Diversity Is Key to a World-Class Organization

Today’s customers have come to expect world-class quality in the goods and services they purchase. Diversity-based management is about good business, not just meeting state or federal mandates; it involves optimizing the interaction between people from all walks of life. Without organized approaches, many negative factors will destroy harmony in the workforce. World-class quality is possible only in an environment in which people from different walks of life can come together as a unified team. The construction arena is no exception. Research into construction “best practices” has shown that good construction quality depends on a cohesive team working toward a common goal (Oglesby et al. 1989). This is sometimes very difficult to accomplish with workers of different cultural, racial, and ethnic backgrounds. An organization cannot have satisfied external customers until it has satisfied internal customers. It cannot meet, let alone exceed, external customers’ needs when internal customers are at war with each other, as is often the case with construction projects.

In his book The New Economics, the well-known quality expert Dr. Edwards Deming views the organization as a system with people representing components that work cooperatively with each other. Dr. Deming cites the importance of informal communication between people in various components of the organization, regardless of level of position. He sees the competition that often occurs between people in the workplace as demoralizing to the individual and counterproductive to the organization as a whole.

Discriminatory behavior is a fact of life in today’s society, despite all the talk about its eradication. Many large corporations have been the subjects of lawsuits in recent years, charged by employees (or customers) with gender, racial, age, and other types of discrimination. Many have settled out of court to avoid publicity and hefty awards against them for egregious behavior that was outlawed many years ago. The fact that many of these organizations generally deny wrongdoing would suggest their top executives really believe they have done nothing wrong.

Discriminatory practices can be very subtle, but destructive; often they manifest in such actions as stereotyping and selective communications. Derogatory remarks are often made thoughtlessly, resulting in generalizations about minority groups, such as “Latinos are hot-tempered,” and “many African-Americans are on welfare.” Recent immigrants are often branded as “illegal aliens.” These beliefs can be damaging, and they create the conditions for minorities to fail in the job environment. Discrimination is often reflected in organizational communication patterns. Quite often minority groups are excluded from informal communication links with individuals of the majority group who have networks with other professionals of similar race/ethnicity or other common interests. As organization charts flatten, formal links diminish in importance, increasing the value of informal links. This situation may undermine minorities in management positions whose subordinates may obtain crucial information even before they do. In the construction industry discriminatory practices in the ranks scarcely reach the public view, yet their negative behaviors affect construction quality performance in subtle but tangible ways.

Today, a more conservative Supreme Court promotes the principle that race should not matter and seeks to diminish the impact of prior legislation that allowed minorities to have equal access to trades and professions that were previously largely unattainable. Despite this, there are many examples of successful actions and programs by advocates of positive change. The Associated Builders and Contractors (ABC) and the ABC National Diversity Committee have developed strategies to assist their member companies in building and sustaining diversity as a competitive strategy for the future (“Construction associations” 2006). These strategies have been identified as best practices.

One example is the strategic alliance between ABC, the National Society of Minority Contractors (NAMC), and Women Construction Owners and Executives, USA (WCOE). These organizations collaborated in 2006 to improve opportunities for women and minorities in construction. ABC signed separate agreements with NAMC and WCOE with the expectation that local members/chapters would establish similar relationships throughout the United States (“Construction associations” 2006). These initiatives are expected to empower minority- and women-owned firms by improving networking and training opportunities. They also promote diversity across race, gender, and age, and provide construction awareness outreach at an impressionable age so that school-aged children view the construction industry as a viable career path. In 2006 the program awarded scholarships to high-school graduates for attendance at such highly recognized institutions as City College of New York, Carnegie Mellon, Temple University, Howard University, and Manhattan College in New York.

In January 2007, the State of Illinois under Governor Rod Blagojevich created a grant Employment Opportunities Grant Program (EOGP) to provide greater opportunities for minorities and underserved groups to enter the construction industry (Gov. Blagojevich 2007). Illinois state officials recognize that minority groups are confronted with many obstacles to entering the workforce, especially with regard to obtaining the skills training needed for relatively lucrative construction jobs. The program, administered by the Illinois Department of Commerce and Economic Opportunity, has a goal to increase the number of these groups and to implement the governor’s economic development strategy. Participants can include African Americans, Hispanics, females, and ex-offenders. In Maryland, the Department of Transportation created an “on the job” training program (OJT) to increase the number of minorities and women in the highway construction industry (Woodrow Wilson Bridge 2007).

