LDR1: The Inclusion Paradigm: The Key to Organizational Performance

1. LDR1: The Inclusion Paradigm: The Key to Organizational Performance Georgia Coffey, Deputy Assistant Secretary for Diversity and Inclusion Department of Veterans Affairs April 12, 2012 / 11 am – 12:15 pm

2. The federal government is one of the most diverse environments in American society in terms of race, ethnicity, and gender (REG). Yet we still have barriers to equal opportunity. Despite our diversity, we maintain a largely homogeneous mindset which leads to cognitive dissonance, conflict, and flawed decision-making. This is the inclusion challenge. The Context

3. The Challenge Although diverse, the Federal Government continues to face challenges to inclusion; we go to great efforts to bring in diverse employees, then we retrofit them into an outdated, homogeneous mindset and convergent business processes. Diversity and inclusion must be the complementary cornerstones of our talent management strategy and our business processes. Diversity without inclusion, will not work.

4. By 2042, there will be no single demographic majority; we will be “majority minority. By 2050, 1 in 5 people living in the US will be Hispanic. There are currently 4 generations in the workplace; soon to be 5. Disabilities affect 20 percent of all Americans. Women earn the majority of college degrees awarded in the United States. There are an estimated 9 million LGBT individuals in the U.S. Diverse workforces in culturally competent orgs have the highest employee engagement, which in turn leads to higher performance and productivity. References: US Census Bureau; The Gallup Organization. Employee Discrimination in the Workplace, Public Opinion Poll. December 8, 2005; Sirota Survey. The Facts

5. Historical Perspective

6. Core Understanding

7. Defining DiversityThe full spectrum of human differences and similarities, including immutable and mutable characteristics yielding unique perspectives. Reprinted with permission from Loden Associates.

8. The Business Case for Diversity and Inclusion

9. What Does the Research Show? • Diversity Research Network • Workforce diversity is positively associated with higher business performance outcomes. • Racial diversity is positively associated with higher performance in organizations that integrate and leverage diverse perspectives. • Gender diversity is positively associated with more effective group processes and performance in organizations with (inclusive) people-oriented performance cultures. • The Effects of Diversity on Business Performance: Report of the Diversity Research Network, October 2002.

10. What Does the Research Show? Center for Creative Leadership • Diverse teams are more creative and perform better in problem solving than homogeneous teams. • Diversity in workforce and processes results in better decision-making. • The effects of diversity are highly dependent on the presence of facilitating or inhibiting conditions in the organization; absent facilitating conditions (inclusion) the aforementioned outcomes are reversed.

11. The flip side… • UNC Business School • Workplace conflict results in 22-53% lost productivity. • EEOC • Average EEO complaint costs approximately $60,000 (administrative process) up to $250,000 (including settlement/damages). • 25-40% of workforce attrition rate and 5-20% in lost productivity can be attributed to poor diversity management; turnover costs 75-150% of the replaced employee’s salary.

12. Systems that Influence Organizational Inclusion

13. The Bureaucratic Model Hierarchical. Chain of command. Controlled communications; need to know. Linear business processes. Convergent thinking and decision-making. Self-reinforcing maintenance of status-quo. “Heroic” leadership and accountability.* *David Bradford and Allen Cohen, Power Up – Transforming Organizations through Shared Leadership. Wiley & Sons, New York, 1998. Current State of Government

14. The Inclusive Model Flattened organizations. Empowered contributors. Continual, transparent communications; knowledge is empowering. Matrix management. Divergent thinking; open-ended decision process. Innovation and creativity encouraged and rewarded. Shared leadership and accountability.* *David Bradford and Allen Cohen, Power Up – Transforming Organizations through Shared Leadership. Wiley & Sons, New York, 1998. Desired End State

15. How do we get there?Begin with Cultural Competence Cultural Proficiency Cultural Competence Cultural Pre-competence Cultural Blindness • Cultural Incapacity Cultural Destructiveness

16. Cultural Proficiency implements change to respond to cultural needs, do research and teach. Cultural Blindness differences ignored, treats everyone the same, only responds to needs of dominant group. Cultural Competence recognize individual and cultural differences, seeks advice from diverse groups, hires unbiased staff. Cultural Incapacity racism, maintains stereotypes, unfair hiring practices. Cultural Pre-competence explores cultural issues, are committed, assess needs of organization and individuals. Cultural Destructiveness forced assimilation, subjugation, rights and privileges for dominant groups only. 16

17. Leadership Mindset: Recognize your bias (Harvard Bias Impact Analysis Test). Challenge assumptions; abandon preconceived notions. Open your mind to new, untested notions; consider alternative. Shared leadership: Power and accountability must flow down Sharing power does not = abdicating responsibility. How do we get there?Business Process Reengineering

18. Business Processes: • Re-engineer business processes: Design processes to yield more than one solution; (this is counter-intuitive so you must be deliberate). • Use interdisciplinary teams; encourage divergent thought. • Don’t fear creative tension; all constructive conflict. • Align personnel rewards systems accordingly. • Matrix management.

