MANAGING DIVERSITY: Grappling With Change in the Work Force. A SPECIAL REPORT : Work Force Changing : Firms Begin to Embrace Diversity

Marooned in Washington by a blinding snowstorm, a small group of senior managers from Digital Equipment, a computer manufacturer, spent a long weekend seven years ago breaking a taboo that had sworn American corporations to silence for a generation.

They talked about race: the stereotypes whites hold about blacks and Asians and other people who look and act different from the corporate norm. They talked about sex: the difficulty men and women have working together in business.

It wasn’t idle conversation. The managers knew Digital’s labor pool was changing. Cycles of immigration, the baby bust and the flood of women pouring into the job market meant men--make that white men--could no longer expect to dominate the corporate world.

New Strategy Emerges

But affirmative action and equal opportunity employment, programs of the 1960s and ‘70s, had not made their company a welcome working place for the women and minority members and immigrants expected to shoulder white men from their exclusive hold on corporate power in the early years of the next century.

The talk was painfully frank. But from the snowbound dialogue grew a new strategy at Digital.

Digital employees would face up to their stereotypes and biases. Nonconformity to the gray-flannel-suited norm, in race or sex or conduct, would be regarded as a valuable commodity, not a handicap. Colorblindness, the goal of the civil rights era, would be rejected as an ideal. Productivity in Digital employees would be unlocked by managers acutely aware of the diversity in the work force.

“The whole principle is in not trying to be colorblind, but in recognizing there are colors,” said Alan P. Zimmerle, one of the Digital managers who took part in the candid discussions in 1981 and who now directs the programs that grew out of them.

With varying degrees of sophistication, dozens of American companies are latching onto the same notion.

“Valuing differences” and “managing diversity,” terms less threatening than “affirmative action” but perhaps more far-reaching, are the ubiquitous new buzzwords of corporate human relations. Striving to keep their firms a step ahead of a historic shift in the makeup of the labor market, companies are making women, immigrants and minorities--long held in low regard and given minimal opportunities for advancement--the unlikely new heroes in the American corporation’s battle for world competitiveness.

At companies as different as McDonald’s and McDonnell Douglas, workers are being challenged to talk openly about biases, fears and stereotypes. Borrowing the techniques used to train managers for overseas assignments, employees are being sent to school for introductions to the cultures, foreign and home-grown, from which their co-workers hail.

Critics warn that the movement does little more than update the “sensitivity training” that was a 1960s business fad, in the process perpetuating stereotypes rather than erasing them. Minority leaders and some business analysts say corporations would be wiser to follow the lead of a handful of firms that set rigorous numerical quotas for integrating every level of their organizations. Or, they say, companies should at least build concrete programs to assist non-whites and women in climbing the corporate ladder, rather than toy with employees’ attitudes.

Still, the corporate fascination with “diversity” is real, as evidenced by a small explosion of business consultants, seminars, in-house corporate programs, training films, university courses and academic publications. And unlike past drives to desegregate industry, it has developed without federal government pressure--indeed, at the end of a decade in which the civil rights agenda has widely been viewed as on hold.

“In past years, it was a government issue, and underlying that was a bit of social responsibility,” said Chuck Smith, executive director of recruitment, placement and training for Pacific Bell, where both minority and white managers have undergone cultural training in the last two years. “That’s passe now. This is a business issue.”

How so? At a Hewlett-Packard manufacturing plant in San Diego, managers realized they were having trouble communicating with--let alone motivating--their large number of Mexican, Indochinese and Filipino employees. The company responded by developing classes that instruct managers in the basics of their workers’ cultural backgrounds, including the differing ways people communicate.

“We need to be aware of gesture and tone and inflection and pace, of the amount of emotion we use, the amount of control, or what sort of logical reasoning processes we’re comfortable with--linear or expressive,” said Waymon Smith, training manager at the San Diego plant. “Just being aware of what those differences are makes communication a lot more effective.”

Too Many Leave

Many firms, meantime, spend heavily to recruit top black and Latino engineers and business school graduates, only to see large numbers quit in a few years, often to start their own companies.

