Best Practices on Effective Utilization of Employee Resource Groups

August 10, 2017 8:17 am

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By Shane Nelson

Since July 19, most of the talk in the D&I space has been about Deloitte’s decision to do away with its employee affinity groups. Many have reached out to DiversityInc to get our thoughts on it. We oppose the decision. We firmly believe that employee resource groups (ERGs) play a critical role in helping companies achieve business objectives. Our article, Analyzing Deloitte’s Plans to Phase Out Business Resource Groups, outlined some benefits that ERGs present to companies including, but not limited to, providing leadership opportunities for members and increasing employee engagement.

In the past few weeks, I’ve read a number of articles that concluded that Deloitte made the right decision. All focused on talent development and how, in general, ERGs have done little to change the racial and gender diversity in senior leadership. In my experience, based on years of sifting through and analyzing D&I data, that’s not the case. The articles also didn’t cover other business objectives that many companies use ERGs for, such as recruitment, branding, community engagement and commerce. In addition, I’ve yet to read an article that acknowledges there could be coexistence between ERGs and inclusion councils.

This article, illustrated with case studies, addresses those areas I think the others missed.

Effective Utilization of ERGs Yields Good Results

ERGs are utilized for myriad business objectives, from increasing recruitment of diverse candidates to career development to commerce. If your company had a particular segment/group that it needed to reach, doesn’t it seem like a prudent move to utilize employees most familiar with that segment/group?

Take CVS for example. In 2016, MinuteClinic launched a first-of-its kind initiative with the Department of Veterans Affairs Palo Alto Health Care System to expand access to high quality and convenient care services for veterans in California. When developing the pilot, CVS consulted a focus group with its VALOR colleague resource group (CRG) members to inform them of the VA Palo Alto launch. The feedback was exceptional and helped to derive service standards and program workflows that would best meet the needs of its veterans. The initiative was so successful that this past April, the company began partnering with the Department of Veterans Affairs in Phoenix to offer a similar service for veterans in that area, which its Valor CRG also consulted on.

General Motors has been a longtime supporter of the United Negro College Fund (UNCF). The company sought to further increase its brand with UNCF and increase funding for underrepresented scholars. GM started by having an ERG executive champion the annual UNCF walk campaign. All of GM’s African Ancestry Network’s (GMAAN) ERG Leadership Board, along with hundreds of ERG members and allies, supported the program. In 2016, GMAAN’s efforts raised $362,809 for underrepresented scholars, a 4.9 percent increase over the prior year, improving GM’s image and brand in the community.

On the commerce side, companies have reported utilizing ERGs for a wide range of objectives, from product development to market testing to product sales. One recent example, courtesy of Comcast NBCUniversal, centers on product development and implementation. The company’s Hispanic ERG, Unidos, partnered with internal development teams to test the Spanish language version of the X1 Voice Remote. The ERG assisted in populating a database of available voice commands, enabling Comcast’s Spanish-dominant customers to easily navigate its X1 set top box guide and find programming in their preferred language. The collaboration resulted in — and continues to be — a huge general market success.

GM challenged its ERGs to contribute to the bottom line by producing business plans that include market outreach. The GMAAN business plan focused on building brand ambassadors and targeting marketplace constituents to help increase vehicles sales among community influencers across GM vehicle brands. ERG members generated more than 950 vehicle referrals and influenced the purchase or lease of nearly 500 GM vehicles, influencing $12.5 million in revenue.

Internally, companies are using ERGs to foster and cultivate talent. Comcast’s ERG Mentorship Program, started in 2012, enhances the professional development initiatives of the ERGs by providing opportunities for one-on-one mentoring relationships with senior leaders. The program’s goals are to provide mentees with direct access to successful and talented senior level mentors; create a mentoring culture; and to recognize, inspire and foster high-potential employees.

The curriculum also offers executive lunch-and-learns; networking events; and business case challenges to help mentees develop their professional presence, business acumen and presentation skills. Comcast reports that the program has provided employees at all levels with significant exposure to senior leadership; more than half of mentors in the program are at the VP level and above. The result: more than half of mentees have been promoted since participating in the program. Participation has enabled overall development and growth of the mentees as future leaders.

Are ERGs and Inclusion Councils Mutually Exclusive?

The answer is no — having ERGs and inclusion councils is not a zero-sum game. There are companies on the Top 50 that have had ERGs and inclusion councils working in tandem for years. A perfect example is EY, No. 1 on the DiversityInc Top 50. EY also ranked on nine specialty lists, including the top spots on the Top Companies for Diversity Councils and the Top Companies for ERGs.

I interviewed EY about this interesting dynamic. The firm reported that its Professional Networks (PNs) began as affinity groups, progressed to resource groups and ultimately evolved into the PNs that exist today. The program is aligned with EY’s business strategy and purpose: “helping to elevate the voices of our people so that they feel a strong sense of belonging, and have the platform to grow and succeed.” Each network is open and inclusive and encourages participation from allies. The networks have three strategic drivers — connecting its people; connecting communities; and connecting with clients to build successful relationships, brands and careers.

