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12 Diversity Practices ofHigh-Performance Organizations
Executive Summary
Strategy Leadership Talent Culture Market
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Peers R esear ch
Technology
Strategy
Leadership
Culture Talent
i4cp Network
Market
Tools
Peers R esear ch
Technology
Strategy
Leadership
Culture Talent
i4cp Network
Market
Tools
About i4cp
i4cp enables high performance in the worlds top companies.
i4cp is the world's largest vendor-free network of corporations focused on building and
sustaining highly productive, high-performance organizations. Through a combination of
peer networking, human capital research, tools and technology, we enable high
performance by:
Revealing what high-performance
organizations are doing differently
Identifying best and next practicesfor all levels of management
Providing the resources to show how
workforce improvements have
bottom-line impact
Over the last 40 years, i4cp research has
revealed the five key human capital
domains that companies leverage to drive
performance. Our members - many of thelargest and most respected companies in
the world across a wide spectrum of
industries - use this research, i4cp's
expertise, tools, technology and vast
network of peers to improve productivity
and drive business results.
Revealing what high-performance
organizations are doing differently
Identifying best and next practicesfor all levels of management
Providing the resources to show how
workforce improvements have
bottom-line impact
Over the last 40 years, i4cp research has
revealed the five key human capital
domains that companies leverage to drive
performance. Our members - many of thelargest and most respected companies in
the world across a wide spectrum of
industries - use this research, i4cp's
expertise, tools, technology and vast
network of peers to improve productivity
and drive business results.
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About the ReportThis report combines the key findings from the Diversity Practices Surveywith excerpts of interviews
conducted with diversity executives to lend additional practitioner perspective. It focuses on the 12
findings identified in the survey that highlight the diversity program practices that differentiate
higher-performing organizations.
The Institute for Corporate Productivity (i4cp) conducted the Diversity Practices Surveyin September
2009 in conjunction with its Diversity Accelerator. A total of 249 respondents participated in the
survey. Full results and interactive data are available on the i4cp website in the Diversity Practices
Survey Portfolio.
About the Market Performance Index (MPI)The MPI is based on self-reported ratings to four questions about a companys current performance
in the areas of revenue growth, market share, profitability and customer satisfaction as they
compare to the companys performance five years ago. The average of these four responses
determines a companys MPI score. Companies are then separated into roughly equal thirds and
listed as higher performers, mid-range performers and lower performers.
The following is a breakdown of respondents by MPI score.
The following is a breakdown of respondents by organization size.
Authors and ContributorsMary Ann Downey Lorrie Lykins
Eric Davis Joe Jamrog
John Gibbons Eric Davis
David Wentworth
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Contents12 Diversity Practices of High-Performance Organizations ....................................................... 0About i4cp ...................................................................................................................................... 1About the Report ............................................................................................................................ 1About the Market Performance Index (MPI) ................................................................................. 1Authors and Contributors .............................................................................................................. 1Contents ......................................................................................................................................... 2Executive Summary ....................................................................................................................... 3
The role of diversity effectiveness .................................................................................... 4Key Findings ................................................................................................................................... 5
1) 1) Higher-performing organizations are more likely to build the business case fordiversity on the need to reflect their customer base and community demographics ..... 5
Demographics ................................................................................................................................ 72) What is your current title? .................................................................................................... 73) What department do you work in? ...................................................................................... 74) Within which sector does your organization primarily work? ............................................ 85) Describe your organizations type of operation: .................................................................. 8
i4cps Diversity Accelerator ........................................................................................................... 9
Use of all results, analysis and findings require explicit permission from i4cp.
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Executive SummaryAs the global economic downturn reached a critical mass, i4cp, working closely with the diversity
professionals that comprise its Diversity Accelerator, fielded a comprehensive survey of
organizational diversity practices. Economic turmoil was forcing some organizations to shift focus
and resources to surviving the recession, lending even greater urgency to the question of what
diversity and inclusion success looks like and what it means in terms of the bottom line. This
impetus lent a keen edge to i4cps focus on the practices of higher market performing organizations.
The business case for diversity has been clearly established in most organizations. Demographic
change and globalization are here to stay. People of divergent races, genders and beliefs are
redefining the workplace as well as the meaning of success. Organizations must be well-studied on
the markets they want access to and the broad talent pools that exist, which not only bring skills to
the table, but provide inlets to those markets.
Though many diversity practices are logically tied to factors such as organization size and global
reach, companies with higher market performance scores noticeably place more emphasis on
specific aspects. By combining analysis of those behaviors with other demographic variables, this
report identifies those practices that link effective diversity initiatives to higher market performance.
The 12 findings from i4cps Diversity Practices Surveyare based on the practices of higher market
performing organizations and those who report greater diversity success. This report details how
these organizations:
1. Are more likely to build the business case for diversity on the need to reflect their customer
base and community demographics
2. Make diversity an important consideration in developing their succession plan
3. Place more importance on framing diversity as a business relevant issue and on creating
accountability
4. Have a more inclusive definition of diversity
5. Are less likely than lower performers to sponsor employee resource groups that are based on
traditional diversity labels or categories
6. Are more likely to specifically budget for diversity initiatives
7. Are more likely to assign responsibility for leading and executing the diversity strategy to the
executive team
8. Place greater emphasis on diversity recruiting and are more likely to concentrate training on
diversity skills
9. Do not attempt to calculate the ROI of their diversity investments
10.Monitor diversity success by looking at both their applicant pools and their ability to retain
once the talent is in the door
11.Are less likely than lower performers to compare diversity metrics against minority
representation in the community
12.Are more likely to conduct an annual CEO review and to tie results to compensation
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To assess areas where market performance and perceived diversity effectiveness cross paths,
respondents were asked, How effective is your organization in leveraging diversity strategies
and initiatives to meet business goals? Twenty-five percent reported that their organization is
highly or very highly effective in this area. Seventeen percent had both high performance
results and highly effective diversity practices, making these 35 organizations of particular
interest when determining best practices. In several instances where market performance
alone shows little differentiation, the addition of this effectiveness result shows a clear
preference among these organizations.
