News Column

The Power of Diversity

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Diversity Elite

Click here to view the Diversity Elite 60 companies

Southern California Edison (SCE) has learned to recognize and appreciate the huge diversity of its consumer base, its employees, and its potential labor market, especially in the heartland for most of its 4.8 million customers, the Los Angeles region.

"We need to know what's going on in that marketplace," says Frank Quevedo, vice-president, diversity, with the Rosemead, California-based electric utility. "We need to connect with the community we serve."

That's a common refrain among many of the 60 companies whose best practices in the field of diversity and inclusion have earned them recognition among the 2007-2008 Diversity Elite.

SCE tops the Diversity Elite list after finishing third last year.

Reaching out to neighbors, assisting different sections of their communities, and establishing in-house programs and policies for the benefit of all staff are touted by many companies as core values ... and sound business practices.

It all makes perfect sense to Jonamay Lambert, who has been in the business of diversity for 20 years. She founded Lambert & Associates, just outside Chicago, and is now national practice leader for diversity and inclusion with Capital H. Group, a human resources consultancy that bought her company late last year.

Ms. Lambert detects a "fundamental shift" in diversity attitudes driven by demographics -- growing populations of different racial and ethnic groups, greater acceptance of equal opportunities for women and the disabled, and seismic generational changes.

She says the looming retirement of millions of baby boomers is making way for a new generation that is "very different in terms of what they want," and hence in the way companies must attract, train, and retain them.

"Young people today grow up in a more diverse world and are used to that," Ms. Lambert explains. "Diversity is something they expect and want."

She lists three of the current major diversity issues as the retirement of baby boomers, increased globalization, and what she describes as the largest and fastest-growing minority -- the disabled.

With ethnic minorities heavily represented among SCE's customers, Mr. Quevedo says the company strives to be consumer friendly, for example, by translating written materials and paying extra to key staff who can speak other languages.

The company monitors leadership, recruitment, retention, promotion, and other performance measures to make sure "we're doing what we say we're doing." That starts high up: Two members of the board for SCE's parent company, Edison International, are Hispanic -- the new president of Purdue University, France Cordova, and Luis G. Nogales, managing partner of Nogales Investors.

Affinity for Support
In the first half of this year, Mr. Quevedo says 70 percent of hires were women or minorities; of just under 15,000 employees, he says close to half are minorities, with 29 percent Hispanic.

"Affinity groups" help foster a sense of inclusion. Employees have formed groups in support of women, African Americans, Hispanics, Native Americans, those with roots in China, Vietnam, the Philippines, and the Middle East, plus gay, lesbian, bisexual, and transgender supporters.

Mr. Quevedo says diversity extends to the SCE board, where four of the 10 members come from minority groups. Across the company, he says, staff can see the efforts being made to embrace diversity and inclusion and "know that we're serious about the contribution of all employees."

Nobody does diversity quite like Wal-Mart, or at least not on its scale.

The Bentonville, Arkansas, retail giant employs the equivalent of a decent-sized city -- 1.3 million people in the United States alone -- of whom around 75 focus solely on diversity relationships inside and outside the company.

Donald Fan, director of marketing and communications for diversity relations, says Wal-Mart has a community outreach program and an equally strong diversity ethic running through the company.

Knowing the Neighborhood
Wal-Mart works with Hispanic, African-American, Asian-American, and women's organizations to better understand and serve those communities. "We need to understand not just their buying habits or how they spend their money, but also their culture and heritage," Mr. Fan says.

Such relationships bring mutual benefits. "The community recognizes us as a partner, an advocate, and a friend," he says, adding the hope that this trust and positive image will translate into a loyal customer base.

Wal-Mart employs more than 826,000 women, 237,000 African Americans, and 154,000 Hispanics, and has established in-house resource groups supporting those people plus others. That diversity ascends to the corner offices -- the high-profile CEO of Wal-Mart's U.S. stores division, Eduardo Castro-Wright, is Hispanic.

Mr. Fan believes the company's 14-strong board also reflects diversity with three women, two Hispanic, and two African-American members; in addition, he says, Wal-Mart works with more than 3,000 minority-owned suppliers in the United States.

Diversity Dollars
Financial institutions in general have scored well on the Diversity Elite -- four of the top 10 companies this year are in the finance industry.

