Resource Groups 101: A Primer on Starting Them & Using Them for Business Goals
What best practices will help you start resource groups and use them to maximize talent development and market share?
Definition: Resource groups, known as employee-resource groups, business-resource groups, associate-resource groups, affinity groups and employee networks, have existed in corporate America for more than two decades. But it's only in the past five years that their use in corporate America as key drivers for recruitment, retention, engagement, talent development, supplier diversity, and marketplace sales and customer service has escalated.
Historically, companies have started with resource groups for Blacks and women, and in their early versions, many of these were more social and were used for gripe sessions. Today, they are run by the company with specific business goals in mind.
Here's a primer on how to set up resource groups and how to most effectively use them.
What do you call them?
These groups are known by many different names—employee-resource groups, business-resource groups, associate-resource groups, employee networks and affinity groups. In recent years, more companies in the DiversityInc Top 50 have chosen to use the word "resource" to emphasize their value to drive the business mission, including gaining market share through culturally competent sales and customer service, and recruiting and engaging a diverse workforce to create innovative, marketplace-focused business solutions.
Which resource groups should you start first?
While many companies start with groups for Blacks and women because they are easily identifiable and most commonly associated with historic diversity and affirmative-action plans, each company must address its own needs. If the marketplace is increasingly Latino or Asian and you are having a hard time recruiting Latino or Asian talent, then those resource groups might be the best place to start. If your company needs to be more inclusive of LGBT people, an LGBT and allies resource group would be valuable.
What's important is to have specific resource groups based on the needs of your company—and to make sure the resource groups are inclusive of everyone, especially people who are not of that group's demographic but who want to learn more about it or are allies.
What are best practices to get resource groups started?
First and foremost, have a business charter that is approved by your diversity department. State clearly what the role of the resource group is and how it will impact your business, whether it is through recruitment and talent development or external market relationships.
Make sure the resource group has an executive sponsor, preferably from the senior ranks of the organization, and if at all possible, have it be someone who is cross-cultural. Do not wait for critical mass to start a resource group; if it is needed and you don't have enough employees, have corporate diversity start it and encourage others to join. Try to find people who are not already considered high potential for leadership positions within the resource group, and use the opportunity to offer them cross-functional experience and leadership training. Corporate funding for these groups varies widely, but an average for the DiversityInc Top 50 is $15,000 per year per group.
Who should be an executive sponsor and what role should they play?
The resource group's executive sponsor should come from the highest ranks of the organization (CEO and direct reports, if possible) to send the message to the company that this is a high priority for reaching business goals. If possible, the sponsor should be from a different demographic group for both inclusivity and to create more awareness at executive levels.
The sponsor should keep the resource group focused on business goals and report back to the executive diversity council on progress. The sponsor should not personally be the group's leaders. At an increasing number of DiversityInc Top 50 companies, a portion of the sponsor's compensation is tied to the resource group's performance. The groups, once established, should also have regular meetings with the CEO and senior executives (quarterly is most prevalent among the DiversityInc Top 50).
How do you get people to join resource groups?
Our data shows that the best way to increase membership is to first open up resource groups to all employees, including hourly and union workers. Second, publicize internally the benefits of joining the groups and assuming leadership positions (including access to senior leaders, potential for promotions, ability to influence business results). Third, make group leadership part of performance reviews and, eventually, compensation.
How do you measure success of resource groups?
DiversityInc Top 50 companies measure the retention, engagement and promotion rates of group members versus those who are not members. They also measure the resource group's contributions to the business. For example, see Novartis Pharmaceuticals' presentation on ethnic resource groups at our recent Innovation Fest! on how the company saved $100 million in market-research fees using its resource groups.
For more best practices on diversity management and resource groups, read:
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Magical thinking will not move the needle on your diversity efforts, or your career, if your leadership is not accountable for results.
Over the weekend I received an email from a diversity consultant who wanted to "depoliticize" my column about Rex Tillerson and his speech on race and diversity management at the State Department.
Secretary Tillerson talked about using the "Rooney Rule" in the State Department. That "rule" is nothing more than magical thinking in most circumstances.