“Since we’ve hired a lot of good people, why do they leave?” asked Robert N. Beck, executive vice president of human resources for BankAmerica. “One of the reasons they leave is that they don’t see an opportunity.”

Beck’s solution? He is a leader of a high-level corporate campaign that challenges chief executives to develop programs to retain and promote minority managers.

Some dramatic demographic trends help frame the issue.

From now until 2000, according to U.S. Labor Department estimates, women, minorities and immigrants will constitute 84% of the new entrants to the American work force. Already, white men make up less than a majority of American workers, a milestone passed in the first half of the 1980s.

The numbers alone are enough to sway some firms to shed the ethnocentric attitudes of the past.

Competition Cited

“To try to run an international, multinational company in a competitive environment without the creativity, resources and skills of that size of a potential work force is undercutting your company’s ability to be successful,” said A. Barry Rand, president of U.S. marketing operations for Xerox, a concern that has set firm numerical goals for female and minority representation at all corporate levels.

“Managers that haven’t learned to manage diversity by the year 2000 will be incompetent,” added Judith Katz, a corporate consultant in San Diego.

Nonetheless, the shrinking corps of white men continues to dominate the positions of power in the business world. The mandate of the Civil Rights Act of 1964 to hire women and minorities has gotten both groups inside the corporation. But once inside, their progress has been limited.

A survey in 1986 by Korn Ferry International, an executive recruiting firm, found 13 minorities and 29 women among the top 1,360 executives in Fortune 1000 companies--barely 3%, though women and minorities made up 51.4% of working Americans that year.

Change in Proportion

A broader measure by the Equal Employment Opportunity Commission showed that the proportion of women, black and Latino managers at all levels in corporations actually fell from 1985 to 1986, as the streamlining of America’s bloated corporations proved most painful for the groups that could least afford to lose ground. Meanwhile, complaints to the commission of racial and sexual discrimination continue to mount.

“The doors only seem to be open for one or two blacks or Hispanics at a time,” said New York banker Leroy Nunery, president of the National Black MBA Assn.

The upheaval in the workplace has many faces.

Esprit de Corp., the popular maker of women’s and children’s clothing, has made the internationalism of its work force a cornerstone of its advertising. Esprit employees, Asian and American-born, white and Latino, have smilingly modeled the firm’s youthful garments in a long-running ad campaign.

But many of the immigrant workers at Esprit’s distribution center in Brisbane, outside San Francisco, are burdened by their limited ability to speak English. They sacrifice hourly wages to take the English classes offered by the firm, but complain that their chances for advancement are narrowed by an unspoken preference for native speakers.

“In China, a foreigner’s skills are respected, even without language skills,” said Sandy Woo, a report analyst whose husband, a physician by training, now packs boxes at Esprit. “Here, we never get a chance.”

Better Relations

In Long Beach, McDonnell Douglas is struggling to forge better working relationships between the military-bred male managers who long have run the company and the independent-minded women with whom they increasingly must coexist.

Since last fall, Douglas has offered a training course that aims to explain the behavioral differences between women and men. First, workers of each sex gather separately to air their frustrations. Later, they meet together for role-playing exercises, a consultant’s lectures and a chance to compare notes.

When Arlen L. Marsyla, manager of manufacturing budgets, completed the class in December, his female subordinates found him a better boss. The Bell Gardens native, a Navy veteran and career Douglas employee, was more willing to treat women as equals--to curse at staff meetings without first apologizing to the ladies, for instance.

Some of his new attitudes were more profound. “I kind of thought of women as, ‘You’re the second income to the household,’ ” Marsyla said. “ ‘You’re not really here to have a career, per se.’ But it helped me focus. . . . If a woman is coming into the work force, maybe their aspirations aren’t any different than mine.”

Discussion of Goals

Marsyla has sat down in the last few months with all his female supervisors to discuss their career goals. A week ago, he took a vacation day to attend a state conference on women’s issues. “I think I’ve learned to be more open and more direct,” he said.

Programs like Douglas’ “Women-Wise and Business Savvy”--and other firms’ training sessions on ethnic and foreign cultures--free workers to discuss stereotypes and biases that were made taboo subjects for polite conversation by the civil rights advances of the 1960s and 1970s.

