconti: What advice would you give women who are thinking about starting their own business?

Eason: Do your research first. Know what to expect. I had my own business for eight years, a consulting business that dealt with business processes in the area of procurement and finance. What you have to realize is what the sales cycle is like, how you have to behave in your client’s situation, what you are expected to deliver and how that’s different than just going to work from 8 to 5 or anything else that has to be done in a normal, day-to-day job. As an entrepreneur, you’ve got to jump up and be in charge of everything. Be aware of that and plan your time accordingly.

The post How WBENC Helps Companies & Women-Owned Businesses appeared first on DiversityInc.

DiversityInc CEO Luke Visconti recently interviewed Thomas F. Zenty III, CEO of the Cleveland-based hospital system. (University Hospitals is one of the 2012 DiversityInc Top 5 Hospital Systems.) Zenty discussed the dramatic impact of the Affordable Care Act and how the hospital’s diversity efforts in the workplace and the community are helping it survive. Read this article and other CEO interviews in our digital issue, and sign up for DiversityInc magazine.

Zenty spoke on this topic at DiversityInc’s event last month, Diversity-Management Best Practices From the Best of the Best. Click here for video of his talk.

Luke Visconti: What is the intersection of solid diversity-management initiatives and the reduction of healthcare disparities?

Thomas F. Zenty III: Many studies have shown that there is a direct correlation between people of diverse backgrounds being willing to seek care and knowing that people who look like them will actually be providing that care. So the intersection between diversity and disparities is rather significant. We want to make certain that we’re doing everything that we can to make sure that people of color will be able to work in our organization, hold positions of leadership—caregivers, clinicians and support staff—in order to make people of all backgrounds, colors and faiths feel comfortable coming to University Hospitals to receive the world-class care that we provide.

Visconti: How is diversity and inclusion a competitive differentiator for a hospital?

Zenty: There is no better way to gain the pulse of what’s happening in the communities that we serve than by having people who live and work in those communities actively engaged with us at every level. From an employee perspective, it’s critically important that we have people of diverse backgrounds who will bring skills, talents, perspective in order to help us to do a better job as we look to achieve our mission. We think it’s critically important for diversity to be well represented across our entire health system at every level, be it gender, religion, race, color. In fact, we’ve recently reached out to the Amish community because one of our hospitals has a very large Amish population, and we realized that we did not have a member of our board who was of Amish descent. As a result, we added a new Amish board member to our hospital, and he’s brought a lot in terms of a better understanding of the Amish community and the healthcare needs of that community.

The point is we need to look into the community to better understand who are the communities that we serve? Who best represents those individuals within those communities that we serve? And how can we engage them at every level, either as employees, as members of the board, as leadership-council members? And we want to make sure that we’re engaging everyone in the communities that we serve.

Visconti: You’re very personally involved in the community. Why?

Zenty: It’s critically important for an organization of our size in a community of this size, as the second-largest private employer in Northeast Ohio, to make certain that we’re going to be focused on diversity at every level within the communities that we serve. Our organizational values include excellence, diversity, integrity, compassion and teamwork. And diversity is one of the key components of the cornerstones of the work that we do every day in taking care of our patients and meeting our mission. As the leader of this organization, it’s critically important for us to be actively engaged in community activities to make certain that we’re not only aware of what’s happening in the community, but play a leadership role in advocating on behalf of many different agenda items. One of the key ones, though, is in the area of diversity in Northeast Ohio.

Visconti: University Hospitals has a 100 on the Corporate Equality Index, the Human Rights Campaign’s index of equality for LGBT people. Why is that important to you?

Zenty: The LGBT community is very important to us for all the other reasons that I stated in all the other populations that we serve. They’re very much a part of our community. We want to make certain that they’re recognized and represented. They have actually recognized us for our work in this regard, which we’re very pleased about.

Visconti: Your chief diversity officer reports directly to you. You also have hands-on interaction with people who are responsible for delivering results in diversity management. How important are these two things?

Zenty: It’s critically important that the chief diversity officer reports to the chief executive officer. Donnie Perkins is our chief diversity officer and does an excellent job in the role. However, it’s also important to note that we have a very close working relationship with Elliott Kellman, who is our chief human resources officer, because so much of what we do in workforce planning and workforce development is structured around the importance of diversity at every level in our organization.

In our organization, we selected the top 24 people from within our health system to be part of an education-and-training program in conjunction with Case Western Reserve School of Business. We’ve engaged 13 physicians and 11 non-physicians who were at senior levels in our organization who we feel have the potential to grow and develop in the years to come within University Hospitals’ health system. They were selected on the basis of their accomplishment. They were selected on the basis of diversity. They were selected on the basis of their ability to grow and develop within our organization. It’s an 18-month program, but we’ve seen great success thus far. One of those individuals has already been promoted to a new senior position that was recently created in our organization.

