May 4, 2020 – Competitive companies, organizations and government agencies know that diversity matters. Why? The demographics of the nation must mirror the workforce. Why diversity? It’s the customer; it’s the worker; thus, it must be the executives. Research shows that organizations that unleash the potential of diverse talent innovate faster and see better business results. It starts by attracting proven talent with diverse perspectives, experiences and contributions, then building and nurturing an environment in which everyone can do their best work.
Recently, Heidrick & Struggles launched a newly formed diversity and inclusion (D&I) practice. The practice is led by Lyndon Taylor, partner-in-charge of the firm’s Chicago office, along with Jennifer Flock, partner, Europe D&I practice consulting lead, and Christianne Garofalo, partner, Americas D&I practice consulting lead.
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For private equity firms, nothing impacts an investment return more than talent. Why? Institutional investors increasingly see portfolio company talent management as a crucial lever for value creation, risk mitigation and growth. But there is a fundamental shift underway at PE firms. They are moving beyond traditional views of human resources to something more transformative – with a heavy emphasis on talent management & development, culture and engagement. According to this latest landmark research report from Hunt Scanlon, it all has to do with unleashing higher levels of leadership performance to boost results. And that has required a hard look at value creation and how top talent enriches returns.
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“More so than at any other time, leaders today need to be agile, responsive and inclusive, seeking input from executives with different viewpoints, experiences and backgrounds,” said Krishnan Rajagopalan, president and CEO of Heidrick. “During this COVID-19 pandemic, we cannot overstate how critical it is to have diverse voices and inclusive leadership across an organization. Our newly launched D&I practice brings our consultants’ expertise in recruiting and developing top diverse talent together with our in-depth experience in creating inclusive leadership teams and workplace cultures to help organizations deliver demonstrable change and accelerate performance, both in times of crisis and for the future.”
In a recent global survey conducted by Heidrick & Struggles, the firm explored how executives at large public and private companies in North America, Europe and Australia perceive the D&I efforts of their organizations, including contribution to business success. The survey specifically delved into how clearly companies have been defining and communicating D&I goals, linking them to strategy and assessing their contribution to business results, and creating inclusive cultures.
Of the 412 executives surveyed, only 22 percent of respondents said they are seeing D&I efforts contribute to their companies’ business success to a large extent. But one group of respondents more often saw a significant contribution. That subset of respondents said their organizations clearly define both diversity and inclusion, link them to business strategy and assess their D&I efforts on a financial basis. Notably, their companies also generated a five-year revenue compound annual growth rate (CAGR) 62 percent higher than that of the other companies in the survey.
“Companies face unprecedented challenges right now, which only underscores the need to ensure D&I efforts are a tangible force for good and, ultimately, impactful for their business,” said Mr. Taylor. “Our experience suggests that while definitions and strategies for D&I are far more prevalent than they were even a decade ago, most still fall far short of committing to the breadth of change necessary to fundamentally shift an organization. To drive real change, the leaders of companies, specifically the C-suite, have to clearly link diversity and inclusion to their business strategies and model inclusive leadership behaviors.”
Positioned to Help Companies Attract Diverse Talent
Heidrick & Struggles’ D&I practice is positioned to help companies attract diverse leaders, with its in-depth consulting experience and data-driven approach to developing and retaining top diverse talent, and creating inclusive workplace cultures. With an expansive network of consultants across all major commercial sectors, the firm’s D&I practice works with companies seeking to link their D&I goals to their strategic business outcomes.
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Improving diversity is something that most well-run companies and mission-driven businesses are now implementing. Progress is slow and many times it feels as if we are all taking one step forward, two steps back. But no organization is more important to the success or failure of these initiatives than executive search firms. They hold powerful sway over who moves into the boardroom and into C-suite positions, where all of the most important corporate decisions are made. That power, according to Dale E. Jones, CEO of Diversified Search, raises more questions than answers these days.
Mr. Taylor is also a member of the financial services and CEO and board of directors practices, focusing on the asset management and banking sectors. He works with both privately-held and publicly-traded clients on executive, functional leadership and board director engagements. He also advises organizations across sectors on diversity and inclusion strategies, particularly talent management and succession.
Ms. Flock, who is also a member of Heidrick Consulting, has expertise with balanced leadership and works with senior executives and leadership teams to understand and adapt to key 21st demographic trends. She has two decades of experience driving change in Fortune 500 companies around performance, growth, and innovation. Ms. Flock has worked with global clients across numerous industries, including professional services, consumer goods, energy, transportation, healthcare, industrial, financial services, high tech, and others.
Ms. Garofalo is also a partner in Heidrick & Struggles’ San Francisco office and a member of Heidrick Consulting. For more than 20 years, she has helped organizations activate talent by using practices that engage, retain and deploy its people. She focuses on assessment and executive coaching for individual development, building inclusion skills for high performing teams and designing transformative organization interventions.
In addition to its new D&I practice, Heidrick & Struggles continues to underscore its commitment to further promote diversity and inclusion at the top through its board diversity pledge, a commitment to help boards diversify, and the Director Institute, an apprenticeship program designed to accelerate the development of diverse executives and prepare them for broader operating roles and corporate board service.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media