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Taking the Angst Out of Workplace Racial Diversity and Inclusion

A Black Guy, a White Guy, and a White Woman Walk Into a Bar…

Well, not exactly. They met while working at a startup, Linden Labs—a San Francisco–based internet company best known as the creator of the 3D virtual world, Second Life. Together this trio cofounded Truss, a software development company, in 2011. The Black guy, Everett Harper, is Truss’s chief executive officer; the White guy, Mark Ferlatte, is the company’s chief technology officer; and the White woman, Jen Leech, is the chief operating officer. Go to Truss’s website, and you’ll see racial diversity in action. Click on “Meet the Team,” and you’ll see a photo and bio of every single member of their 40-plus team. Click on “Jobs,” and the first thing you’ll see are the words “In search of an inclusive and transparent workplace culture that encourages you to be your best self.”

This includes Truss consciously deciding that its compensation strategy would be both transparent and simple. Why? “The reason why we conducted salary transparency was a diversity issue,” says CEO Everett Harper. “We knew women and people of color in the tech industry were being paid less for the same job. People like Erica Baker at Google and a couple of others had privately gathered data and exposed the pay disparities. So we said, “How can we solve this problem?”

“A big part of the work was testing our assumptions and asking folks if they would have a problem if we made salaries public,” says Harper. “Would they leave if we did? Luckily we got overwhelming support.” The next part of the experiment was figuring out the details of pay transparency. Harper and his cofounders knew their experiment would fail if it felt like something they were doing to people versus for people. So they assembled employee committees throughout the company to conduct research, collect salary data, perform leveling, and surface contrary opinions.

Truss CEO Everett Harper and his cofounders knew their experiment would fail if it felt like something they were doing to people versus for people.

Truss kept employees informed throughout the process. “Wash, rinse, repeat,” says Harper,  referring to the communication plan and frequent updates. By the time the company launched pay transparency, it was no big deal.

Take Heart, Fail Well

Did Truss get it completely right the first time? Of course not. Harper is a big believer in experimentation. At the heart of experimentation is making mistakes. Assessing what was and wasn’t working was all part of Truss’ learning and then tweaking the process as they went.

“I’ve been seeking a directive about what I need to do to get it ‘right’ when there is no right way. Explicitly telling folks, ‘you will get this wrong and you need to try anyway,’ is a message that is missing from the conversation right now.” Meghan Donahue, Goodwin Law, Learning & Professional Development Manager

How do you fail well? Experiment. Learn and then implement what you discover during your next round of experiments. Michelle D. Gass who currently serves as the CEO and Director of Kohl’s Corporation said in a July 2021 Bloomberg article that during her tenure at Starbucks “failure was an important part of being a leader.” Gass joined the coffee giant in 1996, when it had about 1,000 stores. By the time she left, in 2013, it was up to about 20,000. “Through that whole time, I always felt like I could make a difference, to have that entrepreneurial mindset,” says Gass. “Not everything worked, and that was OK,” she told Bloomberg. “It was OK to fail. It was encouraged.”

Like Any Other Strategic Priority

Businesses run on this fundamental formula: define your strategy, set specific goals with clear accountabilities, and then tie rewards to successful outcomes. Creating a racially equitable culture is no different. The greatest effectiveness in managing racial diversity comes from viewing it as an ongoing business process integrated into the organization’s core marketplace strategy.

Executive coach Leslie Ashford, referring to her role as head of talent for a global financial services company before she retired, told us, “DEI consultants did a good job explaining the business case, but they didn’t tell you about the difficult and raggedy things you need to know and will encounter. They would do the workshops, but they didn’t dig in to assess where our culture is today and where we are going, and they certainly didn’t look at our policies and practices.”

“Taking a project approach is how we execute and make an impact. Rather than some sort of theoretical framework that’s floating around, we break things down into bite-sized and meaningful actions you can actually bring to completion. Just like any project, we’ll assess and review the impact to the organization. I think that’s the only way that diversity, inclusion, and racial equity will actually get integrated into the business.”  Heather Thomas-McClellan, global head of talent at CFRA Research

Nereida Perez’s DEI career spanned two industries prior to joining the spice company McCormick. Previously, she held positions in engineering and logistics at UPS, Shell, and National Grid. She already knew that business leaders use metrics to determine if they are meeting customer requirements and achieving financial goals. To get funded she had to show that her initiatives would produce measurable results for the company. “At UPS it was ‘I can’t give you funding unless you tell me how much more revenue you’re going to generate, the number of packages you’re going to be able to sell, deliver, or pick up,’” she explains. Perez coined this approach the “UPS perspective” while she was working at the Latin American division of the company. Ever since, she has been applying this measurement rigor to advance her diversity and inclusion work.

