Grow new markets

When I joined Gillette in 2002, Jim Kilts was the chairman and CEO. He had come from Nabisco, which was a far more diverse consumer-products company, and he wanted Gillette to catch up, creating a company that was more reflective of evolving consumer markets. We found that an intentional program of supplier diversity was an immediate way of bringing in new voices. To that end, we added our first African American—and Latinx-owned marketing agencies, Fuse Advertising and LatinWorks, respectively, in an initiative that was led by Julie Washington, at the time the vice president of commercial marketing. The result was a more thoughtful approach to our multicultural consumers from an advertising, messaging, and product perspective.

Take the shaving category. Through our new agencies, we reached out to Black and Latinx customers and found that existing ad campaigns weren’t speaking to this market. Black men tend to get razor bumps from shaving, and we presented research showing that there was a whole overlooked market of men who would happily buy a gentler shaver that would cause less discomfort. So we developed a new kind of razor and a marketing campaign for it.

Make DEI a business unit

Another excellent example of what happens when you make DEI an intentional business strategy is the work that Clorox has done. It is not by accident that, at this writing, the CEO is a woman, Linda Rendle, while the executive team has Asian and African American representation. Over the past fifteen years, the Clorox Company has been developing a culture of inclusion that is instructional to any business leader seeking to scale DEI throughout the organization.

In 2006 Donald Knauss became CEO (a job he held until 2014) and hired Erby Foster to be Clorox’s chief diversity officer. At the time it was a job they both knew would have to be invented from scratch, but Knauss liked Foster’s idea that DEI should be a business imperative rather than just a social-justice issue. Foster ran his DEI division as a business unit. Much of what he did there involved building diverse teams through employee resource groups (ERGs) that functioned in many ways as action-learning teams.

What Foster created was an ideal template for the role of a chief diversity officer. Because the CEO has to be steering the strategy, and may have to delegate the day-to-day DEI effort to a CDO, that CDO should be someone who will run the operation as a visionary leader, with the goal of using diversity and inclusion to create a competitive advantage.

“The way I describe it is I created pull, not push,” says Foster, who started out as one of a handful of Black CPAs at Arthur Andersen and became a DEI expert not by design, but because he saw a crying need to open doors for Black professionals. He now runs a consulting firm for companies seeking cultural transformation, Foster Inclusion.

“Push,” he explains, “is if you have a government contract and they say you have to comply with affirmative-action criteria. So the government pushes me, the CDO, and I push the company. People will comply but eventually push back. They’ll say they’re too busy running the business to attend diversity meetings. You’ll be left with nothing but activities. You might celebrate Black History Month, but you won’t make real changes.”⁴

What he did instead was start pulling people into ERGs. These he saw as serving a multifold purpose—not just the traditional role of advocating for their members and helping them develop skills, but also functioning as business teams. The first big success story came from the Asian ERG in 2010. Foster had done research and found that, in the United States alone, Asian consumers had $600 billion in annual buying power. “This was a market we weren’t talking to,” he says. So CEO Knauss addressed the members of the ERG and asked them to come up with ideas for targeting the Asian market. It was a rather typical CEO action-learning briefing, reminiscent of the way Jack Welch would address a group of executives at GE, spending about an hour discussing a challenge he wanted them to take on, and telling them to come back in thirty days with a plan.

At Clorox, the ERG members had six months, and within that time they came up with three big business ideas: taking Clorox home-cleaning products to India, marketing the Green Works line of biodegradable cleaning products to the Asian market, and acquiring a small specialty-food company. For the third idea, the group had a list of ten potential acquisition targets. The company followed up, and the next year Clorox bought Soy Vay Enterprises, of Felton, California, a manufacturer of kosher Asian sauces, salad dressings, and condiments.⁵ It was the 100-year-old Clorox Company’s first entry into the food sector, but with this new set of data and insights into the buying power and habits of Asian consumers, the company had a business case for expanding its product lines further—something that happened again and again once Foster decided that a little competition among ERGs would lead to more big ideas.