But at the other end of the spectrum, we’re also concerned that we don’t have enough people of color in our management ranks. So we put together a mentorship program, which will include people at the senior administrative level who will choose people who have promotional capability within our organization, who will be working with each of us to make sure that they will be given the opportunity to grow and develop within our organization in both non-management as well as in management roles, so that we can encourage more people of color to get actively engaged as supervisors, managers, directors, vice presidents.

Visconti: How are you holding your senior team accountable for diversity-and-inclusion results?

Zenty: Our senior team is very actively engaged with Donnie’s leadership in making certain that we are focused on diversity at every level within our organization, looking at the healthcare needs of the people who we serve, making certain that our employees are given equal opportunity for promotion and growth within our health system, making certain that people who are in middle management have opportunities to grow into senior-management roles, and making certain that we are focused on doing everything that we can to prepare the next generation of leader who will be people of color and of diverse backgrounds. Likewise, it’s important to mention that our board has been focused on diversity over the past many years. And I’m pleased to report that the Council on Economic Inclusion has awarded us for two years in a row recognition for the diversity of our board. If we receive it a third year in a row, we’ll go into the Hall of Fame, and we’re hoping that that will be achieved. This actually starts at the top, beginning with our board, and then filters throughout our entire organization.

Visconti: What do you see as the greatest challenge facing University Hospitals? And how does diversity and inclusion factor into the solution?

Zenty: The greatest challenge will be how to address the changes that we’ll be facing under healthcare reform. One of the key things that we will focus on in the area of diversity is to make certain that the 32 million more Americans who will now have access to healthcare insurance that didn’t have it before, that they will be well represented both within the communities that we serve as well as well represented in the patient populations that we care for. We have a number of very strong specialty clinics that will focus on the needs of specific elements within our population. But we want to make certain that as we see this influx of new patients arriving, we clearly understand what their needs will be—which is more than just episodic acute-care needs, but the continuum of care of services that we’ll be able to provide to them in the years to come.

Visconti: I found University Hospitals’ website to be exemplary in its ability to communicate your mission, your values, how diversity ties into all of this, your corporate citizenship, your engagement with the community. Why is it so important to communicate this?

Zenty: University Hospitals really wants to be a leader in the area of diversity. We’ve been in existence since 1866. We’ve been a very active and vibrant part of this community for that same period of time. And we want to make certain that we’re going to be leaders in the area of diversity—to set the example, to set the tone toward diligently making great things happen in the world of diversity, and to make certain that we’re going to focus not only on the needs of our patients, but also on the needs of those within our organization, to make certain that everyone will be able to realize their fullest potential.

The post Interview With University Hospitals CEO Tom Zenty: Diversity Leader, Innovator, Community Citizen appeared first on DiversityInc.

Tyson, the current President and Chief Operating Officer, was interviewed by DiversityInc CEO Luke Visconti the day he was named to the position. To hear audio of the interview, click on the audio players below. Tyson also spoke at our diversity event, emphasizing the organization’s emphasis on cultural competency and an inclusive workplace.

Cultural competence in healthcare is a hallmark of both Kaiser Permanente and Tyson’s personal priorities. “Our mission is to continue to become better educated and increase our competency in understanding the nuances of how we care for a diverse population,” he told DiversityInc. “The Institute for Culturally Competent Care is a training ground. … It’s a metaphor for where the brain trust is to help the rest of the organization better understand how to care for diverse populations.”

In addressing corporate leaders who are selecting a health-insurance provider, he noted that the commitment to diversity is critical. “Your employees will see themselves in the walls of Kaiser Permanente. We are a diverse organization, taking care of diverse people,” he said.

Where Are All the Black CEOs? 

Kaiser Permanente, No. 3 on The 2012 DiversityInc Top 50 Companies for Diversity list, is not in the Fortune 500 since it is a nonprofit. However, the naming of a Black person to lead this major organization is a significant step. Currently, only 1.2 percent of Fortune 500 companies have Black CEOs, compared with 4 percent of the DiversityInc Top 50.

Kaiser Permanente’s Next CEO: Why Healthcare Reform, Cultural Competence Are Financial Decisions

Tyson noted Halvorson’s legacy of creating the most diverse top of the organization in the DiversityInc Top 50. “My job is to build on that and leverage the great strength of the diversity as we continue to deal with very complex problems in this country and the healthcare system,” he said.

Tyson is chairman of the board of directors of The Executive Leadership Council, which works to improve Black representation in senior levels across Fortune 500 and equivalent organizations. He emphasized the need for diversity from all underrepresented groups at the tops of organizations. He also is on the board of the American Heart Association.

Increasing Engagement and Motivation

Tyson discussed his long career at Kaiser, saying: “I’ve been afforded over the 28 years wonderful experiences in multiple roles. … At the end of the day, what has kept me here is that I believe in the mission, in high-quality affordable care.”

He added: “It’s all about creating an environment where the people bring their best thinking forward and are respected and recognized for that. The benefit is to have a highly motivated staff coming to work every day, taking care of our 9 million plus members.”

