Call to Action

When CEOs ask their Human Resource department heads to hire more minority employees, they are probably reacting to the public’s demand for increasing diversity in the workplace. “It’s the right thing to do!” claim strong supporters for minority-related causes. Many of these industry watchdogs strongly believe their persistence is winning over the hearts of shrewd CEOs whose relentless search for profits has often undermined minority career advancements.

With 78 million baby boomers retiring in the next 20 years, the Census Bureau claims that over 35 million job positions may remain unfilled based upon an expected reduction in the current U.S. labor force. Most of these job positions will eventually get filled by minorities, who will become the majority by 2042, according to a recent New York Times front page article. The Hispanic sector alone is expected to represent 30% of the U.S. population, or about 128 million individuals.

Today, Hispanics account for about 15% of the US population with a total of 47 million individuals. Their explosive growth from year to year has become a powerful economic force that companies can no longer ignore. Driven by an active consumer base and a vibrant work force, Hispanic purchasing power will exceed $1 trillion by 2010 and double by 2015.

With Hispanics filling less than 8% of white collar jobs today, the expectations that more Hispanics will be seeking corporate career opportunities in the years to come has attracted the attention of CEOs and their management teams. Quick-reacting companies that provide meaningful career opportunities for Hispanics will undoubtedly get a leg up on their competition by gaining early access to the best and the brightest candidates. Nevertheless, attracting candidates may be challenging since the majority of the Hispanic population is under the age of 15. For those candidates that are available, firms should make their work environment more inviting by promoting programs on cultural acumen and integration. Ultimately a well orchestrated program that emphasizes cultural similarities as well as important differences among diverse employees will foster increased productivity through improved collaboration and retention.

For years, CEOs felt that diversity departments were just another medium to generate positive corporate images within a targeted community. Newspaper articles covering local galas, for example, could generate a powerful backdrop for a corporate logo providing positive public relations value. However, as diversity included Hispanic communities, the public relations value generated mixed results. Department heads quickly learned that their efforts had to be all inclusive. Leaving out important members of a community from a photo or article, for example, could potentially anger readers. Over time, marketing campaigns that included the input of a diversity department tended to underperform expectations and hence were deemed problematic or ineffective.

Due to a growing number of failed marketing events, CEOs could no longer justify the tens of millions of dollars invested in diversity and have demanded a direct correlation to increased sales or reductions in costs from their managers. Unable to show reliable results, diversity officers at many corporations large and small have seen their budgets severely reduced and in some cases eliminated. The budget reduction has left some companies operating skeleton departments run by one or two individuals.

With scaled down budgets, diversity has lost favor with top management and continues to be one of the first budgetary line items to be affected negatively during an economic downturn. Senior VPs and middle managers who were once asked to sit in on diversity meetings no longer receive invitations. Even the term Diversity has been threatened. At a Fortune 500 company, “Diversity Department” was replaced with the less controversial phrase, “Office of Inclusion.” Regardless which term is used, the challenge of creating harmony in the workplace to attract needed candidates from a talent pool of individuals with seemingly different cultural backgrounds continues for the most part unanswered, unaddressed, and unchallenged within corporate America.

CEOs can no longer rely on “feel good” rhetoric to promote diversity in the workplace. To initiate positive change, they must take on a more direct role by adjusting their corporate culture to financially reward rather than showcase departments that achieve competitive leverage from a more diverse team.

Getting the process off to a good start is crucial. Without having to reinvent the wheel, an ideal medium to initiate change and renewed acceptance towards the benefits achievable from a diverse workforce would be with a diversity department, only this time the organizational structure would look different. Rather than have one diversity officer to run the department, we recommend having multiple diversity officers, one for each of the three major minority sectors, namely, Hispanic, African American, and Asian. All three department heads would report directly to the CEO.

Why would a team of three diversity officers be more effective? History shows that companies that have only one to represent all minority interests tend to favor their own ethnicity at the expense of estranging the others. Rather than promote the benefits from a diverse workforce, a one-person department could potentially be viewed as a self-serving medium that favors one ethnicity.

A few years ago, a Fortune 500 company hired a Hispanic professional to head up their newly minted diversity department. After a successful launch, the Hispanic diversity officer moved on to another organization and was succeeded by an African American professional who in less than one month replaced the original department with African American employees. Many of the collaborative agreements with Hispanic non-profit organizations were tabled and replaced with agreements from African American non-profits. By the time the company’s annual Corporate Diversity Forum was launched, the ratio of panel members participating in each session had reversed to favor African Americans.

CEOs should note this could negatively affect a work force by promoting resentment among the rank-and-file rather than harmony. The negative sentiment from the underrepresented ethnicities including whites could permeate into other departments causing reduced morale and lack of trust, all of which could generate higher turnover among employees. A diversity department with multiple officers can provide a CEO an ideal platform from which to showcase their genuine support for a more diverse workplace. Since all three officers will have to learn to work effectively together, their feedback to a CEO can provide valuable insights on optimal ways to introduce, incorporate, and integrate diversity within their corporate culture. In part they can become an ideal internal focus group dedicated to help CEO’s and their managers study customized best practices for leveraging diversity in their workplace.

Tom Kadala is the president of ResearchPAYS, Inc., a strategic business consulting firm dedicated to the development and expansion of Hispanic consumer markets. - ( Mr. Kadala can be reached at