Is Deloitte’s New Diversity Strategy a Good Idea?

When most organizations tackle diversity issues, they do so by creating programs to recruit minorities, including women, members of the LGBT community, and visible minorities. To date, these programs have changed the workforce but they have not yet created organizations where executive teams and boards of directors are not primarily White and male. In fact, despite small gains, at the executive level, minorities continue to show few signs of gaining ground in most organizations. On this basis, Deloitte is now trying a radical new approach.

Deloitte’s New Diversity Strategy will Focus on Retraining Existing Leaders

Deepa Purushothaman, who is the national director of Deloitte’s soon-to-be-abandoned women’s employee resource group (ERG), explains, “A lot of our leaders are still older white men, and they need to be part of the conversation and advocate for women.” In an interview with Bloomberg, Purushothaman further emphasized, “By having everyone in the room, you get more allies, advocates, and sponsors.”

On this basis, Deloitte is now turning its diversity strategy up-side-down and inside-out. As reported in this week’s Harvard Business Review, “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.”

As the HBR article further explains, “This is a reversal from the strategy large companies have been trying for decades: focusing on empowering ‘out groups’ through dedicated networks, known as affinity groups or ERGs. This approach was pioneered in 1970 when Xerox launched the first one, now called the National Black Employees Association.” Today, ERGs are commonplace in companies and tend to target employees of color, LGBTQ employees, and women. The original idea was to support these groups within a predominantly male and White corporate cultures. Indeed, there was hope that these groups would enable minority concerns to be more easily be addressed. To be clear, ERGs have not been a failure, but they are clearly not the only answer, and this is where Deloitte’s new strategy comes in.

Why Deloitte’s Strategy Makes Sense

How to hire a geniusDeloitte’s chief inclusion officer Deb DeHaas is clear about why Deloitte has decided to move from ERGs to its new strategy: “The key to unleashing the power of our diversity is inclusion. To us, inclusion is leadership in action…. It’s everyone’s responsibility, every day and at every level, to create the culture that can make that happen.” And the numbers suggest that leaders, of course, are still mostly male and White. As Avivah Wittenberg-Cox has argued, “The reality is that most female CEOs who get appointed to the top are selected, groomed, and appointed by male leaders. Xerox’s Anne Mulcahy, IBM’s Ginni Rometty, and GM’s Mary Barra are the result of CEOs and companies that had pushed for better gender balance for decades. Google recently gender balanced its top team not because of incremental, organizational diversity efforts but because the CEO, Sundar Pichai, decided to appoint six women and seven men to run the business. Meanwhile, the rest of the tech sector continues to insist that such qualified women are impossible to find. Sad as I am to have to admit it, the future of female leadership in business is still in male hands.”

Critiques of Deloitte’s Approach

Deloitte’s approach may be a logical next step, but it is not without its problems. Before copying Deloitte’s approach, organizations should ask at least four critical questions:

  1. Will training existing leaders to be more inclusive in their hiring and promotion decisions take money out of established leadership and development initiative for minorities and if so, at what cost to minority employees and the organization?
  2. What measures will be put in place to hold leaders accountable if they do not change how they are building their organization’s leadership capacities over time?
  3. What sort of training will be deployed to support the transformation of established leaders and who will deliver it?
  4. Would Deloitte’s new approach to promoting diversity be better adopted as a complement to rather than replacement for established ERGs? If so, how might these two approaches work together?

 

 

August 5, 2017   Updated :August 5, 2017      

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