New CEO: Kaiser Permanente’s Innovation, Affordability Delivers Economic Advantage

The decision to name Tyson came after an exhaustive search. “The full board of directors underwent an extensive internal and external search process, meeting regularly to consider a number of highly qualified candidates, to identify the next leader of Kaiser Permanente,” said Kim Kaiser, board member and chairman of the search committee. “The board’s decision to offer this position to Mr. Tyson is a testament to Kaiser Permanente’s robust internal succession-planning process. During Mr. Tyson’s 28 years at Kaiser Permanente, he has demonstrated excellent leadership and vision for this organization, uniquely qualifying him to serve as our next chairman and CEO.”

Kaiser Permanente’s succession planning will be featured in our diversity web seminar on succession planning, which will include best practices from IBM and CVS Caremark as well, on Dec. 4.

“The board made an excellent choice,” said Halvorson.

“Bernard has done an extremely good job as President and COO of Kaiser Permanente, and I am confident he will continue to perform at the same level as Chairman and CEO.”

Tyson has been President and COO for almost two years. Previously, he was Executive Vice President of Health Plan and Hospital Operations for Kaiser as well as Senior Vice President and COO for the organization’s regions outside of California.

He has a bachelor’s degree in Health Services Management and an MBA in Health Care Administration and Management from Golden Gate University in San Francisco. He also earned an advanced leadership certificate from Harvard University.

The post Interview With Bernard Tyson, Next CEO of Kaiser Permanente appeared first on DiversityInc.

Barbara Frankel: For the several years that we’ve known you, you have been a very proactive diversity leader. You chair the diversity council. You visibly support diversity and you hold your executives accountable for results. On both a business and a personal level, why is this important to you?

Clay Jones: First on the business side, we’ve been involved in and around diversity in our company for decades. Unfortunately, we weren’t making the progress we wanted to make and we had to examine why that was the case.

As a government contractor, we realized we had gotten into a mentality that dealt with diversity as a requirement or as something to avoid bad things happening, as opposed to it being a good business strategy. It was only when we changed our thought process and realized that diversity can be a proactive, constructive business strategy to help advance our business that we started thinking about it correctly.

Once we had established that, we put a diversity business strategy together that we could communicate to our employees. From that came the strategies that not only talked about accountabilities and incentives to do this but also focused on outcomes that would allow us to build those diverse teams, which we felt inherently outperform non-diverse teams. There was data we found that we could support that with. Since we actually put those teams in place, they do in fact outperform teams, and we’re reminded of that importance to our business.

The first thing we realized we had to do when we changed our strategy was to change our thinking. We work and have lived in pretty much a male, white-dominated industry. So we had to bring in outside thoughts to educate us on how other people think to focus on the value of our differences as opposed to accentuating them for all the wrong reasons. It was through that training that my own thinking and the thinking of our leadership team really changed.

Like so many other things in life, if you haven’t experienced it, you have to become more aware of it. We became more aware, not only of the microinequities that we know exist in every organization but also the condition that we had to put in place to not only be attractive to people from different backgrounds but also to allow them to be successful once they got here and to be able to move through organizations. While I think we made a lot of progress, we still have, as always, a long way to go.

Overcoming What You Heard as a Kid

Frankel: How do you think it has changed you personally?

Jones: I’m a son of the South. I experienced firsthand the civil-rights movement in the South. I can say I’ve seen it from both sides. My relatives and my friends at that time were very racially bigoted. I grew up in a period when that was normal and expected behavior. It wasn’t until I got in college that I knew that thinking was not correct and appropriate. My thinking evolved all the time I was in the military—my eight years in the Air Force and all the time I’ve been in business. But I don’t think I had seen an acceleration of my thinking until we began to do this diversity journey here.

It’s our ability to be open to thoughts and ideas. The idea of not just diversity but inclusiveness is something we added to how we think. That understanding of being accepting is one thing and being welcoming is another. When you marry inclusiveness with diversity, for me, that really was another plateau on my own personal thinking.

Not only has it made us a more diverse company, it has made me a better leader. The way I deal with all our employees is more respectful; I think it’s more open. I personally listen better, not one of my great strengths over a long time.

Frankel: The defense-contracting industry has become increasingly competitive in diversity. Why do you think that is, and how are you facing the ability to compete for talent?

Jones: One of the reasons our industry is becoming much more involved in this is for the very terms that we put our business case together. We realized that if we were a more diverse company, we would come up with more innovative solutions. We realized that we would tap into the best talent available, no matter where it was.

But the other thing we realized is our customers are becoming increasingly as diverse as our country is, and our worldwide markets have become more diverse. To be able to craft the kind of solutions that we need for that diverse set of customers, we had to think more as they think. We had to bring more perspectives to the table.

All the other companies in the defense environment are dealing in this exact same area. There’s not a defense company in the United States that’s not focusing a lot of its attention on moving offshore and exporting more. That requires it to be more culturally diverse.

Bringing Diversity to Iowa

Frankel: You’re challenged in some ways, more than your competitors, because you’re headquartered here in Cedar Rapids, Iowa, where there is not a lot of racial diversity. What are you doing to overcome that and to get talented people who are Black, Latino and Asian to come here?

