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5th Annual Global Diversity Seminar Barcelona, Pepsi Presentation by Maurcie Cox
 

5th Annual Global Diversity Seminar Barcelona, Pepsi Presentation by Maurcie Cox

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Maurice Cox gave a keynote presentation on the future of diversity & Inclusion for corporates at the 5th Annual Global Diversity & Inclusion Seminar in Barcelona.

Maurice Cox gave a keynote presentation on the future of diversity & Inclusion for corporates at the 5th Annual Global Diversity & Inclusion Seminar in Barcelona.

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  • What gets me excited about coming to work everyday are the improvements and perceptions on Point out key points D&I is Build slide left side first and right side Change red to another color Is 2006 We have been steady improvement with our org. health for all groups
  • We ’ve covered quite a bit, now I’d like to open it up for discussion and questions.

5th Annual Global Diversity Seminar Barcelona, Pepsi Presentation by Maurcie Cox 5th Annual Global Diversity Seminar Barcelona, Pepsi Presentation by Maurcie Cox Presentation Transcript

  • Diversity & Inclusion's Next Big Global Act: The Work We'll Need To Do 5 th 5th International Diversity & Inclusion Seminar Barcelona, Spain February 24, 2012 Maurice Cox
  • New Bern NC
  •  
  • What we will cover today
    • Where are we on this D&I journey
    • How have we done on some core practices
    • A PepsiCo case study
    • Final thoughts
    • Q&A/discussion
  • Perhaps this is the D&I version of half time—we’re not losing the game, but are we winning?
  • “ Because in either the game of life or football the margin for error is so small. I mean one half step too late or to early you don't quite make it. One half second too slow or too fast and you don't quite catch it. The inches we need are everywhere around us. They are in every break of the game every minute, every second .” --Al Pacino in “On Any Given Sunday”
  • Obsolescence and irrelevancy is more prevalent than ever
  • Dictatorships
  • Businesses
  • Technology Society ?
  • For the last 20 years or so, D&I has been trying to get the mix just right, like Noah’s Ark
  • “ It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.” - Charles Darwin
  • How well have we done in D&I?
    • What impact have we made in D&I?
    • Have we adapted well enough?
    • How do we make the mix work better?
    • What is our future?
    • For the Fortune Global 500, female CEO’s are up as well as those in the C-Suite
    • Women make-up on BoD’s has improved, but not enough
    • In the U.S., C-Suite representation of people of color is up but BoD representation is actually down
    • D&I increasingly seen as added value to most enterprises
    We are continuing to make progress, but it still depends?
  • When it comes to CEO's and how they rate D&I, it can be puzzling Source: Confidential
  • Boards of Directors are in the middle Global Board Directors (Men) *Source: Heidrick & Struggles, Women Corporate Directors and Harvard University survey Best practice on corporate governance globally
  • The actual work we do
    • Purpose of benchmark study was to determine the level of D&I integration/frequency in organizational development/talent practices*
    • 28 member companies responded .
    How well have we done in D&I? *Source: Mayflower Survey by Dr. Alan Church VP OMD, PepsiCo, Inc. 3M Allstate Assurant Bank of America Best Buy BMS Boeing Citi Corning CVS Duke Energy Eli Lilly & Co. Ford Motor Co. Halliburton Intel John Deere Johnson & Johnson Nike Parker PepsiCo Pfizer Pacific Gas & Electric Prudential Shell State Farm Toys ‘R’ Us Union Pacific VF Corp.
  • Core HR Practices Does your company include D&I in...? Note: Not all companies provided information for all categories.
  • D&I Items in Organizational Surveys Total # of D&I Items on Survey Note: Not all companies provided information for survey items. Select Comments
    • “ We have other questions probing areas of trust and teamwork… Our tactic is to include diversity characteristics in our analysis models, rather than ask more than just a few specific diversity questions.”
    • “ Although we have items that speak to D&I, they are not specific to it. We are fairly early in our D&I journey. We do have harassment and discrimination training, but I do not consider that D&I.”
    • “ Targets for D&I have remained consistent over the years and cover three areas: gender (% of females in senior positions), nationality (% of local people in country management positions) and inclusion (% favorable of the [D&I program]).”
    • “ Yes, in both the standard opinion survey and the leadership survey. In addition we include responses to engagement and culture questions as part of our analysis.”
  • D&I Items in Organizational Surveys Total # of Items on Survey % of Total Survey Items that are D&I Note: The numbers on these two charts do not correspond to each other.
  • D&I Items in Performance Management Select Comments
