Profiles in
DiversityJournal
®
Sharing Workforce Diversity Experiences
U.S. 12.95 U.S.
$$
Volume 5, Number 4 • July/August 2003
Celebrating Over A Decade of Achievement
Fannie Mae’s
Special Section
Supplier Diversity
Maria Johnson A personal interview
The strategies that will make today’s alliances more rewarding, and tomorrow’s even more profitable. Case studies from The Coca-Cola Company, Ford Motor Company, MGM MIRAGE, Xerox Corporation, DaimlerChrysler and more.
P lus ... T he u niversiTy
of
M ichigan r uling : W haT D oes
iT
M ean T o c orPoraTe a Merica ?
®
Diversity Journal Profiles in
Sharing Workforce Diversity Experiences
PUBLISHER / MANAGING EDITOR James R. Rector SENIOR EDITOR Katherine Sandlin
pointofview From the editorial staff of Profiles in Diversity Journal
EDITORIAL CONSULTANT Laurel L. Fumic PRINTING Master Printing ADVISORY BOARD HONORARY CHAIR Steve Miller, former Chairman, President and CEO Shell Oil Company CHAIR Edie Fraser, President Diversity Best Practices VICE CHAIRS Carlton Yearwood, VP Business Diversity Waste Management, Inc. John Sequeira, Diversity Manager Shell People Services May E. Snowden, Chief Diversity Officer Eastman Kodak Toni L. Riccardi, Chief Diversity Officer PricewaterhouseCoopers OVERSEAS CORRESPONDENTS Dr. Myrtha Casanova, President European Institute for Managing Diversity Barcelona Spain Graham Shaw, Director Centre for Diversity and Business London UK LETTERS TO THE EDITOR
Commentaries or questions should be addressed to: Profiles in Diversity Journal, P.O. Box 45605, Cleveland, OH 44145-0605. All correspondence should include author’s full name, address, e-mail and phone number.
DISPLAY ADVERTISING
30095 Persimmon Drive Westlake, OH 44145 Tel: 440.892.0444 FAX: 440.892.0737 profiles@diversityjournal.com
SUBSCRIPTIONS
U.S. $49.95 one year / $89.95 two years; in Canada, add $10 per year for postage. Other foreign orders add $15.00 per year. U.S. funds only. Subscriptions can be ordered at: www.diversityjournal.com or call customer service at 800.573.2867 from 8:00 a.m. to 5:00 p.m. EST.
Profiles in Diversity Journal® is published bi-monthly by Rector, Inc., Principal Office: P.O. Box 45605, Cleveland, OH 44145-0605. James Rector, Publisher, Rector, Inc. All Rights Reserved. The views expressed in this publication are those of the authors and may or may not represent the views of the publisher. Reproduction in whole or in part without written permission is prohibited. Registered in U.S. Patent Office.
Using our Leverage In the five years we’ve been producing Profiles in Diversity Journal, we’ve yet to see an issue that more clearly illustrates the power of corporations to leverage diversity: to give voice to an ideal, to give assistance to minority businesses, or to prepare the new leaders of tomorrow. Our Special Section on supplier diversity is a case in point. Essentially, the supplier diversity process, especially the second-tier supplier diversity model, is an exercise in leveraging diversity. Using your buying power to help minority- and women-owned businesses grow is a time-consuming and labor-intensive process, to be sure, but as you will read in the articles in this issue, the returns are spectacular. From DaimlerChrysler Corporation, the industry innovator now celebrating twenty years of minority sourcing, to the MGM MIRAGE effort so new their management considers their program “still on training wheels,” these corporations are committed to using these programs—their leverage—to advance diversity both inside and outside of their organization. Our stories on the Supreme Court’s University of Michigan rulings are yet another. Corporate involvement in this landmark argument for affirmative action through the “Fortune 500” brief heightened the court’s awareness of the far-reaching consequences their decision would have on the future of business. Within the signing corporations, employee awareness of the true commitment of their organization to diversity was increased, as well. In our piece “Friends of the Court,” Allen Boston, Director of Ernst & Young’s Office of Minority Recruitment, says “it’s important that firms that talk about having inclusive environments, and that talk about providing and fostering fairness and equity, take these stands firmly demonstrating the importance of such a decision ... I don’t believe corporate America could have remained silent on this issue if we consider diversity part of our overall business strategy.” We do. Thanks largely to those that work untiringly to champion diversity within our organizations, we keep our goals in sight and develop new ways to achieve them. People like Maria Johnson, Fannie Mae’s Vice President of Diversity, Health and Worklife and the subject of our cover story, and ChevronTexaco’s Carole Young, the subject of our first “PDJ Profiles,” are prime examples of the personal commitments that help bring about change in an organization—in effect, the “personal” leverage that moves our organizations forward. We believe this issue will leave you feeling empowered to leverage your own change. When it does, we’d like to be a partner in your celebration.
James R. Rector Publisher
ISSN 1537-2102 1-800-573-2867 www.diversityjournal.com
Profiles in Diversity Journal
•
July/August 2003
Katherine Sandlin Senior Editor page 3
What’ s possible when 70,000 people with diverse cultural, national, and family backgrounds, skills and life experiences work together toward one common vision?
Anything. Sharon Larkin, mother of two active boys and Divisional Vice President of Human Resources.
Abbott Laboratories. www.abbott.com
Volume 5, Number 4 • July/August 2003
Supplier Diversity
A Special Feature The strategies that will make today’s alliances more rewarding, and tomorrow’s even more profitable. DaimlerChrysler
Twenty Years of Minority Supplier Leadership . .11 Since the inception of its program in 1983, DaimlerChrysler has sourced over $21 billion with minority suppliers. MGM MIRAGE
Focus on the Business Case . . . . . . . . . . . . . . . . .14 MGM MIRAGE takes aggressive steps to advance their new supplier diversity initiative.
contents
Raising The Bar
Corporate and Non-Profit Perspectives Fannie Mae
Agent of Change . . .6 An interview with Vice President of Diversity, Health and Worklife Maria L. Johnson on more than a decade of accomplishment at Fannie Mae and her vision for its future. Syncrude Canada Ltd.
Refining Leadership . . . . . . . . . . . . . . . . . . . . . . . .26
The Coca-Cola Company
Part of the Big Picture . . . . . . . . . . . . . . . . . . . . . .18 Coke’s commitment to be a model corporate citizen in the communities it serves is well represented by its extensive supplier diversity program. Xerox Corporation
Outside the Box . . . . . . . . . . . . . . . . . . . . . . . . . . .20 Xerox makes a departure from the traditional business model to make minority suppliers visible participating partners. Ford Motor Company
Empowering the Community . . . . . . . . . . . . . . . . .22 Ford’s comprehensive plan of continuing support and education to minority suppliers builds trust and loyalty just as certainly as it builds and sustains communities. Starwood Hotels & Resorts Worldwide, Inc.
Harnessing the New Tools . . . . . . . . . . . . . . . . . . .24 Starwood launched its MBE program last month with an online vendor registration and database. The MWBE Directory
Point. Click. Connect. . . . . . . . . . . . . . . . . . . . . . . .25 MWBEs find a new website the ideal place to advertise, network and connect with purchasing corporations.
Syncrude’s Leadership Excellence Process and LeaderShip newsletter promote employee growth and improve company culture. Ernst & Young LLP
Friends of the Court . . . . . . . . . . . . . . . . . . . . . . . .35 Sixty-nine corporations filed an amicus brief in support of the University of Michigan’s admission policies. Why Ernst & Young felt it was the right thing—and the only thing—to do. Deloitte & Touche
Betting on a Sure Thing . . . . . . . . . . . . . . . . . . . . .44 To better reach the under-served Indian Gaming market, Deloitte & Touch brought in “a ringer” in Gjrjle Dunlap.
The Changing Landscape Simmons Associates, Inc.
Ten Red Flags in a Diversity Initiative . . . . . . . . . 42 Ready ... FIRE ... aim! Starting the diversity initiative before the business case and strategy have been completed can be a monumental waste of time and money. Spencer Stuart
The Recession-Proof Program . . . . . . . . . . . . . . 46 Why your diversity initiative must—and will—survive this economy.
Legal Briefings
PDJ Profiles
Highlighting Diversity Leaders of Distinction
Holland & Knight LLP
Affirmative Reaction? . . . . . . . . . . . . . . . . . . . . . . 32 The Supreme Court’s University of Michigan decisions reinforce diversity in education and corporate America; however, corporations and colleges must be careful, cautious and counseled.
ChevronTexaco
Carole A. Young . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 ChevronTexaco’s General Manager of Global Diversity on the development and maintenance of inclusive organizations.
Patton Boggs LLP
Brave New Diverse World . . . . . . . . . . . . . . . . . . 39 History may show the debate outside the courtroom was more important than the Supreme Court’s actual decision. How this debate deepens the need for a comprehensive corporate diversity strategy.
Hear & There
Diversity in the News
Georgia Tech Named #1 Producer of African-American Engineers . . . . . . . . . . . . . . . . . . . . . .49 October 15 Designated Disability Mentoring Day
1-800-573-2867 www.diversityjournal.com
Profiles in Diversity Journal
•
July/August 2003
. . . . . . .50 page 5
Raising The Bar
Fannie Mae
AGENT OF CHANGE
CELEBRATING OVER A DECADE OF ACCOMPLISHMENT WITH FANNIE MAE’S VICE PRESIDENT OF DIVERSITY, HEALTH AND WORKLIFE MARIA L. JOHNSON .
Photos by Gabrielle D. Barry
In his commencement address at the University of Maryland last May, Fannie Mae Chairman and CEO Franklin D. Raines illustrated the power of each individual as an agent of change through the story of Archimedes, the ancient Greek mathematician and inventor.
increasing the diversity of the workforce and creating programs to foster an environment that allows those employees to develop their careers as far as their talents and skills will take them.
“Archimedes was amazed by the power of a simple new invention that had emerged in his day,” he said. “It was called the lever. With this tool, he declared, ‘Give me but one firm spot on which to stand, and I will move the earth.’”
Fannie Mae prizes its company’s diversity and is consistently ranked among America’s most diverse workplaces, as one of the best places to work. While the company’s efforts have made it what many consider a model organization, neither Johnson nor Raines have ever considered their work accomplished.
Maria Johnson has found her spot to stand, and she has found the position with which she can make the most change. For the past 11 years, she has championed the diversity of Fannie Mae inside and outside of the organization. With the full support of this Chairman and CEO, Maria has untiringly embraced the task of ever
“Companies cannot assume that because they have arrived at the status of a leader in diversity best practices that it is the end all, be all,” says Johnson of their success. “Companies must constantly assess their overall corporate objectives and link their diversity strategy to these business objectives. A big focus of
page 6
Profiles in Diversity Journal
•
July/August 2003
Fannie Mae’s strategy is not to lose the momentum around what we have achieved over the last 11 years in the diversity arena. “I firmly believe that unwavering commitment from the top and financial resources are critical to the success of any diversity initiative. Companies must fund diversity initiatives as a business objective and not view it as a human resource ‘program.’ Fannie Mae was visionary when we implemented our diversity program 11 years ago. The resources and support from senior management that this program benefits from have a direct link to the long-term success of the program, and the culture as well. “Diversity is imperative to our overall mission,” says Raines. “Our mission is to bend the financial system to give every family in America—rich or poor, white or minority—a 1-800-573-2867 www.diversityjournal.com
Fannie Mae Agent of Change: Maria L. Johnson better chance to share in the American Dream of homeownership. “In a nation that is growing more diverse by the day, employers that prize diversity enjoy a distinct competitive advantage. In order to succeed in a diverse economy, our companies need a diverse set of eyes, ears, experiences and expertise to help us see the new markets, know how to serve them, and break down the barriers along the way.” Johnson brought a diversity of experiences with her to this position. Before joining Fannie Mae in 1992, she was the Presidential-appointed vice chair of the U.S. Merit Systems Protection Board—a federal labor adjudicatory agency—a position she had held since 1983. In 1990, she was appointed to design and serve as the first chief administrative judge for the District of Columbia’s Office of Employee Appeals Temporary Appeals Panel. A graduate of Howard University, she received her law degree from Georgetown University Law Center. Johnson was a commissioned officer in the U.S. Navy Reserve Judge Advocate General’s Corps for 15 years, and was admitted to practice before the U.S. Supreme Court and the U.S. District Court for the District of Columbia. Five years ago, when Profiles in Diversity Journal was struggling to get off the ground, we were lucky enough to find our first heart-felt supporter in Fannie Mae’s Maria Johnson. We can tell you from experience that her vision and enthusiasm are infectious. She is one of the rare people that have found they really can move the earth. We’re delighted to be able to share with you our opportunity to speak with her about the issues that impact her work, her corporation—and corporate America as well. 1-800-573-2867 www.diversityjournal.com
PDJ: Fannie Mae implemented its diversity program eleven years ago and now appears on every award and ranking from Fortune to Working Mother. What can Fannie Mae do or what is Fannie Mae doing to sustain its leadership in diversity with corporate America? JOHNSON: The biggest challenge for any company that has a successful diversity track record is complacency. I believe that successes of long-standing diversity initiatives like ours could roll back in short order if there were not meticulous attention to not losing ground and to maintaining a sense of urgency. Bigotry and hate are not traits that babies are born with. These are traits that are taught by the parents to the child. Most people spend the majority of the day in the work environment and that is where the lessons of tolerance and fairness have to be reinforced on a daily basis. That is the only way to break the cycle of ignorance and distrust that is the foundation of discrimination. PDJ: I’ve heard you say that resources and budget are key to successful diversity programs. How would you convince other corporations that the key to successful implemention of a diversity program is to ensure buy-in from the top down? JOHNSON: You can have a generous budget and generous head counts for diversity initiatives, but if it is not a passion of your CEO, and if it is not driven hard and consistently, then you’re not going to have a successful program—I don’t care how much money you pour into it. The flip side of that is that there is no bargain basement deal here. If this is not viewed as a corporate business initiative instead of an HR initiative, and if it is not adequately funded and adequately staffed, you’re going to get what you pay for. Profiles in Diversity Journal
•
July/August 2003
Too often companies will try to bury new diversity initiatives several layers of management removed from the CEO. Most of the companies that have had the greatest successes have had officer-level, independent departments, usually starting outside of their Human Resources department as direct reports to the Chairman’s office. PDJ: Franklin Raines was the first AfricanAmerican CEO of a Fortune 500 company. How do you feel his vision and leadership has influenced diversity at Fannie Mae? JOHNSON: Frank Raines was our Vice Chairman when the program started in ‘92. Now that he is our Chairman, he has made it possible for us to take it to another level. Not only is he a personal role model because of his own accomplishments, but he is very much the spirit that continues to move us to the next level. PDJ: Fannie Mae has a lot of programs that most companies don’t offer: family leave, mentoring programs, employer assisted housing (EAH), forward prepayment of college tuition, etc. Do you find that these programs have an impact on retention and on recruitment? JOHNSON: Oh, absolutely. As in any company, you have to see some kind of results from your investments and we know beyond a doubt that our programs are significant tools in our recruitment efforts and in our high retention rates. Many diversity and work-life initiatives originally start in companies to make the workplace more family-friendly for women. What we found out years ago was that men take advantage of our programs with as much frequency as women do. Our CEO, Frank Raines, even took paternity leave when his last daughter was born. page 7
Agent of Change: Maria L. Johnson
Fannie Mae
PDJ: What is Fannie Mae’s EPS tool and why is it significant to your diversity initiatives? JOHNSON: I consider the Employee Perspective Survey (EPS) a crucial element in the continuing success of our diversity initiatives and our employer of choice status. We combined our diversity health assessment with our employee perspective survey years ago. It is the responsibility of my office to oversee this function. We have an extremely high participation rate— 89 percent of our employees took part in our last survey. Every senior officer has to share the results with their employees and execute action plans to address areas that need attention. We also conduct minifollow-up surveys to see what progress the divisions have made against their goals. Updates on progress made on divisional action plans are periodically reviewed by our senior management. Our employee
perspective survey provides us with candid and confidential feedback from our employees. Employees feel that we listen to them.
