If you really want inclusion and diversity, TODAY corporate training budgets should be targeted to facilitate diversity and inclusion in higher paying jobs, with a focus on building an internal pipeline of people skilled at thinking. Here’s why:
The worker participation rate of the largest represented management demographic (white men) is expected to decrease. This potential impact is dramatic, if you consider the decrease in the overall population trends of non-Hispanic whites. With the shrinking white male workforce, employers will pay more for their experience until their impact is supplemented with non-white and female workers, automation or outsourcing.
At the same time, the USDOL is projecting the participation rate of women will increase. Unfortunately, this increase in women in the workforce is projected to fill traditional female roles:
· Healthcare/homecare workers
· Cooks
· Fast food counter
· Registered nurses
· Waitress
While women will continue to be underrepresented in the two top growth roles with higher salaries--operations managers, and software developers.
An equally bad trend is the percentage participation rates of non-white men is projected to decline even more than their white counterparts, as this population increases. We will lose progress in pay disparity between the races and the sexes, as dollars revert to white males, again.
In other words, with all the corporate discussion and promises, the US government is already projecting we will fail at diversity and inclusion in the workforce. This will be to our detriment as the dependent ratio per earner rises to levels we haven't seen since the 1960s at the peak of the baby-boom births.
There is more you should know. Take a look at this:
External hires cost a lot more than an internal promotion. SHRM estimates cost of external hires can exceed 3X the salary of the manager being replaced when long-term costs are considered.
Companies favor external hires; they exceed internal promotion by 18%, read more.
And yet, according to a Wharton Business School study, external hires score lower on performance evaluations and are 61% more likely to get fired from their new jobs, than internal promotions.
And further, it takes external hires two years to rise to the level of performance and employment of internal hires. In other words, after two years, the internal promotion and the new hire have the same level of longevity, employability, and promotability.
How is it possible, companies opt for new hires over internal promotions? There are a number of factors:
It's difficult to maintain a good succession plan. Factors impacting this are candidates willing to enter the pipeline, candidates deemed capable of entering the pipeline, and perceived costs of training and professional development programs.
Even with higher costs, the allure of "new blood" is appealing to executives. The assumption is the current team isn't capable, nor promotable. This is a reinforcing bias where we believe the problem is them, not us (ouch!). After all, if external candidates have broader experiences and more training, isn't that really an internal disparity that needs corrected?
The work environment is significantly more complex than we realize when considering work trust, culture, problems, politics, policies, procedures, technology, product, vendor and customer and employee relationship knowledge. All the while "the new guy" is learning, the current team is doing some of their work and catching him up to speed--hence the two-year threshold for employability.
Often what we think is new blood and a fresh outlook, isn't that different than our existing view, or it isn't one that can be executed; this is called TBU, True-But-Useless. Worse still, candidates sometimes overrepresent their capabilities, or we overestimate the transferability of their skills and experience in our complex environment.
Lastly, a common obstacle is agility, systems thinking, and learning isn't promoted, or promoted ineffectively. This results in a suppression in the options that are available for success and step-ahead outcomes. This culture often runs deep and is more than a new critical employee or manager can overcome.
If you want to improve your position in the future market trends, training budgets should today target:
Underrepresented populations in higher salary positions. While not in higher level, high paying positions, these groups need a boost in problem solving, engagement, and collaboration skills. This will facilitate impactful contributions which will increase their visibility and promotability and shift the perception of their capabilities in the minds of executives and coworkers. This will at the same time, boost their confidence, which is critical to success.
High-networked positions. Similarly, if you improve the collaborative leadership, problem solving, communication, and systems thinking skills of the employees with high-interface ratios (number of daily contacts with other employees), this has an osmotic benefit to the entire organization with permeating impact.
The actions above are urgent and cannot be ignored! If we really want underrepresented populations to thrive in our organization, we must invest in them now. Also recommended is the following:
Begin to redirect recruiting budgets investing and developing effective and inclusive professional development plans. This will decrease costs of staffing and yield a more robust benefit to the organization. I cover this in more detail in another blog here.
Invest in problem solving, collaboration, systems thinking and effective project management and meeting strategies. Learn about PLS training courses here.
Promote pluralism and universality in your operations management framework. I cover this in more detail here.
Utilize modularization, which are transferrable thought structures to expedite information sharing and learning. The speed of thought and mental model sharing is directly related to an agile mindset. To understand this, realize that using prefabrication increases the speed of building construction by 20-50%. Similarly, knowing effective thought constructs will increase the speed of constructing shared mental models, ideation, and decision making. Learn more about the PLS Framework here.
Investing in the professional development of your employees increases job satisfaction and will decrease the likelihood of them jumping to another employer and increases productivity and morale. There is no better use of HR dollars than to invest in your employees.
Lori G. Fisher, PMP
PLS Management Consulting
Purpose | Leap | Surge
USDOL Statistics cited can be found here:
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