    • “ Every professional employee is expected to have one D&I related objective on their People Results (there are three other categories as well) which accounts for 50% of their total compensation.”
    • “ We have two sets of competencies, one around our company Values, within the PM process for all salaried employees and this includes the value of The Individual, which includes some behavioral statements around diversity.”
    • “ We track retention of high potentials who have gone through our diversity programs.”
    • “ Yes, but not universally. In many units, employees have specific goals related to diversity, which they set, and they are held as accountable on these as any other goals.”
    • “ It is linked to Executive bonuses.”
    • 17 (61%) of member companies include D&I in their performance management processes.
  • D&I Items in Talent Management Select Comments
    • “ A ‘diversity profile’ of the candidate is used (called out) in the talent management/ slating process.”
    • “ In talent reviews, the ‘how’ discussion of an individual getting their results will sometimes include ‘respects and champions diverse employees.’ ”
    • “ Our talent acquisition process includes consideration of diversity to have an employee population that reflects the customers we serve.”
    • “ We require diverse interview slates for open positions and track % diverse slates interviewed. We have a strategy for diverse sources of talent (e.g. we participate in diversity career fairs, leverage social media and sourcing through diverse organizations and conferences).”
    • “ We look at diversity of the talent pools and ensure we have diverse slates for all key positions.”
    • 17 (61%) of member companies include D&I in their talent management processes.
  • D&I Items in Training Select Comments
    • “ Not specifically - it is used as a lens in our manager and leader training.”
    • “ Some courses are mandatory for leaders however, most of the diversity and inclusion courses are provided on a ‘pull’ basis.  The ‘pull’ has been tremendous across the company.”
    • “ We have a three-tiered training program that is centrally funded.  We also have on-line learning to support D&I, as well as one-off unique programs in each part of the business.”
    • “ Yes, minimal. We require all new supervisors participate in a diversity workshop focused on ‘managing across generations’. We are developing/updating a broader curriculum to include ‘unconscious bias, micro messaging and leveraging diversity for innovation and growth.’ ”
    • “ We have a course for managers, employees, and production employees.”
    • 16 (57%) of member companies include D&I in their training agenda/ curriculum.
  • D&I Items in the Leadership Model Select Comments
    • “ [We are] currently in the process of creating a leadership model and … D&I is/will be a dimension included in the model as it is emphasized in all other aspects of our work.”
    • “ Although diversity is considered within our leadership model it is not a key dimension.”
    • “ It's specifically included in the Leadership Competencies, which were introduced last year and are being integrated increasingly in HR processes.”
    • “ It is one of 9 Key Dimensions which are measured by 7 questions in our 360 process (out of 58 in total).”
    • “ It isn’t a dimension but we have several elements in our leadership model that align to diversity & inclusion. We look at these elements on an ad hoc basis.”
    • 14 (50%) of member companies include D&I in their training agenda/ curriculum.
  • Additional Results
    • Out of the 28 companies that responded, 10 (36%) reported that they included D&I in all 5 of the OD processes.
      • On average, companies included D&I in 3 out of the 5 OD processes.
    D&I in OD Processes Note: Not all companies provided information for all categories.
  • Summary
    • Organizational surveys are most often used to assess and integrate D&I, followed by performance management and talent management processes.
      • The average number of D&I items on each survey was between 3 and 4, so, while these surveys are certainly capturing a D&I ‘pulse’, they may not be a true diagnostic of the state of D&I.
      • Two organizations noted that they have conducted separate surveys focused specifically on D&I.
      • Integration of D&I items into the organizational survey can reduce burden on employees but those items must be chosen strategically to be sure they are capturing the true state of D&I.
    • Surprisingly, only half of the member companies who responded incorporated D&I into their leadership model.
  • Impact of support for D&I *US Respondents Only Manager Support for D&I Involvement Has Increased from 2004 International Response in 2009 Men: 73% (First year item was asked in PI) Women: 74% PepsiCo Overall (US Only) Women of Color (US) Men of Color (US) White Women (US) White Men (US) 2004 OH 67% 66% 72% 63% 70% 2006 OH 78% 76% 81% 76% 80% 2009 OH 86% 81% 90% 85% 91% Change from 2006 +8 +5 +9 +9 +11 Unfavorable Response to Manager Support * Favorable Response to Manager Support * Company 67% 86% Job & Career 53% 83% Manager Quality 46% 85% Work Environment 55% 79% Compensation & Benefits 49% 73% Overall Satisfaction 59% 86% Turnover Intention 22% 9% Discretionary Effort 89% 94% Accomplishment 62% 86% Favorable (75%+) Neutral (55% to 74%) Unfavorable (<55%)