PDJ: Franklin Raines has said on a number of occasions that his goal is for Fannie Mae to look like America. What does that mean to you?
PDJ: Fannie Mae was just recognized in Working Mother magazine’s first annual best companies for women of color. How do you think Fannie Mae’s diversity programs support women of color?
JOHNSON: The “Look Like America” goal was put in place when we started our diversity initiatives in 1992. Most companies used relevant labor force numbers to determine whether they’ve met their EEO goals. We decided from the beginning to set a far more aggressive standard for ourselves and use the census figures for general population numbers as opposed to relevant labor force.
JOHNSON: If you have consistently applied corporate policies that create a level playing field there is no way, if you’re doing it right, that you’re not going to get a pool of highly qualified minority women who are going to be able to be competitive at the highest levels of the organization. We’ve proven that over and over again. The number of women of color at the officer and director ranks of Fannie Mae is one of the highest in corporate America.
OVER A DECADE OF ACCOMPLISHMENT
Fannie Mae Chairman and CEO Franklin D. Raines
Fannie Mae’s dedication to diversity has been lauded by a number of organizations over the years, including: Executive Leadership Excellence in Diversity Savoy Professional 50 Best Companies for Minorities (#1 in 2002) Fortune Best Companies for Women of Color Working Mother Workplace Model of Excellence National Healthy Mothers, Healthy Babies Coalition Best Places to Work in IT Computerworld Top Companies for Diversity 2002 DiversityInc.com Hispanic Corporate 100 Hispanic 100 Best Companies to Work For in America Fortune Top 30 Companies for Executive Women National Association for Female Executives page 8
Company of the Year in “50 Best Companies for Latinas to Work for in the U.S.” LatinaStyle
Corporate Conscience Award—Diversity The Center for Responsibility in Business
Employers of Choice 500 Employment Review/BestJobsUSA.com
Best Companies for Minorities and Women Business Women’s Network and Diversity Best Practices
Fatherhood Award National Fatherhood Institute
Top Ten Companies for Asian Pacific Americans Fortune and Asian Enterprise
Most Minority-Friendly Company and The Company You’d Most Want to Work For Washington Business Forward
100 Best Corporate Citizens Business Ethics
Salute to Greatness Award presented to Fannie Mae The King Center
Corporate Conscience Award Council on Economic Priorities
Catalyst Award: Embracing Diversity to Foster Long-Term Success Catalyst Top Companies for Minority MBAs Minority MBA Profiles in Diversity Journal
•
Best Practices in Corporate Supplier Diversity Women’s Business Enterprise National Council
July/August 2003
Women in Power: A Score Card Business Week Zero Tolerance Policy Towards Discrimination and Good Workplace The Advocate 1-800-573-2867 www.diversityjournal.com
Fannie Mae Agent of Change: Maria L. Johnson The relevant labor force for somebody in Fannie Mae’s management group would typically be someone with a graduate degree. As an example from your previous question, if you take the number of women of color in the United States who have
PDJ: Can you share your opinion on the recent court rulings at the University of Michigan?
WOMEN AT WORK
JOHNSON: While it was a step in the right direction, it did not go far enough to address the real-life issues that are happening in the real world. The playing field is still very far from being equal. What concerns me is the notion that in twentyfive years there will no longer be a need for affirmative action. This is troubling because America has been grappling with the race issue for hundreds of years and we are just beginning to make incremental progress. Having fair and equal access to a quality education is a critical element needed for minorities in America to create a true color-blind society. PDJ: How prevalent are issues involving sexual orientation and gender identity in corporate America? JOHNSON: I can’t speak for the rest of corporate America, but at Fannie Mae, we addressed those issues many, many years ago. In 1994 we were one of the first companies to offer same sex benefits to our 1-800-573-2867 www.diversityjournal.com
“If you have consistently applied corporate policies that create a level playing field there is no way, if you’re doing it right, that you’re not going to get a pool of highly qualified minority women who are going to be able to be competitive at the highest levels of the organization. We’ve proven that over and over again.”
Photos by Gabrielle D. Barry
graduate degrees, it’s far less than the general population of women of color. However, the standard that we hold ourselves to is the much higher general population. Our recruiting strategies, mentoring programs and education programs all help us achieve our goals. We have reaped the benefits of our multifaceted strategy many, many times over.
employees. We have an actively involved employee networking group of gay and lesbian employees who are members of our Diversity Advisory Council. At Fannie Mae it violates our Code of
Conduct for any employee to be treated differently on any basis, including race, gender or sexual orientation. PDJ: One item that has recently made its way into diversity discussions is the subject of national security. Do you think the effective development of diversity in this society is an issue of national security? JOHNSON: America is a microcosm of the world. The ability to be in an environment where diversity is respected and allowed to flourish enhances national security because it gives us a better understanding of the peoples and cultures of the world. America’s armed forces are the most diverse organizations in this country. Our military is a perfect example to show that understanding and respecting diversity adds to our strength, not to our weaknesses. It’s only when we don’t understand and don’t learn from the lessons of working in a diverse environment that we run into problems.
Profiles in Diversity Journal
•
July/August 2003
PDJ: There have been quite a few studies which show that diversity does have a direct link to the financial bottom line. Why you think that is and what can companies do to ensure that the two work in a symbiotic relationship? JOHNSON: Most companies operate on very slim profit margins. There is a saturation point to any product if you only sell to your current markets. Markets that have been underserved and markets that have been ignored by advertisers or retailers or sellers of business services are the growth areas. When you look at population trends, birth rates, immigration patterns and the global economy, it doesn’t take a rocket scientist to figure out that every customer you add to your base that did not exist before will ultimately make the difference between economic PDJ success or failure. For more information about diversity at Fannie Mae, visit their website at www.fanniemae.com, or contact Gabrielle Barry, Media Relations Manager, at gabrielle_d_barry@fanniemae.com page 9
©2002 ChevronTexaco Corporation. ChevronTexaco is a trademark of ChevronTexaco Corporation.
Creating an even better world. Bring together people from over 180 countries with different backgrounds and it’s amazing what you’ll find. New ideas. Innovative solutions. And an ongoing commitment to build a better company in a better world.
chevrontexaco.com
supplier Diversity
DaimlerChrysler
twenty years of minority supplier
leadership since the inception of its program in 1983 Daimlerchrysler has sourceD over $21 billion with minority suppliers.
t
Jethro Joseph Senior Manager, Diversity Supplier Development
here wasn’t much attention paid to diversity as a corporate initiative when DaimlerChrysler formed their supplier diversity program in 1983. Two decades later, diversity programs and minority supplier programs have become central to the success of corporations in every industry.
DaimlerChrysler remains an industry innovator in developing diverse supplier business opportunities and programs, and the automotive industry leader in percent of total purchases from minority-owned suppliers. Last year about 11 percent of Chrysler Group’s $28 billion purchasing dollars were spent with minority-owned businesses. “We lead the automotive industry in the percentage of purchases from minority businesses,” says Jethro Joseph, Senior Manager of Diversity Supplier Development. “Our goal for 2003 is to increase our minority purchases.” Mr. Joseph leads the Chrysler Group’s supplier diversity program. The company has sourced over $21 billion with minority suppliers since the inception of the supplier diversity 1-800-573-2867 www.diversityjournal.com
program. A few of the innovative initiatives developed by the Chrysler Group to enhance the supplier diversity program are a major Matchmaker Event, Project ONE and the significant supplier diversity content on its vehicles.
minority-owned firms. Matchmaker also makes it possible for matched companies to partner and share across-the-board cost-saving ideas.
matchmaker event Chrysler Group’s successful “Matchmaker” partnership program helps create partnerships between majority- and minority-owned suppliers, increasing business opportunities among the companies. Hosted by Chrysler Group’s Diversity Supplier Development Group, the annual event takes place in September at DaimlerChrysler’s headquarters in Auburn Hills, Michigan. The Matchmaker Event facilitates growth among suppliers in complementing areas of business and generates new business relationships. The 2003 Matchmaker will feature 200 diverse companies available to do business with more than 1,600 other Chrysler Group suppliers.Since the event’s inception, over $50 million in new business opportunities has been generated for the
Profiles in Diversity Journal
•
July/August 2003
Jethro Joseph “The Matchmaker Event benefits both Tier One and diversity suppliers,” states Joseph. “It provides an opportunity for minorityowned companies to meet and develop relationships with Chrysler Group Tier One suppliers, and it helps Tier One suppliers page 11
Daimlerchrysler: twenty years of leadership supplier Diversity
chrysler group’s commitment to minority sourcing 2003 Dodge ram—$200 million 2003 Dodge Ram is pure delight to driving enthusiasts, and also provides powerful proof of Chrysler Group’s commitment to minority suppliers. Approximately $200 million was sourced to minority suppliers for vehicle development, manufacturing and logistical support.
maintain the Chrysler Group mandate of 6.5 percent minority supplier content. Our goal for this year’s Matchmaker is to generate a minimum of $30 million in new opportunities for minority businesses.”
project one
Stampings
oem/erie
Injection Molding Parts
vitec corporation
Fuel Tanks
prime wheel
bates acquisition
Wheels
Vacuum Harnesses
National Minority Supplier Development Council. The assessment is a descriptive tool that allows corporations to identify the not-so-obvious areas within their supplier diversity program or business case where improvements can be made.
DaimlerChrysler provided strategic leadership and vision for the Michigan Minority Business Development Council’s (MMBDC’s) Project ONE in 2002. The business strategy aligns corporations and minority businesses in a team setting, based In 2002, the DCX-led team exceeded their on smart “matchmaking” of their business goal of $25 million dollars in purchases by needs, expectations, and requirements. achieving over $40 million with Project ONE minority business enterprises. Six of the seven corporations selected to Team members such as The Ideal Group, participate (85 percent), and 10 of 13 minority business enterprises (77 percent), Dumas Concepts, Bayview Electric, Devon Industrial Group, and Gala & graduated from the program as one of the Associates realized significant referrals and pilot groups used to help the MMBDC business contracts. establish its Supplier Diversity Assessment and Checklist, a first among the 39 Purchasing Councils in association with the
awarded for supplier Diversity corporation of the year, michigan minority business Development council, 2000, 2001, 2002 corporation of the year, national minority supplier Development council, 2000 leadership award, national minority supplier Development council, 2003 page 12
flex-n-gate
vehicle success stories The bold look and rugged driving experience of the 2003 Dodge Ram is pure delight to driving enthusiasts, and also provides powerful proof of Chrysler Group’s commitment to minority suppliers. Approximately $200 million was sourced to minority suppliers for vehicle development, manufacturing and logistical support of the 2003 Dodge Ram. Minority supplier participation can be Profiles in Diversity Journal
•
July/August 2003
found all over the Dodge Ram, through companies such as Bates Acquisition (vacuum harnesses), Flex-N-Gate (stampings), Mehra Tube (tubing), OEM/Erie (injection molding parts), and Prime Wheel (wheels). In addition, Vitec Corporation was awarded a $125 million contract to supply fuel tanks for Dodge trucks. The contract is one of the largest ever awarded to a minority supplier by Chrysler Group. Dodge Ram was awarded Motor Trend’s “Truck of the Year” for 2003. Chrysler Group sells approximately 400,000 Dodge Rams every year. At a time when all industries are facing challenging economic times, Chrysler Group is still committed to maintaining a high level of minority supplier sourcing. The Chrysler Group commitment shows that minority suppliers can provide quality goods and services that are costcompetitive and technologically advanced. Chrysler Group will continue its efforts to support and develop minority businesses. For more information about DaimlerChrysler’s Minority Sourcing Initiatives, contact Lisa J. Wicker at 1.248.512.2188. PDJ 1-800-573-2867 www.diversityjournal.com
special Feature: supplier diversity
MGM MIRAGE
mgm mirage takes aggressive steps to advance their new supplier diversity initiative with a
focus on the business case
D
eveloping mutually advantageous business relationships with small businesses and firms that are minority- or women-owned has long been part of the MGM MIRAGE business case. Over the past two years, however, MGM MIRAGE has sharpened its focus through the development of a formal supplier diversity
accomplished a great deal. But these results do not come easily. Purchasing is challenging and we have gained important insights along the way. The successes we have had keep us invigorated and focused.”
initiative. The results have been impressive.
MGM MIRAGE launched their supplier diversity efforts in 2001 with a thorough investigation of their existing supplier base. “We went through what I call our discovery stage,” says Rick Jones, VP of Corporate Purchasing. “We needed to assess where we currently stood, so the first task at hand was to decide what criteria we would use for measurement. After much internal discussion, we decided certification would be the obvious measurement criteria, so we took steps to identify our existing suppliers that were women- or minority-owned, both certified and uncertified.”
The company spent $680 million in 2002, representing goods and services that were available for bid through its purchasing department. Of this, $65 million was spent with certified or accredited women-owned, minority-owned and disadvantaged businesses—nearly 10 percent of the company’s total biddable expenditures. Compared to 5.5 percent the previous year, it is obvious MGM MIRAGE is on to something. “We are pleased with the progress we are making in this area, and we will continue our efforts to diversify our vendor and supplier databases,” says Terry Lanni, Chairman and CEO. “We have page 14
Focusing on the task: internal and external preparation
They began their investigation by organizing and compiling a database of nearly 15,000 vendors with which MGM MIRAGE was currently doing business.