As he puts it: “I went to the Latinx group and told them ‘the Asian group is kicking your butts.’ ”

That fired up the Latinx Employee Resource Group (Latinx ERG), and the members launched their own business studies. They noted that millennial Latinos love the flavors they grew up with but are unlikely to spend the time required to cook traditional dishes, so they came up with a proposal to expand the food portfolio, resulting in Clorox’s acquisition of Nueva Cocina, a maker of Latin rice, seasoning, and soup mixes that was started by two Cuban women in Miami.

Clorox now boasts a number of business initiatives that originated with employee resource groups. Pride, the company’s LGBTQIA+ group, was the main force behind such marketing efforts as the Burt’s Bees Rainbow Pride Lip Balm Pack and the Fresh Step cat-litter advertising campaign targeted to gay men. The group found demographic research indicating that gay men were more likely than most other American households to have cats—but that isn’t a statistic most companies take into account unless a diverse pool of employees is encouraged to share what it knows from its members’ own life experiences. Similarly, Clorox’s African Americans Building Leadership Excellence (ABLE) ERG has helped the company develop a stronger foothold in the Black consumer market through such initiatives as a partnership between Kingsford charcoal and Ebony magazine for a summer-grilling campaign, and advertisements for Glad and Pine-Sol that target Black consumers.

Identify a more diverse pipeline of people with potential

Here’s another way that ERGs can serve as a business unit: they can provide an answer to the evaluation gap that was so ever-present in my early career. I’m talking about how senior management spots “potential,” and how no one ever promoted me based on potential. Rather, I had to basically perform the duties required at the next rung to prove that I was promotable after the fact.

But what if you charge ERGs with the responsibility of selecting individuals with high potential from within the group? That’s exactly what Dr. Deborah Ashton has done. Ashton has a PhD in clinical psychology from Harvard but spent much of her career heading up the DEI work at large companies, including Darden Restaurants, Harley-Davidson, Medtronic, and Novant Health before starting her own DEI consulting firm, Planet Perspective. “We found plenty of high-potential women and people of color by having the ERGs nominate them,” she says. “Then they got the mentoring and sponsoring they needed.”⁶

In these cases, the ERGs have deployed the principles of action learning—cross-disciplinary brainstorming, dissecting the problem, and attacking it with outside-the-box solutions—to product and market development as well as to diversity itself. If you pool a group of people with a diversity of expertise and experience, you never know what monumental ideas might emerge.

Speak out when you see bias

Lisa Wardell was one of the most thoughtful CEOs out there when it came to the intentional culture she created at Adtalem—a culture of diversity and inclusion in which she was open about what the company achieved (a highly diverse board, for one thing) and what it still needed to do (she would like to have had more people of color in the executive ranks).

She also made a point of telling people when they’re demonstrating bias, although she was judicious in picking her battles. “When you’re the CEO, the way you use your time and energy sets an example for everyone,” she said. “I try to pick and choose when I speak out so that it’s not coming off as judgmental. But I think it’s important to let people know when they’re seeing something through their own lens and not considering how it might look to others.”

The question of how things looked through her lens versus that of a white supplier came up shortly after she became CEO, in a meeting with a marketing firm. It was a woman-owned firm—in fact, the founder was the mother of the man who led the presentation.

“He pulled up a photo of all the employees and said he wanted to show us how diverse the company was,” says Wardell. “He was so proud because maybe 80 percent of the people in the picture were women. What I saw, though, was a picture of 100 percent white people. I’m a woman, but that’s not my first lens. So I said to him, ‘That’s wonderful, but let me tell you what I see when I look at this picture.’ My team members’ mouths were hanging open; they weren’t used to my way yet.”⁷

Nor was the supplier. I wasn’t in the room, but like Wardell, I have become used to seeing stunned faces when I speak from my lived experience. Many people don’t see what’s happening from the perspective of others until someone tells them and helps broaden their lens.