  • PepsiCo Case Study
    • How we re-ignited our D&I momentum
  • PepsiCo Case Study
    • Losing market share to competition among the fastest growing demographic groups
    • Diverse executive turnover (POC/women) was at 22 & 20% respectively, nearly 2x the core group (white males)
    • Our diverse population was being promoted a little less often than the core group
    • The combination of new hires, turnover and promotions made it impossible to move the needle
    • International markets were barely in the game
    • Re-igniting the D&I momentum a decade ago
  • A PepsiCo Case Study Key Challenges we were facing in late Significant changes in our business structure
    • Spun off restaurant group
    • Spun off bottling operations
    • Actively looking for 3 rd business leg
    Preparing for management succession
    • New challenges/new leadership team
    • New culture beginning to emerge
    Losing momentum on key initiatives like diversity
    • Diversity legacy was at risk
    • Future was unclear
    • CEO put a stake in the ground on the value of diversity and inclusion to the PepsiCo enterprise
      • Motivating factors: the business case for PepsiCo—consumer, customer, employee dynamics
      • Contracted with Board of Directors and senior team
      • Leveraged our external Advisory Boards
      • Established initial metrics
        • 50/50 hiring; parity of turnover & promotions
      • Communicated value at every opportunity
    A PepsiCo Case Study: Executive Ownership Started with the top of the organization
  • “ We believe Pepsi(Co) could build a distinct advantage over its peers by recognizing the need to create more diversity at every level of the organization (from senior management all the way to salespeople on the front-line).” -- UBS Securities Research Report Wall Street Had A Point of View on diversity at PepsiCo Employee Diversity Creates Competitive Advantage
    • Added diversity to bonus vs. merit for key executives—direct reports to CEO
      • Capped total business bonus payouts at 100% if you missed diversity targets
      • Made the goal in first year; but missed in year two
      • Cascaded to next executive level in year three
      • Today, all managers rated 50% business/50% people
      • All people managers now have a diversity & inclusion objective
    A PepsiCo Case Study: Accountability Started with the top of the organization Revised Performance management system
    • CEO & team led leadership development initiative for people of color executives and women
      • Focused on building authentic relationships & commitment
      • Created 4 ½ day leadership development program led by senior leaders with The Anderson School (UCLA)
      • Focused on African Americans, Latinos and Asians
          • Expanded to women
    A Case Study: Leadership Development Started with the top of the organization Instituted intervention initiative against most at risk groups Revised performance management systems
  • A PepsiCo Case Study: Making Progress
    • From 2001-2009, we averaged nearly a 1 pt of growth in representation of diverse executives, including almost doubling of executives of color and 50% jump in women
    • Turnover was at parity across all executive groups (people of color/women/white male) and near parity for non-executive population
    • Employee hiring and promotions have significantly risen for people of color and women
    • Employee engagement steadily improving, with D&I the biggest driver
    • D&I has become a capability we can leverage with our customers
    Results–to-date
  • Why Diversity, Why Now “ In the midst of the current recession, many businesses are focusing on what they see as the basics, and diversity simply is not on – or is falling off-their radar screens. But the reality is that diversity and inclusion matter more than ever to future success. Companies are discovering that to best position themselves for the next business cycle, they need to harness the collective power of their people across the broadest spectrum .” Pricewaterhouse Coopers Why Diversity, Why Now
  • Becoming More D&I Fit Collaborate and partner more internally; make D&I part of the company’s top business imperatives Invest in more D&I research—”In God we trust; all others must bring data” If someone calls you to be on a “best list”, hang up the phone. If they persist, tell them you’ll put it to a vote with fellow employees Get laser focused on those things that move the business/culture; D&I work needs to feel like other work inside the company Have a bias for innovation and cultural adaptation. Be more cautious of external activity; exude frugality, unless you’re already at zero
  • Final Thoughts!
  • Thank You