Diversity and Inclusion 2.0

As we celebrate Black History Month and recognize the accomplishments associated with this annual observance, time should also be taken to acknowledge the significant progress that has been made in the broader area of Diversity & Inclusion (D&I) across our business landscape. We have a long way to go, but heightened respect and appreciation for differences in ethnicity, gender, age, national origin, disability, sexual orientation, education and religion have changed the talent practices of most businesses and redefined the profiles of leadership teams and executive boards. The value of embracing varied perspectives, work experiences, lifestyles and cultures has spurred new levels of innovation and competitive advantage. In its annual Predictions for 2016* research report, Bersin (Deloitte) discusses the rise of a new talent management maturity model that assigns varied levels of maturity based, among other factors, on the sophistication of a company’s efforts in designing and developing D&I solutions. Regretfully, most organizations (71%) are still managing the D&I discipline from a compliance perspective, as their solutions usually take the form of a “program” or, worse still, an “event”. But as some of the more mature organizations have demonstrated, there is an opportunity to take D&I to the next level … call it Diversity & Inclusion 2.0. These organizations view the D&I platform as a strategic imperative and one that is embedded into everything they do. The ultimate goal of their D&I strategy is to eventually not need one at all.

In its research Bersin discusses the development of an “inclusive talent system” by approximately 10% of companies at the highest maturity level. These leading organizations have differentiated themselves in the D&I arena by thoughtfully building the type of culture and processes that invite diversity and generate business value through diversity. This D&I 2.0 approach is more strategic and less programmatic. As we broaden our definition of diversity to include the variability of both people AND ideas, what are some of the actions we can take to further drive strategic diversity across the business? How can we build our own organizational “field of dreams” from which the broadest array of talent and ideas can contribute and innovate in a fast-changing economy?

We know that within the new world of training and development, for example, there is a growing passion around self-directed learning. This trend is shifting the balance between corporate learning that is more centralized and standardized and individual-based learning that allows employees to curate, recommend and arrange content that they find helpful. This latter, more recent, phenomenon recognizes the power of data and technology to access the right learning content at the right time and in the right format. As we define new means for self-directed learning, from mobile devices to podcasts to rotational assignments, we must build these channels and the learning experiences they create with an inclusive mindset that will engage and nurture the minds of a more diverse team.

The performance management process in most companies has floundered over time and struggles to address the needs of a more diverse and demanding workforce. Less mature organizations continue to steward an archaic process that is insensitive to basic needs and new desires such as a fulfilling and inspiring performance review process, investments in affinity groups and communities of practice for specific talent pools, and formal coaching programs. If we redesign performance management from an annual HR process into a more inclusive business system, we can explore and reinvent new approaches to goal-setting and career mapping, informal and formal relationships and performance discussions with the proper spirit and cadence, tailored coaching and mentoring platforms, user-friendly applications that personalize the performance management experience, and a communication strategy that addresses the needs of all populations and inspires the entire workforce.

Our traditional associations with leadership and succession continue to shift as we see an uptick in the importance of agility, collaboration and social advocacy, while the perceived value of hierarchy and tenure has plateaued or is perhaps trending down. With expanding spans of control and more cross-functional, global teams, today’s business leader is more commonly a team leader than a top-down executive. The D&I 2.0 strategy must define the competencies of a diverse leadership team, enable the accelerated promotion of qualified leadership candidates of any profile, and design a tailored, engaging approach to the continued development of such leaders. Replacement candidates for targeted leadership roles should be sourced with a broad brush and selected through a more scientific analysis of potential based on a broader suite of skills and experiences. The mission of a growing business cannot be compromised by artificial constraints placed on any members of a diverse candidate pool. Leading organizations are creating broader networks of relationships and inclusive environments in which to promote and nurture leaders, including the emergence of high performers who historically may have been more reluctant to take on a leadership role in a less inviting workplace.

Diversity & Inclusion has been and remains a critically important discipline driving business performance. While the first generation of initiatives in this area focused on the acknowledgement of and compliance with this issue, there is an opportunity now for D&I 2.0 to up the bar and drive tangible business results. If we can build a truly inclusive workplace that fully expands our view of talent and fully stretches our appreciation for ideas and perspectives, then perhaps our D&I strategy will, over time, simply be our … business strategy.

 

* Predictions for 2016
A Bold New World of Talent, Learning,
Leadership and HR Technology Ahead
Bersin by Deloitte

Cloud-based talent management applications should be used to “brighten” the view of your workforce

The proliferation of cloud-based talent management software has never been greater and set the stage better for a true revolution in the way companies can drive sustainable, competitive advantage through their people. Basing these applications in the cloud provides cost advantages, greater flexibility, efficiency and agility than on-premise systems. But the effective execution of the cloud lies not simply in the utilization of limitless tools and templates now available in chosen system(s), but in the ability to exploit these applications to connect with our people in more meaningful, more human, more effective ways than ever before. As we look at a few examples, we can begin to understand both the risks and the possibilities with these applications and how the cloud can further brighten, not shade, the connection to our workforce.

Performance management has become, perhaps, as disillusioning as any existing talent related business process. Eyes roll and disengagement spikes as workers continue to experience an administrative, impersonal approach to their value as a performer. Cloud-based modules now provide a variety of new features, including more space to write comprehensive comments about performance and new timing functionality to auto-save performance comments. The risk, of course, is that the boundless comment field becomes a proxy for face-to-face formal and informal feedback, a practice that has regrettably become scarce and/or marginalized over time, especially in our “virtual” workplaces. Instead of summarizing and confirming what should be discussed verbally in a live setting, the template now threatens to replace whatever dialogue might have already existed. To mitigate this risk, leaders must utilize the new features to optimize the written mode of communication as a supplement to the verbal one already in place. The performer’s search for clarity can be gained, and long-term engagement sealed, through a multi-modal approach to open and honest performance feedback.