Design skills for engagement

In any large group, honest communication is difficult. And any two individuals might disagree in the course of doing business together, even in the most homogenous groups. Dissent can be especially counterproductive in a diverse group where people can’t fall back on lived experiences, mutually understood codes of behavior, or golf-club memberships and school ties to establish something in common. As I’ve said, diversity is messy up front. To build a culture in which you can have constructive dialogue between people who don’t necessarily see eye-to-eye, I always use a template for engagement and communication that we put to work at Ralston Purina when Nestlé acquired the company. We used action-learning teams and communication tools to integrate two very different cultures. It wasn’t a diversity strategy per se—though it helped us build an intentionally inclusive and collaborative organization—but Janice Duis, a leadership- and organization-development specialist who put the program together for Ralston Purina, continues to use these communication techniques to help scale DEI transformations. I’ve used the techniques too, in setting up a framework to talk about racism and diversity and how we’re going to work together. The language you use will differ from one organization to another, but the point is to create a way of communicating messages and symbols that have the same meaning to everyone within the company.

Duis has designed a toolkit for what she calls “skills for engagement.” She often begins the work with a program that teaches participants to conduct dialogue that fuels advocacy and inquiry to create mutual learning. Many of these tools are adapted from The Fifth Discipline, the classic book by system scientist and founder of the Society for Organizational Learning Peter Senge that describes how to adopt the strategies of learning organizations, which continuously discover new ways of thinking and creating desirable results. At Ralston Purina, this was a two-day program that everyone in the organization was required to attend.

“It’s about understanding another person’s perspectives,” says Duis of the program. “I form an opinion about someone and need to use inquiry to find out their position.” Part of the objective is to break down what she calls a “ladder of inference”—that is, preconceived notions about people that in some cases might be considered biases.⁸

Here’s how the ladder of inference works:

• We all have a reflexive loop in our brain.
• We take actions based on our beliefs.
• We draw conclusions, make assumptions.
• We add on meanings that are both cultural and personal.
• We select “data” in our minds that supports what we believe.

Duis’s objective is to create discussions with others in which we use inquiry and listen to others’ views, thereby challenging our ladder of inference.

At Ralston Purina, executives tended to have the perspective that it was their own experienced people who knew best—yet when they participated in the inquiry sessions and listened to what those from Nestlé had to say, they discovered that many of the newcomers to the merged entity of Nestlé Purina, though they lacked experience in the pet-food industry, had brilliant ideas. We also assigned seemingly incompatible people to work on business projects together. A senior marketing executive who had previously been my rival when we were both at Purina became one of my best friends because we were paired together and had to understand each other’s lived experiences and approach to business. Marketing requires a methodical, linear approach. I was in sales, where I had to make what looked like quick, day-to-day decisions as I worked with my customers. In talking it out, I learned that, in her ladder of inference, I looked unprepared. What she didn’t know was how much research I would do before I met with clients so that I could arrive at decisions that looked spontaneous. When we were assigned to work together, we learned to show each other how we each approached our work, so that we learned from each other. This cross-functional approach works equally well when your aim is to scale a cultural transformation. You put together people who have clashing strengths and weaknesses so that each has skills to teach the other, but you also create intentional pairings of people who might clash culturally, and you give them the tools to learn more about each other through inquiry.

Duis’s third tool for building more-powerful and -productive conversations is something she calls the “left-hand column.” It’s essentially a way of creating a safe space to share thoughts we wouldn’t otherwise feel comfortable expressing in a work setting. At Purina, any of us who had been through the training knew that we could say to a colleague, “I’m speaking from the left-hand column,” and our colleague would know that they were going to hear just what we were really thinking.

We learned to apply reasonable filters but still use the left-hand column to express our biggest concerns and get constructive feedback. In using this technique as a tool for enhancing inclusiveness, you have to set boundaries on the purpose. It isn’t a license for people to express their biases—rather, it’s a way of talking to coworkers about both personal reactions to the workplace and business problems.

As Duis presents it, someone might be thinking, “We can’t deliver the project in two weeks—it isn’t possible in that time frame,” but might also be thinking that if they say that, they’ll come across as incompetent. This is the kind of issue that can be a particular burden to minority employees, who feel they have to prove themselves at every step. But what if the employee is able to tell her boss, “Speaking from the left-hand column, I’m concerned that it won’t be possible to do a thorough job by that deadline.” That opens the way to dialogue that will help head off a supervisor harboring a bias that this is someone who doesn’t deliver what she promises.