Bank of America, No. 5 this year and last year's No. 1, is fully committed to diversity and inclusion inside and outside the company, according to media relations manager Kelly Sapp, based at corporate headquarters in Charlotte, North Carolina.

She says six informal affinity groups within the company play an important role in sharing best practices, mentoring, networking, promoting leadership, and helping with recruitment and staff retention.

Ms. Sapp says of the bank's more than 203,000 staff, close to 70 percent are women and 44 percent minorities. "Women also fill 50 percent of management and officer roles," she adds.

The bank has a 23-member global diversity and inclusion council appointed by chairman and CEO Ken Lewis, a network of diversity business councils plus a philanthropic program established in 2004 with the goal of giving $1.5 billion over 10 years, mostly to local community organizations.

PNM Resources, an electric and gas energy and utility company based in Albuquerque, New Mexico, has the smallest number of employees [1,165] of any company on the 2007 Diversity Elite.

But that in no way lessens the commitment to diversity and inclusion, according to Ramon Gonzales, vice-president of people services. "Diversity within the company makes decisions much richer and, we believe, really strengthens our business acumen. We value the creativity that diversity brings at all levels of the company."

While PNM strives for greater connection to its customers and pursues employment programs reflecting an increasingly diverse labor market, Mr. Gonzales is also focused on some very specific trends.

One is planning how to hire, train, and develop replacement employees for the huge number of baby boomers now approaching retirement. "We need to be relevant to the demographic mix," he says.

Staff educational assistance and information resources on caring for elderly relatives are two more examples of how PNM is helping employees experience what Mr. Gonzales calls "meaningful engagement with the company."

Labor market dynamics are also a hot topic for Eric Falls, executive director of HR shared services for MGM Grand Resorts, part of MGM Mirage, the casino, hotel, restaurant, and hospitality conglomerate based in Las Vegas, Nevada.

With around 70,000 employees needed to maintain gambling and leisure operations, Mr. Falls is concerned about a "shrinking labor market" caused not only by the exit of baby boomers but also by the trend toward more people working from home.

To aid a growing number of Spanish-dominant applicants in an industry where a certain level of English is essential to meet safety and service standards, the company last year began offering free English tuition as part of training.

The company also has programs specifically encouraging minorities, women, and the disadvantaged to bid for purchasing and construction contracts.

The United States Postal Service says it is delivering not only the nation's mail but also a commitment to diversity within the huge organization, with suppliers and throughout the communities it serves.

Based in Washington, D.C., the Postal Service is the only federal government agency to make the Diversity Elite list and is also the second-largest employer with a workforce, including temporary staff, of around 800,000.

Tony Vegliante, chief human resources officer and executive vice-president, says the service follows federal guidelines relating to ethnicity, race, gender, and disability, closely monitoring and reporting on its own performance.

Mr. Vegliante talks about an inclusive "talent acquisition/retention strategy" that goes way beyond traditional mail carriers -- into areas such as engineering, legal, and financial -- and reflects continually changing demographics. "We see ourselves as a microcosm of America," he says.

Worldwide Ambitions
Food manufacturer General Mills, best known for brands and products such as Pillsbury, Betty Crocker, Cheerios and Wheaties, Green Giant vegetables, Yoplait yogurt, and Haagen-Dazs ice cream, has operations around the world.

And it's that global footprint that has Kelly Baker, vice-president of corporate diversity, and some of her colleagues looking ahead at how best to manage the company's diverse worldwide human resources.

General Mills, headquartered in Minneapolis, has a staff of more than 28,000. Mrs. Baker says much of that "great talent" is outside the United States, and the company is increasingly focused on ways to "leverage our differences."

She says that has been happening for a long time domestically through diversity and inclusion initiatives within General Mills that include seven employee-run support networks and close to 30 mentoring programs, plus other programs involving outside suppliers. In addition, Hilda Ochoa-Brillembourg has sat on the board since 2002.

The company's Web site shows how spending with minority-owned suppliers jumped from just $5 million in 1992 to $209 million in 2004, the same year another $109 million was spent with women-owned businesses. Maerenn Ball, the corporate public relations coordinator, adds that General Mills spent $452 million with diverse suppliers in the 2007 fiscal year to the end of May.

For more of Hispanic Business' signature lists, please see the Ranking Channel

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