A question for executives to answer is whether they are on board with diversity in their organizations’. Taking a cursory view of diversity at IBM versus Monitor Company, one sees an outward projection at IBM and inward projection at Monitor. The executives of these two global business giants do not have a shared strategy of diversity.
In a 2006 article, Melissa Jenkins1 reported the findings of 120 HR professionals from Fortune 1000 companies. These professionals used terms to define diversity as “direct impact” and “competitive edge.” The statistics she encountered include 79 percent believe diversity enhances corporate culture. Seventy-seven percent reported diversity improved recruitment and the same percentage said diversity improves worker morale. The largest percentage, 91 percent, found diversity helps keep their organizations competitive. How do these statistics relate to IBM and Monitor?
This comparative analysis considers circumstances, as they existed, when the original authors wrote their case studies. Therefore, this report is only a snap shot of realities then. A future study may interpret events differently based on new data.
International Business Machines is the long name for IBM known globally for mainframe and PC computers; however, IBM is more than computers. IBM is software, IT services, servers, business consulting, and a host of other operations related to technology. From the IBM web site, http://www.ibm.com, we read,
At IBM, we strive to lead in the invention, development and manufacture of the industry’s most advanced information technologies, including computer systems, software, storage systems and microelectronics.
We translate these advanced technologies into value for our customers through our professional solutions, services and consulting businesses worldwide.
In the end, IBMers determined that our actions will be driven by these values:
o Dedication to every client’s success
o Innovation that matters, for our company and for the world
o Trust and personal responsibility in all relationships
These statements support the claim of IBMs outward projection on customers and relationships.
Monitor Company is a global group of consultants with expertise in vital areas of leadership and management. They work in business networking, innovation management, market-to-customer, regional competitiveness, and executive development. Monitor appears driven by individual relationships between consultants and clients and individuality appears the norm in internal affairs. From the Monitor Company web site, http://www.monitor.com, we read,
Monitor is structured as a group of companies, each of which aspires to link cutting edge intellectual property with a diverse array of human, technical, and financial assets in the service of helping our clients compete and win in their marketplaces.
Throughout our history, we’ve been blessed with customers who not only found value in our services, but were committed to our success and growth. We benefited immensely from the patience and commitment demonstrated by our early, relationship clients and from the spirit and hard work of colleagues dedicated to building a firm which could offer both highly competitive services and a highly collegial work environment. Our proudest accomplishment remains our ability to attract and retain so many talented individuals, and our highest ongoing priority is sustaining an environment which will continue to attract a diverse pool of accomplished individuals.
Reading the first quote, one can argue Monitor has an outward projection, yet reading the second quote suggests an approach to clients from an inward position.
IBM and Monitor are very different organizations but have many similarities. Both companies offer technology services, business consulting, and both are global. With worldwide operations, both have personalities representing international flare. With international flare, both have issues with diversity management.
The IBM stance is that diversity is an investment in the future of customers and the future of business, business development, and business diversification. Diversity did not receive lip service from the top rather it received commitment. The IBM diversity decision came with total buy-in from the top. Discussion of its implementation at IBM comes in future paragraphs.
At Monitor, diversity discussions started from survey results during their tenth anniversary year. The company commissioned a global Definition of Purpose exercise intent to learn Monitor’s “vision of itself as it grew into its second decade” (Grant 1994, pg. 2). The surprise result was how uncomfortable people felt in the homogeneous climate of Monitor. Establishment of diversity programs at monitor launched slowly from bottom up.
Implementation at IBM
Thomas2 wrote of his interview with IBMs Lou Gerstner about IBMs business turnaround in the mid 1990s. IBM had an aggressive human relations and EEO management system in place. What Gerstner discovered is that the equal employment opportunity program attempted to ignore differences rather than maximize them. What Gerstner recognized is the IBM customer base is diverse but leadership in the company did not reflect its customers.
IBM made a “significant philosophical shift” in implementing diversity. The tradition at IBM was to minimize differences. Gerstner and his primary implementation partner, Ted Childs, vice president of Global Workforce Diversity, needed to tell the entire organization that the shift was a strategic goal. To implement the departure from the old position to the new, IBM (Childs) selected Bastille Day, July 14, 1995. According to Childs, Bastille Day was appropriate because of its “historic day of social disruption.
We were looking for some constructive disruption.”
Gerstner and Childs with the assistance of Tom Bouchard, senior vice president of human resources, established eight task forces, each having 15 to 20 senior managers from eight different demographic constituencies. Within specific constituencies, the senior managers gather data on personnel trends, labor trends, and customer market trends. As these teams did their research, they discovered many similarities that became “The Vital Few Issues: Employees’ Biggest Diversity Concerns.” Now the task forces had areas from which they could begin exploring areas for business development.
As these senior managers began to think diversity, they began acting diversity. Within their specific operations, subordinate managers did not ignore these senior managers’ actions. Subordinate managers’ resistance soon shifted to the view that diversity is good for operations. IBM now has “pillars of change” including, demonstrated leadership support, engaged employees as partners, integrated diversity with management practices, and linked diversity goals to business goals
Implementation at Monitor
Monitor Company began to recognize diversity following a ten-year anniversary definition of purpose survey of the organization. Several members of the organization proposed Diversity Mentor Program that met with resistance. Reframing the proposal to as an Advisor Network, the firm’s Diversity Network gave empowerment to proceed. Monitor did not have full commitment at the top to diversity management rather it took a bottom up approach and resistance followed.
A significant event coming through director and senior manager level changed the focus of diversity. Women in these roles began to open up on issues of sexual harassment from clients and internal insensitive comments for co-workers. Kaplan, legal advisor and CFO, had a personal interest in matters of sexual harassment and harassment in general. Using a directors meeting, he expressed his concerns by relating how women in director and senior management roles actually felt, sharing how difficult it was for them to speak out.