Although mid-range performers were far more likely to identify as highly or very highly effective
at leveraging diversity to meet business goals, this does not mean that leveraging diversity
effectively isnt supportive of higher market performance. Other factors identified in this
report, such as the business case driver, help to explain this finding. After all, a compliance-
based business driver has much different business goals than a talent-based driver; as well as
goals that are easier to achieve and to measure. Although longitudinal tracking is necessary
for verification, its also possible that an effective and long range talent management initiative
like diversity will reap market benefits only after it has matured and evolved.
Many of the practices identified in this report are also dependent on, or related to, other
practices. A business case driver centered on compliance or the presence of a more
integrated talent management function can influence what other structures a higher-
performing organization might need to make their program effective. Several of the key
findings in this report elaborate on those relationships, with the primary goal of highlighting
performance enhancing practices. Some common practices even among higher performers
are not causally related to performance, and these are highlighted as well. Though this
approach doesnt equate to a magic bullet for diversity success, it does create a roadmap to
the interlocking highway of strategies that can be found in higher-performing organizations.
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Key Findings
1)Higher-performing organizations are more likely to build thebusiness case for diversity on the need to reflect their customer
base and community demographics
Companies at all performance levels seem to agree that diversity is integral to their business
strategy. But higher performers are more likely to say diversity is a way to reflect customer
base/community demographics (26%) than are mid-range (12%) and lower performers (10%). And, in
a kind of mirror image, high performers (6%) are less likely than lower performers (18%) to say they
concentrate on diversity because it's the right thing to do or a legal compliance requirement.
Because this question required respondents to make a choice rather than select all that apply, one
can conclude that the results reflect the companies relative priorities rather than an explicit
measure of whether or not they support any number of the statements in the question. As is
consistent with other i4cp survey findings, higher performing and highly effective organizations are
almost always more likely to anchor their efforts in a solid business strategy. While still maintaining
compliance and ethical standards, these organizations surpass those basic needs by implementing
initiatives in a way that contributes to overall organizational success.
Higher performers Mid-range performers Lower performers
To reflect customer base / communitydemographics
It is integral to our business strategy
To attract top talent
To support the organizations cultureand branding efforts
To strengthen relationships with globalpartners and customers
It is a contract requirement withsuppliers, customers or contractors
It is a legal compliance requirement
Its the right thing to do
To enhance public relations / image
Other
2.9%
5.7%
5.7%
5.7%
8.6%
11.4%
11.4%
22.9%
25.7%
6.7%
13.3%
1.7%
1.7%
8.3%
16.7%
16.7%
23.3%
11.7%
7.7%
5.1%
17.9%
17.9%
5.1%
7.7%
5.1%
23.1%
10.3%
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Seeking to reflect customer base and community demographics is a solid business practice among
high performers that demonstrably helps to open talent pools and markets, supporting a host of
other talent and growth goals. The second highest response for high performers, identifying the
business case as integral to the business strategy, was a more generally focused driver selected by
23% of organizations overall and was the top driver for mid and lower-performing organizations.
Attracting top talent and supporting culture and branding are the next highest drivers selected by
higher performers, at 11% each. These drivers also support larger talent management initiatives and
business goals.
To become a member, contact your account
representative or go to
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Demographics
What is your current title?
What department do you work in?
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Within which sector does your organization primarily work?
Describe your organizations type of operation:
Other
Government
Business Services
Health Care
Industrial Manufacturing
Financial Services / Banking
Insurance
Education
Energy & Utilities
Consumer Products Manufacturers
Automotive & Transport
Telecommunications
Food / BeveragesComputers
Pharmaceuticals
Retail
Not For Profit
Membership Organizations
Aerospace & Defense
Chemicals
Construction
Leisure
Media
Real Estate
ElectronicsEnvironmental Services & Equipment
Metals & Mining
Consumer Services
Securit Products & Services 0.4%0.4%
0.8%
0.8%0.8%
1.2%
1.2%
1.2%
1.2%
1.2%
1.2%
1.6%
1.6%
2.0%
2.8%
2.8%2.8%
3.2%
3.2%
4.0%
4.8%
6.0%
6.4%
6.4%
6.8%
6.8%
7.6%
9.6% 11.2%
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i4cps Diversity AcceleratorThis survey is a product of the i4cp Diversity Accelerator group. Formed in April 2009 to focus on the
myriad issues and challenges with which organizations are confronted in approaching diversity, this
group was comprised of representatives from the following organizations:
Amway Deloitte
Federal Reserve Board ING
Pelco TECO Energy
YMCA of Atlanta YMCA of Greater Seattle
Based on the groups initial meetings, which included identification of issues, brainstorming and
individual interviews, a survey instrument was developed to further explore the issues that were
identified.
We at i4cp would like to express our gratitude and appreciation for the individual contributors in the
accelerator group whose dedication to the field of diversity and inclusion made this research project
possible. Their time and expertise have been essential in the production of the initial survey
instrument and in the final analysis of the data that was produced.
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