Jones: You’re right. The hill’s just little bit steeper for our company. If you look at our demographics, we have about 20,000 people in the corporation, 10,000 of them in the state of Iowa.

If you look at the minority population in Iowa, it’s about 6 percent, compared with about 25 percent in the nation. So we’re well below that in terms of the immediate talent pool. And so, to become more diverse, we have to try harder.

So here’s what we do. First of all, we recruit from outside the state. The largest population we have (at Rockwell Collins) is our engineering population, about 7,000 of those 20,000. We look at sources of engineering talent, both colleges and also existing experienced professionals that are outside the state. We go fish where fish are to bring that talent in.

We have set up excellent relationships with historically Black colleges and universities, for example, for African-American talent. We have focused a great deal of effort on bringing women into engineering and have established strong relationships with the Society of Women Engineers, for example, to help us.

This helps identify them, and another strategy is to get them here. Once they are here, we’ve got to keep them here, and so now they are working in a company hopefully that will be open and welcoming to them. That’s something we control. But they also live in a community where we have less control that is also perhaps not as racially diverse as the people who we would like to see come here. So we established what I think is a national first, working with other employers in this immediate area, which includes the University of Iowa, both utility and industrial employers, to form Diversity Focus, which is an organization whose mission is to increase awareness in the community, benchmark what everyone else is doing so we can share ideas and resources, and then think of new programs that we can do to make this a more welcoming and inclusive community.

They’ve done an outstanding job of all three of those missions that have helped people as they come here not only make Rockwell Collins a comfortable place to work but also make this community a comfortable place to live.

Frankel: How do you encourage people in your corporation, especially your senior executives, to get involved in the community and with multicultural organizations?

Jones: Well, first of all, we all live here too. We all understand that part of our corporate responsibility is to be a good corporate citizen. So the idea of outreaching to the community is not new to this company, nor is it new to the executives here.

In this case, the focus is to understand that when we have multicultural organizations that are springing up as our community gets more diverse, we need to play a role in that.

So just as I participate in a number of specific activities, I ask each of my direct reports to also select an organization that they can uniquely contribute to in the community. We often go out and speak to these organizations. We provide mentorship to these organizations from an executive level. We invite these organizations into our company to kind of see what we do.

As a highly secure facility, we can be very cloistered, so bringing everyone in here, including elementary- and high-school students, opens the company up to the community. Every year, I evaluate senior executives’ progress not only in the community but in our diversity goals for the company, and part of their compensation is tied to that evaluation.

Sustainable Results

Frankel: What are you doing to ensure that the efforts you’re putting in place will outlive your tenure as CEO?

Jones: I am a firm believer that no organization can sustain itself for very long by being a cult of personality. You’re very kind to give me some of the credit for doing this. But I can assure you that there are a host of people around me who feel as I do.

This is not a battle of “do what I say” but a battle for hearts and minds of agreeing that what I am suggesting is the right thing to do. I go back to that business case we built. Everyone in my leadership team buys into that business case that this is the right thing to do for the business. So if you care about the business and our business success, this is an important strategy for the next piece of avionics, for the next radio that we build as a solution for our end customers.

I have every confidence that when I am gone, the spirit of what we have created here has been infused in the company enough that it will carry on without me. In many ways, you can say it could carry on better without me because now we will have a new set of eyes with a new agenda for the company and a new way to advance it leading at the top.

But the foundation of what we’ve established will be here in the infrastructure that they can build upon; as we know in our industry, everything can be made better, everything can be more efficient, everything can be more effective in its outcomes. I know that both our board of directors and I are committed to this enough that we will select someone who has this as a passion as well.

Frankel: What would you like as your legacy to Rockwell Collins?

Jones: I spend zero time thinking about my legacy at Rockwell Collins. This company has been around for 78 years. It was here long before I came and it will be here long after I am here. I view myself as a steward of this company, that I am basically a leader servant of the shareowners, of the board of directors and, of course, the employees and our customers. My measure of merit will be that I leave the company in better shape than I came to it. When I look back over my shoulder, if I can look at that body of work and feel personally convinced that there are certain things that I did, that I champion, that I had an idea for, that made it a better company, then I will feel that I’ve had a successful tenure, that now someone else can build on after that.

Obviously, one of those things I hope to be most proud of is changing the shape, the look and the thinking of this company to be more inclusive and to be ready to move into the 21st century and do business successfully in the United States and around the world.

That’s why this specific diversity and inclusion initiative is so important to me as a quality initiative, as a globalization initiative and as an effort to serve our customers more effectively. So I hope I’ve done a good job with that, but we’ll have to wait until I get there to see if I have.

Success has many parents. If we’ve been successful in this journey, then we deserve recognition in your DiversityInc Top 50. If that success has happened, it’s because a number of people have contributed to it, bringing the ideas forward, nurturing the strategies, being thoughtful in offering new suggestions, and I won’t even begin to list all the people in our company who have helped me and our company advance.

