Can Your DEI Objectives Succeed If You Don't Pay Attention To Leadership Development?
Fiona has run herself ragged. As the chief human resources officer (CHRO) of a medium-sized biotech firm, she has spent the past two years implementing program after program to foster the professional development of her company's hundreds of remote workers. Yet, despite her best attempts, she continues to run against issues: Low retention rates and an absence of minority groups among top executives persist.
Fiona is a made-up character based on the experiences of the HR managers we routinely speak with; these are people who genuinely care about their employees and who are making strides to increase diversity, equity, and inclusion at their company but who are still struggling to achieve their goals. So what exactly is going on, then?
Jim Woods on transforming your workforce to be future-ready.
We contend that the right programs exist in many businesses but are being executed incorrectly, often making the problems they are designed to solve much worse. This is especially evident in mentoring and coaching programs that foster future leaders. According to a literature review, staff retention is increased by 34% when employees have access to professional development opportunities like these. Furthermore, organizations with mentorship programs over five years observed an 18% rise in Black women serving in managerial positions, according to a study in the United States.
However, leadership training is only helpful if it is administered fairly. Unfortunately, here's where many businesses, beginning with the hiring procedure, fall short in our experience.
Eighty-nine percent of the people leaders surveyed and interviewed for this study ranked high-potential leader identification (typically for development programs) as an essential objective, but only sixteen percent have a formal framework to do so. A whopping 85% of leaders said they used informal manager feedback when deciding who should be given a leadership development opportunity.
Most people working in human resources recognize this as a severe issue: Fifty-one percent of respondents acknowledged that the current method of selecting leaders favored some workers over others. They do have a point. White men make up 35% of entry-level workers but 62% of the C-suite, per McKinsey's 2021 Women in the Workplace research. Female employees, especially women of color, follow the opposite trajectory, making up 17% of entry-level positions but just 4% of the C-suite.
The implication is that employees from majority groups are likelier to be represented in the leadership pipeline as they advance in their careers than members of underrepresented groups. This trend has not changed in many years.
Quickening the pace of DEI implementation.
We contend that the unequal distribution of leadership development opportunities in many institutions contributes to the stagnation of leadership diversity efforts. All too often, our biases about who has potential (according to research: tall, beautiful, white men) come into play when informal techniques are used to choose employees for opportunities like mentorship, leadership coaching, or other high-potential programs. Moreover, the problem of inequitable selection further worsens with time since opportunities for leadership development tend to breed more opportunities.
When companies depend too much on unstructured feedback, they limit their ability to identify the people who might benefit from intensive training. Evidence shows that this method of selecting candidates reduces their effectiveness. In their recent book Getting to Diversity, professors Frank Dobbin and Alexandra Kalev say that "mentoring offers the highest payback for the folks who aren't on the executive's radar." They cite Sun Microsystems' experience, wherein "non-star workers" saw the most significant gains in productivity after being paired with experienced mentors.
Providing opportunities to all employees who are part of the broader target group is the most equitable and practical approach to the difficulty of leadership development selection. For example, consider expanding the availability of the leadership coaching you're now providing to "high-potential" new managers to all of your managers.
According to Dobbin and Kalev, this is similar to Sodexo's strategy, which led to increased retention and a sustainable pipeline of underrepresented talent.
Although a truly democratic approach to leadership development may not be feasible at the moment, we still recommend the following four measures to ensure a fair selection process: Getting buy-in from managers and leaders early on is crucial, as systems only succeed if individuals adhere to them.
First, define the possibilities.
Initially, take stock of the formal and informal leadership training programs available within your firm. You should include any chances for employees to obtain the experience and exposure they need to develop in their careers, such as stretch assignments, job rotations, and mentorship programs. The exercise usually reveals how many positions are being filled informally.
Two, specify who meets the requirements.
You should specify what kind of employee meets the requirements for each position you mentioned. There should be concrete, quantifiable standards for assessment in your definitions. Criteria should, as a rule, not be based on an employee's "potential," where there is much space for bias, but on demonstrated performance.
If the opportunity is to participate in leadership training, for instance, criteria can include the employee's shown ability to foster an environment of trust among team members and their curiosity and willingness to take the lead on new projects.
Third, let everyone know about the possibilities.
Our study revealed a correlation between a decline in definitional knowledge and increased organizational authority. For example, our survey participants told us that nearly half of their organization's upper-level management understood what it meant to have high-potential leaders on staff, but only about a quarter of their workforce shared this understanding.
Communicating the leadership development opportunities and required qualifications to all employees and managers is essential. A straightforward way is to have HR prepare a template email for all managers to send out one week after performance reviews when employees think about their careers and how they can advance. This email will detail all available leadership development opportunities, the requirements for each, and the application process. This gives managers something solid to talk about with their employees after reviews to help promote career dialogues and ensure everyone knows the prospects for growth.
The selection procedure should be formalized.
Build a structured selection procedure that promotes honest and open evaluations of potential personnel. It's not enough for organizations to have selection criteria if managers use them on the select few they've already decided to promote. In addition, the results of studies demonstrate that managers are less biased when they consider the performance of all of their direct subordinates before making a final hiring choice.
One legal tech company realized managers were not distributing stretch assignments fairly, although the company recognized this as a significant growth potential that leads to promotions. If an employee receives a 3.5 or higher on their biannual performance assessment, HR suggests giving them a stretch assignment the next quarter. We devised a short survey so that supervisors could tell at a glance who was prepared for more challenging work rather than relying on their judgment. The form served as an extra check and balance for responsibility. HR business partners can review documents, and managers can be coached on the new approach.
The lack of diversity at the top is a problem that many business leaders have acknowledged. However, we contend that the answer is already in front of us all along: rethinking the dissemination of current leadership development options. Leaders can use development programs to lessen bias and more equally progress underrepresented leaders rather than perpetuating a system that rewards individuals we are biased to feel have "potential."
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About Jim Woods
Jim has a passion for accelerating talent across organizations. While this passion has fueled his work in leadership assessment and development, it has crystallized in the area of Diversity, Equity & Inclusion.
Jim's experience spans many industries, including public, finance, consumer, retail, pharma, industrials, and technology. 'Organizational & people agility,' 'design thinking,' and 'digital transformation' are some critical themes Jim works with clients on across the globe.