Profiles in Diversity Journal
•
July/August 2003
The company launched an extensive campaign to get information about the minority status of these suppliers. Through mass mailings and telephone interviews, they discovered that the number of qualified minority- and women-owned vendors they were doing business with was reduced significantly when certification was used as the measurement criteria. “We knew by taking this step that we would dramatically reduce the number of minority vendors reported; but in the end, we would have more meaningful data to report,” adds Punam Mathur, VP of Corporate Diversity and Community Affairs. Identifying sources for potential minority vendors fell to a newly-developed supplier development group whose immediate goal was to identify the organizations that would help MGM MIRAGE meet and build relationships with new minority businesses. “As we went through the process and identified the organizations that we have an 1-800-573-2867 www.diversityjournal.com
mgm mirage: Focus on the Business case association with—chambers of commerce, urban leagues, trade shows and organizations—we tapped into a lot of databases for minority business owners,” says Jones. “But getting the list is one thing, getting usable information is another. “That is why creating the company-wide database was so important. You cannot mandate to a buyer, who has an enormous amount of work to do, that they must additionally search a half dozen organizational databases on the off chance they may find a minority supplier for a particular item. So when we developed our own database and recoded all of our vendors, we designed it so we could know if a vendor is a potential “fit” for us before it goes in. The database has been organized by commodity groups that the buyers are familiar with in this particular industry.
vendor and supplier base depends upon their ability to identify greater numbers of qualified minority vendors. In May 2002, the company launched a vendor website, www.mgmmiragediversity.com, that extends accessibility for new and existing vendors to register and receive procurement information. New vendors that offer commodities that the corporation uses become a part of the database. And, as of a month ago, bid opportunities are announced on that site as well. “While our website is a work in progress,” says Mathur, “it is a meaningful tool for vendors. It provides them with an understandable portal to do business with us. In the past, we had heard from vendors that we’re ‘such a Goliath’ that they don’t know how to explore the opportunity available at MGM MIRAGE.”
Making MGM MIRAGE more accessible to vendors led the corporation to partner with the American Gaming Association to plan and produce the first-ever Supplier Diversity Trade Show during the annual G2E Gaming Convention held in September. The single largest gaming show in the United States, G2E brings together all sectors of the gaming industry—including casinos, Indian gaming, lottery and riverboat gambling—for two days in Las Vegas. By hosting a Supplier Diversity trade Rick Jones VP of Corporate Purchasing show during the convention, vendors from around the country were invited “Now it is a much easier task to identify not to examine opportunities within the entire only the potential minority suppliers for a gaming industry and meet one-on-one given commodity, but also the volume of with the organizations of their choice. sales and type of vendor we are using.” Appointments were scheduled online prior to the event.
Broadening the supplier base MGM MIRAGE understands that continuing success in diversifying their 1-800-573-2867 www.diversityjournal.com
supplier diversity
“It really was effective,” says Jones, who spent the two days meeting with vendors, Profiles in Diversity Journal
•
July/August 2003
Punam Mathur VP of Corporate Diversity and Community Affairs “quite productive for us and the vendors as well. We plan to host it again this September.”
educating is required on all sides of the field The next stage of the program centered on the education of MGM MIRAGE’s buyer group in their importance to the diversity equation. “There is obviously a lot more to supplier diversity than finding minority suppliers for the sake of finding them,” says Jones. Last year, the corporation offered several structured educational sessions for the buyers involved with properties throughout North America. “The business case is what we always lead with. In training throughout the corporation, our business case for diversity is a set of values and results of strategies that will allow us to keep a competitive edge. Purchasing people, by their nature, are more analytical than they are creative, and because of that, a lot of the training deals with the business imperatives. By looking at just the economics of the minority business segment, it starts making page 15
supplier diversity mgm mirage: Focus on the Business case more sense to the analytical mind,” says Jones. “There are some very good business reasons to do what we do. And that’s all
emerging market segments, we are better positioned to book that business away from
part of the training.”
the competition and ensure we are the destination of choice for every market. It
“As long as we’re very clear to the business
also ensures we become the employer of choice for the next generation, as well.”
imperative for our diversity—in our vendor, employee and customer basees—then it is easy to understand the structures and positions our systems must take in order for us to achieve our business goals,” adds Mathur. “Our business is about inviting all people to our properties to enjoy our services. As we deliver the invitation, we need to make it clear that we are sincere in all the other aspects of our business. By identifying and developing new business partners that represent members of
To ensure minority suppliers are brought in during the RFP process, policies have been put in place that make the number of minority suppliers sourced the goal, rather than minority suppliers given the bid. The database tracks sourcing efforts, giving management the opportunity to coach buyers when needed.
tier-two process, and structuring our RFPs to include a diversity component for the major manufacturers that we deal with,” says Jones. “We’re going to call upon the businesses with whom we have partnered to take a more active role in mentoring and supporting the newly developing enterprises. We’re going to use our leverage to further our diversity goals.” MGM MIRAGE (NYSE: MGG) owns and operates 14 casino resorts located in Nevada, Mississippi, Michigan and Australia, and has investments in two other casino resorts in Nevada and New Jersey. For further information, contact Shelley Mansholt, VP, Corporate Communications at smansholt@mgmmirage.com.
“One of the things we are focusing more on this year in purchasing is the
supplier success story:
ron Fernandez, silver lining amenities Silver Lining Amenities is one of MGM MIRAGE’s favorite success stories. A growing amenities company based in Los Angeles, its owner, Ron Fernandez, has found his own “Silver Lining” in soaps, shampoos, and other personal items found in hotel guest rooms. Recently he has expanded his business to include a company-wide contract for guestroom pens and casino slot buckets and is the source for porcelain for many of their properties.
“Everyone goes to Las Vegas looking for an exceptional experience. The goal of Silver Lining is to offer the hotel guest more than they expect. Often common amenities are just that—common. We work to create the ‘silver lined’ environment. When the guest takes home that little bottle of shampoo, we want them to know they’ve taken home something special. “My background was in the packaging and page 16
cosmetics business. Just starting out, I spent a year and a half researching the use of these products in the Las Vegas market. Five years ago, I was coldcalling different properties, literally knocking on doors, when the Mirage allowed us to bid on the amenities for their property. We had the wherewithal, we had done our homework and, most importantly, we listened to them. We listened to what they wanted and to what they felt were the shortcomings of their current supplier. In the end, I think that’s what really made the difference. “We worked hard, and developed a good relationship with that property. In 2002, we were invited to be among the suppliers to vie for an amenities contract for MGM MIRAGE company-wide. At that point, we knew we were doing something right. We were lucky enough to get the bid, and were awarded a three-year contract. I do feel I have to pinch myself on occasion.
Profiles in Diversity Journal
•
July/August 2003
Ron Fernandez Fernandez Ron President of of California-based California-based President Silver Lining Lining Amenities Amenities Silver “The sheer volume of the business that this bid represents has made a tremendous difference in our business. We learned to think a lot smarter, to better use our resources and work more efficiently with our suppliers. “The calling card of the MGM MIRAGE on our resume is an extremely powerful one. We are now doing business with many properties not only in the Las Vegas market, but in other areas. But while it may open the door, the success of our company rests on our capabilities.” PDJ 1-800-573-2867 www.diversityjournal.com
special Feature: supplier diversity
The Coca-Cola Company
coke’s commitment to be a model corporate citizen in the communities they serve is Well represented by their extensive supplier diversity program
part of the
O
big picture
ur approach to Supplier Diversity is simple ... it’s inclusive! Minorities are the fastest-growing segment of the U.S. population, and women make most of the purchasing decisions involving consumer goods, including Coca-Cola products. Including minorities and women as our partners is a business imperative at The Coca-Cola Company. In 2000, Douglas Daft, chairman and chief executive officer of The Coca-Cola Company, reinforced a 20-plus year commitment to supplier diversity for the world’s largest marketer and producer of non-alcoholic beverages. This commitment is directed towards maximizing procurement opportunities for minority- and women-owned businesses by spending $800 million over a five year period. In this regard, our supplier diversity mission is to provide equal access to procurement opportunities for minorityand women-owned business enterprises (MWBEs) and to proactively build
page 18
relationships with and purchase goods and services from these businesses to the maximum extent possible. This mission underscores our long-standing commitment to being a leader in supplier diversity and a model corporate citizen in the communities we serve. In addition, it is in keeping with the Coca-Cola Promise “... to benefit and refresh everyone who is touched by our business.” Since 2000, we have made significant progress: • Our spending with MWBEs has increased from less than 2 percent of our total procurement dollars in 2000 to approximately 5 percent in 2002. • Our spending with MWBE suppliers increased to a record $181 million — an increase of 43% in 2001. • We realized a 50 percent increase in purchased goods and services from MWBEs. Some of the contributing factors to our success are: • Visible executive leadership
Profiles in Diversity Journal
•
July/August 2003
• Creation of internal supplier diversity champions and councils • Continuous supplier diversity training • Establishment of specific numerical goals • Extensive outreach activities
Johnnie Booker Director, Supplier Diversity Additionally, in collaboration with Clark Atlanta University, we have established a MWBE Supplier Mentoring program to assist MWBEs in enhancing their capability 1-800-573-2867 www.diversityjournal.com
the coca-cola company: part of the big picture and capacity. The suppliers participating in our mentoring program have all made substantial progress in moving up to the “next” level of business performance within The Coca-Cola Company and other corporations.
“Our entire organization continues to make excellent progress in this area. However, we can’t let up. We need to keep focused on our efforts because, ultimately, supporting supplier diversity is good for our business.”
Jeffrey Dunn President and Chief Operating Officer, North America
We believe second-tier engagement with minority- and women-owned firms is a critical component to the success of supplier diversity. We have proactively encouraged our primary suppliers to engage MWBEs on company projects and contracts. As a result of these focused efforts, second-tier dollars increased
supplier diversity
substantially from less than $23MM in 2001 to $60MM in 2002. We have also doubled the number of primary suppliers submitting second-tier reports. The second-tier initiative not only helps us exceed our target, but more importantly, it further extends our reach to the local communities we serve. To further complement our success, we host the following internal activities: • Opportunity Forums: MWBEs are able to meet buyers from The Coca-Cola Company and from our primary suppliers to discuss actual procurement opportunities available at these participating companies. • Minority and Women Supplier Showcase: MWBEs are able to set up a display table in the employee center so that company associates can meet them and discuss their capabilities. Our efforts in supplier diversity have afforded numerous recognition and awards, some of which include: • Georgia Minority Supplier Development Council Corporate Crystal Award
Jeffrey Dunn President and Chief Operating Officer North America • Div2000.com Top 50 Corporations in Multicultural Business Development • Houston Business Journal/Women’s Business Enterprise Alliance Top 25 Corporate Champions Award. For more information on the Supplier Diversity Program of The Coca-Cola Company, you may visit our website at: www.coke.net/supplierdiversity.
supplier mentoring: education is essential for success As part of The Coca-Cola Company’s commitment to diversity, we have established the Minority- and WomenOwned Business Enterprises Supplier Mentoring Program. This program is in partnership with the Governor’s Office for Business Development and Clark Atlanta University.
diligently to ensure that they have the tools needed to be included in the procurement process to the maximum extent possible.”
“This is part of our commitment to assure that women- and minority-owned businesses have equal opportunity to compete for contracts with The Coca-Cola Company,” says Johnnie Booker, director of supplier diversity. “We are working very 1-800-573-2867 www.diversityjournal.com
The program’s objectives are to work closely with MWBEs to enhance their competitiveness and to support growth in these business communities. The focus of this formal training and developmental program is to better prepare protégés to meet the business needs of The Coca-Cola Company and to create conditions for them to competitively seek contracts and business opportunities.
Profiles in Diversity Journal
•
July/August 2003
The Office of Supplier Diversity partnered with Clark Atlanta University, an historically black college, to develop the mentoring process. Components of the program include business development, technical assistance, financial access, human resource development and executive mentoring. “The mentoring program has been an asset to the success of our business,” says Rachael Humphrey, president of Metro Courier Corp. “We are still a work in progress, but we are continuing to grow because of Coke’s vision for supplier diversity.” PDJ page 19
W
special Feature: supplier Diversity
Xerox Corporation
hen your company secures a contract with a large business, government agency or other institution, chances are you celebrate it as a sales and marketing “win.” But how often do you consider the sales and marketing advantages of relationships with your suppliers?
Too often, companies do not recognize the many opportunities that exist to develop an ongoing relationship and leverage those ties to build business. Sometimes it’s obvious, such as when a large company contracts with a large supplier and plenty of business is generated on both sides. What’s less obvious, and what I believe is perhaps an untapped goldmine, is the marketing and sales opportunities that large companies can reap from dealing with minority- and women-owned businesses, most of which are dramatically smaller in size and buying power than their majorityowned counterparts. It really is vital for business to view supplier diversity as far more than “just a purchasing matter” or “something nice to do.” Sophisticated supplier diversity programs enable thousands of minority-, womenand disabled veteran-owned supplier businesses to thrive. Xerox’ partnerships
outside
the box With minoRity supplieRs as paRtneRs, ReWaRDs go beyonD “something nice to Do”
Dan Robinson, Manager Global Purchasing/Market Access
page 20
Profiles in Diversity Journal
•
July/August 2003
with diverse suppliers not only offer them financial benefit, but also provide us with quality, cost and delivery incentives. The advantages to contracting with minority- and women-owned businesses have been recognized by Xerox Corporation and many other companies for some time. Minority and Women Business Enterprises (MWBEs) have proven to be among the lowest-cost, highestquality suppliers of a wide variety of goods and services. Xerox’s supplier diversity purchasing program represents an opportunity for Xerox and our customers, who benefit by being offered high quality at the best price and value. And, as we conduct statistical analyses of our suppliers’ performance, we are finding that MWBEs are not only meeting corporate supply standards but, in many cases, surpassing them and outperforming their majorityowned competitors. In 2002, Xerox purchased $264 million in goods and services from minority- and women-owned businesses in the United States, nearly onethird more than it had originally targeted. The total spending with minority- and women-owned business enterprises (MWBEs) represented 23.5% of the company’s total annual purchases. Approximately 1300 MWBE suppliers benefited from this purchasing spend. A strong supplier diversity program also enables us both to benefit as we collaborate to develop innovative solutions for the mutual benefit of our customers and our businesses. Let me give you an example. The traditional business model looks something like this: Say that a large Fortune 500 company contracts with Xerox for products and services. Xerox, in turn, contracts with a minority- or womanowned business for materials, parts and service. The benefits here include Xerox 1-800-573-2867 www.diversityjournal.com
Xerox corporation: outside the box maintaining control of the business dealings and securing a contract with a large, perhaps blue chip, account. But on the down side, that blue chip customer only perhaps reports 5-10 percent of the MWBE’s monies spent from this arrangement. In today’s corporate procurement processes, we need to look for—not shy away from—opportunities to bring in direct participation from minority- and women-owned businesses. So under the new model, Xerox or companies like us would bring the minority- or womanowned business into the transaction as a visible, participating partner. This broadens Xerox’s value to the customer and provides us the opportunity to offer more strength, product and service up front. In some cases, in fact, it may be wise for a large majority company to facilitate a direct buying relationship between the blue chip account and the minority supplier. Here’s why. Let’s say, for example, that Xerox already had an established relationship with XYZ Branding, a minority-owned company that delivers products and services as a prime contractor. And perhaps Xerox recognizes that its blue chip account, Blue Chip National, has a primary need for XYZ Branding’s products and services. Having a relationship with both companies here, Xerox could help forge a new business relationship wherein XYZ Branding would provide products and services directly to Blue Chip National as a prime contractor, using Xerox as a sub-contractor for select products and services. So, in this case, Xerox helps to position the minority business into the primary role, but benefits financially by introducing the relationship and maintaining a subcontractor status.
