The economic case for diversity, equity, and inclusion (DEI) in a company is overwhelming; and by now, has been proven by multiple studies that it positively impacts innovation, overall decision-making, and problem-solving, which contribute to overall financial performance. Diverse teams are more equipped to identify and address the needs of customers from diverse demographics. And, companies that implement DEI initiatives attract and retain more top talent as 67% of job seekers consider diversity an important factor when evaluating job offers.
When making the economic case for DEI, one should do more than simply hire a diverse workforce or replace top leaders with diverse directors and board members. According to the Harvard Business Review, “increasing diversity alone does not, by itself increase effectiveness; what matters is how an organization harnesses diversity, and whether it’s willing to reshape its power structure.” This means that diversity for diversity’s sake does not necessarily improve the economic outcomes for a company, but instead, a company should be looking to weave DEI into the ethos of their culture, take actions, and set goals based on that ethos throughout the entirety of an organization’s structure.
The problem with a lot of companies is that they have initially committed to creating diversity in the workplace but develop “diversity fatigue”, or a feeling of overwhelm and frustration as the work usually takes both a financial and time commitment to start seeing a substantial return on investment (ROI). This phenomenon has particularly resonated three years after George Floyd’s murder when a lot of companies pledged to combat discrimination and systemic oppression within their organizations through an initial commitment to increase their DEI efforts. However, a lot of these companies have since lost steam.
Ultimately, this leads these companies to create a culture where DEI falls by the wayside and becomes a “nice-to-have”, rather than a key component of these companies’ cultures. The sad part is that where companies have originally committed to doing the work to achieve sustainable, equitable, and diverse environments fostering innovation and financial growth, the agenda becomes performative, i.e where their initiatives seem to be motivated only to remain popular amongst their consumers, avoid accusations of discriminatory practices, and/or a way to silence their employees.
First steps toward operationalizing DEI in an authentic way
The first task for creating a sustainable culture for DEI to thrive is the acknowledgment that this work is a marathon, not a race. Therefore, it could take years before an organization can experience or start to notice its ROI. In the meantime, an organization must not get discouraged by failures and mistakes or by the financial or emotional impact along the way.
The whole point of operationalizing DEI is not to save the world. Instead, companies need to rethink their purpose for DEI. The purpose or mission for DEI must be woven into every fabric of the organization’s operations because the leadership and employees know that in order to truly embrace this work, build a culture of support and trust, and thrive in it, it requires an openness to learn and dedication despite the hard work involved. That is the only way to tap into diversity’s true benefits.
A benchmark DEI case study for diversity and belonging best practices: SSA Group
The SSA Group is one of the prime examples of a company that has a sustained commitment to operationalizing DEI. After 12 years, they continue to stick to their original ethos that their employees and the business thrive when there is a true environment of belonging and a culture of inclusion.
Their Introduction Years
In 2011, their leadership came together to consider that if they wanted to implement a substantial change to their organization that would create an authentic culture of belonging, they had to start with a mindset shift. They knew that this work would not happen overnight and that they needed to engage DEI experts to understand the foundational principles of diversity and inclusion (D&I).
They hired consultants who provided some insight and leadership training and they set up a task force that later moved into the HR department to create actions and goals to drive D&I priorities. The daughter of the founder and the company’s Chief Brand Officer, Shannon Fitzgerald was also a major part in driving the cultural change and interacted with the task force on a day-to-day basis. She was their champion for their gender diversity initiatives and Empower(HER), an employee resource group (ERG), was one of their first ERGs that acted as a center of community for female employees and leadership.
In the first four years, they expanded their ERGs to encourage ideas, thought leadership, and business innovation. By 2015, they realized that they needed more support from employees actively engaging in this work; so they created the DICE (Diversity, Inclusion, Community, Engagement) committee. They engaged with employees that had more than a financial reason to be active in this work and also felt there was a human component to ensuring that everyone experiences a sense of belonging at work.
The importance of these first four years is that they educated themselves rather than jumping straight into creating initiatives and goals around D&I when they didn’t have a foundational understanding of the work. They engaged experts and their leadership to have both an emotional and financial interest in the work. They realized that the key in the first stages of operationalizing DEI is listening, not only to their experts but to their employees and their lived experiences. They put metrics in place to anchor their goals and used them to guide changes and adjustments along the way. They also considered the reward of doing the work was not initially going to be a huge return on investment but that they were meeting their goals along the way and that this work will take a time commitment.
Reassessment
Where a lot of companies struggle may be in the beginning stages of operationalizing D&I because they may get discouraged by having to constantly shift their original goals while still not necessarily seeing a substantial financial reward. For SSA Group, because they started with a mindset shift that anticipated the journey and the commitment this work takes, they were able to actively and consistently challenge their original metrics and goals if it did not change the status quo. They learned along the way that they had to stop looking at this work as a fight and rather that they were contributing to a movement.
In 2016, they expanded DICE and changed its meaning to Diversity, Inclusion, Culture, and Equity and added subcommittees. They also started getting feedback from their employees to measure and test their initiatives against employee satisfaction. Through their surveys, SSA Group recognized that there were barriers outside of work, such as worries about finances, family leave, and wellness that prevented employees from pursuing career growth.
