Why Should Nonprofits Invest in Diversity & Inclusion Work? Arguments for the Budget

pencilsI’ve been worried about the diversity problem in my nonprofit organization for a while.  I’m the #2 person, my Executive Director is a little aloof about these issues – he’s ultimately worried that our white, wealthier donors and board members will see this work as “fringe work” and may think we’ve strayed from our mission.  And he’s right, to a certain extent.  How can we justify spending time and resources on internal diversity and inclusion when we have so little resources to work toward our primary mission?
Add to that the fact that I’m also the go-to person for all human resource complaints.  I’ve been trying to keep a lid on things, but I know unless we do some serious work, we’re going to lose people.  We’ve already lost good people and there’s some in-fighting among staff, although the ED is quite insulated from that.  We have some staff well-versed in diversity and inclusion who are all but calling others out on the carpet for their lack of awareness.  Others are really well-intentioned, but get beat over the head by other staff when they make mistakes out of ignorance.  I’m just not sure what to do, but it’s becoming more and more difficult to manage and if I don’t move the organization on this, I will feel like a hypocrite.
 I know we need to make changes, but how do I make the case to invest in this?
If this sounds familiar, that’s because it’s not unusual.  Many people in what I call historically white organizations have a primarily white leadership tier with more diverse hires at lower levels within the organization.  Well-meaning and well-intentioned leaders struggle with how to proactively improve diversity and inclusion within their nonprofit organizations.  They struggle with how to communicate urgency about this work, how to make a case for investing time and resources in it when both are already coming from overdrawn accounts.
Let’s cut to the chase.  Even though nonprofits are mission-driven, change-making, people-focused organizations, they are still in it for the money.  Not to make a profit, but to fund the work toward their mission.  It’s the reality.  And yes, there’s a much more compelling, human reason for diversity and inclusion at your organization, but that may not be the argument your stakeholders need to hear right now.
 
If you’re looking at it from a purely dollars-and-cents perspective, consider these facts:
1. The cost of replacing a staff person can cost an organization anywhere from 50% to 200% of that person’s annual salary according to the Society for Human Resource Management.
And diverse staff are much more likely leave organizations they find unfair.   The 2007 Corporate Leavers Report found that people of color are three times as likely to cite workplace unfairness as the only reason for leaving their employer.  Gay and lesbian professionals said workplace unfairness was the only reason they left their employer.  Where does that 50% to 200% come from?  Consider these factors:
  • HR Staff time (exit interview, payroll administration, benefits)
  • Manager’s time (retention attempts, exit interview)
  • Accrued paid time off
  • Temporary coverage – paid and “unpaid” where another staff full-time member assumes responsibilities.
  • Reduction in program delivery
  • Disruptions to team
  • Hiring activities (job posting, resume reviewing, interviewing, HR hiring functions, orientation & training)
It’s even more expensive to replace those who have been on the job less than a year because in many jobs, an employee is not fully productive for many months. This Compensation Today article highlights the costs of employee turnover.  A high turnover rate in the first year can be extra costly for the organization.
2. Failed diversity & inclusion initiatives are expensive.
Many organizations start their efforts with diversity training.  In recent years, research has shown that some of the traditional models of diversity training actually have an adverse effect on an organization.  In the 2012 Harvard Business Review article Diversity Training Doesn’t Work, Peter Bregman shows how rather than improving appreciation for difference, many trainings have the effect of heightening and polarizing difference, leaving people feeling defensive and cynical about training efforts.  The cost of these failed efforts equals not just the cost of the training itself but also the cost of fixing the mess – which includes bringing in better, more effective training, managing the increase in the staff retention costs (itemized above) and possibly lawsuit expenses.
Organizations should start with assessing what their training needs are.  One way to go about that is to use the Intercultural Development Inventory.  It’s a research-based assessment grounded in a developmental model that is non-judgmental and offers specific training objectives based on an individual and group’s intercultural awareness levels.  Most recently, the diversity and inclusion field has been abuzz about the effects of unconscious or implicit bias – prejudices that go unnoticed by the holder.  There are new trainings specifically designed to get at these unconscious choices we make – a critical consideration in the hiring process.
3. In ten years, if you’re not diverse, you will likely find that your grant-funding options will decrease. This is already true of major urban cores and is expanding out to more rural parts of the country as well.
The D5 Coalition is a national group of philanthropic organizations that have come together across the country to advance diversity, equity and inclusion in philanthropy.  They have four main priorities for big sector changes for 2015, one of which is to increase funding for diverse communities and ensure that foundations offer all constituencies equal opportunity to access the resources they need to thrive.  Another priority involves better data collection – including greater transparency of diversity demographics of organizations funded.
In October of 2014, GuideStar, the nation’s leading nonprofit reporting group, announced that it will begin collecting and publishing demographic information about nonprofit board, staff and volunteer diversity.  This will be an incredible tool for philanthropists to access when considering their giving choices.
So let’s tally up our expenses.  While the following exercise won’t be a perfect fit for your organization, you can certainly plug in your own numbers to estimate the cost for your particular organization.
  1. Lost retention of two professional nonprofit staff members: $60,000 (based on annual salary of $45K, plus benefits = $60K x 50% = $30,000 x two people)
  2. Failed Diversity Training = $10,000 (or much more, depending on how much you spend…)
  3. Fewer grant prospects = $50,000 (5% fewer grant prospects= 5% of $1mill budget = $50,000)