But I do want to cite DiversityInc because your organization has taken an interest in this relatively smaller company in Cedar Rapids, Iowa, that was eager to do better. I believe we did better because we had your help. We had your thoughtful recommendations and advice, many of which we’ve adopted.

We want to thank you and your organization for the work you do and for the way that you help shape a lot of my thinking and our company’s thinking around what we believe is a very important dimension of business.

The post Rockwell Collins CEO Clay Jones’ Diversity-Leadership Journey appeared first on DiversityInc.

The hiring manager at her first banking job hired Mooney on the condition that she would get her master’s degree in finance. That extra talent development made all the difference, Mooney said during her keynote at a DiversityInc event.

“I owe it to him. If someday I wanted a promotion, [not having a degree] would stand in my way,” she said. Her advice? Get all the talent development you can. “Acquire credentials you need for success and the ones that give you the most flexibility for opportunity,” Mooney said.

Additionally, Mooney revealed the three personal skills that she believes women need to focus on during talent development—a strong sense of self, a sense of humor and a sense of team.

It’s these “sensibilities” that helped her become the first female CEO of a top 20 U.S. bank in May 2011 and rank No. 1 in American Banker’s 25 Most Powerful Women in Banking. KeyCorp is one of DiversityInc’s 25 Noteworthy Companies.

1. Sense of Self

Mooney learned an important lesson in personal talent development when she took her first job: Sometimes a strong sense of self is the only thing that’ll get your foot in the door.

She knew she wanted to be in banking—a male-dominated field. After being turned down by several banks, she wasn’t going to take “no” for an answer. It took Mooney three hours to wear down the hiring manager at her next interview. She got the job on the condition that she would go to night school and increase her talent-development potential.

“The man who had hired me was just reflective of the times. Women were tellers, not executives or having executive potential … They simply didn’t hire women into training. The bank did not believe women were a good fit for a managerial training program,” said Mooney. “But I was tenacious, so I was given the chance.”

2. Sense of Humor

But “getting into banking wasn’t the same as getting ahead in banking,” said Mooney. She still had to deal with being one of her company’s only female employees, as well as to earn respect from her male clients. It again was time for some personal talent development.

By using humor to re-characterize herself, she was able to save a commercial real-estate account in the mid-1980s. “[The clients] felt they could take advantage of me. They were anxious to discount me. I had to fix that fast to do my job,” recalled Mooney.

Watch the video above to learn how Mooney’s sense of humor proved that she “wasn’t stupid” and saved the meeting. “Humor creates balance and perspective for the environment around you. It helps manage the external realities in your career, which are not always easy or friendly, even harsh,” Mooney said.

3. Sense of Team 

There has been tremendous progress among women, thanks to increased talent development from diversity-management efforts.

In 2011, the global percentage of women leaders hit an all-time high: 1 in 10 companies had a female director. “Part of the difference is that we led not with differences but by trying to be a part of the team. Diversity has found its way to the C-suite by doing so,” said Mooney.

However, there is still a long way to go. With Fortune 500 CEOs totaling less than 4 percent women (18 total), it is clear that talent-development initiatives in many companies need further fine-tuning.

“The way to succeed in any career is be part of the solution,” said Mooney. Talent development helps every employee to be a team player. Talent development also helps you to better understand the business and how it works. “Behind every successful woman and man is a pit crew.”

Talent Development & the Future?

Mooney knows that it is still “something of an event” to have a “woman or a diverse” candidate leading a company today. But she believes that in the future it will be different. She attributes that more diverse future to the evolution of leadership and the considerable diversity and inclusion efforts of diverse leaders. In addition to mindful recruiting and promotions, their efforts frequently include innovations in talent development, like Kraft Foods’ JumpStart program that provides talent development to master the unspoken “rules” of corporate culture.

She continued, “I have a theory for those who succeed in business dominated by white males. We came in and acted like we belonged. Guess what? Now we do.”

For more on the benefits of talent development, read Best Practices on Improving Retention.

The post How Talent Development Helped This Woman Became CEO of a Major Bank appeared first on DiversityInc.

Read personal stories from two INROADS interns: Talent Development Creates Ability for INROADS Students to Succeed.

The president and CEO of INROADS, who spent 28 years at Pfizer (including his last role as vice president of capability development and stakeholder relations), started life as the son of migrant workers in Fort Pierce, Fla.

“My parents worked in the fields, harvesting vegetables and fruits … we lived in the projects, and from the top of the roof, I had two views, the drive-in theater and Cape Canaveral,” recalls Harper, who now heads the nonprofit that helps low-income students find and succeed in corporate internships. Most of those students are Black, Latino and American Indian.

For more on talent development and diversity in education, read Rutgers Future Scholars Enhances Talent Pipelines With Corporate-Student Outreach and PhD Project: Getting Diversity to the Next Academic Level.

