By Meredith G. Williford – Global MBA Student and Board Member of the BBS Alumni Association
Actions related to workforce diversity, and cultural inclusion in the workplace don’t always have the desired outcomes. On one hand, addressing diversity, equity and inclusion (DEI) can be powerful tool for socio-economic inclusion, talent attraction and marketing multiplication (see Nike’s 30th Anniversary Just Do It Campaign), while in other instances, it can suffer the rebuke of “diversity washing” and erode the corporate brand.
With these polarized precedents, it’s no surprise to find that many leaders are hesitant to act on DEI. The path to action is riddled with challenges. These challenges are not isolated to any specific sector, and certainly not reserved for the Nike’s of the world. Take, for example, the Italian wine sector. It leads in strategic importance for the overall Italian agri-food system and its competitive positioning globally. It is overwhelmingly marked by SMEs, with 40 out of 157,000 grape-growers holding approximately half of the sector’s turnover. For these SMEs, the process by which they meet their social responsibility goals is informal, not yet governed by the limited CSR regulation; however they are not impervious to the social consciousness of employees and consumers. Knowing this, leaders are joining multinational companies in asking “how is DEI relevant to us?”, “what do we need to do?” and “how do we get it right?”.
Sarah Bettman, Principal of Sarah Bettman Consulting, addressed this question in her recent talk at Bologna Business School. This is not an easy subject to tackle, but Sarah has committed much of her life to coaching leaders, and guiding companies along the journey of defining their relationships with DEI. Her consulting experience spans the industrial landscape. She crafted the DEI program from scratch for one of the largest producers and importers of alcohol globally, Constellation Brands, meanwhile addressing organizational culture imperatives of its individual brands. She is uniquely positioned to speak on many of the challenges that are most pertinent to social responsibility in Italy today.
Sarah focused the lens on the Italian wine industry by highlighting both transversal and unique DEI challenges. The central challenge for companies is balancing the urge to act, and the need for clear strategy. When companies act without a clear strategy, and attempt act on diversity, inclusion and equity contemporaneously, they are more likely to take a misstep. Instead, companies that are at the outset of the journey with DEI should plan to dedicate 3-5 years to addressing diversity and inclusion and gradually add in equity, because of the deep structural challenges associated with it. With this as a backdrop, Sarah further organized the field into five challenges and shared insights on how they can be addressed:
Challenge One | Managing Talent is More Complex Than Hiring
According to a recent study, 62% of European organizations devote their efforts to hiring and retention; however, managing talent and cultivating diversity and inclusion within a company is more complex than this. In the wine sector, the talent pool itself is constricted by transversal barriers to entry, but also unique barriers to entry. For example, there are significant barriers to entry for women and people of colour, a transversal issue for US and European companies. Another complexity is limited mobility from vineyards and retail to other parts of the business. Finally, accessing employment in the wine industry can be very expensive and tied to certifications that are socioeconomically untenable.
Companies should consider how they move people who are already committed to our brand into the business and create pathways for people to grow and learn.
Challenge Two | What Does it Even Mean to Have an Inclusive Culture?
In many cases, leaders believe that they and their businesses are inclusive, but the frame of reference is very narrow. So, how do we define inclusive culture? Sarah highlighted that even in the 36% of European organizations devote efforts to creating an inclusive culture, leadership often have a more optimistic perception of the company culture than others within the company. This gap is driven by deeply cultural, power and systemic dynamics, and requires that companies examine the culture in which their’ labor force is situated, the power dynamics, and the dimensions that render our “inclusive” cultures “exclusive”. Given the complexity, Sarah recommends that one way to address this challenge is to ensure that change management experts and change management tools feature prominently at all levels of DEI development and implementation.
Challenge Three | Lack of Leadership Ability to Lead DEI Initiatives
“We can’t fix what we can’t see”, explained Sarah. Leaders of inclusive organizations must have the curiosity and will to expand their frames of reference so that they can identify and validate the diversity of experience across the workforce. When leaders can see what the majority or privileged groups are, who the minority groups are, and how they maintain they contribute to non-inclusive culture. On the ground, this looks like seeing minority groups and understanding their challenges at the moment, so that they can ask the right questions, and anticipate and respond to needs.
Challenge Four | Business Challenges in the Global Marketplace
One of the biggest challenges for DEI as a discipline is that there are varying measures for success and no uniformity of practice standards. Likewise, how it interacts with ESG, for which agreed upon and uniform standards are very limited. As a result, companies are left to define success on their own or in partnership with similar organizations (such as consortia, in the case of Italian wine production). With this in mind, Sarah explains that it’s okay for leaders and their companies to have a point of view and ambition for DEI, while they strategically plan for CSR and ESG frameworks to formalize an
Challenge 5 | Lack of Corporate Point of View
Finally, perhaps the most critical of the challenges is the absence of a real corporate point of view on DEI. What does that mean? According to Sarah, the corporate point of view emerges from corporate values. If companies stand on their values, they can respond to external challenges with integrity and authenticity. In short, companies should “start with where they stand”.
