All in: Shaping tomorrow's manufacturing workforce through diversity and inclusion

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Corporate efforts to bolster diversity and inclusion in the workplace are intensifying

The US has a long tradition of promoting diversity and inclusion (D&I) in both the public and private sectors, with legal frameworks, programs and policies aimed at shaping more equitable and welcoming work environments. On numerous levels, it has become imperative to make workplaces amenable to—and represented by--all groups, whether differentiated by gender, age, sexual orientation, religious or political beliefs, or by experiences such as educational background, military service or physical disabilities. 

In this report, we share insights, experiences and plans from a chorus of D&I experts—interviewed by PwC and The Manufacturing Institute--from consumer and industrial manufacturing companies and other sectors.  While all organizations are developing D&I initiatives in different ways and at different paces, it is clear that D&I initiatives are increasingly becoming embedded into organizations as a core business goal. This is happening as securing and retaining talent becomes more challenging in a tight labor market, and as organizations strive to cultivate innovation through building more diverse workforces.

Five "paths" to making diversity and inclusion work

Path 1: Leading with D&I: setting the tone—and culture—from the top

C-suite and executive leadership mandates on company priorities and values can effect cultural change throughout an organization. Not surprisingly, then, all D&I specialists interviewed for this report agreed that D&I success hinges on executive leadership. Leadership can take place on numerous fronts—from public statements on D&I issues, institution of training programs and establishing policies, such as setting representation targets around recruitment and promotions--and even tying compensation, bonuses and promotions to D&I performance.

“Diversity and inclusion is led by our CEO. He sets the tone at the top with his leadership and expects every leader in the company to help advance our diversity and inclusion goals and lead by example. We don’t treat D&I as an HR issue, rather it is embraced as a business strategy; how our company grows is just as important as the growth we achieve." 

- Michelle Murphy, Chief Diversity Officer and VP, Global Talent, Ingersoll Rand

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Path 2: Measuring the state of your D&I (and targeting future goals)

Success cannot be measured without a clear picture of where you are now--and where you want to go.  The journey begins by capturing the status of D&I programs and policies via metrics on D&I-related employee recruitment, hiring, retention and promotions (as well as employee exits). It continues by responding coherently to the outcomes of the various programs and policies. Once an organization obtains metrics capturing detailed snapshots of their D&I status, it can then set realistic targets.

“For the last four years, we have had goals for advancing women, and we have been able to achieve those goals,”

- Celeste Warren, Vice President, Merck Manufacturing Division and Global Diversity and Inclusion Center of Excellence  

Increasingly, companies are seeking to tie D&I involvement and effectiveness to overall compensation schemes. That could mean computing a D&I “scorecard” and using it to calculate an overall performance score that drives decisions around promotion, salary increase or bonuses, for example.

Right now, we don’t have a hard link tying compensation specifically to D&I achievements, but we do recognize high D&I performance through awards. There is, however, a conversation brewing to tie financial compensation to inclusion and diversity in the workforce.

- Ray Dempsey, Chief Diversity Officer, BP America

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Path 3: Organizing—and empowering—your D&I employee groups

It’s becoming commonplace for companies to spearhead the creation of employee resource groups (ERGs) that not only open opportunities to share experiences, but also serve to advocate for positive change around diversity and inclusion. ERGs are also becoming important for companies to draw important insights that can guide company policy—both internally and externally—around D&I issues.

Union Pacific, for example, has eight ERG groups, including LEAD (for women), the Latino Employees Network (LEN), Black Employee Network (BEN), and BRIDGES (for the LGBT network). According to Polly Harris, Senior Director for Diversity & Inclusion at Union Pacific, ERGs help inform the company what steps it can take to make the company more attractive and engaging for certain constituencies. “With Union Pacific in the transportation and logistics industry, many jobs operate in a 24/7 environment, and we see the need to accommodate women’s needs,” Harris said in an interview with PwC.

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Path 4: Cross-pollinating high-impact D&I efforts

The replication of D&I successes from one part of the organization to another emerged as a common pursuit among D&I leaders interviewed for this report. Transplantation can happen across borders, as in the case of multinationals operating in many global territories. But, it also can move locally—as in from one operation to another—or cross-functionally.

“In some countries, the word ‘minorities’ simply does not even exist in the language in the way it is used in the US.”

- Ray Dempsey, Chief Diversity Officer, BP America

Another powerful way some companies are spreading the word on their D&I policies is through conferences, meetings and even small group discussions. This lets employees share their perspectives, and allows employers to clearly describe their expectations of the workforce. Such open lines of communication can also enhance D&I efforts by informing leadership of concerns and issues that employees may raise.

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Path 5: Partnering with “workforce intermediaries”

As the labor market tightens and skills gaps (especially in STEM-related roles) continue to challenge manufacturers, attracting prospective employees is becoming even more important.  Companies that nurture relationships with outside groups, or “workforce intermediaries”—from educational institutions, federal and local employment agencies, and non-governmental organization and national professional groups—seek to broaden their prospects to reach a more diverse workforce. In doing so, such efforts can also serve to close the skills gap, especially for industrial manufacturers and other sectors that are adopting advanced manufacturing technology.

“In addition to our standard talent sourcing channels, we have excellent partnerships with organizations like the Society for Women Engineers, National Society for Black Engineers and the National Urban League to recruit diverse talent. We seek talent at the national and local level, and develop relationships with organizations that help us identify diverse talent that may be interested in Ingersoll Rand.”

- Michelle Murphy, Chief Diversity Officer and VP, Global Talent, Ingersoll Rand

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Contact us

Jeff Sorensen

Industrial Products Industry Leader, PwC US

Tel: +1 (412) 316 2365

John Karren

US Industrial Products People & Organization Leader, PwC US

Tel: +1 (703) 918 3122

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