1-800-573-2867 www.diversityjournal.com
The benefits are many. Blue Chip National would achieve the full benefits of securing a contract with a minority-owned business. There would be significantly greater incentive for that same customer to expand business with the XYZ/Xerox partnership.
with minority-owned companies that bring fresh ideas and creativity to the table. Establishing and growing a sophisticated minority- and women-owned business program is another way to optimize marketing opportunities. By forging such
“Instead of conjuring up the age-old customer-supplier model of doing business, consider engaging in a ‘strategic alliance’ with a minority business. This approach opens doors with new national accounts and opens them wider, perhaps, with existing contract accounts.” Dan Robinson, Manager Global Purchasing/ Market Access
It also provides Xerox with a distinct competitive advantage. Virtually all large existing and potential customers face an imperative to increase the amount of business they contract to qualified minority- and women-owned businesses. This approach opens doors with new national accounts and opens them wider, perhaps, with existing contract accounts. Many of Xerox’s customers, for example, ask for formal reporting about our diversity initiatives—just as we do with our suppliers. As I mentioned earlier, we’ve found that our minority- and women-owned suppliers outperform the general supplier population on quality, cost and delivery. And that’s a benefit that our customers can experience directly should a revised relationship be adopted, where appropriate. In addition to the financial rewards, Blue Chip National will benefit in much the same way that Xerox does from dealing
Profiles in Diversity Journal
•
July/August 2003
supplier Diversity
relationships, a company can first and foremost meet its own customers’ needs, but also develop a potential new pathway for business, by recognizing that all players could be on either side of the customer/ supplier equation.
Whatever a company’s supplier needs might be, it is important to continuously evaluate with whom you’re doing business, especially in the context of a rapidly changing economic environment and technology needs. Think outside of the box on supplier diversity: instead of conjuring up the age-old customer-supplier model of doing business, consider engaging in a “strategic alliance” with a minority business. Ensure that you’re partnering with a minority business that is keeping pace with technology advancements, knows the marketplace and is a viable financial partner. To maintain a strong supplier diversity program in these challenging economic times necessitates creativity and commitment. Certainly, the more profitable the relationship with a supplier, whether that supplier helps you save or make money, the more viable that relationship will be over PDJ the long-term.
Robinson is Manager, Global Purchasing/Market Access for Xerox Corporation. Based in Rochester, NY, Robinson is Chairman of the Board for both the Upstate New York Regional Minority Purchasing Council and Diversity Information Resources. www.xerox.com
page 21
Special Feature: Supplier Diversity
Ford Motor Company
FORD’S SUPPLIER DIVERSITY
empowering the community Dr. Ray Jensen, Director Ford Supplier Diversity Development
H
enry Ford often is described as the man who put the world on wheels. His moving assembly line and other industrial innovations made vehicles more affordable, and his employment practices created new wealth in the communities where he did business—making it possible, for the first time, for many Ford employees
businesses critical to our legacy and fundamental to our overall mission: to build better communities and a better quality of life for generations to come. As Henry Ford understood so well, it’s not only the right thing to do. It’s also good for our business.
to own Ford products. The facts speak for themselves: The company’s rich tradition of personal and community empowerment reached a high point in 1914, when Henry Ford’s promise of a $5 daily wage drew thousands of African Americans from the South to Ford’s massive Rouge Plant in Michigan. This laid the foundation for development of the black middle class and poured new wealth and diversity into the cities of Detroit and Dearborn. One century later, Ford Motor Company’s commitment to economic empowerment has been greatly expanded to include a vast network of smaller businesses outside our large, global company—the businesses of minority suppliers. We consider these page 22
• Ford has long been an industry leader in minority supplier development and sourcing. • Ford purchased $3.2 billion worth of goods and services from 306 minority businesses in 2002, during a time when many major corporations cut or eliminated their minority supplier programs. • In turn, these suppliers have created more than 39,000 jobs in their communities. • In 1993, we created a 2nd Tier Sourcing Program to encourage our Tier 1
Profiles in Diversity Journal
•
July/August 2003
suppliers to establish their own minority programs. The program has worked very well—in 2002, Ford “influenced” another $1.2 billion in minority supplier revenue. • Ford is part of a very small group of corporations to win the Corporation of the Year Award from the National Minority Supplier Development Council. We have earned this honor three times. The business case for minority supplier development is clear. Over time, the buying public has become much more diverse. So it makes good business sense for us to purchase goods and services from the people living and working in diverse communities. This objective helps us achieve a couple of things. By putting money into minority communities, we increase the tax base and ultimately improve the standard of living. This allows the people living in these minority communities to purchase goods and services—and, of course, we hope they will choose our cars and trucks. 1-800-573-2867 www.diversityjournal.com
Ford Motor Company: Empowering The Community We tackle these goals through an industryleading and comprehensive plan of continuing support and education to our selected minority suppliers. We recognize that suppliers need more than purchase orders to succeed—especially during difficult economic times when small businesses already face tough challenges. They also need training, access to capital and ongoing assistance to achieve a more complete and diversified business structure. Through our programs, we offer the following to selected minority suppliers: • Financial assistance: Ford provides several financial assistance programs, including loans at preferred terms and reduced interest on loans used to fund growth. • Minority Technical Assistance Program: Ford provides an automotive retiree or industry expert to help a minority supplier with a specific project. Many of our suppliers depend upon this program to resolve issues critical to the continued operation of their businesses. In 2002, 88 projects were initiated, totaling approximately $1.7 million in support from Ford. • Engineering Mentoring Program: This program brings together an engineer from Ford and a supplier engineer for one-on-one learning and development. • Lean Manufacturing Program: Suppliers learn principles of lean
manufacturing as part of a long-term journey for continuous improvement at their facilities. These are the same lean manufacturing principles embraced by Ford.
“We must must work work with with our our “We minority suppliers suppliers to to help help them them minority develop into into competitive, competitive, world world develop class companies. companies. We We must must class require our our suppliers suppliers to to join join us us require in creating creating opportunities opportunities for for in minority businesses. businesses. And And minority finally, we we must must teach teach other other finally, companies how how to to be be successful successful companies at this this endeavor.” endeavor.” at
• Tier 2 Reporting: We have historically asked Dr. Ray Ray Jensen Jensen Dr. our Tier 1 suppliers (minority and nonminority alike) to source 5 percent of their purchases to other minority suppliers. This year we’re Nonetheless, our commitment to our minority suppliers remains strong. raising that goal to 6 percent. Though the company has been forced to make many difficult decisions recently in I believe the role of a great corporation is to do … to help … to require … and to teach. its efforts to regain competitiveness, we nonetheless have kept a sharp focus We must have active and vibrant minority on the long-term success of our supplier development programs within minority suppliers. our company. We must work with our minority suppliers to help them develop into competitive, world class companies. We must require our suppliers to join us in creating opportunities for minority businesses. And finally, we must teach other companies how to be successful at this endeavor. Though there always is room for improvement, I believe we’re doing all these things at Ford today. It’s no secret that this is a challenging time for domestic automakers. A turbulent economy, international tensions, intense competition and industry-wide overcapacity have impacted our sales and our profits.
“Coming together is a beginning, staying together is progress and working together is a success.” Henry Ford 1-800-573-2867 www.diversityjournal.com
Supplier Diversity
Profiles in Diversity Journal
•
July/August 2003
We understand that companies that will most likely succeed in our increasingly diverse world will be those that have had a presence all along—working in minority communities, helping to build minority businesses and providing opportunities for the creation of wealth. In the interest of its future business, it is smart for us to nurture these minority suppliers now. Investments made in minority communities are important investments that we believe will build trust and loyalty just as certainly as they help build and sustain communities. Now, and for the next 100 years.
PDJ
For information about this and other diversity initiatives, contact Rosalind Cox, Manager, Diversity and Worklife Planning, by phone at 313.248.7505 or by e-mail at rcox4@ford.com. page 23
Special Feature: Supplier diversity
Starwood Hotels & Resorts Worldwide, Inc.
StarwOOd launChES itS mbE PrOgram with an OnlinE VEndOr rEgiStratiOn and databaSE
harnessing the new tools
S
tarwood Hotels & Resorts is a global organization that is built on diversity. With six distinct brands and operating in over 80 countries, we maintain an associate and customer base as diverse as the world’s population. Each brand’s distinctive appeal affords us a unique position in the global marketplace
that caters to travelers of all backgrounds and from almost every culture. Therefore, creating an environment of inclusion for our associates, guests and suppliers isn’t just the right thing to do, it is the very core of our business. Starwood launched its Minority Business Enterprise (MBE) Program on July 31st, 2003, offering an online MBE vendor registration and database. The program allows Starwood to effectively track and report MBE spend from the property level up through corporate contracts, in real-time. The program also maximizes contracting opportunities made available to minority-owned businesses throughout Starwood’s corporate offices and more than 400 North America hotels and resorts, page 24
including its renowned Sheraton, Westin, Four Points by Sheraton, St. Regis, The Luxury Collection, W Hotels, and Starwood Vacation Ownership properties.
Similar to other Starwood diversity initiatives, the President & CEO has shown his full support, and senior management has invested substantial resources to ensure the program’s success. The program is one of many corporate initiatives that reflect our organization’s overall commitment to providing economic opportunities to all members of the communities in which we work. Those same communities, as a result of this effort, are assured that we are taking all of the needed steps to include MBEs in the
Profiles in Diversity Journal
•
July/August 2003
bidding process for regional and national accounts. In the end, the program will get us a step closer in cultivating long lasting, successful relationships with minority businesses and maximize the opportunity for those businesses to partner with us. “Celebrating diversity and inclusion and improving the communities in which we do business are all principles on which Starwood was built,” says Barry Sternlicht, Chairman and CEO of Starwood Hotels. “When we sat down to write Starwood’s corporate values statement several years ago the first words we put on paper were ‘We value the diversity of people, cultures and ideas and promise to improve the communities in which we do business’,” says Sternlicht. “As we operate in 80 countries, it is simply good business to be at least as diverse as the customers we serve. We continuously strive to show our commitment to these principles and are honored to be recognized for these efforts.”
1-800-573-2867 www.diversityjournal.com
Starwood hotels & resorts: harnessing the new tools As is standard operating procedure at Starwood, we continually strive to be at the forefront of the industry. Our MBE program is an example of that type of effort. Suppliers are able to easily register online for inclusion in the company’s webbased database. Specifically, once an MBE has completed the online profile form, they receive an e-mail confirmation that they have successfully completed the form. Those profiles are then reviewed and approved by our Strategic Sourcing area.
In creating this program, Starwood applied Six Sigma methodology, a process management solution focused on understanding the “voice of the customer.” The senior-level, cross-functional project team responsible for creating this program focused its attention on truly understanding the needs and requirements of everyone affected by the program’s reach, including minority vendors and those responsible for procurement within the company, through extensive customer interviews, surveys and benchmarking.
Supplier diversity
Similar to other Starwood diversity initiatives, the President & CEO has shown his full support, and senior management has invested substantial resources to ensure the program’s success. The MBE program will allow us to further mirror our customer base and provide an effective way to aggressively bid on business that might have been overlooked without the program being in place. PDJ
Certified minority businesses interested in bidding on Starwood contracts can visit www.starwood.com and find the MBE program information located under the Corporate Information>Company Values>Diversity and Inclusion links.
point.click.connect. mwbEs Find nEw waYS tO attraCt buSinESS When Patricia Lynch began her own business last year, she looked for a place to network and advertise—a place that would be seen by corporations looking to do business with a woman-owned business like her own—and she couldn’t find one. So she developed her own. Today, The MWBE Directory (themwbedirectory.com) has attracted a small but loyal following and has grown at a steady rateof 10-15 percent per month since January 2003. The site has also garnered corporate support from IBM, ExxonMobil and ADA Solutions, LLC. “Corporate leaders must seek ways to reduce the indirect and overhead costs associated with seeking the participation of minority- and women-owned businesses,” says Lynch. “Our immediate goal was to create a functional, flexible and scaleable repository for locating minority- and women-owned businesses, accepting a universal definition of a MWBE. This will allow a corporation to easily locate and 1-800-573-2867 www.diversityjournal.com
contact potential candidates, and will also give smaller minority companies the opportunity to network and get national exposure, even though they be miles apart and working on a limited budget.”
“In order to promote fairness, we needed to offer a product that allows all of our customers the opportunity to clearly and professionally present their products or services, regardless of company size or financial strength,” adds Lynch. “That The MWBE Directory is why you’ll notice all affords all corporations advertisements on the site— unlimited access to these Patricia Lynch, whether from our corporate Founder and President MWBE businesses at no sponsors or enterprise The MWBE Directory cost. Our unique search feature allows partners—are of equal size and shape. viewers the opportunity to search by Company, Industry, State, NAICS/SIC Corporate sponsors benefit from a Codes and business description. home-page banner and access to the site’s “Further, the directory provides cost effective advertising solutions to MWBEs on a budget,” says Lynch. While the directory, by definition, accomplishes that mission, it enhances the advertising opportunity by offering each vendor the opportunity to write their own company description, as well as a free website (which is then linked to the directory).
Profiles in Diversity Journal
•
July/August 2003
contact management feature “MWBE Connect,” which provides targeted membership e-mail capability. “I feel a tremendous amount of pride in being able to accomplish this myself. But then, isn’t this what a small business is all about?” For more information on The MWBE Directory, visit them online at www.themwbedirectory.com, or call Patricia Lynch at 201.909.5732. PDJ page 25
raising The Bar
Syncrude Canada Ltd.