“People are very pleased to be allowed to start talking about things like this,” said Lewis Griggs, whose San Francisco firm, Copeland Griggs Productions, introduced a series of training films last winter titled “Valuing Diversity.”

But the films and programs have their detractors.

Minorities and management experts question the ability of any instructor to boil down the characteristics of women, blacks, Asians or Latinos to a relative handful of behaviors or attitudes. The generalizations offered by some trainers--that women are more spontaneous and inclusive in their thinking and men more plodding, that Asians won’t speak up in meetings, that Latinos don’t see the need for rushing projects to completion--may deepen stereotypes, not help workers understand their colleagues’ behavior, skeptics warn.

Breaking the Stereotypes

In some companies, “the entire affirmative action effort has spent years trying to get managers not to think in terms of stereotypes,” said Lorence L. Kessler, a Washington attorney who advises members of the Equal Employment Advisory Council, a group of 200 large corporations concerned with minority employment.

“Then all of a sudden along comes a cultural diversity consultant who says, ‘Asians relate to their work this way, whereas Hispanics relate to their work that way,’ ” Kessler said.

In the abstract, Kessler said, he favors the new focus on diversity. But, he added, “There are some consultants whom I would be reluctant to have talk to managers.”

Too many of the companies embarking on diversity programs are looking for easy solutions to a complex problem, other experts warn.

On the one hand, some critics say, managers need to be thinking of all workers--black, white, male, female, native or immigrant--as individuals, not as members of some culturally distinct group.

“They might get more out of it if they spent their work talking about individuals and that individuals differ and that you have to focus on what are the greatest strengths of each individual and capitalize on those,” said Felice Schwartz, president of Catalyst, a New York-based research and advisory group for women in business.

More Is Needed

On the other hand, many experts say awareness programs alone cannot begin to break down the institutional obstacles that minorities and women confront at work.

“Buzzwords are good for raising consciousness, but they don’t take you very far,” said Eleanor Holmes Norton, a Georgetown University law professor who was chairwoman of the Equal Employment Opportunity Commission during the Jimmy Carter Administration. “Nothing can be done without some very specific sense about why women and minorities are not progressing within a particular corporation.”

A survey of corporate affirmative action programs by the Graduate School of Management at Rutgers University identified an array of aggressive steps that companies could take to break “glass ceilings”--the hidden obstacles to advancement that frustrate many minorities.

Similarities Noted

According to David H. Blake, dean of the Newark, N.J., school, the steps are oddly like those taken to advance promising white male managers: creating opportunities for social contact with upper management, developing mentor relationships with aspiring executives and offering candid performance evaluations that are not sugar-coated for fear of seeming racist.

“Many companies haven’t understood that they need to take some special steps to assist minorities to achieve positions of responsibility and growth within the corporate world,” Blake said. “The whole atmosphere of corporate success has been, ‘Well, you make it on your own.’

“Frankly, that’s a lot of hooey. There’s all kind of formal and informal networks that help people succeed. One of the problems has been that those formal networks, and very much the informal networks, have not been established in ways that make sure minorities can succeed.”

Sensitivity sessions, Blake said, cannot be the beginning and end of a new generation of programs to integrate the corporation.

Awareness Sought

Advocates of the new programs insist, however, that just building an awareness of work force diversity would be a major breakthrough at many corporations. Younger executives who matured during the era of affirmative action and those who have experienced minority status during tours of duty abroad may understand the ramifications of changing work force demographics, they say. But older white males who have had little contact with people outside their tight circle don’t yet grasp the extent of the upheaval.

“It’s very difficult in our society to admit we are a racist and sexist society,” said John P. Fernandez, a sociologist who has surveyed 22,000 employees of large American companies for his studies of racial and sexual bias in the workplace. “It goes against our ideal belief system. Yet what we’re trying to change is over 500 years of racism and tens of thousands of years of sexism. And you’re not going to change that overnight.”

Attacking Racism, Sexism

Still, companies hoping to capitalize on the new diversity are undertaking nothing less than a campaign to sweep racism and sexism out of the workplace.

Avon, the cosmetics company, realized five years ago that it wasn’t making the most of its markets or its employees.

