Five steps to a more diverse workforce
The business climate in Chicago has shifted in fundamental ways in recent years with labor markets heating up and customer and employee expectations becoming more complex. How can businesses succeed in this more challenging environment?
One of the most important steps is developing a more inclusive workforce including women, ethnic minorities and the LGBT community. The advantages include:
Gain access to larger talent pool: Business owners can't afford to ignore a source of skilled workers as labor markets get more competitive. The U.S. unemployment rate fell to 3.8 percent in May - the lowest in 18 years. The latest data indicate the labor market in the Greater Chicago area is even tighter-the unemployment rate for April was 3.6 percent.
Reflect your customers: Chicago is diverse and that trend will only accelerate. Today, Chicago is about 51 percent female and 49 percent male. In terms of ethnic diversity, the city is 32 percent White; 29 percent African American; and 29 percent Hispanic. As the population becomes more diverse, customers are more likely to evaluate firms based on ESG (environment, social and governance) factors.
Drive better ideas: Diversity brings new perspectives, innovation and ideas that can lead to greater creativity and problem solving. A recent study highlighted in Fast Company looked at the performance of 3,000 publicly traded companies over 13 years and found that more diverse firms averaged about two extra products in any given year - about double the typical number for a major company
There's no quick fix, but here are five key steps essential to building a more diverse workforce, which firms can adapt to their size and business needs:
Proactively recruit diverse talent: This requires more focused recruiting efforts and looking for talent in new places. This may include recruiting at more universities and partnering with different organizations. To help recruit top LGBT talent, Bank of America has partnered with leadership organizations such as Out & Equal Workplace Advocates.
Identify and pull through midlevel and entry-level diverse talent into more senior roles: This requires a firm-wide commitment to giving everyone the right opportunities to advance, removing barriers and supporting development. For example, Bank of America has a Diverse Leaders Sponsorship Program, which connects promising talent with senior leader sponsors to help build a robust and diverse pipeline.
Provide support mechanisms: There are many ways to do this, which can be scaled to each firm's size. At Bank of America, we've developed a variety of support groups and networks including the Black Executive Leadership Council, the Leadership, Education, Advocacy and Development (LEAD) for Women network, and Chicago Area Mentor Program (CAMP).
Expand your commitment: Firms need to ensure their commitment to diversity is reflected in their benefits and HR policies and interactions with suppliers and the community. One example of this commitment related to benefits was Bank of America's decision, based on employee feedback, to expand our parental leave program to 16 weeks for both maternal and paternal leave. With employees and customers increasingly focusing on ESG factors, it's critical to select suppliers and support community programs that reflect the diverse population.
Make it personal: Leaders in a firm need to act as advocates and get involved in programs and networks involved in advancing more diverse talent. To leverage this more diverse talent, leaders need to manage with a diversity mindset by encouraging inclusive thinking on their teams, recognizing the differences and biases that might exist, and stand up to address barriers.
• Frank Baumann is vice president; human resources manager at Bank of America.