REFINING LEADERSHIP Syncrude’S LeAderSHIP eXceLLence PrOceSS And neWSLeTTer cOMMunIcATIOnS PrOMOTe eMPLOyee GrOWTH And IMPrOVe cOMPAny cuLTure Peter Marshall, Sr. HR Advisor - Communications
L
ocated in a remote area of Northeastern Alberta, Syncrude Canada Ltd. is a major oil company whose primary assets are its people and reputation. The key to Syncrude’s many successes has been its ability to attract, retain and manage highly motivated, dedicated and talented people, many of whom are recognized as leaders in their respective fields, trades and professions. Our reputation is founded on a corporate value system that encourages learning and innovation in everything we do; pushes the limits of what technology can accomplish; and emphasizes working together to make Syncrude a great place to work. Overarching all of this is a commitment
page 26
to continuous improvement in safety, reliability and profitability. From its modest beginnings 25 years ago, Syncrude has grown to become the world’s largest producer of crude oil from oil sands, and the largest single source of oil in Canada. Over 1.4 billion barrels of light, sweet crude oil have been sent to refiners across Canada and the U.S. since 1978. But that is just the tip of the iceberg: Syncrude is currently in the midst of a major expansion that will increase production from today’s volumes to 350,000 barrels per day, once that development is completed in 2005. With a capital investment exceeding C$5 billion, this expansion has attracted over 5,000 construction contractors. Syncrude itself employs approximately
Profiles in Diversity Journal
•
July/August 2003
4,100 employees and an average of 1,200 maintenance contractors. About 400 of the Syncrude employees are in formal leadership positions. All of these people hold high-skill/high-pay jobs earning compensation that is highly competitive within the industry. We reward our people well for their knowledge, experience and contributions and we encourage them to further upgrade and enhance the skills they bring to our organization. As a result, Syncrude is recognized as an employer of choice for its commitment to the growth and success of its employees. In order to equip itself with the necessary leadership to achieve its strategic growth, 1-800-573-2867 www.diversityjournal.com
Syncrude canada Ltd.: refining Leadership raising The Bar (Left) Oil sand, from which Syncrude will extract raw oil, or bitumen, and process and upgrade it into sweet light crude oil. Syncrude’s 2002 production of this oil totaled 83.8 million barrels or an average of 230,000 barrels per day: about 13 percent of Canadian crude oil. The oil moves by pipeline to a terminal in Edmonton, Alberta, where it is sent onward to refineries in Alberta, Ontario and the U.S. Midwest.
leadership skills training and coaching, and the creation of an individual leadership development plan. One of the things participants told us after they attended the workshop is that they wanted to receive news and information pertinent to their job on a regular basis.
Syncrude concentrates on developing new leaders from within its employee ranks. The company introduced a Leadership Excellence Process in 2000 to ensure that its leaders fully understand the company’s desired culture and leadership model, understand and support the company’s vision and values, possess a strong base of foundational leadership skills, and focus on areas of development in their individual leadership capabilities. A key element of this process is the Leadership Basics Workshop which all new and experienced leaders will attend. This workshop has been well received both inside and outside the organization: in 2002, the Corporate Leadership Council, based in Washington, D.C., featured the Leadership Basics Workshop as a best practice and business case. The Conference Board of Canada also cited it in a study on leadership. The workshop features leadership and learning style assessments, face-to-face “I can see this newsletter becoming ... a way to enable ongoing dialogue with leaders that we initially only reached through our development programs.” Kjersti Powell, Manager of Human & Organizational Development 1-800-573-2867 www.diversityjournal.com
follow-up to the Leadership Basics Workshop, would be very appropriate content,” noted Kjersti Powell, Manager of Human & Organizational Development, when asked about the role the newsletter can serve.
LeaderShip is launched In 2002, to meet this communication need, the LeaderShip newsletter was created to support the ongoing development of leaders. LeaderShip, which is published by Human Resources, has two objectives: to follow up on the Leadership Excellence program and to provide leaders with a better perspective about the direction of diversity at Syncrude. (For that reason, the newsletter styles itself “LeaderShip: a quarterly newsletter on leadership and diversity at Syncrude.”) The publication began with a trial issue, which circulated among key individuals in the HR Department as a discussion vehicle. The eventual first issue contained most of the content found in this “model.” After the first issue was released, it was clear that additional input would be required to help steer LeaderShip. As a result, a small editorial board was created consisting of representatives from the Human & Organizational Development department (training), the Diversity team, and Public Affairs. The proposed content of each issue is now reviewed by this group and some of these individuals have also written articles for the newsletter. “Leadership development initiatives, such as 360-degree feedback, and
Profiles in Diversity Journal
•
July/August 2003
“Even the best leaders can be better.” Eric Newell, Chairman and Chief Executive Officer
“I can see this newsletter becoming an effective reinforcement and encouragement tool and a way to enable ongoing dialogue with leaders that we initially only reach through our development programs.” As to content, LeaderShip tries to keep leaders current on new trends as well as report on issues specific to Syncrude’s Leadership Excellence program. Sometimes that means that rights have to be obtained to reprint articles found on the internet or in print. This has not proven a major problem since LeaderShip’s circulation is small and controlled. The publication provides full attribution for any of these articles. The newsletter is basically divided into four areas. A “lead” article or featurette focuses on behaviours we are trying to get leaders to adopt, or contains follow-up information aimed at graduates of the Leadership Basics Workshop. An example was the article which talked about how page 27
raising The Bar
Syncrude canada Ltd.: refining Leadership
Syncrude has been recognized as one of Canada’s top 100 employers for the last three consecutive years. In 2001 and 2002, Alberta Venture magazine polled 1,800 businesses and named Syncrude the province’s most respected corporation, citing the company for vision and leadership and innovative human resources practices and policies.
leaders could get the most out of their 360-degree performance feedback. The second section concentrates on diversity and now contains mainly original content written by members of the company’s diversity team. A recent innovation is the “Diversity Dilemma,” which poses a question or situation and then goes on to provide the solution. The third section consists of articles aimed at raising the business literacy of leaders, highlighting trends and economic data, and
Although there have been only six issues of LeaderShip to date, judging from emails and telephone calls, the newsletter is filling a need for its readers. In February 2003, an archive of issues (in pdf format) was created in the Leader community on the company’s intranet. This will answer the occasional requests for back issues and will 12.5 percent of the total of Syncrude employees and contractors are Aboriginal. allow new leaders to review back issues. For Syncrude is Canada’s largest industrial the summer 2003 issue, the newsletter was employer of Aboriginal people. slightly redesigned and adopted a more serving as a platform for a community of professional folio fold rather than the previous practice of stapling pages together. practice in the area of management. It often contains information on team One of the goals of management issues, including team LeaderShip is to member recognition, and often features provide leaders thought-provoking quotes about leadership with a better from well-known executives from both perspective within and outside the company. about the direction of The fourth section, which is proving very diversity at Syncrude. popular with readers, is LeaderTips. This section usually includes a couple of quick Peter Marshall, Sr. HR Advisor— quizzes about business terms and general Communications literacy as well as short items about using “Even the best leaders can be better,” says computer applications, chairing meetings, Eric Newell, Chairman and Chief Executive mentoring, becomOfficer. “LeaderShip is about providing an ing a better listener and book reviews. As an example of reader response to this section, a senior leader contributed an article recommending seven of his favourite management books to other leaders.
page 28
Profiles in Diversity Journal
•
July/August 2003
opportunity for leaders to learn and improve. It is also important for Syncrude to know its leaders are placing great emphasis on our Vision and Values and Guiding Principles and LeaderShip is one of the vehicles that can reinforce these goals.” PDJ For more information about the Leadership Excellence Process or LeaderShip magazine, contact the author at pmarshall@syncrude.com.
1-800-573-2867 www.diversityjournal.com
“I am
mak-
ing
“I am
“I am taking
improving your
care of you. And
People define our success.
Diverse perspectives and
talents allow us to provide
I am
innovative food and
Sodexh facilities management
services that improve the
quality of daily life for
the millions of people we
“I am
serve in the U.S. Every day.
ensur-
ing
“I am
a step ahead.” sodexhoUSA.com • 1-800-SODEXHO © Sodexho Member of Sodexho Alliance®
Signatory of the Global Sullivan Principles of Social Responsibility. Food Services, Facilities Management, Vending, Catering, Office Refreshment Services, Environmental Services, Landscaping & Grounds Management, Conferencing, Plant Operations & Management
pdj profiles
PDJ Profiles: carole a. Young, chevronTexaco
carole a. Young
General Manager, Global Diversity ChevronTexaco
Carole Young is General Manager of Global Diversity for ChevronTexaco Corporation, and is responsible for defining the company’s strategic direction, vision, philosophy, objectives and metrics around global diversity issues. Young joined Texaco, Inc. in 1968 and has brought her talents to many areas of the corporation. Before taking the helm of Global Diversity, Young served as Corporate Ombuds Director, developing and managing this company resource program, designed to provide confidential assistance in resolving work-related concerns through counseling and facilitation. She has also served as Supply Analyst for Texaco Trading and Supply Company; Coordinator of Logistics, Marketing and Marine; Senior Coordinator of Environment, Health and Safety in the company’s Middle East/Far East Division; and Staff Coordinator in the Corporate Planning and Economics Department. A native of New Rochelle, NY, Young earned a Bachelor’s degree in Business Administration from Bernard M. Baruch College in New York City in 1970. She also earned a Master’s degree in Marine Transportation from the State University of New York Maritime College in New York City.
ike a painted masterpiece, an inclusive organization is painstakingly created over time with both broad brush strokes and attention to the smallest details. At its heart is a strong commitment by management that fosters a culture of inclusion through its policies and programs. A company that leverages its diversity of talents and characteristics allows its employees to reach their full potential, creates lasting community partnerships, and strengthens its business capabilities. Ultimately, the canvas of a fully inclusive organization is a mosaic of its employees’ ideas, experiences, and skills. “A demonstrated and sustained commitment by management to the company’s diversity is critical. At ChevronTexaco, diversity is a company ‘core value.’ This sends a strong message to employees—that we envision an environment in which the total spectrum of individual differences is valued and integrated throughout all levels of the company. “Management’s words must also be backed by visible action. ChevronTexaco has instituted systems, policies and practices 1-800-573-2867 www.diversityjournal.com
that welcome different types of people and motivates them to perform to their full potential. Our proactive recruiting and outreach programs, diversity councils, employee networks, development committees, and training programs help to sustain and build an inclusive workforce.
of responsibility. This raises the profile of the importance of diversity within an organization. At ChevronTexaco, we recognize and promote employees’ commitment to diversity through awards programs, our company magazine, and on our website.
“Shared accountability and responsibility will help people to internalize corporate and diversity values. When it comes to accountability, there needs to be a topdown bottom-up approach if an organization is going to be successful in moving initiatives forward, modeling behaviors, and meeting strategic business objectives. Most ChevronTexaco employees are required to submit a personal Diversity Action Plan. The Plan defines specific activities designed to broaden their understanding of and strengthen their commitment to diversity. To have a sustained impact, this shared accountability must be reflected in business transactions with your various stakeholders.
“A fully inclusive organization also is committed to fostering diversity in the community. Being a good partner includes supporting diversity programs through sponsorships and grants, community outreach activities and alliances with professional associations around the world. Our relations with the communities where we operate are an important and sound business strategy. Business and community partnerships, woven together, provide mutual strategic advantages in a competitive world.
“There must be established systems to recognize and acknowledge the contributions to creating a diverse organization among employees at all levels
Profiles in Diversity Journal
•
July/August 2003
“Creating a culture that champions an inclusive work environment is a continual challenge. These are some of the elements of building and sustaining an inclusive, world-class environment where everyone feels respected and valued for who they are. The result is an organization with a strong foundation for long-term success.” PDJ page 31
Legal briefings
Holland & Knight LLP
affirmative
REaction?
THE SuprEmE CourT’S univErSiTy of miCHigan DECiSionS rEinforCE DivErSiTy in EDuCaTion anD CorporaTE amEriCa. HoWEvEr, CorporaTionS anD CoLLEgES noW muST bE CarEfuL, CauTiouS, anD CounSELED.
In
Weldon H. Latham, Senior Partner
one of the biggest legal challenges to racial diversity and inclusion in a quarter century, the Supreme Court in June upheld the legal basis for raceconscious admissions in higher education. The 5 to 4 high court ruling endorsed the University of Michigan Law School admission program based on a finding that
applicants, which the Court viewed in a quota-like fashion.
Together, the two decisions—Grutter v. Bollinger1(law school admissions) and Gratz v. Bollinger (undergraduate admissions), notwithstanding their strict limitations on a university’s methods— nonetheless represent an historic victory for in seeking to enroll a “critical mass” of supporters of diversity and inclusion. minority students, the program gives applicants individualized consideration and These cases will have substantially broader impact beyond the context of higher “is necessary to further the University’s education. According to The New York compelling interest in securing the Times, the rulings “sen[d] a strong signal educational benefits of a diverse student to the nation’s employers that they can body.” As Justice Sandra Day O’Connor wrote for the majority: “Just as growing up continue to use race as a factor in hiring.” in a particular region or having particular The rulings also constitute a major victory professional experiences is likely to affect for corporate America, particularly given an individual’s views, so too is one’s own, the leadership major companies assumed, unique experience of being a racial for the first time, in support of a minority in a society, like our own, in university’s efforts to right the wrongs and which race unfortunately still matters” continuing ill-effects of both de jure and (emphasis added). In a companion de facto discrimination in today’s overall University of Michigan case, a 6 to 3 society. The underlying practical reason majority rejected as too mechanical the undergraduate admissions program, which that the decision is so important is that corporate America clearly recognized that automatically awarded points to minority page 32
Profiles in Diversity Journal
•
July/August 2003
racial, ethnic and gender diversity is “good for business!” Nearly 70 blue chip corporations voluntarily entered the fray on the side of diversity and the University, by filing “friend of the court” briefs. These briefs championed diversity in higher education and argued that American businesses’ global competitiveness depends on growing the pool of highly educated, talented and diverse employees. That pool cannot exclude any race or gender—as has been the practice in the past! Corporate America’s showing—and the strength of its arguments—had a critical impact on the Court in reaching the “right” decision. Relying in part on the business briefs, a majority of the Court endorsed the concept of diversity as a justification for the consideration of race (a concept espoused by the late Justice Lewis F. Powell in Regents of the University of California v. Bakke). In the law school case, the majority held that diversity in education produced “substantial,” “important and laudable” benefits for the schools and colleges as well 1 Defendant Bollinger was President of the University when the cases were first brought.