19. Review Map processes and identify chokepoints and convergences Assess Track outputs, outcomes, unintended bias/consequences. Redesign paths/Restructure Eliminate barriers, flatten hierarchies, increase input/ cross communication, redistribute power and decision-making. Measure Ouputs, outcomes, process efficiency Reassess and Adjust Business Process Reengineering Steps

20. Link Diversity & Inclusion to Business Strategy D&I must be strategically planned– A business imperative and not a human resources initiative. It must be embedded in organizational strategic plan, goals, and operational strategies. Aligned with business processes, job descriptions and performance management tools. Communicated and reinforced.

21. Cultural competency training. Conflict management training for managers and employees. Mentoring/coaching Diversity focused internships. Intra-agency rotational assignments. Inter-agency swaps/partnerships. D&I embedded in leadership development programs. Diversity & Inclusion Indexes. VA’s Inclusion Strategies

22. The VA Diversity & Inclusion Indexes A benchmark metric for: Workforce diversity. Workplace inclusion. May be correlated with organizational performance. Included in VA’s quarterly workforce diversity reports, electronic Dashboard, and MD 715 tool. How do we know we are there?

23. The VA Diversity Index • The VA Diversity Index is a single metric on a scale of 100 that efficiently measures workforce diversitybased on the convergence of VA’s workforce representation by REG with the R/CLF. • Is scalable and reportable by: • Organization level • Occupation level. • Demographic group • May be correlated with performance metrics and trended over time • Applicable Government-wide =

24. VA Diversity Index Ratio of VA workforce representation to corresponding RCLF VA Diversity Index based on CLF = 84% VA Diversity Index based on RCLF = 96%

25. The VA Inclusion Index • A measure of the degree of workplaceinclusion on a scale of 100, based on survey responses on select items in the Employee Viewpoint Survey (EVS) • 20 EVS items were selected based on content validity and factor analyses to yield reliable indicators of six empirically validated dimensions of workplace inclusion • Favorable responses (i.e. agree, strongly agree) on each survey item are computed, and averaged. • Index may be further weighted by additional factors (per capita EEO complaints, grievances, attrition rates).

26. 6 Inclusion Dimensions As identified through empirical research • Fairness of Employment Practices (Rules and Procedures) • Fairness of Employment Practices (Performance Evaluations) • Inclusion/Participation in Decision-Making • Inclusive Management and Leadership • Information Access/Open Communication • Integration of Differences

27. Lessons Learned • Intelligence Community: 9/11 • Obstacles leading to intelligence failures included: • Hardened attitudes against change. • Insular organizations. • Resistance to external recommendations. • Insistence on preserving the status quo.* • * Walter Pincus and Peter Baker. “Dissent on Intelligence is Critical, Report Says,” Washington Post, March 30, 2005.

28. Lessons Learned Intelligence Community: 9/11 • Recommendations for improvements in performance culture include: • Agencies should encourage dissent, not smother it. • Move away from tradition of searching for consensus, in favor of open debate and more diverse spectrum of views.* *TheCommission on the Intelligence Capabilities of the United States Regarding Weapons of Mass Destruction, March 31, 2005.

29. Lessons Learned • Scientific Community: NASA • “Organizational culture refers to the values, norms, beliefs, and practices that characterize the functioning of a particular institution.” • Causes that contributed to the Columbia accident included: • An organizational culture that squelched dissent. • A performance culture that stifled differences of opinion. • Resistance to external criticism and doubt. • Imposition of the “party line vision … [which] led to flawed decision-making, self-deception, introversion, and diminished curiosity.” • Organizational barriers that prevented open, effective communication.* • *Columbia Accident Investigation Board Report, 2003.

30. Lessons Learned Scientific Community: NASA • NASA has since implemented one of the strongest diversity management programs in Federal government.

31. Economic Community: Lehman Bros. “A culture that is too strong can also end up too rigid and can shut out diversity, especially diversity of perspective.”* Issues leading to its bankruptcy and one of the worst economic meltdowns of the 20th century: Insular organization. Narrow decision-making; failure to gain broad input/perspective. Outmoded, embedded cultural habits. Hoarding information. Misuse of talent. Rigid, inflexible culture. *Hope Greenfield. “Culture Crash” The Conference Board Review, Fall, 2009. Lessons Learned

32. Lessons Learned Economic Community: Lehman Bros. Many of these issues are identical to those that led to Enron’s failure a decade earlier.

33. What does this mean for the Federal workforce? • Diversity & Inclusion in the workplace enhance performance and productivity; they are business, economic, and social imperatives. • Diversity of thought is rooted in our race, gender, and ethnicity; EEO is essential and foundational • Diversity without inclusion will not work. • Diversity & Inclusion strategies must be strategically aligned with business goals and processes. • Diversity and Inclusion must be efficiently measured in order to facilitate progress; leaders must understand and communicate the imperatives

34. Synergy for a High-Performing Organization High Performance Equity Workforce Diversity Organizational Inclusion

35. Presented by: Georgia Coffey Deputy Assistant Secretary for Diversity and Inclusion U.S. Department of Veterans Affairs Georgia.coffey@VA.Gov