The Power of Support

His family, friends and teachers recognized that the bright child and gifted athlete had a chance for a better life. He excelled at football and basketball, and as starting quarterback, he led his high-school football team to a state championship. Harper won a full scholarship to Morgan State University in Baltimore, but a serious knee injury put it at risk. The school let him in on a conditional scholarship: If the knee got better and he could play, he could stay.

He boarded a Greyhound bus for Baltimore, not knowing if he had a real future or if he would return to the fields. His knee got better and he made the team—and then he was injured again.

“Before I was hurt, I was at football practice and a tall gentleman in uniform came over to me,” Harper recalls. “He said: ‘Maybe I can talk to you about how you can leave Morgan State with two degrees, no matter what happens with football.’”

The gentleman was with the Army ROTC, and his suggestion and mentorship changed the young man’s trajectory. Harper went on to major in social work and then went in to the Army, where he achieved the rank of captain in the 82nd Airborne Division.

Harper loved the structure and opportunities of the military, but his family was having tough financial times, so he decided to seek employment in private industry. His first and only corporate employer was Pfizer, where he was hired as a salesman.

For more on veterans and talent development, watch Diversity Web Seminar: Veterans in the Workplace Webinar.

Recognizing Potential

“My district sales manager, Richard Matthews, asked me what my aspirations were. I said, ‘I would like to grow up and have your job.’ He said, ‘Then that’s what you’ll do,’” Harper recalls. “I owe him a tremendous amount for just being able to tell me I could reach for this. Leadership is not about you but what you do for your people.”

Harper spent almost three decades at Pfizer, becoming a senior executive with major leadership positions in sales, public affairs and public policy. He helped start the company’s African-American resource group and served as its president—and he was deeply involved in the company’s efforts to reduce healthcare disparities. He also was a member of Pfizer’s Global Diversity and Inclusion Leadership Committee. Along the way, he broke a few barriers.

“I was the first and only in eight different positions at Pfizer. I could do nothing about being the first, but I could always do something about being the only,” he says.

Harper spent two years as an executive on loan to the National Urban League and the Executive Leadership Council, which works to get Blacks into senior positions in corporate America.

Pay It Forward

In his mid-50s, Harper decided he wanted to share the business and leadership skills he had learned in corporate America with nonprofits, and his strongest goal was to mentor and educate students.

Thus the fit to lead INROADS was perfect. INROADS has found spots for more than 2,000 student interns with more than 200 major corporations. With nearly 24,000 alumni, Harper sees great opportunity for expanding the organization’s potential to help young people gain the first foothold to corporate success.

“My one-year plan is to work with the national board of directors and key stakeholders and ensure we have the financial stability to help our 2,000 students. I want to enhance the awareness and benefits of INROADS so we are no longer the best-kept secret in corporate America,” he says.

Beyond that? “Our goal is that companies tell us over and over that they value the partnership because it is a part of their overall talent blueprint,” he says, adding, “Talent is a continuing life cycle, not just a one-time thing.”

Follow INROADS on Twitter (@INROADS), Facebook and LinkedIn, or watch video interviews with INROADS alumni on YouTube. Read this profile in DiversityInc’s June 2012 digital issue.

The post Talent Development: From Migrant Workers’ Son to CEO appeared first on DiversityInc.

Diversity management and awareness for increased cultural competence in the workplace have led Toyota Financial Services’ employees to be more sensitive in the community—and that has increased their business, says George Borst, president and CEO.

In this hard-hitting interview on diversity management with DiversityInc CEO Luke Visconti, Borst discussed the strong emphasis on training, mentoring and succession planning – and the results they are having. He also emphasized TFS’ community involvement and efforts to implement equity in credit ratings. Toyota is No. 41 in the 2012 DiversityInc Top 50.

Borst explained how TFS employs a three-phase program rooted in diversity awareness. All 3,300 associates receive foundational training, and managers receive cultural fluency training, to help highlight individuals’ diversity blind spots and erase the underlying nuances of discrimination. It’s a 360-style approach to diversity management that’s allowed TFS to increase its representation and engagement of people from underrepresented groups.

For more on the importance of diversity training, read Do White Men Really Need Diversity Outreach? Watch our talent development web seminar for best practices from The Coca-Cola Company and CSX Corporation on increasing talent and employee engagement.

A Supplement for Business Success

Luke Visconti: Why is diversity so important to Toyota Financial Services?

George Borst: Our business, our work force has to mirror the people that we sell to and the people that we work with. I would love to take credit for it myself but I have a great expression: If you have two people in the room that think the same way, you now have one too many in there.

That is a very powerful thing. If everybody on the management committee thought the same way I did, it would be easy but as ineffective as it could be. This forces us to look at things in more creative, more innovative, ways.

Luke Visconti: Would you say that you are using race and gender as a proxy for diversity and thought?

George Borst: No. Diverse opinion does not rely on whether somebody is gay or Spanish or a woman. You get people that think differently.

We are a Southern California–based firm. People may look at us and say, “We are a blue state [TFS is in California] so we think differently and make these policies.” There are a lot of people that think differently.