In the state of California public works contracting projects for transportation construction have incorporated diversity practices under Governor Arnold Schwarzenegger. Several major companies signed a joint agreement with the state in July 2006 to provide an equitable opportunity for all small businesses, including Disadvantaged Business Enterprises, but especially those in communities with high unemployment and underemployment. The signatories included such major companies as Granite Construction, CH2M Hill, Carter and Burgess, Parsons Brinkerhoff, Quade and Douglas, and professional organizations such as the Black Business Association, Women Construction Owners and Executives, and the state’s Business, Transportation and Housing Agency.

Studies conducted in Wisconsin indicated a significant lack of diversity among 475 contractors in the southeastern region. In 2006 the National Associations for the Advancement of Colored People (NAACP) and the University of Wisconsin–Milwaukee’s Employment and Training Institute studied the racial composition of these firms, and found that for each African American in training there were eleven white apprentices. For each Latino apprentice there were fourteen whites (“Diversity efforts” 2007). To counter these disparities, Wisconsin’s Milwaukee County Labor Council has been working in conjunction with their “Big Step” program. Big Step is the Building Industry Group Skilled Trades Employment Program, and they have collaborated with the Wisconsin Regional Training Partnerships to place more than 350 people in construction industry jobs of a total of 473 new placements. Of the new hires, 61 percent were African Americans, 9 percent were Latinos, and 3 percent were women. The program’s success is indicated by the fact that between mid-2005 and January 2007 24.3 percent of new building trades in metro Milwaukee were minorities (“Diversity efforts” 2007).

The Construction Labor Management Council of Southeastern Wisconsin, Inc., represents approximately 650 union contractors and 30,000 workers and is focused on including women and minorities who have been excluded from the trades in the past. The stakeholders have lauded these efforts as a way of harnessing public, private, and philanthropic resources to accomplish specific improvements to the economy.

Construction is the fastest-growing women-owned business, yet there is a persistent belief that it is not a typical profession for women. In fact, there is reference to a “concrete ceiling” in the field that few women have been able to break through. Organizations such as Professional Women in Construction have been dedicated to helping women to succeed in a male-dominated field.

Some major corporations in businesses other than construction have created the position of diversity officer to monitor their progress with regard to diversity initiatives. Twenty-five large corporations now have diversity chiefs reporting to the CEO or at the corporate suite level. One example is that of UPS, which goes even a step further. CEO Mike Eskew heads a diversity council of twenty members. In addition to monitoring diversity within the organization, UPS also promotes diversity in its supplier base as well as in its customer base. In 2006, UPS spent approximately $700 million with diverse suppliers, including $150 million with 1,200 or so minority firms (Petrella 2006).

Successful organizations excel not by just having a good product or service, but by recognizing that world-class performance incorporates many other factors. These factors have to be embodied in a strategic plan, as they do not occur in isolation or by accident. The strategic plan is typically built on a foundation that comprises a clear mission statement, a vision statement, and the organization’s values. The mission statement identifies the organization’s purpose for existence; the vision statement galvanizes everyone’s efforts towards an ideal future accomplishment; and the values are the core beliefs of the organization, such as customer satisfaction, serving the community, and treating people with dignity. The strategic plan orchestrates this system and clarifies how each employee plays a role in deploying the plan. It must be noted that world-class organizations that have won the Malcolm Baldrige National Quality Award have all demonstrated in great detail the use of such a plan. Examiners rate not just the plan, but the degree to which its elements are deployed (Fosset 1994).

A commitment to diversity-based management has to be an integral part of the strategic plan to become a reality. Leaders and senior managers have to take the lead in promoting diversity. They should first confront their personal biases and stereotypical attitudes, recognizing that no ethnic group has a monopoly on natural mental ability. They should communicate belief in dignity and respect for all, identify and remove barriers to minority groups in the organization, eliminate judgmental attitudes, and learn to listen. They have to “walk the talk” as people are very sensitive to the way leaders act. Leaders’ body language and other nonverbal cues set the tone for the organization, and cannot be manipulated to create an impression as easily as words can. Leaders should take the trouble and time to understand the potential of diversity, which goes far beyond hiring a portion of the work force from “other groups” simply because it is said to be a good practice. To be meaningful, diversity needs to be applied across the organizational spectrum. Many organizations claim to have a diverse workforce when in fact they simply have a number of women and minorities in clerical or low-level professional ranks.

An engineering or construction organization should set up a formal structure for managing diversity so that it does not get taken for granted; the degree of complexity should be based on the organization’s size. As exemplified by UPS and a number of other companies, the position of diversity officer (DO) provides leadership to the program. It should be recognized, of course, that the DO is an administrative position reporting to top management, and the CEO or someone at a related level should establish and continually review metrics for the deployment of the diversity objectives.

Other guidelines include: