California Procurement Center January 2015

Union Bank Frontrunner in Overall MBE Procurement

Supplier Diversity Industry Alphabet Soup

National Tier 1 & 2 Procurement with MBE's

Union Bank Deposit Market Share in CA %

Data obtained from Greenling February 2014

Escaping the Old Boy Network: The Banking Industry & Supplier Diversity

Corporate Uphill Challenge in Supplier Diversity

PATIENCE

PERSISTENCE

PASSION FOR CUSTOMER

Data obtained from Greenling February 2014

Escaping the Old Boy Network: The Banking Industry & Supplier Diversity

pam@getice.com

Linked In: Pamela Isom

Twitter: @pam_ICESafety

Facebook: Pamela Isom CEO

Facebook: ICE Safety Solutions Inc.

Data obtained from Greenling February 2014

Escaping the Old Boy Network: The Banking Industry & Supplier Diversity

3 out of 4

Fortune 500 Companies launched Diversity Programs by the end of 1990's

• Federal Government:

8A, SBA, DUNS, CCR, Hub Zone, Veteran/Disabled Veteran, Woman Owned SB

• State Government:

DGS, Small Business (SB), WOSB

• City/County Government:,

SLEB, Hub Zone, Small Business ( SB), SF Human Rights Commission

• Corporations:

MBE, WBE, Veteran Owned, Disabled Veteran Owned, LGBTBE

• California Public Utility Commission:

MBE, WBE, MWBE

• Transportation Airport, Cal Trans, Valley Transportation Authority, BART:

Disadvantaged Business Enterprise-DBE

• NEW: California Department of Insurance: MBE, WBE

KEY TO SUCCESS FOR DBEs

#PATIENCE

#PERSISTENCE

#PASSION

Corporate Diversity & Inclusion Best Practices in SD

- Formal Leadership Commitment/ Involvement

- Corporate D&I objectives integrated in Business Plan

- Dedicated Diversity Professionals

- Effective Internal/ External Communication Plan

- Diversity Supplier Growth & Education Plan

- Supplier Diversity Goals & Objectives

- Social Networks/ Affinity Groups

- Corporate Accountability

- Diversity Initiative Assessment

Diversity & Inclusion Perspective

- D&I programs exist at most major corporations

- D&I literature Best Practice shared amongst SD Industry

- D&I Cost/ Benefit analysis challenging for areas of:

• # of Diverse Suppliers
• Procurement Spend
• Consumer Impact

- Corporations & Diverse Suppliers bifurcated regarding diversity progress

Corporate Member

Return on Investment

DIVERSE SUPPLIERS

BY REVENUE

PASSION FOR THE CUSTOMER

DRIVING BUSINESS SUCCESS THROUGH DIVERSITY

Pamela Isom

President/CEO

ICE Safety Solutions Inc.

WRMSDC MBE Input Committee

Immediate Past Chair

Union Bank MUFG

Community Advisory Board

NMSDC

Field Operations Committee

Supplier Diversity

What Is Diversity?

Diversity is more than race and social economic status.

It is teaming our strengths &

opportunities to exceed our goals & objectives.

PERSISTENCE

Diversity Strategic Plan

DIVERSE SUPPLIER IN THE CORPORATE

SUPPLY CHAIN

Relationship Conflict

Task Conflict

Three Conflict Types

Process Conflict

Three Diversity Types

1. Relationship Conflict

2. Task Conflict

3. Process Conflict

Relationship Conflict:

Animosity or annoyance about non-task related issues

Example: Attacking team members based on communication style, cultural or political viewpoint differences

Effect: Depletes energy and effort, reduces time devoted to the task at hand. Increases turnover and absenteeism, results in poor performance and low commitment.

Task Conflict:

Disagreements about tasks being performed

Example: Team Members disagreeing about how to budget for specific activities or which merged company’s processes to use

Effects: Team benefits from increased debate about ideas and viewpoints, Helps avoid “ Groupthink”

Research Findings

Process Conflict:

Conflicts about who should be delegated to perform certain tasks

Example: Team Members disagreeing about who should be appointed to lead a newly set up a task force

Effects: A small amount improves performance because the right person can be assigned to the job

1. Social Category Diversity: Visible demographic characteristics (age, gender, ethnicity and race)

2. Informational Diversity: Expertise of the individual, educational level, organizational tenure and work experience

3. Goals & Values Diversity: Organization vs. Individual goals and underlying values teamwork

Initial Observations

• Informational Diversity will increase task conflict in the team, but increase team performance

• Social Category Diversity will increase relationship conflicts, but if valued and managed effectively will increase performance

• Values diversity increases conflict and decreases team morale and team performance

• Diversity introduces increased conflict

• The relationship between the following three areas impacts organizational performance
• Organizational Culture,
• The Business Strategy
• HR Practices

• Certain environments and business strategies enhance the effectiveness of diverse teams; others do not

Research Recommendations

Diversity & Performance

• Refine your own emotional and social intelligence

• Focus on Diversity Values of the team early and often

• Continuously develop ability to have tough conversations

• Build an Organizational Culture and human resource practices that will translate diversity into positive business results

• The Wharton School of Business at the University of Pennsylvania conducted a major Diversity Research project 1998-2002

• The Diversity Analysis Research Team (DART)
• Key Initial Observations
• Three Types of Diversity
• Three Types of Conflict

Talent Makes

The

Difference

Organizational Observations

Talent Makes the Difference

The success of today’s and tomorrow’s businesses depends more on human assets than on physical or financial assets.

Buildings, equipment, manufacturing facilities, and most technologies can be readily purchased.

However, the human talent and know-how needed to drive our knowledge-based industries are much harder to come by.

• Organizations that are not serious about diversity often fail to achieve their diversity objectives and then create “Paradigms to Justify Failure”.

• Organizations that “Make a Decision” to commit themselves to Diversity, generally succeed in achieving their stated Diversity Objectives.

• Organizations often separate the support they use in two Diversity related areas:
• Diversity Recruiting: Use a Search Firm to identify and hire Diverse Talent
• Workforce Diversity Initiatives: Select a Consulting Partner to study & improve their work culture

World of Work Trends

Organizational Observations

Employers can no longer expect employees to join them early in life and stay indefinitely. Firms must actively and creatively encourage good people to stay—especially in high tech markets.

• A trend toward free agency.
• The dissolving employer/employee contract.
• An intensifying need for technical skills.
• A growth in Internet recruiting.
• Demands for greater work-life balance.

More Jobs less Talent

Defining Diversity Success

Economic growth is outpacing the growth of the workforce:

• The U.S. Economy is growing at 2.4%

• The U.S. labor force is growing at 1.2%

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Demographic Shifts

Being Truly Committed To Diversity

By 2012 there will be 163 million jobs available and only 160 million people to fill those jobs.

Source: BLS

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Talent Shortage

Diversity Critical Thinking Skills

This concept describes an ability to apply critical thinking skills to diversity issues.

It includes the ability to understand and articulate many of the complexities involved in effectively discussing and resolving diversity issues.

The supply of highly skilled technicians and professionals is being overwhelmed by demand, particularly in computer-related fields.

Retaining Talent

Creating a climate in which the potential advantages of diversity are maximized while the potential disadvantages are minimized.

- Taylor Cox

Managing Diversity

Demographic changes have made retention especially challenging.

Managers are Key to Retention

Defining Diversity

Marcus Buckingham and Curt Coffman stated the following:

Managers tromp companies.

If your relationship with your manager is fractured, then no amount of in-chair massaging or company-sponsored dog walking will persuade you to stay and perform. It is better to work for a great manager in an old-fashioned company than for a terrible manager at a company offering an enlightened, company-focused culture.

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Turnover Costs

So, Why Diversity?

“Our greatest strength as a human race is our ability to acknowledge our differences, our greatest weakness is our failure to embrace them.”

- Judith Henderson

The U.S Department of Labor estimates turnover costs of about one-third of the new person’s salary. Among managerial and professional employees, the percentage increases dramatically.

Retaining Talent: Why People Stay

• Pride in the organization
• A respected supervisor
• Fair compensation
• Affiliation
• Meaningful work

Diversity Overview

Retaining Talent: Why People Leave

Diverse Talent Management Overview

• Diversity Overview

• Organizational Observations

• Talent Makes the Difference

• Diverse Talent Life-Cycle Management Process

• Attracting & Retaining Diverse Talent

• Diversity Strategic Framework

• The company’s leadership shifts.

• Conflict with immediate supervisors.

• Close friends leave.

• Unfavorable change of responsibilities.

Retention & the Service/Profit Chain

Phase IV: Measure Results

• Customer Loyalty drives Profitability and Growth.
• Customer Satisfaction drives Customer Loyalty.
• Value drives Customer Satisfaction.
• Employee Productivity drives Value.
• Employee Loyalty drives Productivity.
• Employee Satisfaction drives Loyalty.
• Internal Quality drives Employee Satisfaction.

Source: James Heskett, Thomas Jones, Gary Loveland, W. Earl Sasser, Jr. and Leonard Schlesinger, “Putting the service-profit chain to work”, Harvard Business Review 72.

• Measure results of implementing the DSP

• Identify Opportunities for Continuous Improvement

Phase III: Implement the Diversity Strategic Plan

• Implement Strategies (3-5 Year Plan)

• Insure consistency across departments

Diversity Strategic

Framework

Diversity Strategic Framework

Phase II: Develop a Diversity Strategic Plan (DSP)

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• Define Ideal/Targeted Condition

• Identify GAP (Problems)

• Develop Strategies to Close the GAP

Diversity Strategic Direction

Phase I: Determine Current Condition

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• Conduct Cultural Audits

• Conduct Focus Group Interviews

• Assess Diversity Key Performance Areas
• Representation & Performance across demographic groups

Driving Business Success

through

Diversity & Inclusion

Diversity Strategic Framework

Learning Objectives

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• Identify a list of critical 21st century business & customer needs and increase participant knowledge of how to meet those diverse needs.

2. Provide action steps that will help transform perceived soft skills into hard business results and sustain progress towards diversity initiatives.

3. Present the Four Phased Diversity & Inclusion model which drives business success.

Eric Ellis M.A., President/ CEO

Integrity Development Co.

Phone: (513) 874-6836

Email: ericellis@integritydev.com

www.IntegrityDev.com

Attracting Diverse Talent

In this section we will review information on how

to attract and retain talent in five specific Diverse

Subgroups:

• Hispanic/ Latino Americans
• African Americans
• Asian Americans
• Disabled Americans
• Female Americans

We will provide some additional information on

Hispanic/ Latino culture as an example of the kind of

information that strengthens your ability to work

successfully with diverse cultural groups