Bernard Tyson, the late, great former CEO of Kaiser Permanente, had his own way of letting people in the organization speak their minds. His code term was “freedom of speech.” He had a standing joke with his senior managers that if they wanted to disagree with him on an issue, they’d ask, “freedom of speech?” he’d say yes, and they’d tell him what they thought. “It’s about creating a culture where a nurse can walk in and say, ‘I’ve been thinking about something. What if we did this process 1, 2, 4, 3 instead of 1, 2, 3, 4?’ ” Tyson said in an interview with MIT Sloan Management Review. And he did listen when nurses proposed new ways of doing things. For example, from a suggestion that came from the front lines, nurses began sharing essential patient information during shift changes in the patients’ rooms instead of the nurses’ stations, so that patients had a voice in their own care.⁹

Some of us have been using these collaborative skills since well before the era of anti-racist leadership, but now it’s more important than ever to have a framework that allows you to have courageous but sometimes uncomfortable conversations. Think of it as an essential system for running your business. I’m seeing the Bay Club Company, as one example, encourage employees to talk about their experiences with racism through a system designed by Lloyd and Amber Cook, the company’s husband-and-wife DEI director team. They’re calling it “the coffee chats.” Employees from across the company are invited to come together once a month, sometimes in person and sometimes virtually, in a safe space led by members of a DEI task force that’s been set up, to talk about experiences and things they’ve learned in the workplace and in their lives.

The cloud communication company Twilio has started a video platform called “Did You Know?” which encourages employees to discuss inclusion issues. An episode about the “model minority myth” that gets applied to Asians, for example, featured three employees explaining why a stereotype that some people might see as positive actually upholds white supremacy. As one speaker said, the myth minimizes actual racial discrimination against Asians, and “it implies that hard work and family values can overcome over two centuries of Black enslavement.”¹⁰

Create intentional symbols and artifacts

Visual communication is massively powerful. Be highly intentional in determining the images that employees, customers, suppliers, investors, and society—all stakeholders, in short—are going to identify as representative of what this company produces and what it stands for. What people see when they enter the lobby is more than just window dressing; it reveals the formal culture. I’ve often talked with Duis about this aspect of inclusiveness, and she says it’s especially problematic if no one pays attention to decor that’s dated.

“Think about what new hires see when they come through the front door,” she says. “Do they see a series of portraits of every former CEO and they’re all white males? How am I welcoming people into the organization? Do they see what the company is most recognized for? If you’re trying to build a diverse organization, do people of color come in and see others who look like them?”

I once spoke on a panel at which other participants talked about their company bringing in its first African American executive. He told them that as he walked through the halls, he could spot the lack of diversity just in the way the company laid out the product design. No one had thought about how the product photos showed only white people.

Look to the future in the way you showcase the company. And although it might seem paradoxical, connecting with the company’s past is also a way of keeping the culture moving forward. Staff and other stakeholders like to know that the present-day CEO’s vision is a continuation of the best of the founding ideals.

Several years into my tenure at Jamba, I invited Kirk Perron, the founder, to come back as a consultant, because I knew he was passionate about what the company stood for. He wanted Jamba to be a fun experience for customers, a place that inspired healthy living. In rebuilding the culture, that message became a touchstone that helped us recruit the diverse and impassioned workforce that we needed. Tell the founders’ stories to showcase what they did that was courageous and innovative, and how you are carrying on the tradition with a company that you’re rebuilding for the world we live in today.

These days, I’m pleased to see a number of companies starting new traditions that point to a more equitable future. One of the most powerful examples is Schnuck Markets. When you walk into any one of the company’s supermarkets, you will find the managers, the cashiers, and the people stocking shelves all wearing the company’s T-shirt that says, “Unity is power” on the front and “We stand together against racism” on the back. Could there be a clearer statement about what this company stands for?