THE LEADERSHIP IMPERATIVE IN ORGANIZATIONS
To activate cultures of inclusion, strong and cohesive leadership is essential. Sarah defined several leadership imperatives for organizations:
Imperative One | Strategy – For successful, sustainable and meaningful action on DEI, organizations should focus their efforts on business strategy, mission and values. Leaders must align their values and brand promise to define what “inclusive culture” looks like in their organizations. Once that vision is established, they can chart the strategy required to get there. As Sarah says, “start with where you stand”.
Imperative Two | Leadership – Companies must invest resources in the development of leaders. Companies must tangibly prioritize the identification and development of leaders who will role model and promote the behaviors that reflect its values and diffuse the culture of inclusion. Enabling and upskilling current leaders, and promoting, hiring and developing new leaders requires time, investment, and often, changes in the make-up of leadership.
Imperative Three | Change Agents – Organizations must carefully select who is responsible and accountable for driving DEI strategy and initiatives. This is where we should all take a pause. If an organization in which senior management is made up entirely of the group with the most power (in Italian wine, this is white, Italian men), is it appropriate for an organization to ask someone from the group with the least power to be responsible for driving change? Most often the answer is “no”, because generally, those with the least power have the least influence. Instead of asking underrepresented groups to drive strategy, organizations might focus on embedding inclusive leadership and allyship behaviors across its leadership and holding it accountable for listening to and executing the recommendations from minority groups to drive change.
Imperative Four | Define & Hold Accountable – Define what success looks like and hold ourselves, our teams and our organizations accountable for achieving that success. As Sarah said, “that which we permit, we promote”. To lead DEI, we must define our standards and hold one another accountable. To do this, we can ask ourselves “what behaviours would make an incredibly inclusive experience within my team(s)”, and “how do we create ground rules that we follow and to which we can hold one another accountable”. We should answer these questions, operationalize the standards within our teams, and then take the best of those into interactions with other teams. Through this standard-setting and accountability promise, we can diffuse change throughout our organizations.
LEADERSHIP, WHERE TO START
Sarah’s final contribution was a reflection on our individual responsibility, as leaders, to define our relationship to diversity, equity and inclusion. How do we, individually, develop a mindset and behaviours that amount to unlocking our ability to lead inclusively and create cultures that are inclusive for ourselves? After all, our frame of reference always starts with the self, and that is exactly where we should start. She coached students on how to approach this reflection, and provided some guiding questions for leaders:
Reflection One | What is my individual context?
According to a recent McKinsey study cited during the talk, the cognitive ability to understand one’s own biases, adopt different perspectives, listen actively and ask the right questions are foundational skills for successful participation in the future of work. Likewise, the interpersonal ability to foster inclusiveness, role model valued behaviors, and develop relationships based, in part, on humility and empathy are essential.
There are many ways to arrive at these abilities, and Sarah recommended that leaders start with guiding reflections, such as:
Reflection Two | What were my community experiences?
Our community experiences shape the way that we relate to others. A common refrain in workplaces is “my personal beliefs do not impact the way that I interact with others at work, I am professional” or “as a manager, I don’t care what life experiences or characteristics my team members have, as long as they are professional and get the job done”.
These refrains take for granted or assume a common definition of “professionalism” and casually discount biases that shape what we value when we assess how (and why) “the job is done”. Asking ourselves questions such as “how does where I grew up and where I live now influence how I see or think about things?”, and “what organizations have I belonged to that have influenced my perspective?” can help us to unpack how we measure and perceive our actions and others’ actions in the workplace.
Reflection Three | Within my company, where do I have influence and authority?
Finally, Sarah asked students to reflect on influence and authority. This reflection is useful in many ways, but particularly in the development of allyship mindsets and behaviours. When we are assessing our relationship to DEI, whether as leaders of an organization or employees with minimal authority in the organization, we should ask ourselves where we have an advantage in comparison to others. Taking a step beyond the advantage, we can ask ourselves where we can influence others, shape behaviours, and drive change. We can then ask ourselves, what the organization’s values are? And finally, where is my organization in its DEI journey – what does diversity look like within the organization, who feels included in the organization and what does that mean, and are people treated fairly and equitably?
IN CLOSING, it is not only the wine industry that is experiencing challenges in the adoption of DEI principles. In an ideal world, companies are ideated, conceptualized, strategized and operationalized to offer unique and differentiated value from others within their competitive set. And while every business across the wine industry supply chain is unique, Sarah demonstrated that the challenges experienced by wine industry actors are more transversal than they are unique: both within the wine ecosystem and in the context of other industrial sectors.
If we want to solve challenges such as creating pathways from the vineyards to the business, defining what diversity and inclusion look like for family-owned brands, and removing barriers to entry into the industry for those marginalized across gender, gender identity, ethnic and socio-economic lines, companies can start with these three guiding principles:
With these to guide the conversation, perhaps leaders won’t hesitate to say the word “diversity” or “inclusion” when discussing business in a crowded room, and companies can get to work to achieve better outcomes for people, the brand, and all stakeholders.
“Do the best you can until you know better. Then when you know better, do better.” – Dr Maya Angelou