$125,000 – TOTAL SAVINGS
 
By engaging in strong internal diversity and inclusion work, the average one-million-dollar nonprofit has the potential to reinvest a considerable amount of its resources into its mission, build a strong and diverse staff team, reduce turnover, improve service and strengthen its organization.
It’s a new year and time for a new way of thinking.  Let 2015 be the year you decide to do something different.

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Kathleen LaTosch at NCRC Annual Conference 2012
Kathleen LaTosch is a consultant specializing in diversity and inclusion planning for nonprofit organizations.  For more information about Kathleen’s work and availability, email her at klatosch at gmail.com

Nonprofit Diversity Recruiting – Who’s in Your Pool?

swimmers“The truth is, when it comes down to hiring,  people tend to hire the people they want to spend time with, regardless of who applies for the job and often those people are people they share common interests and experiences with, people who tend to come from the same background. ”  

There are a number of common suggestions for recruiting for staff diversity:  listing job postings with diverse job boards, networking with culturally diverse organizations, connecting with HCBUs, participating in diverse job fairs, etc.

According to a study by Lauren A. Rivera in a report put out by the American Sociological Association, the truth is when it comes down to hiring,  people tend to hire the people they want to spend time with – regardless of who applies for the job – and often those people are people they share common interests and experiences with, people who tend to come from the same background.  If your personal networks are people who all look like you, you’re still going to have a problem, and we’re not even talking retention yet – we’re just talking about getting people in the door.

This New York Times article details how many of today’s top employers rely extensively on internal referrals.  And it makes sense – you want to hire someone good, someone who will do top notch work and help your organization rise – you want someone with a known track record. It makes sense to hire people you know or that come from a trusted referral.

So, who’s in your pool?  

According to the Public Religion Research Institute’s 2013 American Values Survey, the degree of diversity in one’s personal networks vary greatly based on race.  For the average white American, 91% of their personal network is also white – with 1% each of a number of different races and ethnicities.   For 75% of white Americans, their entire network is white.  For historically white organizations, personal networks are key.  If your circle is homogeneous, your short-list of preferred applicants will be too.

The ASAE Center recommends strategies that get at this personal network issue – get people in the pool before you need to swim.  This is absolutely true for small and mid-sized nonprofit organizations who may rely extensively on internal networking due to the availability of fewer HR resources.

How do you get new people in your pool?

One way is to expand your own personal network.  Even better? Encourage all staff and board members to expand their personal networks too.  Expanding these networks not only results in greater diversity among potential candidates, but has several valuable (and free) benefits:

  1. Broad-based diversification of personal networks. It deepens the awareness and education of each staff/board member regarding the critical issues facing that community while also reducing cultural assumptions based on lack of knowledge.  A key element in reducing unconscious bias is the building of personal relationships with those different from oneself.
  2. Deeper organizational connection to and with specific communities. The relationships that develop can create valuable programming partnerships, cross-issue advocacy, and expanded resource options.
  3. Better outreach. It raises the public profile of both organizations who are working together to achieve a greater common good and extends each organization’s marketing reach.

Once community partnerships are formed, the relationships have greater potential to last beyond individual leadership changes because they are entrenched in the organizational DNA.

When we worked on a racial inclusiveness initiative at Affirmations, Metro Detroit’s lesbian, gay, bisexual and transgender community center, a group of staff and community members came together to brainstorm actionable and measureable ways to make this happen. Since Affirmations was struggling with having a largely white board and staff, specific encouragements were provided for both staff and board to help them build their own personal network and subsequently make more diverse referrals for open positions.

