Chris Goward and Margaret Kett of executive search experts, Tyzack on delivering transformational change via diversity.
Companies gain value from revenues and market share by turning intangible assets such as brands, intellectual property and human capital, into strategic assets. It is the realisation of these intangible assets that the success or failure of the business relies upon. Talent management is another intangible asset which growing in perceived value, must be released. Whilst companies now regularly link talent management to the business, vision and strategy, talent diversity remains an area that should be addressed with greater urgency.
A recent survey, initiated by Fiona Woolf when she was Lord Mayor of London and led by Charlotte Sweeney of Charlotte Sweeney Associates, highlighted that 87 per cent of respondents said that while those at the top of their organisation took diversity and inclusion seriously, 84 per cent claimed that the work undertaken in diversity and inclusion had not affected them personally. Worse still, 85 per cent of respondents believed diversity and inclusion is not being taken seriously by their organisation as a whole. This indicates that senior teams do want to address the diversity agenda but are failing to do so in a way that the whole organisation can relate to.
Boards want to move the diversity agenda forward, yet this is happening at a slow rate of change. One reason for this might be lack of accountability for diversity and inclusion in many organisations, as 70 per cent of respondents said they had no idea who was in charge of the diversity and inclusion agenda and a mere 20 per cent believed there were good measures in place to ensure the initiatives are being deployed throughout the organisation.
Multi-national beverage alcohol organisation, Diageo, which employs almost 30,000 people, has the view that talent is not simply an HR issue but a fundamental business issue. Today, 40% of its Executive Committee and Board members are women. The company has made talent a strategic matter and it invests heavily in the process, irrespective of culture or gender. However, recognising the importance of diversity, at all levels within the company, so the company’s growth lies at the heart of its approach to inclusion.
Talent is one of the six key performance drivers that Diageo focuses on to drive operations in each of its 21 geographic markets. The company champions diversity, believing that it provides sustainable competitive advantage. Appointing Nicola Mendelsohn to the board, for example, was not simply a matter of a box-ticking exercise to satisfy politically-motivated gender quotas for the boardroom. As Vice President, EMEA of Facebook, Ms Mendelsohn has significant experience at the forefront of digital marketing and communications that is of value to Diageo.
Diageo has developed a programme (Plan W) that aims to empower two million women in 17 countries in Asia-Pacific by 2017 through systematic investment in knowledge and skills. Two pilot programmes in India are showing positive results towards this goal.
Having developed a culture that embraces diversity throughout the organisation, being recognised at all levels through to senior leadership, one of Diageo’s human capital objectives is to have at least 30 per cent of senior management positions held by females.
As the focus on diversity increases, it needs to be addressed with sound commercial goals in mind. A board which has a balanced male to female composition does not automatically mean that it demonstrates diversity of thought, and could suffer from group-think. Diversity will only ever benefit an organisation if it has been developed to enhance diverse mind-sets that complement the overall organisation.
With this in mind, diversity and inclusion might be more transformational if they are no longer seen as initiatives but rather embedded into the organisational culture. Positioning them as a key source of competitive advantage that they will become such an ingrained part of corporate life that they are no longer the issues they are today. To help with this, HR professionals need to be trained to deal with the current level of complexity in this area while engaging with leaders at all levels within the business.
Positive legislation is being more readily embraced, such as shared parental leave. It will be very interesting to see if the 8 per cent of men that the government are expecting to take this up comes to fruition. It may well be that there needs to be cultural change at a societal and corporate level for this progressive law to fulfil its objective.
Organisations should actively seek to harness diversity, and to create an inclusive environment where everyone has the opportunity to do their best work. allowing everyone to be who they genuinely are in the work environment this level of authenticity will underpin the notion of diversity and ensure it is embedded in an organisations culture. Only then can it truly deliver the competitive edge brought about through authentic diversity of thought.
This is without doubt one of the most impactful ways of creating transformational change which will elevate most intangible assets within a company, from brand and culture to competitive advantage.