Closing Case: Using Strategic Goals to Drive Diversity
Case Summary
In 2015, Sodexo came in second on DiversityInc’s list of Top 50 Companies for Diversity. Coming on the heels of #1 finishes in 2010 and 2013 and #2 finishes in 2011, 2012, and 2014, Sodexo’s 2015 ranking made it the only company to make DiversityInc’s top two for six straight years. Strictly speaking, that commitment began in earnest in 2005, when Sodexo, a French-based multinational provider of food and facilities-management services, agreed to pay $80 million to settle a lawsuit filed in 2001 by black employees who charged that they weren’t being promoted at the same rate as white coworkers.“It was a very painful thing for the company,” recalls Dr. Rohini Anand, Senior VP and Global Chief Diversity Officer. A specialist in multicultural issues, she began evaluating the experiences not only of African American employees, but those of Hispanics, Asians, and gays and lesbians. She also instituted a program of metrics to measure the performance of every diversity-related initiative, including a diversity scorecard to align the results of such efforts as promotion and retention with organizational strategy. By 2005—the year of the class-action settlement—Sodexo had pronounced itself “a leader in diversity,” but the self-congratulations were a little premature. In fact, complaints about promotion practices—and even about incidents violating basic respect and dignity—continued to surface right up to the time that federal oversight over Sodexo employment practices came to an end. As suggested by the run of DiversityInc citations from 2010 to 2015, Anand’s efforts may have begun to pay off. Today, for example, 10 to 15 percent of total bonuses for about 16,000 managers is tied to the attainment of diversity-related goals, as is 25 percent of upper-management bonuses. “We are trying to drive change,” promises Sodexo North America CEO George Chavel. “We’re not just pointing to those metrics but using them.”
Case Questions
1. Do you think diversity goals should be a part of a company’s strategy? Why, or why not?
2. Over the last few decades, a number of firms that were sued for discriminatory employment practices ended up becoming exemplars for promoting diversity. What might explain this pattern?
3. Describe the link between developing strategies for increasing diversity and then implementing those strategies.
Discussion Question
4. Discuss the influence of organizational purpose, mission, and the top management team on human resource strategy.