Recommendations for expanding your nonprofit’s pool:

For the board of directors:

  • Ask all board members to participate in 4-hour diversity and inclusion training within first 6 months of service (offered monthly).
  • Encourage board members to build a relationship with one organization serving a community different from their own and annually attend their events and network with members.
  • Invite board members to participate in a community leaders forum that included board members from other nonprofit organizations serving diverse constituents.
  • Ask all board members  to recommend one person of color for board service each year. This last item was supported by the work of the first three items.

For staff:

  • Require all staff to participate in 4-hour diversity and inclusion training within the first 90 days of employment.
  • Encourage staff members to build a deeper relationship with a “sister” organization serving a more diverse constituency – learn from that organization’s best practices, offer support in areas of expertise, build relevant and effective programming partnerships and join together on mutual advocacy issues. Have each  identify and network with a contact at each agency to support and encourage the establishment of deeper relationships among individuals at each organization.
  • Encourage every member to refer one person of color to the organization for hire each year.

Together, these ideas aimed at deepening cross-cultural relationships, fostering strong organizational partnerships and driving organic cross-cultural learning and thinking. Expectations for making referrals is paired with actions each person can take to successfully build and diversify their own networks.  They say “it’s all about relationships” – deepening relationships among people across cultural differences is key to arriving at that interview comfortably and confidently – for both the interviewee and interviewer.

Part 11: Why Should Nonprofit Invest in Diversity & Inclusion Work?  Arguments for the Budget

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This is one post in a multi-part story documenting one historically white organization’s journey toward becoming racially inclusive.  The series seeks to document the challenges and successes faced along the way in an effort to provide a learning tool for other nonprofit organizations who wish to do the same.  For a complete copy of Affirmations’ “Blueprint for Change” visit www.GoAffirmations.org and click on About Us.Kathleen LaTosch at NCRC Annual Conference 2012 
 
Kathleen LaTosch is a consultant specializing in diversity and inclusion planning for nonprofit organizations.  She worked at Affirmations, Michigan’s largest LGBT organization, from 2002-2011 and served as Chief Administrative Officer from 2007-2011.  While there, she led a broad-based racial diversity and inclusion initiative.  For more information about Kathleen’s work and availability, email her at klatosch at gmail.com
 

4 Action Steps for Nonprofit Diversity & Inclusion

first things firstMany nonprofit organizations feel challenged at the task of recruiting a racially diverse staff.   They may have tried a number of things unsuccessfully or feel unsure of how to start the work.  Organizations such as these often have a majority white staff – especially at the top.

I call these historically white organizations – nonprofits founded and run by well-intentioned and passionate white individuals who want to make a difference in the world, but are struggling with how to make that happen in an inclusive way.

In starting from these roots, there is often a strong values-based sense of “doing the right thing,” but board and top leadership haven’t been able to successfully build a racially diverse staff throughout the organization.  As is often the case, nonprofit organizations may have a relatively diverse staff at the lower-paying end of the hierarchy, with dominant white culture staff holding most of the top leadership positions.  Alternatively, sometimes the program area of a nonprofit will have a diverse staff, while administration and development departments remain homogenous.

The good news is, if you’re already building a diverse staff, even at the lower-paying end of the spectrum, you’re on the right track.  Having a diverse staff, even if imbalanced, is a common step toward building a more diverse and inclusive staff – you just need to keep going and deepen the work.

Resources exist to help nonprofit organizations build staff diversity and inclusion.  “Building Inclusive Nonprofit Organizations,”  published by the Denver Foundation, is an excellent resource I’ve used.   It includes a step-by-step guide and detailed manual for helping you to lead your organization through a successful diversity and inclusion process.  It helps you identify your goals and set a framework for how to reach those goals.

Strategies for Diverse Talent,” published by the Independent Sector, is another resource I’ve been exploring.  This report was created by the 2013-2014 Class of Fellows.  They reviewed the literature on effective practices for building diverse nonprofit organizations, interviewed organizational development experts around the country, then compiled a set of best practices and tested them on the National Audubon Society.  The result was a framework for nonprofit diversity and inclusion practices which includes four “Quick Wins” – strategies that are low cost, easy to implement, and have quick results.   I used this framework for a recent talk on nonprofit staff diversity and inclusion, adapting it to a human service model, and found it really useful.

Let’s explore the four “Quick Wins” and some concrete strategies that can help you and your nonprofit organization move ahead with staff diversity and inclusion.

Quick Win #1: Leverage broader recruitment sources.  Post on diverse job boards, attend diverse community festivals and job fairs, etc.  

