Getting To The Boards

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Getting to the highest levels of management: a challenge for Latinos
Hispanics in management positions were 6.6 percent of the entire US labor force in 2006, while they are only 2 percent of the highest positions in Houston.
Jorge Luis Sierra
October 31, 2007
La Voz de Houston

Published in: Business, Education
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Getting To The Boards

  1. 1. JORGE LUIS SIERRA JOURNALIST jlsierrag@yahoo.com Education is a key factor Getting to the highest levels of management: a challenge for Latinos Hispanics in management positions were 6.6 percent of the entire US labor force in 2006, while they are only 2 percent of the highest positions in Houston Jorge Luis Sierra October 31, 2007 La Voz de Houston Houston – Only a few Hispanics have managed to get to the highest positions of the big companies in Houston, but that may change if new generations have better access to higher education. According to a recent study of the Houston Hispanic Chamber of Commerce (HCC) and the University of Houston Downtown, in 2006, only 46 Hispanics were members of a select group of 2,403 executives and members of corporate boards in Houston. “It is shameful to see that the (Latino) representation is so poor,” says Edgardo Colon, president of the HCC Board. “But it is even more shameful to see that this happens in all the industries in Houston,” adds Colon who participated in the study. Other investigations offer evidence that this lack of representation might be a national trend. In 2006, 13.1 percent of the labor force was Hispanic, but only 6.6 percent of it was professionals with managerial positions, found a recent study by The Business Journal of Hispanic Research, a publication of The National Association of Hispanic MBAs, an institution promoting the integration of Latinos in the corporate world. “It is not a secret for anybody that Latinos are concentrated in the lowest positions and
  2. 2. frequently they don’t have possibilities to get an equal representation (in the companies),” says Miguel Olivas-Lujan, professor of Business Administration at Clarion University in Pennsylvania and researcher for that magazine. The researcher says that this disparity has to do with the lack of educational opportunities for Latinos and the fact that they don’t take advantage, due to lack of knowledge, of all the scholarships available. Qualification “There are a lot of companies looking for Hispanics to hire,” Olivas says, citing close to 350 companies that participated several weeks ago in the 2007 NSHMBA Conference and Career Expo that took place in Houston. “However, they don’t find enough qualified candidates.” According to Olivas, “it is also difficult to deny there is discrimination in companies, but it is prohibited and that gives us (Latinos) an advantage.” Adolfo Santos, Political Science professor at University of Houston Downtown and director of that investigation, believes that cultural identity factors in the companies affect the lack of representation among Houston corporate boards. “Part of what is happening here is that these (managerial) levels are more comfortable with people similar to them,” Santos says. Colon says, however, that part of the problem is that big companies don’t know that there are qualified Hispanics in Houston to serve in the directing boards. “(As a community) we have to educate those companies that this talent exists.” Sonia Perez, regional vice president of the telecommunications giant AT&T for the Houston area and South Texas, says that the success of a company is based on its ability to reflect its clients’ characteristics and to seem the closest to them. “A great deal of our success is that we look like our clients, behave like them and sell the products and services they demand,” says Perez, who has been working 28 years for AT&T. “And this is true for Latinos, Asians and African-Americans.” AT&T declined to inform how many Hispanic clients the company has in Houston and how many Latinos have directive positions. However, according to AT&T numbers, 11 percent of its employees nationally are Hispanic, out of more than 300,000. Twenty-eight percent of AT&T executives are minorities, in contrast to 12 percent in all U.S. corporations, the company says. Perez explains that Houston is the third biggest market for AT&T, only after Los Angeles and Chicago. In 2006, this company had revenues of more than $63 billion, according to the 2007 Fortune annual ranking of America’s 500 biggest corporations. A growing market Some companies have understood the need for hiring more Latinos in the context of such a
  3. 3. powerful Hispanic market, whose purchasing power would surpass $863 billion in 2007, according to an investigation made by the College of Business at the University of Georgia. “Obviously, the Hispanic market is at its peak, in multiple levels, with a continually growing share of the global market,” says William Glick, dean at the Jesse H. Jones School of Management, Rice University in Houston. “Understanding this market could mean a huge difference for a company.” Glick gives the example of the strategy followed by the financial giant Merrill Lynch, based in New York, to widen the diversity of its clients and manage investment funds of different ethnic communities. According to Glick, a Rice graduate fellow who worked for several years recruiting candidates from different ethnic communities to work in the firm, “She found incredibly qualified candidates of Latino and African American origin,” he says. The key factor Education is one of the most important key factors to reach higher levels of management, says Glick. “The importance of education comes to light when one finds different salaries for people with different levels of education, particularly among people who have a master’s degree in business administration.” Glick emphasizes that while it may be possible in a small business, it doesn’t happen in big companies, “particularly in the world of the biggest U.S. companies.” Hispanics like Stephen Quezada, majoring in accounting at the University of Houston, aspire to enter a big company and ascend to the top levels of management. “It is going to be difficult. I will have to work hard,” says Quesada, a second generation Hispanic, son of an Ecuadorian father and a Mexican-American mother. “And I hope for a company which values hard work, where race doesn’t matter.” Other Hispanic students realize that the effort could be great. “It is easy to enter, what is difficult is to have management positions,” says Victoria Guerrero, student of Marketing and Finance and a representative for the UH chapter of the National Association of Hispanic MBA Students. However, some Latinos prefer to create their own company instead of opening a path in one already established. “My idea is to create my own company,” says Nathalie Hendricks, UH finance student who defines herself as “diverse, a mix of Mexicans, Europeans and Americans.” On impulse One example that this may be possible in spite of the challenges is Javier Loya. Born in El Paso, Texas, and a Houston resident, Loya created his own company, Choice! Energy, focused on making transactions of oil, natural gas and electricity for other companies.
  4. 4. Loya studied Political Science at Columbia University in New York and learned to sell energy contracts when he was working for United Crude Oil in Connecticut. In 1994, he created Choice! Energy, which today has 85 employees and annual revenue of $60 million, according to Loya. The businessman says education was the decisive factor in his career. “I had the fortune of having parents, brothers and sisters that with education were able to get a lot of things,” says Loya. He is the sixth of seven brothers of a family from Ciudad Juarez, Mexico. An effort to educate more Hispanic entrepreneurial leaders is currently underway in Houston. Rice University, says Glick, tries to “incorporate diversity into the classroom” with a mix of international students, some coming from Spanish-speaking countries, with Latino students born in the U.S. Sonia Perez says that AT&T promotes the creation of internal advisory groups called Hacemos to give orientation to Hispanic employees. “Part of my responsibility is to make sure Latino employees have the information they need to succeed in the corporate structure,” she says. Multinationals like Hewlett Packard, a technology company based in Palo Alto, Calif., with branches in 170 countries, has developed a program called Crece y Gana to help employees from different ethnic origins, mainly Latinos, to grow inside the company, says Olga Perez, Vice President of Human Resources. Perez, who recently was in Houston recruiting personnel, says: “ In the past few years, the company has put emphasis on increasing diverse talent and identifying those people who have leadership potential.” However, the road ahead for Hewlett Packard could be long. According to its own numbers, in 2006, 5.1 percent of its 6,868 managers were Hispanic, in contrast to 84 percent Anglo.

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