Within the next four years, in order to combat these disparities, they expanded several initiatives that pertained to health and wellness, including financial wellness, and focused on gender parity, where they rolled out internal job postings, explored gender composition in the hiring and promotion process, and created paid maternity/paternity leave for up to 12 weeks fully paid.
They realized in their reassessment of their initial goals that they needed more diverse leaders driving this work and term limits for DICE because they wanted fresh perspectives and innovation. They also realized that at this stage they were trying to accomplish a lot through their expansion and had to learn how to prioritize change. Plus, they had to learn that operationalizing diversity, equity, and inclusion (DEI) has to be embedded in the brand of the company, not just in its internal ethos.
Covid and Beyond
2020 was a driver for a lot of companies to want to implement DEI into their culture and make swift changes to their ethos. Given SSA Group was already doing this work, Covid was not so much a catalyst, but a point of reassessment and expansion. The George Floyd murder sparked more conversations, especially for Black employees and leaders to want to speak their minds in a safe space at work, particularly not only around their lived experiences but around their mental and emotional well-being.
SSA Group wanted to create these safe spaces so they worked to expand their ERGs to include: Pride, pertaining to LGBTQIA+ employees, Melevated, targeted to Black and POC employees, and Hispanos USSA, including their Latinx employees. They even took this a step further so people outside of their demographic could learn from their lived experiences, inviting predominantly White and male executives to attend and take part in these ERGs. They also expanded their health and wellness initiatives to teach employees more about self-care. This initiative included investing in Behavioural Essentials, the company that provided their mental health resources, because they believed so much in its accessibility to helpful well-being resources for their employees.
They expanded their DEI initiatives to address diversity disparities with their supplier vendors. They worked with DEI experts to begin increasing their diverse vendors by 25-35% over the next 5-7 years.
They also wanted to expand their recruitment and hiring efforts to become more equitable. In 2022, SSA realized that 60% of their entry-level employees were women of color who weren’t advancing due to a lack of training and growth opportunities. They started with a mentorship program but realized that it may not have been enough for aspiring talent to become proficient in business leadership and financial operations. So, they charged their executives with taking a vested interest in aspiring talent within the company by teaching them business operations and advocating for their professional growth through their newly created Apprenticeship Program.
Where a lot of companies hire diverse candidates to show that they have an initial commitment to diversity and inclusion, these initiatives supported higher retention for diverse employees, saving them over $6000 per new hire that would occur in a revolving door scenario. In 2022, SSA Group’s salary retention rate was 90.67% with more than 27% of employees getting promoted or changing positions.
Present Day
SSA Group continues to commit to DEI and has rebranded their efforts as IDEA + Belonging (Inclusion, Diversity, Equity, and Access + Belonging). IDEA+ Belonging is the conglomerate of all their DEI initiatives and continues to drive their DICE chapters across North America that act as the connecting tissue to drive their efforts. SSA’s DICE chapters and ERGs work together to ensure SSA’s IDEA+ Belonging brand is reflected across all their strategic drivers: belonging, innovation, and sustainability. They continue to monitor their previous lessons learned and measure their goals and initiatives against their actual impact.
They also learned that the money that they invest in their IDEA+ Belonging department ebbs and flows. They acknowledged that operations run their company and DICE is not a revenue-generating department. They continue to drive their initiatives but when PnL (profit and loss) gets tight, they have to reevaluate how they can continue to drive initiatives realistically with the financial constraints. This acknowledgment allows them to continue to stay on track while being realistic about the time and financial commitment that is DEI.
What other companies can learn from SSA Group
Ultimately, companies have to decide that if they are going to commit to implementing DEI into their cultural ethos and operations, they have to view that this work has both a financial and emotional return. The business case is clear but there is a human component to doing this work. If your leadership does not have a vested human interest in this work and wants to genuinely see an authentic cultural shift, it is less likely that your company will have the stamina to want to commit to it over years, even decades.
Plus, if your company’s sole focus on implementing DEI initiatives is just to drive revenue, your company will lose employees. It will essentially reiterate the commodification of diverse demographics and their exploitation; which has been a fabric of the United State’s capitalistic economic structure and culture, more generally. And, your diverse employees will know and feel that the only reason for hiring them is to fill the company checkbox rather than value their perspectives, lived experiences, and merit-based talents.
Companies also have to understand that DEI is not a stagnant, never changing set of goals that continue as your business continues. Just as your business and the needs of your customers expand, so do your employees’ needs. In order to make any real effective change, your goals, metrics, and initiatives have to change and expand as your business does.
Plus, most changes happen incrementally, often after mistakes or failures have occurred. There will be mistakes along the way and companies have to be willing not to shy away from the work once they happen for fear of looking bad to their customers. The reality of operationalizing DEI is getting uncomfortable and being open to continued learning. Engage experts that can help you along the way so that not only do you learn from your failures, you can implement initiatives that support your successes.