When she first arrived at McCormick, of course, there was race work under way; however, the company’s diversity and inclusion strategy was broad. McCormick measured the diversity of its workforce and promotions, but it was not measuring the impact of inclusion on the business performance, such as productivity and profitability.

“In a manufacturing environment like McCormick, if the company is going to provide funding for your initiatives, you must show how they are going to increase productivity, improve retention, or open up new markets,” says Perez.

Who Snuck the “E” Between the “D” and “I”?

We define the “E” in DEI as a measure of how and to what extent “Diversity” and “Inclusion” are embedded into an organization’s business strategy and every business policy and practice. The organization’s “E” perpetually monitors and, as necessary, recalibrates “D” and “I” to stay ahead of potential relapse and continually advance toward an antiracist workplace. “Depending on where your company is in its race work journey, it may be time to reexamine your “E.” Your company may already track diversity metrics that show 55 percent of your workforce is non-White. Those numbers can look impressive. However, it is only when you dig deeper that you find, say, that number plummets to 2 percent at the leadership levels.

You might also find that your company isn’t as racially diverse as you thought. Many companies take a “lumping approach” to diversity metrics. Lumping together broad categories, such as “gender” and “people of color,” can give a false sense of progress. While numerous companies have made inroads in gender diversity by increasing representation of women at all levels, what gets lost is how well women of color—specifically Black, Native American, Hispanic and Pacific Islander—are progressing.

Apply Key Performance Indicators to Diversity and Inclusion

One way to reevaluate your metrics is to take a fresh look at your key performance indicators (KPIs). KPIs are a staple in most large companies to measure revenue, profit margin, and other business objectives. If creating and sustaining a racially diverse and inclusive workplace is one of your company’s objectives, you need KPIs. You also need a baseline. One company taking this approach is MassMutual, which has added a KPI called “diversity in the pipeline.” To measure progress, the people at MassMutual look at diversity by levels in the organization. They further break down diversity by looking at race, gender, ethnicity, age, LGBTQ+, veterans, and individuals with a disability. “We start by creating awareness of the data with business leaders; what the organization looks like today and how diverse the various layers are,” says chief diversity and inclusion officer Lorie Valle-Yañez. “While it is important to have diversity at the top of the organization, you need people in the pipeline.”

When we view workplace racial diversity and inclusion like any other strategic business priority we take the angst out of it. We don’t have to be perfect. We don’t need to have all the answers. Reimagining a racially diverse and inclusive workplace and making it a reality requires collaboration, research, experimentation, and ongoing communication.

What’s one actionable step you can take to begin or continue your race work?

Margaret H. Greenberg and Gina Greenlee are organizational development (OD) professionals who take a business and an asset lens to race and racism in the workplace. Portions of this blog are from their upcoming book, The Business of Race: How to Create and Sustain an Antiracist Workplace and Why It’s Actually Good for Business. To learn more and download a chapter, please visit: https://businessofrace.com/

Engage with the authors in a series of live, 20-minute webinars during the month of September. They will provide an overview of the book, including the business case for racial diversity, and take questions. The event is free but you must register to attend: https://www.eventbrite.com/e/167959873503

To book Gina and Margaret for your next virtual or in-person conference or corporate event, email them at businessofrace@gmail.com

Margaret H. Greenberg is president of The Greenberg Group, a consulting firm founded in 1997 to coach executives and their teams to lead large-scale organizational change. She is recognized by the International Coaching Federation as a Professional Certified Coach. She is also co-author of Profit from the Positive, which has been translated into three languages, and developed into an online certificate program that has trained business leaders in 17 countries. Gina Greenlee is an organizational development, project management, communications, training and educational professional with more than 30 years of experience. She specializes in experiential learning models and stages of readiness for behavioral change. She is trained in Advanced Facilitation by Johns Hopkins University and Johnson & Johnson to motivate demographically diverse populations in widely varied settings. The author of 17 books, Greenlee has been published in The New York Times Magazine and Essence magazine.