1-800-573-2867 www.diversityjournal.com
Holland & Knight LLp: affirmative reaction? The Supreme Court university of michigan Decision Legal briefings as society as a whole. According to the law school decision, these benefits included promoting “cross-racial understanding,” “break[ing] down racial stereotypes” and “enabl[ing] students to better understand persons of different races.” Justice O’Connor explicitly observed that the business briefs and one filed by retired military leaders: “…point to the educational benefits that flow from student body diversity… [N]umerous studies show that student body diversity promotes learning outcomes and better prepares students for an increasingly diverse workforce and society, and better prepares them as professionals. These benefits are not theoretical but real, as major American businesses have made clear that the skills needed in today’s increasingly global marketplace can only be developed through exposure to widely diverse people, cultures, ideas, and viewpoints.” Justice O’Connor also noted that “…in order to cultivate a set of leaders with legitimacy in the eyes of the citizenry, it is necessary that the path to leadership be visibly open to talented and qualified individuals of every race and ethnicity. All members of our heterogeneous society must have confidence in the openness and integrity of the educational institutions that provide this training....” The Court validated the use of race to create a diverse environment, which in turn should promote greater cross-cultural understanding and strengthen important institutions within American society. Having had the privilege of working with several of the major corporations that have seriously addressed diversity matters in their own companies, I was particularly 1-800-573-2867 www.diversityjournal.com
pleased to hear the comments of General Motors Corporation and Eastman Kodak Company. General Motors led the way by filing the first corporate brief on behalf of the University in the lower court cases. Rod Gillum, GM’s Vice President for Corporate Responsibility and Diversity, stated, “General Motors’ position has consistently been that diversity of background, thought and experience is essential to the education process. Efforts by universities to create a diverse student body from which corporations can recruit should be supported.”
without affirmative action there would not have been as well-educated and experienced a Colin Powell and a Condoleezza Rice for him to appoint! The Bush Administration filed a brief against the University, arguing that diversity should be achieved through “race-neutral”
“Although “Although proponents proponents of of inclusion inclusion can can declare declare victory victory in in the the Supreme Supreme Court’s Court’s ruling, ruling, itit is is also also clear clear that that the the legal legal battles battles are are far far from from over. over. Corporate Corporate America, America, in in fact fact all all America, America, must must pay pay close close attention attention to to these these future future battles. battles. Hopefully Hopefully this this precedent precedent in in education education will will favorably favorably influence influence diversity diversity in in employment, employment, minority minority business, business,
May Snowden, Eastman Kodak’s Chief Diversity Officer, observed, “We are pleased that the Court upheld affirmative action at the University of Michigan as an appropriate enrollment tool. We rely on universities such as Michigan to produce graduates with the multicultural background and experience to help build a workforce that reflects the diversity of our customers.” The Court’s recognition that race matters stands in stark contrast to the position adopted by the Bush Administration in these cases. Despite President Bush’s triumphal pronouncements following the decisions, the Court, in fact, dealt a major blow to the Administration’s stance against “affirmative action” as a valid tool to achieve true diversity and inclusion. While President Bush should be applauded for the selection of a diverse Cabinet (almost as diverse as President Clinton’s Cabinet), he apparently needs to be reminded that
Profiles in Diversity Journal
•
July/August 2003
and and other other contexts.” contexts.” Weldon Weldon H. H. Latham Latham
means2 which guarantee admission to public colleges to a certain top percentage of students in every high school in the state (e.g., the top ten percent of the class). Justice O’Connor made short shrift of this position. She suggested that such plans are particularly difficult to implement in graduate and professional schools and do not lead to individualized consideration of applicants. She also observed that schools are not required to “exhaust every conceivable race-neutral alternative” before instituting race-conscious programs. Furthermore, such a top ten percent plan looks a lot like another type of quota, which the Court invalidated in the companion case. Although proponents of inclusion can declare victory in the Supreme Court’s ruling, it is also clear that the legal battles 2 The Bush Administration was referring to the “so-called” race-neutral polices utilized in Texas and Florida.
page 33
Legal briefings
Holland & Knight LLp: affirmative reaction? The Supreme Court university of michigan Decision
are far from over. Corporate America, in fact all America, must pay close attention to these future battles. Hopefully this precedent in education will favorably influence diversity in employment, minority business, and other contexts.
and are ignoring the plain language of the majority opinion. The Court has set a flexible standard, requiring only “serious, good faith consideration of workable race-neutral alternatives that will achieve the diversity the university seeks.”
Two areas of debate that have arisen from the decisions are whether the Court ruled that affirmative action should be temporary, and what obligations it imposed on schools to explore “race-neutral” alternatives before they consider race in their admission programs. A majority of the Court ratified Justice O’Connor’s statements that “race-conscious admissions must be limited in time,” and that the Court “expect[s] that 25 years from now, the use of racial preferences will no longer be necessary to further the interest approved today.” What the Court appears to be saying is that efforts to achieve diversity and inclusion will not be needed as soon as the playing field is actually level. Indeed, in a Chicago Tribune interview of Justice O’Connor, the writer noted that O’Connor’s remarks “indicate she offered the time frame as an expression of hope—not a definitive endpoint, as dissenting justices and opponents of affirmative action had suggested.” Let us all hope so, but a true “level playing field” could be achieved much sooner if our President and right-wing conservatives would stop pretending that the level playing field is even close to being achieved today. Critics of the Court’s decision in the law school case have also seized upon Justice O’Connor’s discussion of “race-neutral” alternatives to argue that the Court has now mandated such programs, and that institutions that do not quickly establish such efforts will be threatened with lawsuits. These critics are clearly wrong page 34
commentators have observed that Justice O’Connor has often joined the other conservative justices in opposing affirmative action in other contexts. They should be reminded, however, that in 1995, again speaking for the majority of the Court in Adarand Constructors v. Pena, she In fact, the high court’s decisions are stated, “the unhappy persistence of both the sparking a re-examination of the use of practice and the lingering effects of racial race in university admissions policies in discrimination against minority groups in Washington, Texas, California and Georgia, this country is an unfortunate reality, and where either courts or voters have sought to government is not disqualified from acting outlaw its use. As reported in the Chicago in response to it.” Tribune, officials at the Universities of Texas and Georgia, whose court-ordered The decisions in these cases, however, prohibitions were repudiated by the will require corporations, colleges and Supreme Court’s decision, have directed universities, and other institutions of their attorneys to examine how the use of higher education which use race-conscious race can be appropriately re-introduced. In methods of increasing diversity and California and Washington, where voters inclusion, to review their methods in order struck down the use of race, lawmakers are to effectively defend themselves against considering measures to overturn this legal challenges by misguided organizations legally questionable ban. that oppose fairness and inclusion. The These decisions will ultimately impact the diversity policies and programs of corporate America—from terms and conditions of employment (e.g., hiring, promoting and firing), to minority contracting programs. One legal expert suggested that the Court’s reference to the corporate briefs in the law school decision hinted that the Court—or at least a majority of Justices—might be willing to extend its ruling to some employment lawsuits. Bob Rabin, an employment law professor at Syracuse University, stated in the Detroit Free Press that “[t]he language of the opinion and the fact that it cited these briefs is encouraging in that the [C]ourt values diversity as such.” Constitutional law professor Mark Rosenbaum, who teaches at Michigan and UCLA, stated that the decisions demonstrate that “race still counts in America and the business of eliminating discrimination is not complete.” Some
Profiles in Diversity Journal
•
July/August 2003
subtleties and complexities inherent in compliance will necessitate that corporations and universities defer to legal experts to review existing programs and policies, or to develop new ones. Although proponents of a fair and inclusive America can be justifiably optimistic, they also need to be careful, cautious, and counseled. One of the joys of being both a commentator and a practitioner (who represents major corporations, colleges and universities, and government entities) is that following such a sound, fair and equitable Supreme Court decision on diversity, I am empowered to better assist clients in making diversity a reality. PDJ Weldon Latham is a Senior Partner and Practice Area Leader of the Holland & Knight LLP Corporate Diversity Counseling Group. He serves as Counsel to the Coca-Cola Procurement Advisory Council; Chair, Deloitte & Touche LLP Diversity Advisory Board; and General Counsel, National Coalition of Minority Businesses. www.hklaw.com . 1-800-573-2867 www.diversityjournal.com
raising the Bar
Ernst & Young LLP
friends of The courT
T
Sixty-NiNe corporAtioNS filed AN AmicuS Brief iN Support of the uNiverSity of michigAN’S AdmiSSioN policieS. why erNSt & youNg felt it wAS the right thiNg—the oNly thiNg—to do. Allen Boston, Partner and Director, Office of Minority Recruitment
he Supreme Court hearing on the University of Michigan Law School admissions program was marked by the voluntary entrance of nearly 70 Blue Chip corporations into the legal battle via a “friend of the court” brief. As the court debated the constitutionality of admissions policies in public higher education intended to foster diversity, these corporations sought to make the business case for diversity to the high court. As stated in this brief, these corporations found racial and ethnic diversity in our nation’s leading colleges and universities to be “vital to the interests of American business, and it is necessary to ensure that members of all segments of our society receive the education and training they need to become the leaders of tomorrow.” Ernst & Young LLP was one of the corporations taking a stand in what came to be known as the “Fortune 500” brief. A global organization with 106,000 employees in 135 countries, we, like many corporations, knew that we had a serious stake in the outcome. That is because we strongly believe that, to be effective in this 1-800-573-2867 www.diversityjournal.com
global economy, we need what we call “diversity of thought” in order to compete. The best way to apply unique solutions to business problems that impact our marketplace is through this “diversity of thought,” obtainable only if you hire from a wide array of backgrounds. Our key goal is to provide quality service—not only to our clients, but throughout the marketplace—and that quality can only come from dynamic change, and the willingness of our people to share their ideas and their unique perspectives. Maintaining an inclusive culture is integral to Ernst & Young’s success. It’s a constant process, and there will always be room for improvement; however, we have made great strides. Over the past five years, our U.S. firm experienced an 85% increase in minority hiring as a percentage of overall
Profiles in Diversity Journal
•
July/August 2003
hires. We’re working to continue this growth by increasing the number of qualified minority hires and interns. Just as we have worked to build an inclusive environment, we look to the universities
““Just Just as as we we have have worked worked to to
build build an an inclusive inclusive environment, environment, we we look look to to the the universities universities from from which which we we recruit recruit to to create create an an environment environment that that is is inclusive inclusive as as well. well. ”” Allen Allen Boston Boston
from which we recruit to create an environment that is inclusive as well. We believe diversity in the classroom at both the student and faculty levels is, quite frankly, a very valuable experience for everyone. It gives each participant a real opportunity to enhance the skills they need to be effective leaders—as well as team members—in America, and the highlypage 35
ernst & young llp: friends of the court raising the Bar competitive global economy as well. Having universities address diversity gives each of their students the opportunity to be more successful as they enter the corporate environment. When Ernst & Young signed the amicus brief, we did so knowing that the university’s ability to have race remain a consideration as one element in admissions was the most equitable thing to do. The focus in any successful culture, be it within a university or corporation or nation, must be on ensuring a fair and equitable environment. This is an interesting distinction from an environment where you treat people equally. When you’re looking at treating people fairly and equitably, you’re also considering their differences. However, when you treat people equally, you’re assuming there are absolutely no differences.
these programs. Our people attend, work one-on-one with the students and invite these students to come to our offices as well. Of course, at the end of the day, we’re hoping they remember the profession, the school, and Ernst & Young as they make a selection.
America’s “striving for equality” should really be “striving for equity” or “striving for fairness.” People are not the same, by any stretch of the imagination—not in corporate America, or in America overall. If we’re going to leverage the talents of our people, to garner that rich talent, to be successful, we need to be looking at how else we can create equity in every sense of the word—within both the corporate and educational environments.
As a partner at Allen Boston, Director, Office of Minority Recruitment at Ernst & Young, and Ernst & Young, I am Rick Bobrow, E&Y’s Chief Executive Officer, Global Practice, enjoy a moment at the Annual National Convention of the National Association of Black extremely pleased that Accountants (NABA) in Boston in July. we took this position to file an amicus brief. I am also environment, which ultimately forms the obviously very pleased that the other foundation of the Ernst & Young People 68 corporations did the same. It’s First culture. important that firms that talk about having inclusive environments, and that talk about In filing the amicus brief, we made a providing and fostering fairness and equity, unified stand. The corporations, take these stands firmly demonstrating the universities and not-for-profit importance of such a decision. What would organizations that made this stand have happened to the case had there not understood it was an issue that not only been this type of support from corporate impacted the University of Michigan, America? We may never know. However, but was significant to organizations, I don’t believe corporate America could corporations and universities across the have remained silent on this issue if we country. It was the right thing to do from a consider diversity part of our overall business perspective and it was the right business strategy. thing to do, period.
At Ernst & Young, we have partnered with several schools of business and have engineered specific programs dedicated to bringing a diverse group of students to campus. For example, we sponsor summer residency programs designed to introduce high school students to business and accounting and introduce them to specific universities and business programs. Ernst & Young does more than fund these programs; we are physically involved with
Support for this move came from the top. Jim Turley, our Chairman, and Rick Bobrow, our Global CEO, are our senior leaders who give direction to our firm around creating an inclusive environment. When we decided to file the amicus brief, we told our people about it through our daily electronic newsletter. The support we received was overwhelming. It was a confirmation of our commitment to diversity, to a fair and equitable
page 36
Profiles in Diversity Journal
•
July/August 2003
Allen Boston is a Partner and National Director of Ernst & Young’s Office of Minority Recruitment (OMR). OMR is a strategic group within Americas Recruiting, focusing on recruiting candidates from a wide range of talent pools. For more information, contact Catherine Svoboda at catherine.svoboda@ey.com. PDJ
1-800-573-2867 www.diversityjournal.com
At Prudential Financial, great performances are composed of many talents. At Prudential Financial, we believe that what makes us different also makes us stronger. That’s why we celebrate diversity in everything we do. The Many Faces of The Rock.® Insurance† Investments° Real Estate* For more information on our supplier diversity program, visit us at
prudential.com Click About Prudential Click Vendor Relations Click Supplier Diversity
You can see it in our people. Experience has shown us that the best ideas come from blending varied points of view. So, we seek out true original thinkers with unique backgrounds and perspectives.
You can see it in our customers. Millions of customers, from countries and cultures all over the world, rely on Prudential Financial to help them achieve financial security.
You can see it in the way we do business. At Prudential Financial, we’re committed to the needs of the individual. Which is why every product we offer also comes with one-on-one professional guidance. We’re also committed to utilizing a diverse supplier base to provide the quality, price and service we require.
©7/2003. The Prudential Insurance Company of America. †Insurance issued by The Prudential Insurance Company of America, Newark, NJ and its affiliates. °Securities products and services offered through Pruco Securities Corporation (member SIPC). *Real Estate brokerage services are offered through the network of independently owned and operated franchisees of The Prudential Real Estate Affiliates, Inc. Equal Housing Opportunity. Each of the above is a Prudential Financial company and is solely responsible for its respective financial condition and contractual obligations. We are an Equal Opportunity Employer and are committed to diversity in our work force. IFS-A075737
F
Legal Briefings
Patton Boggs LLP
ollowing the Supreme Court’s
announcement that it would hear the University of Michigan cases challenging the race-based elements of that school’s undergraduate and law school
brave new world d
admissions policies, a national debate ensued. Will diversity survive at the nation’s colleges and universities if admissions policies are made color blind? And what will be the wider implications for business and other organizations?
i
v
e
r
s
CORPORATE divERsiTy sTRATEgy POsT-miChigAn
executives should ask: How is the Supreme Court’s ruling likely to affect our approach to diversity. The likely answer is: Not much. It is unlikely that the Court’s ruling will preclude you from doing what you are doing—or should be doing—to respond to the imperative of diversity.
e
What’s your diversity strategy? An effective diversity strategy should be comprehensive. It should touch virtually every significant corporate activity. Wise companies see that diversity is about more than avoiding claims of discrimination. Diversity breeds opportunity. For example, companies that meet the requisite criteria can qualify for an expanding array of government contracts. Environmental concerns now include issues of environmental justice, where companies must consider impact on minority communities. International commerce requires companies to understand the cultural disconnects between nations, so that traveling or transplanted employees will be alert to differences that may affect their ability to do business.
