Reflections on Racial Justice: Part XI – Talent: The Business Case

Convincing a company to commit to diversity and inclusion requires a business case:  information that shows how diversity serves their self-interest.  Usually, this falls into at least one of three categories:  talent, markets, performance.  Information from the SMU Cox Latino Leadership center of excellence illustrates.


Reflections on Racial Justice: Part X – Hope?

Talent.  Hispanic is the largest fast-growing demographic, but it is underutilized as a talent resource.  The percent of Hispanics in the general population, overall labor force, civilian workforce, mid-managers, executives, and board members can be dramatically represented as a pyramid.  At each higher level the percent of Hispanic penetration was smaller and smaller, and always smaller than the Hispanic percentage in the whole population.  Pinch points can be easily seen.  I recall reviewing these data with AT&T’s Senior Executive Vice President for HR.  He immediately zeroed in on the difference between Hispanic penetration in mid-levels and executive levels.  The penetration in mid-levels did not provide a large enough pool to expand the penetration in upper levels.  He pounded his finger on that point on the graph and exclaimed, “if you can help me solve that, I’ll put in with you.”  Our leadership development programs prepared more mid-level talent for executive levels and more lower-level talent for mid-levels.

Markets.  Hispanic consumer spending is worth billions of dollars.  However, lack of understanding of the market can close the door to this opportunity as was famously the case at General Motors:  the Chevrolet Nova was a flop in Latin America because no one considered that Nova in Spanish means, “doesn’t go.”  My friend David Gonzales’s experience with the development of chili lime Doritos illustrates how knowledge of a segment and its decision-makers can open an untapped specialized market, lead to other new products, and cross over into mainstream consumer spending.

Performance.  Data from SMU’s Latino Leadership center of excellence presented at a recent webinar shows how diversity correlates with better financial performance.  Differences of 15% or more between quartile one and quartile four in measurements of gender diversity and 35% or more between the first and fourth quartiles on measurements of ethnic diversity correlate with financial returns above the median in specific industries.

Greater diversity also results in better performance in:

  • talent attraction and retention
  • customer orientation
  • employee satisfaction
  • decision-making
  • innovation
  • company image

Even though diversity can increase friction in teams by 15%, it can boost productivity and efficiency by as much as 60%.

Once an organization recognizes that a commitment to using diverse talent is in its best interest, what needs to happen to make it work?  I will explore best practices in next few Reflections.



Frank Lloyd
Frank Lloyd
Dr. Frank Lloyd is a board member and Diversity Equity and Inclusion Chair for Literacy Achieves, a Dallas, Texas-based non-profit that teaches English as a second language to adult immigrants to facilitate their employment, parenting, and other life skills. He is the producer of Literacy Achieves’ podcast, When I Got Here: Untold Immigrant Stories where immigrants share inspiring personal stories of why they left their homelands, how they got to the U.S., and the lives they are making here. Dr. Lloyd is the former Associate Dean of Executive Education at Southern Methodist University's (SMU) Edwin L. Cox School of Business, where he led the development and delivery of award-winning executive leadership programs and established a national center of excellence on Latino leadership. Dr. Lloyd joined SMU’s Cox School from the Thunderbird School of Global Management in Arizona, where he was Vice President of Executive Education. Prior to joining Thunderbird, Dr. Lloyd was a human resources executive with General Motors. Among the highlights of his career, he was responsible for organization development and leadership training for GM Europe during its transition from mass to lean production, and he was the first GM Human Resources manager at New United Motor Manufacturing, Inc. (NUMMI), the historic joint venture between GM and Toyota noted for its innovative labor-management relations and the introduction of the Toyota production system. Dr. Lloyd is an emeritus member of the Board of Directors of UNICON, the Global Consortium for University-based Executive Education. He is the former board chair of Daystar US which mobilizes resources to support Daystar, a non-denominational Christian university in Nairobi, Kenya whose mission is to prepare servant leaders for Africa. He also served on the national board of Inroads, an organization with the mission to develop and place talented underserved youth in business and industry and prepare them for corporate and community leadership. Dr. Lloyd was a Fulbright lecturer at the University of Isfahan in Iran. He also served as a U.S. Information Agency curriculum consultant for Germany. He earned a master’s degree at Purdue University and a Ph. D. at the University of Iowa. His undergraduate degree is from Occidental College.

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  1. Thank you for this insightful comment. Experience in SMU’s Latino Leadership Initiative shows that if this demographic feels neglected they tend to leave without warning, in the “middle of the night,” so to speak. Women leave to start their own businesses and men leave for positions in other companies. They end up getting passes around like (Anglo) baseball managers or football coaches. There is a lot to do to retain abd advance diverse talent. I recently heard that diversity is just getting invited to the dance. Inclusion is being asked to dance, and equity is gettong to pick some of the music. Hiring diversity is just the first step. Frank

  2. Thank you for recognizing not only the potential upside of diversity but also that unless the new normal is tackled thoughtfully, friction is likely to be the main outcome.

    Many companies focus mainly on whether they hire diversely but have too little focus on retention. Solving the promotion into the managerial rank problem for all minorities shows employees that there can be good reason to stay with the company because they are seen. Their contributions may lead to advancement.

    That is where the friction comes in again, because if the next level of managers are even less used to working with people not like themselves, the work of adjusting needs to happen again. And again. And again… as the minority managers rise in the ever more previously isolated hierarchy.

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