George Chavel, president and CEO of Sodexo North America, was just a child when Detroit descended into chaos in 1967 in what would become one of the deadliest and most destructive race riots in modern U.S. history.
Chavel's father owned and operated a candy and tobacco wholesale distributorship in the heart of Detroit's predominantly Black inner city where the violence erupted. At the conclusion of five days of rioting, 43 people had been killed, about 350 injured, 2,500 buildings looted or burned and more than 7,200 people arrested.
But Chavel said his father's store stood unscathed. His father, whose family emigrated to this country from Greece, was a champion of diversity long before it was fashionable—one of the few white business owners who didn't abandon the inner city.
Chavel said his father's legacy left an indelible imprint on him and was one of the many catalysts in his life that led him to become a champion of diversity in his own right.
Sodexo, No. 2 in The 2012 DiversityInc Top 50 Companies for Diversity, has been a leader when it comes to implementing, measuring and assessing diversity initiatives. Chavel sat down with DiversityInc CEO Luke Visconti at our diversity event in Washington, D.C., to talk about his diversity journey. To attend DiversityInc's upcoming events, click here.
Visconti: So, George, I'm going to start with your personal story. What do you think in your life led you to be such a champion of diversity?
Chavel: I call it the two D's. The two D's for me stand for Dad and Detroit. Growing up in Detroit was a very, very interesting experience for me. Just because you grow up in Detroit doesn't mean you are going to have a diversity lens … but a combination of Detroit and my dad are what built me into who I am today. My dad was a small-business owner, but unlike many whites in Detroit in the 1960s, he stayed in the city. He stayed where his business was thriving. He also stayed connected to the community. He was very open to diversity even way back then when there wasn't even a program. It was something he felt was the right thing to do.
When the riots hit Detroit in those horrible turbulent times in the 1960s, my dad's business was on Mack Avenue, the heart of where the riots had begun. [His business] had big glass windows. You could see inside. It was a wholesale candy and tobacco distributor. Cases of candy, cigarette cases were everywhere. During the riots, we were afraid when we heard the news … We were worried that the business was gone. Finally, after about three days, my dad drove down to the business … and his entire business was standing as it was. The businesses around him were burned and gone, but his business was there. I was [young] and it didn't really connect with me as a [child], but years later, I realized it was because of his reputation, because of his own commitment and because of the type of person he was in the community that his business was safe and untouched.
Visconti: Your company, in my view, derives a great deal of business benefit from your diversity management, your excellence in it and your accomplishments. Tell me a little bit about that.
Chavel: It's not something we take for granted. When I think about our diversity journey, it's become a differentiator for us in many ways we didn't really plan on. In the highly commoditized industry that we're in, we're asked to do a lot of price-sensitive areas and try to bring the best price we can.
My bottom line is 2 percent, so you have to do a lot of things to bring that to the table and you have to do a lot of things right, and pricing is important and cost is important. But what we find on our journey is at the end of the day, if the price is equal and if there is nothing else a potential client can discriminate against, if they realize they're doing business with a company named Sodexo that is committed to the journey of diversity and inclusion, that can be a factoring decision.
I believe our diversity journey has helped us produce value. The other area is innovation. At this point in our journey, we don't take anything for granted. We are actually getting out of the way of our people and letting them take the journey. Senior leadership is engaged. They are involved [and] we put our money where our mouth is. For many years now, we've had 20 to 25 percent of our senior-executive bonuses tied to our own diversity scorecard. It's a tough scorecard and it's uncoupled from our financial results, so regardless of where our executives land on their company objectives, we de-couple that from [our financial] results and significantly reward those who have accomplished their goals in the [diversity] area.
Visconti: You once shared a story about when you were still a regional vice president of sales and you went on a sales call to respond to an RFP (request for proposal.) Do you mind sharing that with the audience?
Chavel: When I was a regional VP, and a Midwesterner from Detroit, I was given the wonderful task of overseeing the South for the first time. It was a great opportunity. I had 15–20 states I was managing and we had a very, very large potential piece of business in the healthcare space, about three times the size of our average contract. We went down with a team and we met the administrative team at this hospital in the state of Alabama. Everything was actually going pretty well. Then came the time when we were going to introduce our potential onsite team. Typically, what happens is you bring in two or three or four candidates that meet the prerequisites … the client is looking for. So, we brought in our candidates. By far, head and shoulders above the best candidate was an African-American male. He was very experienced. I personally knew him and worked with him before … and he had clearly met the test of all the teams. But there were two administrators who got a say in the final approval. One administrator called our head of sales and said very quietly, "You guys are doing great and you got the business; there is just one thing. You have to not have that Black guy here."
It was a big test for all of us. It wasn't much of a test for me, frankly … and today it's the easiest decision I made. We decided to nicely walk away from the business. We decided to say no, we're not interested. I'm happy to tell you, as time changed and peoples' lives changed, seven years later, we ended up getting the business and we wound up winning it the right way, with the right African-American candidate, because that individual was the right candidate at the time.
Visconti: I'd like to talk to you about the global operation. The U.S operation has a very metrics-driven approach. Can you tell us how the metrics-driven approach is being brought to the rest of the world?
Chavel: Globally, it's been a little bit challenging. We're actually participating in the DiversityInc global survey, and many of those questions are very difficult around the world. We're in 80 countries. We serve 60 million customers a day. We have 395,000 employees. That is the scope of what we're talking about. Many of the questions in the global survey we're not allowed to ask legally. We can't talk about sexual orientation. We struggle very much with global acceptance of our LGBT community. We can't talk about religion and there are several other parameters.
So, we have found a common ground globally, and that is around gender. We've decided the first phase of our global strategy is to have gender be the hallmark. We recently moved from 16 percent to 20 percent of Sodexo women around the world being in global senior positions. We have a desire to move that from 20 to 25 percent by 2015 and I want the women to be in senior operations positions. We are an operations-driven company … and when we start seeing the needle move and we have women in senior operations positions, we'll know we've made some real progress. Just a few short years ago, my [global] colleagues would say innocently, "Diversity is one of those U.S. things." But now I think we have a global executive team that is very much aligned around doing the right things and having a more inclusive organization.