Minorities and women “weren’t moving up in the organization,” said Daisy Chin-Lor, who developed the New York-based company’s multicultural programs. “The organizational culture did not allow for participation that wasn’t in the mainstream style. We were asking people to assimilate and become part of a melting pot and not be themselves.”

The result was dangerous for a consumer products business. Strategies for responding to the growing ethnic markets for Avon’s products weren’t bubbling up through the organization. Innovation was stifled. “We weren’t getting the flow of ideas, the flow of creativity, the full range of what their potential could be,” Chin-Lor said.

Avon’s answer was to build the principle of valuing diversity into every level of company operations.

Five-Year Plan

The president of each of Avon’s divisions maintains a five-year strategic plan that links multiculturalism to the company’s business goals. Avon Chief Executive Hicks B. Waldron is chairman of a committee that relays women and minority workers’ concerns and ideas for helping the business to top management. High-potential middle managers of all races are sent for management training not to Stanford or Harvard, but to the School of Management at Morehouse College, a predominantly black institution in Atlanta.

The foundation of the effort, though, is an educational program in which Avon managers and executives explore their ethnic and sexual biases and get training in the management of a diverse work force.

For Avon, the result has been above-average levels of women in top management and more minorities in upper management ranks than ever before, Chin-Lor said. Retention is up. Black Enterprise magazine dubbed the company one of the best places for blacks to work in America. Catalyst honored the company for advancing women’s careers.

Slow to Change

But the point has not yet gotten through to many executives, and Chin-Lor, now in charge of human resources for Avon in Europe, still finds that many companies cannot understand why Avon has gone to all the trouble.

“The blank stares,” she said, “come from the fact that people wonder, really, why are you doing this? You don’t have to do this legally, and your business isn’t suffering and you don’t have a morale problem. Why in the world would you take on the job?”

At Digital, as at Avon, executives think they have the answer.

Its “Valuing Differences” program can be excruciatingly personal. Groups of eight or 10 employees, like the group that met years ago in Washington, strip bare their feelings about each other’s race and sex and individual peculiarities. But in the process, said Zimmerle, the company’s equal employment manager, they are making Digital a more desirable place for women and minorities--and even iconoclastic whites--to work.

“It’s about creating an environment where everybody can be successful,” he said. “It’s about creating an environment 10 years from now, when, if we’re competing for engineers, and a lot them are Asian, or a lot of them are black women, Digital will be their company of choice.”

EXECUTIVE CHECKLIST

Robert N. Beck, executive vice president of human resources for BankAmerica in San Francisco, travels across the country challenging corporate chief executives to assess their companies’ performance as employers of minorities.

He took on the job as an extension of his participation in the Program to Increase Minorities in Business, an elite task force of corporate executives, educators and minority leaders.

At a series of breakfast meetings, Beck has asked the CEOs to consider a series of questions about their firms’ conduct.

“If you like what you hear in the answers you don’t have to do anything,” Beck tells the executives. “But I suspect you won’t like the answers, and then I ask you to do something.”

Questions

What are we doing to enhance the upward mobility of minorities? Is that enough?

Is our development plan for minorities part of our operating plan?

What will we accomplish this year and next year in upward mobility for minority employees?

How do we measure and reward our managers’ efforts and results in this area?

Are we creating a pool of minority talent, by function and business unit, to help us accomplish our overall goals?

What process do we have to identify minority management candidates?

Who are the minority successors for me and my direct reports? What are we doing to prepare them?

Who are our high-potential minorities within the organization? Do I know them? Have I met them?

How does the minority manager within our organization perceive the corporate culture?

WHO’S THE BOSS?Though women and minorities have made some inroads, white males still dominate the ranks of American management.

(Percentage of managers or officials in medium and large private companies)

WHITE ASIAN AND YEAR MALES WOMEN BLACKS LATINOS PACIFIC IS. 1970 87 10 1.9 1 0.3 1975 81 14 3.1 1.7 0.5 1980 77 19 3.9 2.2 1 1985 69 25 4.8 2.6 1.4 1986 69.1 25.1 4.7 2.5 1.5

Source: Equal Employment Opportunity Commission.