Ironically, history may show that the debate outside the courtroom was more important than the Supreme Court’s actual decision. For those who have recognized the imperative of diversity in the business, non-profit and government sectors, change began long before the Court accepted the case and will continue long after announcement of the decision. For sound business reasons described below, that change should continue.
A World of difference Regardless of how the Supreme Court decision may change the law, nothing in the decision will change the laws of demographics. The United States is growing more diverse every day. Diversity affects every aspect of today’s society. Companies that recognize the link between diversity and the bottom line will understand how to integrate diversity into strategic initiatives that will yield a competitive advantage.
If you do not have a diversity strategy, or if what you have is not comprehensive, your company may be missing out on fruitful opportunities. The following is a framework for building a comprehensive and effective diversity program.
diversity Training Most organizations think of diversity as an employment issue. It certainly is that—but it is much more. Existing markets grow increasingly diverse; new or previouslyignored markets emerge. Organizations that engage diverse populations will benefit. Singleton B. McAllister and Douglas B. Mishkin Co-Chairs, Patton Boggs LLP Against this backdrop, enlightened Corporate Diversity Practice Group 1-800-573-2867 www.diversityjournal.com
Profiles in Diversity Journal
•
July/August 2003
Strategic diversity planning begins with corporate awareness of the breadth and depth of diversity issues. Understanding the diversity phenomenon requires all employees, from executives to rank-and-file employees, to respond to issues they may never have identified or addressed. page 39
Legal Briefings Patton Boggs LLP: Brave new diverse World requirements and Affirmative Action and for assistance during audits by the Office of Federal Contract Compliance Programs (OFCCP).
government Contracts Governments have made diversity considerations a priority in contract requirements. Businesses hoping to win and maintain government contracts must comply with a broad range of diversityrelated regulations that pertain to the company’s workforce, subcontractors, vendors and suppliers. Corporations Singleton B. McAllister should understand Affirmative Action requirements and Small Business Planning begins with training. For executives, training will enable a company’s Subcontracting Plan requirements, and implement enterprise-wide programs leadership to understand the internal and external applications of diversity initiatives. designed to assure compliance with the full Internally, managers and supervisors must range of diversity-related regulatory areas. Compliance will require heightened be trained with the tools necessary to lead an ever-changing workplace. Organizations attention from businesses that are new to government contracts and the procedural will benefit when employees see that their requirements that are a way-of-life for companies value the full range of perspectives created by a diverse workforce. experienced government contractors. Externally, such training will assist Environmental Justice corporate leadership in identifying Corporations are increasingly vulnerable to emerging markets and customer bases while expanding relationships with vendors concerns of minority, low-income, underand suppliers—all of which ultimately will represented and Native American populations that claim adverse health enhance the company’s public image. effects due to allegedly discriminatory policies in violation of environmental laws, Employment regulations and policies. Corporate Employment is the first arena companies environment compliance requires typically think of in relation to diversity. familiarity with the EPA-related aspects of Companies generally are familiar with the Title VI of the Civil Rights Act of 1964, as host of anti-discrimination laws that well as the requirements of Title VI for pertain to hiring, firing and everything in conducting federally-authorized state between, and (hopefully) are aware of the permitting programs under the Clean Air need to train managers and supervisors Act, Clean Water Act and the Resource how to respond to the challenges of Conservation and Recovery Act, among managing a diverse workplace so as to other laws. promote productivity and efficiency while minimizing the risk of costly litigation. Beyond training, companies need counsel for compliance with MBE/WBE/DBE page 40
Crisis management and media Communications A public accusation of diversity-related wrongdoing by a corporation—an employment discrimination class action; a minority community protest over environmental concerns; a consumer boycott to highlight perceived inequities in vendor and supplier or franchisee relationships—can be a magnet for press attention and create a serious public relations crisis. A diversity strategy should include a plan for responding to such a
Douglas B. Mishkin, Esq. crisis through a coordinated legal, legislative and public relations effort. Only through such a coordinated effort can a company simultaneously protect its legal interests in court while continuing to promote its image in the court of public opinion.
Litigation Even the best training, counseling and strategic planning is no guarantee that a company will avoid litigation. Through proper mobilization of internal resources in conjunction with relationships with outside counsel, corporations must be prepared to
continued page 48 Profiles in Diversity Journal
•
July/August 2003
1-800-573-2867 www.diversityjournal.com
takes you places
Exceptional performance is driven by exceptional people — working at a place where they can leverage their experiences, strengths and perspectives. At JPMorgan Chase, we’ve created an environment where everyone can reach their fullest potential. Our people build strong networks, meet new challenges head-on, grow their careers and take themselves — and our firm — to new heights.
© 2001 J.P. Morgan Chase & Co. All rights reserved. J.P. Morgan Chase & Co. An Equal Opportunity and Affirmative Action Employer M/F/D/V. JPMorgan Chase is a marketing name for J.P. Morgan Chase & Co. and its subsidiaries worldwide.
The Changing Landscape
Simmons Associates, Inc.
ten redflags in a diversity
In
initiative
Terrence R. Simmons and Peggy Hazard
Flag #4: Ready … FIRE … Aim!
our last article, “Red Flag #3” (June/ July issue 2003) we established that Line Ownership and Accountability for diversity is the appropriate and essential line-staff relationship in all successful diversity initiatives. While Human Resources and/or diversity specialists or councils can assist in this process, they cannot drive it. The CEO and executive team must author the key elements of the process, actively lead it and hold line managers accountable for following through toward achieving business-related diversity results. We also mentioned that often this realization is finally reached only after years of hard effort by HR and diversity councils and after costly training has been implemented. In fact, this “after the fact” order of events happens so frequently, it rates our “Red Flag #4.” Starting the diversity initiative before the business case and strategy have been completed—with extensive training for employees or a diversity council providing leadership or a set of established metrics being put in place—amounts to workers building a page 42
bridge before engineers have designed it or marksmen beginning to shoot before locating a target. Yes, it’s clearly ready … FIRE … aim! The sequence of events is critical. The wrong sequence can be an indicator that a diversity program is headed for trouble—or worse, may become a monumental waste of time and money. Our advice: If your organization is beginning its diversity initiative, do not: • Begin with training. • Begin with a diversity council. • Establish metrics before defining specific diversity objectives.
Begin with Training Many companies launch their initiatives with training. But if there are no clear strategy, objectives and expectations, training is reduced to “101 Awareness.” In addition, diversity training programs that aren’t effectively tied to the company’s overall goals and objectives can generate several serious problems. Profiles in Diversity Journal
•
July/August 2003
Employees think once they’ve gone through training, they’re “done.” One such employee, when asked what he would do after attending training, proudly announced, “I have been ‘diversified.’ What more can you ask of me?” When training is not carefully placed within a strategically planned series of steps, that happen both before and after, employees believe the training is the process. Since they are not prepared in advance or approached in the future about what they need to actually do in support of diversity, many dismiss the workshop once they leave. At worst, they describe it as a waste of time and money. Off the shelf or one-size-fits-all training simply cannot provide effective, bottom line-oriented skills for an entire organization (in our next article we will address the key attributes of training, including design, delivery, customization by function, industry, country, etc.). What should happen before training begins for employees and managers? Here’s a quick checklist: • Establish a solid and specific business case for diversity within the organization. • Conduct a Cultural Audit or Needs Analysis to discover organizational strengths and needs related to diversity. • Engage the CEO and full executive team in authoring a strategic plan for leveraging diversity toward the specific business results identified earlier. • Launch the first stages of your diversity communications process. • Using all of the above, develop the content of training programs which deliver the business rationale, diversity awareness/ understanding and an appropriate set of skills to enable each cluster of attendees to productively change their behavior once they leave training so that they can, in fact, achieve the business results expected. • Have leaders explain to all attendees in advance of their training that they will be 1-800-573-2867 www.diversityjournal.com
Simmons Associates, Inc.: Ten Red Flags in a Diversity Initiative The Changing Landscape held accountable for diversity-related deliverables after they return from the program.
clear objectives, it is unlikely that the composition of the diversity council will be ideal.
Only at this point should training be designed and delivered to help the line people fulfill their responsibilities. Soon after training, people author their plans, get approval from their managers and begin their implementation. Obviously, a manager’s plan should be more elaborate than an employee’s, and an executive’s would apply to his/her business unit, division, region, etc. Training then becomes a logical step in a process of achieving business results.
Another challenge is encountered when people with a personal and critical agenda join a diversity council. At some point, the council may find itself working with very confidential material and exposed to very revealing discussions with the organization’s top people. It won’t take long for unsettling questions and comments about the council’s composition and role to begin circulating at the organization’s top levels.
Begin with a Diversity Council
These problems aside, the most frequent and troublesome obstacle arises when the diversity council starts the initiative, creates the strategy, happily wins the approval of the executive team and then finds it does not have the organizational power to implement it effectively. In essence, if the initiative is owned and led by the council instead of the executive team, its implementation will almost certainly be second rate. This is usually true even when one or two of the council members are also part of the executive team. In most instances, their role on the council does not include binding decisions for the full organization.
We often find that organizations have given a council a carte blanche assignment to launch the diversity initiative. And, how were the council members selected? They were drawn from the ranks of employees from many levels in the company who have shown the most interest in diversity over the years, of course! Personal interest and enthusiasm is an obvious requirement for council membership. But, will these individuals have the skills to mobilize diversity as a major business driver and successfully merge with other corporate goals? In most cases, the answer is no. If the organization’s executive leadership has not created the diversity plan and set
It is essential then, from the start, for "Metrics can can only only be be selected selected everyone to recognize that the true “Metrics once the the organization organization has has owners of the diversity initiative will be once thought through through what what itit thought wants to to achieve. achieve. Selecting Selecting wants those that that are are easiest easiest to to those establish (representation), (representation), and and establish that may may not not track track progress progress on on that critical business-based business-based drivers, drivers, critical can be be aa cause cause of of wasted wasted can money." time and money.” Peggy Hazard Hazard Peggy Managing Director Director and and Managing Executive Committee Committee Member Member Executive 1-800-573-2867 www.diversityjournal.com
the organization’s executive leadership, not HR and not the council. It follows that the executive leadership should author the diversity strategy as delineated above (and in our previous “Red Flag” article). A council can be given certain early tasks to accomplish such as gathering information on best practices, selecting a consultant and
Profiles in Diversity Journal
“Many companies launch their initiatives with training. But if there are no clear strategy, objectives and expectations, training is reduced to ‘101 Awareness.’”
Terrence R. Simmons Founder, Chief Executive Officer and Managing Partner
assembling certain carefully chosen types of data that may support a needs assessment. However, the council’s role moving forward should be conceptualized as part of the executive leadership’s implementation strategy. What are the tasks they may undertake? What are the special skills required? Will they need to analyze data, influence line executives, facilitate communications and meetings, develop a series of metrics? Council members’ “interest in diversity” will certainly be a required qualification for membership. But, it may turn out to be only one of many.
Establish “Diversity Metrics,” Then Create a Plan We are often asked, “How do we measure diversity?” This question frequently comes not only from diversity practitioners, but from many of the organization’s most analytical thinkers, who feel it is their role to stop the organization from moving off into another “touchy-feely” direction. Their interest is to either impose discipline, rigor and the scientific method or expose the entire project as mere fluff and unworthy of pursuit in a business setting. However, the question, “How do we measure diversity?” is itself illogical when posed to the consultants. We can only reply with another question: “What are the long-term objectives of your diversity process?”
continued page 48 •
July/August 2003
page 43
raising the bar
Deloitte & Touche
Dunlap grew up in Los Angeles and has four siblings; her father was a musician. Early in her career, she worked for a number of non-profit organizations in Los Angeles, such as the Community Youth Gang Services, Rue’s House and People Who Care Youth Center. She was instrumental in reorganization and money-saving projects for the various groups and applied that experience when she first moved to the Chemehuevi reservation at Lake Havasu in California in 1988, after her mother took ill.
betting on a sure thing to better reach an under-served market deLoItte & touche brought In a rInger
W
hen the Chemehuevi Indian tribe of California needed a cool head to preside over its governmental affairs, it turned to Gjrjle Dunlap. And when Deloitte & Touche needed a strong hand to help guide its fledgling National American Indian practice, it, too, turned to Dunlap. A mother of two and grandmother of three, Gjrjle (pronounced GIR-lee) Dunlap is deftly mixing personal experience and professional ability as a development manager for the firm’s National American Indian practice. Dunlap, whose mother was a full-blooded Chemehuevi, has been with D&T since 2000 and is responsible for the Pacific Southwest sector of the practice, among the fastest-growing in the firm. “When I first started, there weren’t too many people in Indian Country who knew
page 44
Deloitte & Touche, so I was out selling and building trust with the gaming tribes,” said Dunlap, based in Los Angeles. “The word spread, and now we are called for a variety of assignments.” “Without Gjrjle, we may not have won many of the engagements. Dunlap’s heritage, previous experience as a tribal leader, and keen understanding of gaming are great assets,” said Stephen Doyle, the past Business Development Center director for the Pacific Southwest. The National American Indian practice was established in 1999 to serve Native American organizations. Based in Tulsa, Oklahoma and initially led by the former chief of staff of the Cherokee Nation of Oklahoma, the practice targeted the American Indian community and related gaming industry.
Profiles in Diversity Journal
•
July/August 2003
When she arrived on the reservation, she began working for the Chemehuevi Housing Authority, then rose to assistant to the executive director in the daily operations.“I found that they were not really taking advantage of the grants that were available to them. My previous experience with not-for-profits helped me to identify these grants, and I helped the community apply for them.” In this role, she successfully applied and received funding for three consecutive years for modernization projects on existing housing on the reservation. In addition, she helped them receive a $5.2 million HUD grant for the construction of 35 housing units. Her drive to help others and make a difference didn’t stop there; in 1997, she was elected chairperson of her tribe and served as chair for three years. “The political scene was not really something that I wanted to get involved with, but the political situation was not good on the reservation and when they asked me to consider running as chair, I felt that it was the right thing to do,” said Dunlap. As tribal chair, she reorganized the tribe’s administrative and financial budgets and successfully increased the administrative revenue that allowed her to hire staff to begin work on the tribe’s Destination 1-800-573-2867 www.diversityjournal.com
deloitte & touche: betting on a sure thing Resort project, which consisted of a hotel/casino and other amenities.
state is home to 108 federally recognized Indian tribes. “The opportunities in the Midwest
“It not only helps the firm find business within the American Indian community, it also helps my community.” Gjrjle Dunlap Development Manager Deloitte & Touche National American Indian Practice
After her mother passed, Dunlap decided to return to “Corporate America.” “Being a chairperson was a 24-hour-a-day-job, and I found it very difficult to obtain support within the tribal council in pursuing development endeavors,” said Dunlap. The opportunity at Deloitte fell into her lap. Deloitte’s National American Indian practice was looking for a Native American to help them generate business. Gaming development in the Golden State offered the practice new vistas of opportunity; the
1-800-573-2867 www.diversityjournal.com
Despite her hectic schedule, Dunlap continues her relationship with members of the Chemehuevi Indian Tribal Council and has served in a variety of roles on its board.
weren’t there,” says
She is currently a board member with the
Bill Hartman, retired partner and former head of the National American Indian practice. “However, when California, home to 50 Indian tribes, approved
Central Development Recovery Project (Los Angeles, CA) and is the “Associate Member Liaison” of the CNIGA (California Nations Indian Gaming Association) Associate Member Program. She has also served as Vice Chairman of the Board for the Qualified Business People’s Club, Chairman of the Board of the Small World Child Care Learning Center, Secretary of the Board for Brothers & Sisters Unlimited, and Chairman of the Board for the Alcohol PDJ Abuse Program LA.
Indian gaming, we wanted a Native American with good tribal contacts to represent the firm and hired Gjrjle Dunlap.”
For more information about the Deloitte & Touche National American Indian practice, contact Natalie Webb, Manager, Public Relations at nawebb@deloitte.com
That suited Dunlap just fine. “What I like about my position with Deloitte & Touche is that it not only helps the firm find business within the American Indian community, it also helps my community,” she said. The Chemehuevi Indian Reservation is in southeastern California on the Arizona border, with twenty-five miles of its boundary along the shores of Lake Havasu.
A Winning Market: Native American Gaming The California Nations Indian Gaming Association (CNIGA) is composed of 56 federally recognized Tribal Governments, each a sovereign nation recognized under the United States Constitution. According to CNIGA, the total casino revenue generated directly by Indian gaming in California, including in-casino concessions, approached an estimated $1.4 billion in 1997, and continues to increase each year.
raising the bar
Additional direct revenue is created by gaming patrons’ expenditures at local non-casino businesses which total an estimated $273 million. The total positive impact of Indian gaming on the output of final goods and services in California, both directly and indirectly through subsequent rounds of spending, is estimated to equal approximately $4.4 billion.
Profiles in Diversity Journal
•
July/August 2003
Indian casinos employ an estimated 14,571 California residents, 90 percent of whom are not Indians. In addition to those directly employed at casinos, Indian gaming supports an estimated 33,800 additional jobs in California through subsequent rounds of spending by employees, vendors, construction firms, tribal governments and other affected businesses. page 45
the Changing landscaping
Spencer Stuart
W
ith America in the midst of a recession, many corporate initiatives—which were safe during the boom of the 1990s—are today feeling the pressure. Administrators are slashing budgets for training, corporate communication and human resource programs, while other programs are nervously waiting for the “budget axe” to fall on them. However, when it comes to diversity, the exact opposite is happening. Rather than forsaking diversity, we are finding that many companies are making it a top priority. But why? Here are a few considerations as to why diversity remains a valid business case in today’s economic environment.
passage of time, the increased use of technologies and expired patents provide all companies the same level of access to business efficiencies. The playing field, for the most part, is quite equal. So, to break through this “equality,” companies seek new platforms to achieve competitive advantage. This mature market mentality is supporting diversity initiatives in two ways.
To accelerate growth rates, companies that offer products and services to the mass market are aggressively trying to penetrate sub-segments within their current customer base. Companies, especially those in the consumer-driven industries, realize that, to meet the growing needs of these specialty segments, they must cultivate a diverse culture in their executive ranks. For a mature economy The majority of industries in the U.S. today example, a large cosmetic manufacturer’s target customer was women aged 18 to 40, are “mature.” By that, I mean they possess and this target customer base grew a full breadth of product and service offerings; they have fully leveraged pricing, approximately four to five percent annually. cost controls and back-end efficiencies; and This same company learned that Africanthey are competing against well-established American women outspend the mass market in this industry by competitors. In addition, through the
a ratio of three-to-one. To profit from this research, the company created marketing programs to target African-American women. The resulting growth in this specialty customer segment strongly contributed to growth in the overall business by an additional three to four points (or, twice the previous growth rate). A second consideration is an organization’s talent—their people—which has now become the next competitive platform. Leveraging the quality of people, and the quality of the decisions they generate, has become a priority. Many studies have documented that companies that foster a diverse workplace are more profitable, often as a result of the ideas and perspectives a diverse workforce brings to the organization. Today, companies are sharpening their competitive edge by diversifying their executive and employee teams. This diversity can only enhance a company’s chances of successfully penetrating some of the customer subsegments mentioned above.
the changing face of america Today’s pool of candidates has changed dramatically as the “face” of America changes. The Hispanic population has surpassed African Americans as the largest ethnic group in America. In addition, the amount of money African Americans spend annually has reached unprecedented proportions. So as companies seek to hire the best talent, it is no longer a smart business decision to focus solely on Caucasian males. Indeed, America’s population has become so dynamic that, in an average
THE
recessionproof PROGRAM
why your diVersity initiatiVe must— and will—surViVe this eConomy Virginia Clarke, Diversity Practice Co-Leader page 46
Profiles in Diversity Journal
•
July/August 2003
1-800-573-2867 www.diversityjournal.com
spencer stuart: the recession-Proof Program an educated consumer “America’s population has become so dynamic that, in an average group of the five ‘best-in-class candidates,’ there likely will be only two Caucasian males.” Ginny Clarke
group of the five “best-in-class candidates,” there likely will be only two Caucasian males. This is a dramatic shift in the human capital landscape, and one that is forcing companies to look at all potential candidates.
1-800-573-2867 www.diversityjournal.com
Consumer and shareholder activists and government regulations have ingrained themselves into the corporate world. Today’s consumers, partly due to the ability to quickly share information via the Internet, are far more aware of the makeup of companies that provide them with products and services. Plus, investors are increasingly vigilant with regard to issues of fairness, inclusion and equity. Also, companies seeking to work with the government will be held to stringent EEOC standards. Therefore, as organizations continue to find themselves
Profiles in Diversity Journal
•
July/August 2003
the Changing landscape
subject to increasing consumer and government scrutiny, they are sensitive to having not only a diverse workforce, but a diverse executive management team and Board as well. These trends begin to explain why companies consider diversity a priority, even during a time of recession. The bottom line is that effective management of a diverse workforce increases revenue and profit. For minority and female candidates who have a strong resume and a good track record of performance, your time has come! Successful companies are looking for your skills and diverse perspectives, and the possibilities PDJ are endless. Ginny Clarke is the co-leader of Spencer Stuart’s Diversity Practice and is a member of the firm’s Financial Services Practice. Ginny is based in the firm’s Chicago office.
page 47
ready ... FIRE ... aim! Metrics can only be selected once the organization has thought through what it wants to achieve. Selecting metrics at random, that are easiest to establish (representation), and that may not track progress on critical business-based drivers, can be a cause of wasted time and money and send a signal to the entire organization that, at its core, the company’s diversity initiative is merely an elaborate affirmative action plan.
Simmons Associates Continued from page 43
share, enhanced sales effectiveness, a more productive and efficient work environment, retention of outstanding talent, etc.
First Things First
Typically, these problems are not detected until the Before metrics can be established, the organization must answer questions related diversity initiative stalls. The to how diversity will contribute to its practitioners seek business results, how it wants its work “additional tools to environment to change and several others, along with how it will become more diverse. get to the next stage,” when in fact the If the metrics measure only hiring, the problem may be the organization may believe it is making result of sequence. progress in diversity, but totally miss For those who have measuring those aspect of diversity that contribute to its success as a business entity. not yet begun a diversity initiative in A carefully chosen process of identifying key earnest, we share this to prevent costly mistakes. For those who have initiatives objectives, then developing dedicated metrics, should yield a useful list of metrics well underway and are frustrated at the lack which focus attention to increases in market of results, we hope this will shed light on possible causes.
brave new world respond to litigation involving allegations of discrimination, harassment and non-compliance with the full spectrum of federal and state diversity-related statutes and regulations. Companies should be able to combine litigation with legislative, regulatory, political or public relations strategies to craft innovative, aggressive and cost-effective strategies designed to protect the full range of a company’s interests.
After Michigan The Supreme Court may have closed the book on the University of Michigan cases, page 48
Find out more about the “10 Red Flags” of a diversity initiative by contacting Simmons Associates, Inc., at 215.862.3020 or online at www.simmonsassoc.com. PDJ
Patton Boggs LLP Continued from page 40 but the diversity imperative represented by the 2000 Census will continue and grow. Businesses that recognize the opportunities presented by the increasing diversity of our society will profit. Those results will be the product of a diversity strategy that embraces internal and external relationships and operations. In the end, the mark of a successful strategy will be the elimination of separately-titled “diversity” programs and “diversity” officers, because it will be embedded in the function of every officer, manager and supervisor and ultimately every employee. That day is not at hand,
Profiles in Diversity Journal
•
July/August 2003
but the efforts of those who “get” diversity will bring it nearer. Singleton B. McAllister is a partner in the public policy and business law practice groups of Washington, D.C.’s Patton Boggs LLP. She is cochair of the Patton Boggs Corporate Diversity Practice Group. Singleton may be reached at 202.457.6402 or smcallister@pattonboggs.com. Douglas B. Mishkin, Esq. is a partner in the employment law group of Washington, D.C.’s Patton Boggs LLP. He is co-chair of the Patton Boggs Corporate Diversity Practice Group as well as co-chair of the firm’s Employment Law Group. He may be reached at 202.457.6020 or dmishkin@pattonboggs.com. PDJ 1-800-573-2867 www.diversityjournal.com
&
hear there
diversity in the news
Georgia Tech Named Nation’s #1 Producer of African-American Engineers
degrees in engineering, which accounted for two percent.
Georgia Tech is the number one producer of African-American engineers at the bachelor’s and master’s degree levels, according to Black Issues in Higher Education magazine’s annual college rankings report, awarding more bachelor’s and master’s degrees to African-American
practices, rather than relying on affirmative “Georgia Tech action quotas. Georgia Tech awarded 125 approaches bachelor’s degrees in engineering to Robert Haley minority African-American students for the 2001Director of Special Projects recruitment on a College of Engineering number of fronts 2002 academic year—10 percent of the total number awarded that year. Among the from elementary to graduate school,” said top five universities to rank in this category, Robert Haley, director of special projects in engineering students during the 2001-2002 Tech is the only institution that does not the College of Engineering. Haley is academic year than any other university or have a predominantly black student creator and coordinator of FOCUS, an college in the country. Georgia Tech ranked population. Rounding out the top five are: annual event at Tech designed to attract the #4 (tied with Pennsylvania University) for North Carolina A&T State University with country’s finest minority undergraduates to the number of African-American engineers 124; Florida A&M University with 76; its graduate programs. who received a doctorate that year. Morgan State University with 72; and Tuskegee University with 70. “Through FOCUS and other programs, The Black Issues rankings, considered to be we are working to create a campus an important tool to measure the success of Georgia Tech awarded 37 master’s degrees environment of inclusion, respect, and campus diversity endeavors, underscore in engineering to African Americans, six community, where diversity is viewed Tech’s efforts to create a diverse campus percent of the master’s degrees in as a valuable asset in every aspect of PDJ through strong recruitment and retention engineering that year, and four doctoral campus life.”
Diversity — It’s What We Do “ADL [was] instrumental in the development of our in-house programs and central to their success.” James A. Kavina, FBI, US Dept. of Justice At ADL, we’ve always believed that a diverse workplace builds stronger, better businesses and organizations. It’s who we are and what we do. So it’s no surprise that our A WorkplAce of DifferenceTM programs lead the market and that we’ve trained hundreds of thousands of people at some of the best American and global companies. To find out what we can do for you, please call: Sharon Mathews 212-885-7805; smathews@adl.org 1913-2003
OUR 90TH yeaR
1-800-573-2867 www.diversityjournal.com
Profiles in Diversity Journal
•
July/August 2003
page 49
&
hear there
diversity in the news
October 15, 2003 Designated As National Disability Mentoring Day By Labor Secretary Chao Oct. 15, 2003 has been designated as National Disability Mentoring Day, Secretary of Labor Elaine L. Chao announced today. Begun in 1999, National Disability Mentoring Day promotes career development for students and job seekers with disabilities through one-on-one job shadowing, group visits to public and private employers, and hands-on career exploration. It is held in October in conjunction with National Disability Employment Awareness Month.
“National Disability Mentoring Day is an opportunity for young people with disabilities to gain firsthand exposure to many of the career options available to them,” said Roy Grizzard, assistant secretary of labor for the Office of Disability Employment Policy (ODEP). “It will also make employers and the general public increasingly aware that people with disabilities represent a largely untapped resource for sustaining our national economy and well-being.”
Jaime Powers, seated, learns about Verizon from her mentor, Joan Hewitt, DMD-Syracuse, NY.
United Kingdom, and Australia are expected to participate in National Disability Mentoring Day.
ODEP is the nation’s first assistant secretary-led office that specifically addresses “National Disability Mentoring Day helps Assistant Secretary Grizzard also gave policies that impact employment of people answer the President’s challenge to build a special recognition to the American with disabilities. It acts as a catalyst to more welcoming and compassionate nation Association of People with Disabilities, stimulate new ideas about employment for all our citizens, which is the cornerstone which co-sponsors National Disability through research and development, of his New Freedom Initiative,” Secretary Mentoring Day with ODEP and works with policy analysis, grant awards, technical Chao said. “I strongly encourage young other national organizations to promote assistance, and the promotion of effective PDJ people, schools, businesses, and career exploration for students and job business practices. government agencies throughout the seekers with disabilities. In 2003, young For more information and local contacts for the country to become involved in this people in all 50 states, Guam, American event, contact the American Association of People with Disabilities at www.aapd-dc.org. important national event.” Samoa, Japan, Italy, Singapore, France, the
No-Fault Resolutions Personal Empowerment: Achieving Individual and Departmental Excellence is a new book by Bennie Crane and Dr. Julian Williams that was written to demonstrate to supervisors and managers that selfempowerment can be used to create NO-FAULT RESOLUTIONS TO DIVERSITY ISSUES. They do not have to sacrifice important relationships in order to carry out the responsibilities of their positions. For Only example: • “Affirmative action makes me uncomfortable as an officer $29.95! of a growing department.” Read my response on page 50. • “What are acceptable or unacceptable accommodations to cultural diversity?” On page 51, I begin my response with “In order to understand diversity we need go no farther than our own families.” • “Some members of my command are bitter after being passed over for promotion because of our department’s affirmative action program.” On page 53 get a detailed account of how I addressed a similar incident. • “How do I recognize a bias in myself?” On page 54, I state that I don’t know of anyone that does not have a bias. I go on to provide information on how to avoid getting into trouble because of them.” See page 110 for No-Fault Solutions That Break Through Stereotypes! ISBN 0-87814-842-6 Order it today from PennWell Books! Tel: 1.800.752.9764 • www.pennwellbooks.com page 50
Profiles in Diversity Journal
•
July/August 2003
1-800-573-2867 www.diversityjournal.com