I think race and gender get you different points of view quicker but there are also a lot of different points of view there. I wouldn’t say we use it quite as a proxy but as a supplement.

In the diversity and inclusion area over the last couple of years, we have launched a three-phase program where we had awareness training for all of our 3,300 associates. We had a second phase called “Small Acts of Inclusion” that talked about nuances of discrimination and how you make people feel more part of the group.

We are just launching what we call the third-phase, “Generational Workplace.” People in their 60s look at people working in their 20s and may view them differently. Everybody has different points of view on work/life balance, so we are trying to make people understand how they work together.

Building the Bench

George Borst: That leads us to the second phase—our talent-review system. We are a management committee group of 10 people and we meet a couple of times a year to talk about the work force. We have one seven-hour meeting on succession planning.

Prior to the meeting, everyone rates the national managers, corporate managers, non–management vice presidents, and management committee vice presidents by strengths, weaknesses, readiness, et cetera. We determine whether they have areas to work on, what else they need, what they do well, et cetera. [Hear Borst speak in detail about their leadership selection process by clicking the player below.]

We then post the top 35 jobs in the company that are the next layer under the management committee and we select the top three candidates in the succession plan.

We then look at each one from a diversity point of view. We say, “How do we look on diversity?” For example, if we find out that we have three white men that are 45 years old, we go through the whole thing and adjust for a diverse slate of candidates.

When we put somebody in there, we say, “To be successful in this job, what do they need to do?” We assign them a management committee mentor who is not in their direct line of command. We talk about extra training or cross-organizational projects that they can get on to get more exposure.

We have been doing this four or five years now. It has really led to a much more diverse population for us. There are 10 people on our management committee: 40 percent are women or people of color; the next level down today is now 36 percent women or people of color. Our field national managers now are 21 percent people of color or women and the level underneath them is 34 percent.

We really are trying to build the bench but not only build the bench. It’s one thing to show somebody’s name out there, but if you don’t give them the support to be successful—mentoring, the extra training, et cetera—it really goes away.

We have two internal programs: Advanced Leadership Development and Executive Leadership Development. We have these annually over the last three years. Sixty-eight percent of the people that have gone through the Advanced Leadership Development program are women or people of color; 60 percent of our women or people of color have gone to the Executive Leadership Development program.

We have a much more ready bench. That has helped the organization start to think differently about how we interact with our customers, our dealers and the people that may need help, both in buying a car and socially in the market.

The Danger of Homogeny

Luke Visconti: From the perspective of being a leader of a large organization, why do you think there ends up being a homogeneous selection? What’s the danger of that?

George Borst: I think it’s a legacy carryover. If you go back 20 years ago, the aha moments on what diversity and inclusion bring to an organization were not there. You are dealing with an experienced population who are now in key middle-management jobs that are disproportionately white males. [Click on the player below to hear Borst discuss the need for diversity in the workplace.]

In the last 10 years, people have gotten more enlightened and realized the diverse population they sell to. They have started to realize that you can make a lot of mistakes if you don’t have people thinking differently and, more importantly, creating the environment where they feel safe to challenge and attack things differently.

What you have to do is accelerate good, smart people that maybe haven’t had many opportunities but certainly have the EQ and the IQ to succeed if given the right support. You need to accelerate that to give a more level playing field that mirrors the population.

During Black History Month, I went to three of our African American Collective’s (AAC), a business partnering group, lunches and one of their evening events. I went to learn something.

We had a consultant at one of these meetings—he was an African-American. He was talking about the nuanced discrimination in the work force with women and he was talking about how a promotion opportunity comes up.

In his example, he said, “If there isn’t an immediate qualified candidate, the companyhas to take a risk. They may look at a white male candidate and say, “Let’s give him a chance.” In the same breath, they may say to a female candidate, “Why don’t we give her a project?”

It reinforces the nuanced discrimination. The sad part is that the person saying those things is being diverse in their thinking. They wanted to give this person a project to see what they can do, whereas they were going to give a white male a shot without having to prove himself on a project.

That got a reaction from the audience. That makes somebody like me take notice that we need to be careful. It also reinforces what we are trying to do in this talent-review session and give those people the right support, take the right risk.

Mentoring Improves Morale

We do our associate opinion survey and we added a couple of years ago two questions:

* Have you been formally or informally mentored in the last 12 months? It was about 42 percent. We segregated the people that said they were mentored: their morale was 20 points higher than the general population.

* The second question that we monitored against them was whether they had an opportunity to grow and develop—they were 22 percent higher than the population.

We formalized a mentoring program in the last year. It’s called RPTM (Realizing Potential Through Mentoring). We had a training program—trained mentors and mentees. Sixty-one percent of the 92 people selected were women or people of color. We could start to move the ball there—trying to build a groundswell, a nucleus of a work force that does think differently, feels comfortable—and it’s being appropriately recognized.

The most dangerous people are those that think they are open-minded and non-discriminatory. They have this nuanced discrimination that they are blind to.