Background: Pittsburgh Steelers owner Art Rooney, in 2003, made it a policy to interview one "minority" for every coaching position. It was a result of bad publicity following two prominent Black coaches being fired, despite winning records. Attorneys Cyrus Mehri and Johnnie Cochran later underscored the perception of discrimination by writing a study documenting how Black head coaches, despite winning a higher percentage of games, were less likely to be hired and more likely to be fired.
Because overt discrimination is costly in the public sphere, the Rooney Rule was instituted and fines were levied against two teams who did not interview a minority candidate for a coaching position.
But racism is persistent. Here are the results 16 years later: 70 percent of football players are Black, 20 percent of quarterbacks are Black, 10 percent of coaches are Black, 0 percent of owners are Black.
The very definition of antebellum plantations.
Are Black people too stupid to be coaches or quarterbacks? Charles Murray or the Freakonomics racists might say yes, but here's the truth — interviewing someone who was not as prepared as everyone else being interviewed is a set up for failure. Quietly, behind closed doors and closed minds, the results will be attributed to race and/or gender (in a corporate setting). But the truth is that preparing people for management positions is management's responsibility — and if management is all white men, what is the real color of failure?
If you don't give your people equitable opportunities to be assigned responsibilities that lead to leadership positions, don't have discipline in your mentoring, don't have an executive diversity council to oversee and hold accountable the process, you will produce the same results you currently have in most companies: white men in almost all positions of responsibility. That is the case at ExxonMobil, that is the case in the State Department, that is the case in most corporations, and under current leadership direction, it will never change. Never.
Regarding "depoliticizing" my initial column, you can't depoliticize this subject. Counting enslaved Black people as three-fifths of a human being is politicizing race (Article 1, Section 2 of the U.S. Constitution). In the recent past, with a Black president, corporate diversity leaders could all try to nudge and wink at recalcitrant white executives in an effort to make progress without rocking the boat too much — but that hasn't worked. There has been very little progress for diversity outside of the DiversityInc Top 50.
Soft-pedaling this subject and expecting progress while attempting to not hurt any feelings by "depoliticizing" diversity is impossible with white supremacy, neo-Nazis and neo-Confederates being tacitly (and at times bluntly) endorsed by the president.
Here's an example — a prominent CEO posted a diversity statement for a public website. From the CEO's statement: "The despicable conduct of hate groups in Charlottesville last weekend, and the violence and death that resulted from it, shows yet again that our nation needs to focus on unity, inclusion, and tolerance." Two sentences later the CEO wrote this: "We have worked with every U.S. president since Woodrow Wilson."
1. "Tolerance" of hate groups or of those who do is acceptance and endorsement of hate groups. If you are going to "tolerate" me because of who or what I am, please know your tolerance is belittling and humiliating. I can tolerate lima beans in a stew. I do not have the imprimatur to "tolerate" another human being; nobody does.
2. Woodrow Wilson was the worst racist to ever occupy the White House. He was a horrible, horrible man. Either the CEO does not know American history or is sending a dog whistle to the White House, which is currently occupied by a white supremacist. By the way, the CEO is a member of a well-known sexist golf club.
Either way, it's wrong. And here is this CEO's diversity results: A leadership team (19 people) that is 5 percent non-white, 26 percent women.
Should you work for people like this? What does their leadership say about the future of this company? Their innovation? Their commitment to ethical behavior? Their stock is down for both one-year and five-year periods. Magical thinking does not increase stock prices, either.
Leaders from Novartis, Sodexo, Johnson & Johnson and Marriott International provide insights into critical factors that enabled their companies to make progress in gender balance in senior leadership.
Novartis, J&J, Marriott and Sodexo have made significant progress in increasing women representation in senior leadership. Four years ago, these four companies, on average, had 13% and 6% more women in levels 2 and 3, respectively (one and two levels below CEO and direct reports), than the Top 50. Now, they have 25% and 36% more women in those levels than the Top 50.
This panel discussion from the 2017 DiversityInc Top 50 Learning Sessions will give you insights into critical factors that enabled these companies to make progress in gender balance in senior leadership.
• Caryn Parlavecchio, Head of HR and US Country Head HR, Novartis Pharmaceuticals Corporation
• Wanda Hope, Chief Diversity Officer, Johnson & Johnson
• Marisa Milton, Regional VP Human Resources, Marriott International
• Moderator: Sandy Harris, Vice President, Global Diversity & Inclusion, Sodexo
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