Key players in the Advisory Network included Rotenberg, a gay employee with a long history of business success going back to his teens; he is also of Jewish faith. Also, Basden, an African-American noted the lack of minorities when he joined the company. Another is Singh-Molares, of mixed Indian and Hispanic decent. Born in Europe, he grew up in Manhattan where he attended the United Nations International School.
Grant3 writes in her analysis that Basden did not feel that directors understood diversity and that change was not likely. In a quote, Basden related that directors “don’t see the problem, physically don’t see the problem, mentally don’t see the problem.”
Writing of Singh-Molares, she quotes him as saying he sometimes feels different but not uncomfortable. Speaking on behalf of hiring practices, she quotes him that Monitor hires people with the special needs of the company, not hiring someone who will fail. “It doesn’t help [minorities] and it doesn’t help us.”
Another key members discussed by Grant is Martineau, a director, one of the first women hired by Monitor. She became a director in 1991. She felt like she had to be one of the “guys” while being the “first” female director. She explained in a board meeting that she often felt sexually harassed by clients. Further, she explained feeling like others considered women as disabled if they became pregnant. She described gender-hurdles at Monitor as external to the organization.
Firstbrook, is a senior manager, also a woman, and holds an engineering degree. She explained how difficult it is for a woman engineer to get ahead in a male dominated career. She supported Martineau’s position of external pressure relating how men perceive women giving consulting advice.
The Advisory Network had support; however, most consultants felt they would not use it. Rotenberg asked for time allocation for the work of the Advisory Network and received notice to work it as a collateral assignment.
The organization already had Professional Development Advisors for employees that were “formal and institutional.” They felt the Advisory Network should be “informal and personal.”
Armed with a new sensitivity, Fuller, the founding director, accepted the role of diversity as a tool to improve performance at Monitor. He issued a statement that began, “There is not a lot of dissent in our management ranks about whether we ought to be doing [something about diversity]. There is only anxiety…” Fuller, quoted by Grant, commented that because of his position, he feels separated from the rest of the organization and by virtue of is background is not qualified to execute “some of the tactical aspects of managing diversity… What I can do is act as a sounding board and I can as something of a sponsor.”
In the final assessment, Monitor did acquire top-down buy in to diversity management and from previous attempts at bottom-up diversity management, the Diversity Network became a reality with Fuller and Martineau overseeing its implementation.
IBM, from the most senior level, recognized the value of diversity as part of the culture. Further, they recognized their customer base was diverse and internally, they had to reflect their customer base to expand it into new areas and products. IBM became very successful at reinventing itself in its global market. Hoyle4 tells us that a clear-shared vision pulls people into a change process in a way that makes the vision happen. Hoyle shares four principles of persuasion that leaders need to employ in order for visionary change to occur. At IBM, Gerstner had these skills.
1. Identification Principle: Like cause and effect, addresses personal fears, hopes, and desires.
2. Action Principle: Either sponsored or by personal proof of a value of something, people will not buy in.
3. Principle of Familiarity and Trust: Acceptance of ideas comes through those we trust or regard and credible.
4. Clarity Principle: The idea must be clear, not confusing, not open to several interpretations
Monitor, it appears, was unconsciously unaware of the need to manage diversity even when facts began to emerge from its internal Definition of Purpose survey. Applying the four points above to Monitor, one concludes it was not prepared to take steps until reality from senior managers and directors manifested themselves in a directors meeting. Maxwell5 writes that leaders need to slow down, work at the pace of the organization, and be involved and engaged in dialogue at all levels. Fuller admitted feeling separated from the organization by position, although admitting he felt bad about that.
The title of this paper asks what we can learn. Organizational culture has formal and informal processes that link values and beliefs. IBM and Monitor possess both these links. Entering either company, a new recruit begins a socialization process and builds informal relationships while becoming more comfortable in their roles. Finally, over time, people naturally tend to one role or another that serve the organization in some formal or informal way6.
IBM learned the value of diversity linkage is economic. Improving their organizational population diversity opened new way of think about and serving a diverse customer population. Monitor learned that although it has highly motivated people in a good work environment, they needed to explore their vision of diversity. Emerging leaders often had differing views of what diversity meant. It became apparent that proponents of different advisory groups needed to link their resources for the greater personal and organizational good.
Another view of the two organizations is the value placed on individuals and groups. IBM operates in a manner that supports teamwork and group effort to accomplish goals. Monitor has an individual consultant/client operation valuing the effort of the consultant in a relationship to satisfy client needs. Observation of the diversity climate at IBM versus Monitor is an example of open climate versus closed. IBM projects outward to identify diversity needs and Monitor projects inward.
IBM improved its heterogeneity and improved its economic bottom line. Monitor seems to remain more homogenous yet sensitive to diversity of its population seeking to recruit more people from different backgrounds. In both cases, the organizations recognize equal employment opportunity and diversity do not ignore differences. Instead, they champion differences. IBM is more successful at maximizing them.
IBM, with its much larger reach in the global community learned the strength of diversity to cast light on customers and cast light internally. The IBM business commitment did not change because of diversity; rather it embraced other truths and other traditions to improve business. Monitor, intentionally or unintentionally, cast shadows on diversity; they seemed insecure with it or feared it, they denied it to themselves giving it evil properties. Their final acceptance of it came only after most senior members made it an open issue.7
In diversity and globalization, it is important to acknowledge the two sides of human nature. Confucius said, “Human beings draw close to one another by their common nature, but habits and customs keep them apart.”