Environmental, Social & Governance Briefs

Creating Diverse and Inclusive Business: The Evolution of Employee Resource Groups

July 30, 2019

This is the first of a two-part blog series on employee networks and inclusion. Stay tuned for the second installment soon.

There are many kinds of employee networks that develop within corporations, either as a corporate (“top-down”) initiative or because employees self-organize (a “bottom-up” initiative). Employee Resource Groups (ERGs) are in the category of what I like to call “activist” networks. This type of corporate network is common for corporations, but is almost always compartmentalized or “siloed” from the rest of the business. So, how do companies integrate employee activism with day-to-day business? The simple answer is—collaboration. But, if companies want to focus on collaboration, they must think bigger about the concept and about how the work of employee activist networks can help guide the culture of the company.

Employee Resource Groups and activism

The definition of activism is: “A doctrine or practice that emphasizes direct vigorous action especially in support of or opposition to one side of a controversial issue.” Whether you’re fighting within the system or outside of it, your stance is just as important and just as powerful. ERGs are a perfect example of this.

ERGs have a long history in the business world. In the ‘60s, the first ERG was initiated at Xerox with the support of the company's CEO, Joseph Wilson. The race riots that started in Detroit and moved up to Rochester, NY prompted him to begin actively implementing integration strategies across the company. Xerox’s National Black Employee Caucus stood for more than just progressive business practice at the time—this group, and Wilson’s determination to push back against racist business practices and systems—is the definition of activism. ERGs were and are a stance against divisive social and cultural practices. They’re safe spaces within a business for marginalized groups of people. Now, most Fortune 500 companies have ERGs:

“A 2011 Mercer report of 64 employers found that the average membership rate for ERGs was approximately 8 percent of the total global employee population ranging from less than 1 percent to over 20 percent, depending on the organization. The Employer Assistance and Resource Network on Disability Inclusion (EARN) indicates that 90 percent of Fortune 500 companies have ERGs.” (Employee Resource Groups: A Strategic Business Resource for Today’s Workplace, Boston College Center for Work & Family).

Unsurprisingly, ERGs often sit under the management of a business’s Diversity and Inclusion function. It makes sense. But the questions I’m now seeing crop up indicate bigger thinking: how do businesses take the perspective and power of ERGs and cross-pollinate? What is the evolution of employee resource groups? How do we take the voices, experiences and knowledge of marginalized groups and share them with other employee networks? How can we maintain the safe space ERGs provide and hold while elevating—across the company—what they offer?

Boldly going where no company has gone before

In 2017, Deloitte decided to disband its ERGs entirely. It ended its women’s network and other affinity groups and began to focus on making inclusion a challenge for everyone.

In the Harvard Business Review, Avivah Wittenberg-Cox notes: “The central idea: It’ll offer all managers—including the white guys who still dominate leadership—the skills to become more inclusive, then hold them accountable for building more-balanced businesses...

“In the end, as Deloitte rightly points out, these networks (ERGs) divide people up into artificial subgroups (which group does a black lesbian join?) and isolate them from the networks of power and influence that are such a key part of how leaders identify and promote people.” 

ERGs are the result of employees organizing to rally against oppressive power structures. Deloitte’s approach is fascinating because it means everyone is challenged to actively collaborate on inclusion (even the “old white guys”). This makes it possible for a diverse workforce to hold true power at a business. And what does cross-company collaboration look like?

“It is a process with associated behaviors that can be taught and developed. It is a process governed by a set of norms and behaviors that maximize individual contribution while leveraging the collective intelligence of everyone involved. It is the way in which a group of people collectively explore ideas to generate solutions that extend beyond the limited vision of a single person.” (Kip Kelly, Creating a Collaborative Organizational Culture, UNC Executive Development, 2014).

If collaboration becomes the point, inclusion has the potential to spread across the organization. And if, unlike Deloitte, a company decides to keep and hold the safe space created by ERGs, there’s still the possibility for collaboration between ERGs and the rest of the employee population. Kip Kelly outlines these three key building blocks for organization-wide collaboration—as you work to bring activism of ERGs to the company, keep these in mind:

1. Trust 

Trust is the foundation of effective collaboration. Amy Edmonston of Harvard Business School says: “Great teams consist of individuals who have learned to trust each other. Over time, they have discovered each other’s strengths and weaknesses, enabling them to play as a coordinated whole.” (Stanley McChrystal, Chris Fussell, Tantum Collins, David Silverman, Team of Teams: New Rules of Engagement for a Complex World, Portfolio Hardcover, 2015)

There are many facets to trust, but vulnerability is the aspect that most affects the collaborative process. Without vulnerability, people will not fully invest themselves or their ideas in collective efforts. In the collaborative process, trust means creating an environment where everyone can openly express concerns, fears, and differences of opinion (i.e., be vulnerable) without fear of rejection, aggression, or retaliation. When vulnerability is threatened, behaviors that stifle creativity and innovation—like self-editing—take over. Furthermore, when people feel disrespected and see their contributions going unrecognized and unvalued, they disengage and look elsewhere for opportunities to contribute. Trust and respect are the bedrock of collaboration and are the key to building a commitment to collective goals.

2. Communication 

There is no collaboration without effective communication. Leaders must communicate why collaboration is important to the organization’s success and must outline the strategy and roadmap for how the organization will work collaboratively. Both employees and leaders must share and build ideas, constructively criticize, and provide feedback.

Effective communication requires a substantial level of self-awareness. Employees must understand their own preferences for how they approach a collaborative situation. They must also understand the communication and collaboration styles that other employees may prefer. It is this awareness that allows employees to recognize different communication and collaboration styles and to leverage them. This heightened level of self-awareness allows individuals to modify their behavior and communication styles, which paves the way for increased engagement. All employees must be taught these communication skills for a collaborative environment to be realized. Everyone in the organization must be on the same page, and this can’t be accomplished if senior leaders are the only ones who have the opportunity to develop these communication skills.

3. Shared Vision and Purpose 

The best way to get employees invested in the collaborative process is to give them an opportunity to contribute to a shared vision and purpose. This is about taking the time to articulate the “why” to everyone involved in the collaborative process on a particular project or initiative. Unfortunately, this can easily get overlooked when managing heavy workloads and deadlines. Instead, it should be prioritized as a necessary investment for increasing individual and team performance and long-term success. Leaders must ensure that all employees understand how their work contributes to the goals of the team and organization and how collaboration will help them meet their goals. When employees understand their broader purpose, they can make more meaningful contributions to their teams.

To this point, in his book Team of Teams, General Stanley McChrystal explains, “Team members tackling complex environments must all grasp the team’s situation and overarching purpose. Only if each of them understands the goal of the mission and strategic context in which it fits can team members evaluate risks on the fly and know how to behave in relation to their teammates.”

Wherever you take your ERGs, take into account that success comes better, faster, and stronger with organizational collaboration. Think big, and think creatively about how you can integrate inclusion. Deloitte is only one example of an innovative way to bring inclusion to everyone, and every company culture is different—do what aligns best with your company values, and never forget the power of employee voices.

This piece was originally published by Realized Worth.