In Part 1 we explored data from the DOL in general and the OFCCP in particular to see what the current EEO/Affirmative Action violation trends are, who is being cited for it (by industry), and what may be the cause of these trends. In Part 2 we looked not at the “justice” of equal employment and affirmative action, nor at scaring companies into compliance by discussing settlements, sanctions, and lost productivity, but at hard data on the substantial positive financial benefits (increased revenues, sales, customer numbers, market share, and profitability) that are a direct result of a diverse and fair (therefore compliant) workplace.
Now that we have this data, it’s time to use it. The whole gist of this series is to create a change in attitude towards EEO/affirmative action compliance from “this is just a bureaucratic annoyance I plan to ignore” to “this forces me to achieve my business goals.” Whether or not you are a federal contractor, we want you to embrace EEO/AAP compliance as a TOOL to monitor a BUSINESS OBJECTIVE.
Today we look at mobilizing your management and staff. Then we will close out the series in Part 4 where we’ll look at the best practices and practical tools for implementing that change.
Who needs to buy in?
First and foremost, make sure that you yourself have bought in. Although I assume that if you’ve read Parts 1 and 2 already and are still reading this, you’re already onboard conceptually. However, you may or may not have committed to making the change. If you have stated to yourself “I loved reading about it, but I simply don’t have time to make it happen,” take a step back…especially if you are not the final decision maker for implementing EEO/AAP/diversity programs! Whether or not you are the final decision maker (“DM”), follow these suggestions to help clarify the purpose of your EEO/AAP/diversity initiatives to those around you and inspire them to support the effort…and start with yourself if necessary. As an aside, companies with support from senior management and executives (most especially the CEO) are the most successful at maintaining these programs.
In addition to DMs, whose consent is needed to implement an initiative in the first place, there are many others who are important for you to identify and engage. Look at those whose duties include job posting procedures, interviews, possible software upgrades (not likely, but possible), recordkeeping in the payroll/HRIS, documentation of certain activities, and internal “branding” to employees, applicants, and possibly the greater populace.
Execs and recruiters are a “given”, as you can gather from the list of duties affected, but hiring managers are often forgotten. This is unfortunate because they are often the individuals on the front line: Their activities make or break an affirmative action program. They’ll need to understand that using HR-approved standard wording for job requisitions, applicant dispositions, and other applicant and employee-tracking documentation can have an effect on the bottom line. They will also need to understand that while any individual headcount fulfillment on its own may not have a major impact, the cumulative effect of consistency will add up quickly to the revenue increases we described in Part 2.
Different stakeholders need to buy in at different times. Some may have influence with the DMs and be engaged before the initiative has been proposed. Others don’t need to know until implementation. In either case, it’s important to get as many people on board as possible.
To recap the “Who”: First, know that you yourself have bought in and committed. Secondly, identify others who will need to buy in for the success of the program. This includes the management that would “okay” the initiative, but also includes recruiters, hiring managers, and others whose actions would affect the success of proceeding.
Once you’ve identified your stakeholders, you must present the evidence. Review the following to help create your strategy:
Was your industry highlighted in Part 1?
Healthcare and Social Assistance, Administration and Waste Management, Wholesale, Professional/Science/Technical Services, and Manufacturing were all industries highlighted for not historically having compliance issues but seeing a recent leap in citations. This is likely due in part to stricter enforcement by the OFCCP, but also to a failure to maintain the AAP practices because there was so little trouble before and no hard data to show why following an AA program was a benefit. If you are in those industries, you may want to go back to Part 1 and print the charts out.
If you’re in Agriculture or Construction, there’s a likely chance that the corporate culture is indifferent to whether practices are outdated or ignored. You will have to determine for yourself bothering to discuss enforcement trends with stakeholders will provide any benefit.
Although useful for you, the HR practitioner, the data from Part 1 will only be useful for stakeholders that have already expressed a concern for diversity or stated that “we should review our hiring processes.” Otherwise, they may become defensive of your company’s current practices or claim that the data “has nothing to do with us.” For these people, skip to “Who wants to make money?” Part 1’s data will be most useful in implementation, showing where a company in your industry should take special care.
“Who wants to make money?”
Many of you reading this are federal contractors and many of you are not. The significant difference between federal contractors and non-contractors when it comes to affirmative action is that contractors are required to document, monitor, and analyze their activities to ensure they are not discriminating. They may also be audited to see that they are following these requirements and taking any corrective actions the analyses may indicate.
If you are not a federal contractor and wish to implement a program to increase diversity, ensure fair pay, and hire the best qualified candidates in a systematic way with a goal of increasing revenue 9% for every 1% increase in diversity within the company, then you will almost certainly document, monitor, and analyze your activities to ensure you are not discriminating. You will also self-audit from time to time to see that you are following your initiative and taking any corrective actions your analyses may indicate.
What’s the difference? There isn’t one. The Fortune 500 companies that are already doing this have embraced the attitude that it is an important, productive business activity. The federal contractors that aren’t doing this are having difficulty seeing it as anything but an encumbrance. Stated in this manner to a stakeholder, however, is likely to put that stakeholder on the defensive.
Using the cheat sheet below, use the data points from Part 2 and apply them to your company’s numbers. You can then present these numbers as possible goals which, along with the practices we will present in Part 4, form a cohesive strategic initiative. If you are a contractor, you may wish to propose this strategy along with the statement, “Plus, this will take care of our AAP requirements,” or “As long as we have to fulfill our AAP requirements, let’s make sure to do it in a way that brings in some additional revenue.”
The Cheat Sheet
Here is the cheat sheet:
- Companies w/ highest racial diversity = 15x sales revenue vs. lowest diversity
- Racial diversity: +1% diversity = ~+9% sales revenue
(up to the % diversity in the relevant population)
- Gender diversity: +1% diversity = ~+3% sales revenue
(up to the % diversity in the relevant population)
- 39% higher customer satisfaction
- 22% greater productivity
- 27% higher profitability
- 22% lower turnover
This may be presented casually to some, or with others you may wish to make a formal presentation: “In order to reach projected goals of an X% rise in productivity, bringing in $Y, I propose we Z.” “Z” being the topic of Part 4, so keep an eye out.
Who’s a Team Player/Leader?
Many people, DMs and otherwise—and certainly hiring managers—want to be “part of the team” that is making waves in an organization. Remember to acknowledge the importance of these stakeholders to the success of the company and that their efforts are appreciated. Do not forget, even after implementation, to document successes and impact and share them with those involved.