Many organizations continue to post to the same places they’ve always posted jobs and fail to achieve different results.  They also use their own interpersonal networks, which for a historically white organization, usually means a white network.  Organizations must re-think the ways in which they are posting positions and cast a wider and more strategic net.  Are you tapping into historically black colleges and universities or, if you don’t have any locally, to those colleges and universities with a diverse student body in your region?  What diverse community fairs and festivals are in your region?  Are you connected with your local Urban League?  What diverse community cultural centers can your organization be involved with?

Secondly, many nonprofit organizations source staff from interns and volunteers.  Where do your interns and volunteers come from?  Are you turning to a largely white network for referrals?  In order to create a more diverse pool, identify organizations serving and connecting with people of color and offer opportunities.  It’s important to diversify the pipeline feeding your intern and volunteer streams.

Quick Win #2: Articulate diversity and inclusion to your organization.  Send messaging from leadership about why diversity and inclusion is important and make sure every staff member is knowledgeable about the organization’s vision on this.

This is an important step but it requires that the nonprofit organization already have a clear diversity and inclusion statement.  If you don’t already have it, you need to establish one.  Without a clear statement, it will be impossible to articulate the organization’s vision on diversity and inclusion.  And unless organizational leadership is fully on board, it simply won’t stick.  The process for establishing your diversity and inclusion values should be collaborative – it should include a group of cross-organizational people as co-authors who create a draft, reflect it back in staff and board meetings for input, make necessary revisions, then request formal adoption by the board of directors.  A well-crafted and promoted values statement provides clear direction for the organization’s actions and gives staff and other stakeholders a language and foundation for making complex decisions related to diversity and inclusion.  Board adoption institutionalizes the values, maintaining consistency through future leadership changes.

Quick Win #3: Replicate best practices across the organization.  Identify two areas where diversity and inclusion are working well within the organization and replicate them.

This suggestion helps organizations frame the work from a solution-focused perspective; it energizes your staff and highlights the “bright spots” that are working well.  It can be a wonderful way to engage more staff in the process.  Some key questions to ask: what is your organization doing well on diversity and inclusion?  Are there programmatic elements that can be adapted for staff development?  Is your youth work cutting edge when it comes to diversity and inclusion?  Can the youth present to staff – an idea that supports both youth leadership development and broader staff awareness.  Do you offer diverse and inclusive programs and events to the community?  How can that be adapted for staff?  Can staff be encouraged to attend?

Quick Win #4: Cultivate partnerships.  Convene a small group of thought leaders, across the field, for roundtable discussion.

This is a wonderful way to build connection across nonprofit organizations, strengthen and foster relationships, and, in the process, infuse diverse ideas, practices and programs into your organization.  Some concrete items that can come from these relationships:

  • Cross-cultural training opportunities for staff
  • Job posting and volunteer exchanges
  • Deeper issue education and awareness
  • Programming partnerships and collaborations

A word on cost.  You don’t have to spend a lot of money on developing diverse and inclusive practices, but you will have to devote time and people energy.

Nonprofit staff typically wear many hats, work many hours and have to be highly resourceful to make ends meet.  Identifying a single staff member to coordinate diversity and inclusion activities when they already have a full-time job description, is a recipe for disaster.  Balls will get dropped; other priorities will press and the one tasked with the work will be unduly burdened and unfairly blamed for ineffectiveness.  There’s just not enough time in the day.

For maximum effectiveness, diversity and inclusion work needs to be spread out among a broad range of organizational stakeholders, who each do some of the work and be ideally coordinated by an outside third party.  This maximizes focus on the plan, reduces internal conflicts of interest and power struggles, and considerably shortens the work time frame by focusing energy on the most effective strategies.

Having a simple, actionable plan ahead of you can make the work much easier and there are many free tools and resources to help you with the work.  Here’s a quick checklist from this blog for moving your work forward: Checklist – 4 Wins in 5 Steps.

Read Part 10: Nonprofit Diversity Recruiting: Who’s in Your Pool?

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This is one post in a multi-part story documenting one historically white organization’s journey toward becoming racially inclusive.  The series seeks to document the challenges and successes faced along the way in an effort to provide a learning tool for other nonprofit organizations who wish to do the same.  For a complete copy of Affirmations’ “Blueprint for Change” visit www.GoAffirmations.org and click on About Us.Kathleen LaTosch at NCRC Annual Conference 2012 
 
Kathleen LaTosch is a consultant specializing in diversity and inclusion planning for nonprofit organizations.  She worked at Affirmations, Michigan’s largest LGBT organization, from 2002-2011 and served as Chief Administrative Officer from 2007-2011.  While there, she was responsible for facilitating a broad-based racial diversity and inclusion initiative.  For more information about Kathleen’s work and availability, email her at klatosch at gmail.com