Talent profiles can now be defined and made visible in greater detail, incorporating more specific behavioral components associated with standard job competencies. Cloud-based applications have set a new standard around the granularity of our view of a given job. The resulting expectation is that the organization will be fully accountable to that standard across the entire talent system. If not, the profiles become “cloudy” and the workforce skeptical. Learning objectives for role-based curricula should align with the behaviors specifically outlined in the system. Performance must be fairly assessed against the sub-competencies so carefully defined in the profile. Applicant screening processes should leverage these detailed role profiles to drive superior candidate pools. Indeed, the opportunity for a truly systemic and integrated approach to the management of talent awaits the company ready to fully embrace the cloud.

There are now new performance subject areas within systems available for employees or managers to report more fluidly on development goals. Such reporting capabilities allow for a running commentary or “diary” of progress and constraints associated with predefined development objectives. Of course, sometimes the root cause of impeded progress or unbridled success is hidden or below the waterline, liberated only by an open dialogue about a project or goal. Valued self-reflection coming out of these applications can inform the peer discussions, team meetings and management conversations that follow. Organizations must not allow the application to define a development culture; rather, the emerging capabilities offered by cloud based technologies must support the culture and ensure that the processes these technologies automate are advancing, not replacing, the human dimension of talent management.

Talent leaders understand that with progress comes risk. If sophisticated talent applications monopolize the communication channels within our business, our workforce will be hidden from our view. On the other hand, if we leverage the capabilities of cloud technologies in the right way, the future of our business and the commitment of our people will never be brighter.

The Promise of Performance Management

The business process of performance management (PM) often seems like an isolated room within the “human capital” house (see figure below). The walls around the room appear opaque, with little visibility or clarity provided to a workforce that wants to understand what informs the performance management process and how the process aligns with other dimensions of one’s career.

HC House

Indeed, performance management continues to be one of the most disheartening and unfulfilling components of the people function. In a recent report from the Institute for Corporate Productivity, Performance Management: Still Waiting for Real Change, “seven out of ten respondents believed that their organization’s PM process is not managed well, and that it does not have a positive effect on performance”. Other findings find it highly administrative, archaic and outdated. According to Bersin by Deloitte’s 2015 Global Human Capital Trends, “performance management is being reinvented for a new, forward looking purpose: to serve as an efficient, focused business process that improves employee engagement and drives business results.” In the minority of organizations that get it right, performance management is a tremendous, value-rich component of the business and a catalyst for accelerated performance and growth. So how can we tear down the walls and connect this tremendously important discipline to the rest of the human capital framework?

Differentiating “performance”

One simple answer is to utilize the PM process to truly recognize superior performers. Rather than simply yielding to an annual, cascaded budgeting exercise that lands on a relatively meaningless and discouraging merit increase range of 2.4% to 3.0% for everyone, we can use thoughtful evaluations completed by conscientious managers. Those managers would assess performance against clear, strategically aligned goals and behavioral competency guideposts to create a wider dispersion among lower and higher performers (e.g. 0% to 5.0%). Similarly, we can annually examine and market test those pivotal or highly valued roles, as defined by our workforce planning process, and adjust salaries accordingly to better price those positions with more market or strategic value. Such a change will better integrate Performance Management with Engagement and Retention (see framework below) and establish more of a meritocracy-based culture. 

Recognizing “potential”

Many organizations have moved away from forced rankings and, instead, have shifted to talent reviews. In this setting, leaders from all functions meet to identify those 20-25% of the workers, across the entire business, which have earned performance-based, discretionary bonuses. Why not use that same process to document and engage those individuals who have demonstrated the “potential” to move into new or emerging roles across the company? Then you can supplement annual review discussions with meaningful dialogue about career aspirations and alternative career ladders. Whether you call this exercise succession management or career planning, the benefit to the employee is that the evaluation is about performance AND about the performer. This extended focus on “potential” better links Performance Management to Succession Management and increases the possibility that valued members of your team will more actively and creatively consider career journeys they can have inside the company.

 

TSF3

Bridging performance gaps with learning experiences

Regretfully, there is very little correlation between the performance gap(s) of an individual contributor in one year and the learning path that is designed for that individual in the coming year. The emergence of new learning technologies, social learning, and other modes of development have enabled talent to access more creative avenues for bridging performance gaps, yet this areas remains an underutilized strategy. Exploiting such options will better link Performance Management to Learning and Development and empower our workers to utilize training in its most optimal context – immediate, tied to a specific learning gap, and learner driven.

Articulating your performance culture

How consistent is the employee value proposition you present to a recruiting candidate with the actual Performance Management experience the person witnesses as a new hire? So often candidates are brought into an organization with a misunderstood picture of their earning potential or short-term promotion and leadership opportunities. The first performance review process feels disconnected from the unlimited possibilities shared only months earlier, and the employee is left feeling disillusioned and burned. Clearly discussing the organization’s approach to Performance Management will better link this importance discipline to Talent Acquisition by managing expectations and reducing unwanted attrition.

A company’s Performance Management process is not an uninvited houseguest, left to revel in paper forms and impersonal compliance-based assessments; rather, it is an essential part of the HR family with a rich source of date about how, why, and when employees perform their job. Such insight can fuel the engine of a well functioning talent management practice.