Read more about EY’s PNs: EY’s Resource Groups Connect Members With Its Culture, Community and Clients

EY also defined its inclusiveness councils for me. The inclusiveness councils (domestic and abroad) differ from its professional networks. Council members are key influential leaders who are nominated and selected. EY reports that council members represent different parts of the business and functions and include many global leaders who are focused on driving change and progress in their local markets. Council members play an active role in shaping EY’s processes across the organization and help the firm achieve its D&I goals, including the development of high-performing teams, asking better questions, equitable recruitment, retention and sponsorship across all dimensions of diversity.

Read more about EY’s Inclusion Councils: EY’s Global Diversity and Inclusion Committee is Structured to Effectively Tackle Global D&I Challenges

“At EY, we see tremendous value in structuring our business resource and affinity groups around gender, ethnicity, ability and sexual orientation, to name a few. Each network is open and inclusive and encourages ally participation. This continues to elevate the voices of our people and strengthens a sense of belonging,” said Karyn Twaronite, Partner, Global and Americas Diversity & Inclusiveness Officer.

To effectively manage D&I and yield desired results, EY believes it also needs inclusion councils. Twaronite explains, “We have also expanded our efforts to invest in inclusiveness councils around the world. These councils consist of key influential leaders from all areas of our business who help us to further drive our D&I strategy by exploring challenges, elevating best practices and creating more equitable outcomes for all of our people. By investing in both resource groups and councils, we ensure that all differences and perspectives are better heard and leveraged.”

“By investing in both resource groups and councils, we ensure that all differences and perspectives are better heard and leveraged.”

EY, and other companies on the Top 50 and specialty lists, understand that ERGs provide tremendous help in achieving business objectives but also know that ERGs can’t possibly achieve all business objectives. Rather than limit the insights and perspectives it can extract by doing away with its professional networks, EY opened the gates by investing in the professional networks and inclusion councils.

Both have worked together to help the firm tackle some real issues affecting its people. One example of EY’s inclusion council and networks partnering together occurred this past spring when the executive order on Immigration was issued. The firm’s International Cultural Exchange Network (ICEN) received many calls from members about the status of their jobs and families. ICEN elevated the inquiries to the Inclusiveness Advisory Council and the two groups worked together to organize a survey and a meeting that addressed questions and concerns related to immigration challenges. Led by a council member and an ICEN network executive sponsor, along with the participation of the EY Visa & Immigration Team, the Global Mobility team, EY Assist and EY Security, the session provided critical support and covered firm resources available to address issues and concerns.

In this article, we’ve seen a number of ways ERGs can be utilized to achieve valuable outcomes for companies. There are plenty more. Deloitte has created this summer’s buzz with its decision. I don’t work at Deloitte and never have so I don’t know for sure what the catalysts were in the firm reaching this decision. But, I’m very interested to know how its ERG members feel about the decision. It’s possible, but very unlikely, that the majority of its ERG members agreed with the decision. Its women initiative (WIN) has been around for 24 years. The accounting industry once struggled with women representation, much like the tech sector today. They’ve come a long way and are now leaders in work/life initiatives and other strategies to recruit and retain women. Women resource groups have played a critical role in that process. My hunch is Deloitte’s WIN made very significant contributions to the firm. I feel for them and the other groups.

To conclude, below are some recommendations for Deloitte on the objections it received and how they could have been handled differently.

• Millennial employees don’t like demographic pigeonholes. Okay, I get it. I’m a millennial, I’m serious, and I don’t like to be pigeonholed. I explained to one client that it’s all about how the ERGs are communicated and branded to millennials. If a company suggested I join the Black ERG, without communicating its goals, objectives and benefits, I’d probably give them the side eye. But if it’s communicated that the Black ERG is utilized to help the company recruit, develop and retain a higher percentage of Blacks and further penetrate the Black consumer market (if a B2C), then I’d be very interested in joining.
• White men want to be included. That’s great; they should be and it isn’t difficult to get them involved. Companies like GM do a terrific job with engaging their white male executives. The company’s Black, Chinese, Hispanic, LGBT, Native American and Vietnamese ERGs are all chaired by white men. On the How to Encourage White Men to Push for Change webinar, GM’s Global CDO Ken Barrett detailed how the company is successful in doing so. Barrett notes that it doesn’t have to be a heavy lift and gives recommendations on getting started:
• Start the dialogue – listen to find commonalties to make a connection; search for alignment.
• Start small – you don’t need to head up a D&I event. Get involved, share brief remarks, become an ally.
• Set up quick wins – praise advocates for their efforts, no matter how small.
• Create a diverse friendly environment.
• Lead – don’t be afraid to ask questions.