That’s why we gave our executives cultural-fluency training: it puts you on a scale from zero to 140 how open-minded you are in acceptance of other groups, of other points of view. Nobody saw anybody else’s individual score. We had a coaching session and a training session, so hopefully they have alerted some people to their blind spots.

Luke Visconti: How long have you been doing that?

George Borst: We just started. It was the first one we did and we are really excited about it. It was a lot of fun and showed where the group scored and where you scored versus the group.

That’s one of the things everybody kept close to the chest—you were shocked that you could have been seen as a bigot. People probably had a lot of “aha” moments that I don’t think a lot of people shared.

Partnering Around Differences

George Borst: We talk about the importance of Toyota’s business partnering groups on campus and the support they get from the executives. I go to a lot of the business partnering groups. I enjoy going to those things because I meet a lot of different people and I always learn something from that.

But here is the thing that always startles me: I get a 150 percent recognition because the people there are so happy that somebody is there supporting their cause and they really appreciated when a member of senior management attends.

I have shared this over the last couple of years with my key direct reports and now a certain amount of their bonus is derived from diversity and inclusion activities and I will tell you the beauty of that—my direct reports started showing up and the people that work for them started realizing this is important. People now going down two and three and four levels are coming to these meetings and people thought they had to be from an underrepresented group to go.

Helping Consumers With Credit

Congresswoman Maxine Waters had come to our campus in California, and if she wins in November, she will be our district representative, our congresswoman from Torrance.

I pulled together some numbers: the focus was how we help people that are less fortunate than us. I started by telling her that Toyota Financial Services, when we approve somebody for credit, we are blind of whether they are African American, Hispanic or whatever.

What we are proud of in the financing of new autos is that TFS is number one in lending money to the African-American community and number one in lending to the Hispanic community.

The biggest issue facing the country over the last three to four years is the blowup in the housing market. There are a lot of very good people of all races that got hurt in the housing crisis and the depreciation of the housing market just put them upside down.

In evaluating somebody’s credit, if they have 120 days behind on the mortgage and they haven’t been foreclosed on, and the rest of their credit is good, we will approve them. Our view is that these people are not credit criminals; they are good people that ran into hard times. They have managed to pay their other bills. You know you should try to help people that have a good credit history except for foreclosure because you need a car to get to work.

We try to do that to help the community, and I think that has really improved things.  We have been doing this for a couple of years and are very satisfied with where it is.

Active Community Outreach

We are not good at being a “checkbook-charity” organization. We like to be very active in our involvement.

About six years ago, we decided we wanted to do charity work in a big way. We wanted to identify with an organization where our associates could be active and where it would not be self-serving. We picked the Boys and Girls Club of East Los Angeles. It’s in the middle of gang territory—a very tough part of town.

When you fast-forward five years, we have offered to just the Boys and Girls Club of East LA 200 partial scholarships to go to college. There is a national Boys and Girls Club week—it’s usually in April—and last year there was an event every day. We have 700 people here on campus; we had 140 people volunteer. Some of the events were on campus. We bused the kids in.

We since upgraded our involvement with Boys and Girls Club. In cities where our associates live and work, especially Baltimore, Cedar Rapids and Phoenix where we have customerservice centers with as many as 500 associates, we are deeply involved with the local clubs.

We now have a more formal program called Diplomas to Degrees with a national Boys and Girls Club that we just launched in the last year. About 41 percent of what we do in philanthropy goes to diverse organizations.

– Luke Visconti

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The key, said Jim Turley, chairman and CEO of Ernst & Young, at a DiversityInc event, is to have multiple approaches. (Ernst & Young is No. 6 in The 2012 DiversityInc Top 50 Companies for Diversity.) He said it’s best to tailor your company’s initiatives by geography so diversity strategies remain central to local customs and beliefs. Once established, diversity leaders can then look to incrementally push the boundaries.

“The mental picture I have is of somebody pushing a round, heavy stone up a hill, and you have to lean into it and put your shoulder into it, and the real art is—and we all can picture this—if you lean too far, you will fall flat on your face and the stone rolls over you and you’re back at the bottom,” said Turley.

During his presentation, “The Growing Importance of Corporate Social Responsibility,” Turley spoke with DiversityInc CEO Luke Visconti. He recounted the story of a recent trip he took to Saudi Arabia, where contact between men and women is rigidly controlled.

“We have a number of women in our professional staff,” he said. “They have to be in a separate office, separate everything. But they were sitting in the same town-hall meeting, which, technically, was probably a violation of the law in Saudi, but again, you push.”

In this 33-minute video, Turley discusses more about Ernst & Young’s global diversity strategies and shares best practices that can help companies achieve a more equitable workforce despite cultural barriers. Click here to watch.

For more on global diversity, read DiversityInc’s exclusive Global Research report with comprehensive data, demographics and best practices from 17 countries.

The post E&Y CEO: One Global Diversity Strategy Isn’t Enough appeared first on DiversityInc.