A successful diversity initiative led to an unintended consequence at Walmart

Discussion
Photo: Walmart
Sep 24, 2020
George Anderson

A Bloomberg article on Walmart tells the story of an unintended consequence that arose as a result of the retailer’s commitment to greater gender diversity.

Walmart, in 2009, faced a glaring disparity between the percentage of women it had in leadership positions compared to the female representation of its total workforce, according to Bloomberg. Twenty-seven percent of senior roles were filled by women, while half of its overall employees were female.

The retailer made a concerted effort to bring more women into leadership positions at the store and corporate levels. Women now represent 45.71 percent of Walmart’s management and 30.59 percent of its officer positions, according to the retailer’s 2021 fiscal midyear “Culture, Diversity & Inclusion Report.”

One unintended consequence of Walmart’s push, according to Bloomberg, was that the percentage of Blacks in leadership roles has declined in recent years. Today, 20.69 percent of the company’s workforce is Black, with 11.64 percent in management and 6.85 percent in officer roles.

The death of George Floyd at the hands of police officers in Minneapolis earlier this year opened the eyes of many Americans to racial inequality in the U.S., and Walmart was among the corporate citizens to respond. The retailer and its non-profit Walmart Foundation pledged in June to provide $100 million over five years to the Center on Racial Equality. The organization will use the funds to conduct research, advocacy and other efforts to support groups serving Black communities. The Center will also provide counsel to Walmart about ways it can better understand racial bias and structural racism within the U.S.

Walmart is not the only major chain that has pledged itself to greater racial diversity in response to nationwide protests in cities and towns that call for an end to discrimination and abuses of power by law enforcement. Gap, Target and others have made public commitments to promote racial diversity. Others, such as Sephora, have pledged to carry more products from Black-owned businesses.

A Pew survey released last week found that 55 percent of Americans support the Black Lives Matter movement, with 29 percent supporting it strongly. These figures are down from a few months ago as President Trump and conservative media outlets have tried to portray violence and looting as widespread. Ninety-three percent of BLM protests over the summer were peaceful, according to the nonprofit Armed Conflict Location and Event Data Project.

DISCUSSION QUESTIONS: How can large retail organizations achieve diversity objectives without unintended negative consequences? Do you think there is a link between reaching gender and racial goals and achieving greater diversity of thought within businesses?

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Braintrust
"This is not a one-dimensional problem so solving the problem does not happen with a one-dimensional solution."
"This is a result of bias among decision makers at Walmart. The collective efforts to balance gender representation across their work force only revealed that bias."
"...it’s hard to craft a solution to a problem you can’t, or don’t want to honestly, define, and that’s why unintended consequence start popping up."

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16 Comments on "A successful diversity initiative led to an unintended consequence at Walmart"


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Neil Saunders
BrainTrust

This shows how a one-dimensional focus on diversity, even if well-intentioned, can create issues. There is no easy fix to this, but I think having a diverse candidate pool from which to pick management hires is very important. How can this be accomplished? Ensuring there are equal opportunities and encouragement for all internal workers is one. Making sure jobs are advertised widely and where a variety of different people can see them is another. Outreach to younger people in school and college to explain career options and choices is sensible. In short, a variety of activities are needed to ensure diversity and fairness in hiring.

Cathy Hotka
BrainTrust

The more diverse a company’s leadership team is, the better it will understand its customers. Walmart has put a lot of effort into developing its workforce and mentoring them into leadership roles, with very favorable results.

Ben Ball
BrainTrust

The Law of Unintended Consequences is as inescapable as the mythical Irish guardian of lousy luck ” Murphy.” Pushing on an object, whether the water-filled balloon used in our high school physics class or a society, will cause it to bulge somewhere else. Typically somewhere completely unexpected. That doesn’t mean we shouldn’t try to improve. But it does mean that leadership must be mindful of the inevitable and actively watch for the unexpected symptoms when they initiate change. Preparing the organization by admitting that you know things unexpected will happen during major change is even better. Ask for the organization’s help in identifying them and be proactive in mitigation if you can. Easier said than done of course.

Gene Detroyer
BrainTrust
Here is what we know. The more diverse a company is by gender, by ethnicity, and if an international company, by representatives from around the world, in both management and especially in leadership, the better that company performs. The less diverse it is in these areas the poorer it will perform. But let’s give a bravo to Walmart. Their efforts of bringing women into key posts have certainly paid off in magnitude. One wonders how much that has to do with Walmart’s winning streak. Unfortunately, sometimes when you, a person or a company, focus on a goal you miss some of the consequences of reaching that goal. In this case, it was pretty simple. The “old guard” hung in while many of the women who were brought in were blocking places that were normally attributable to racial diversity. I suspect as our eyes continue to be open to diversity that Walmart will again be very successful in broadening their management and leadership. The next round of enlightenment for Walmart will be to increase diversity of… Read more »
Mohamed Amer
BrainTrust

Managers become focused on single metric KPIs because they are easier to measure and compensate. Unfortunately, organizations, like life, are messy and do not adhere to neat PowerPoint slides and traffic light status reports. Organizations need to define diversity, or whatever comes next, thoughtfully and robustly so that the entire picture is understood and the various outcome scenarios are anticipated. Specific to diversity, one can address age, race, ethnicity, gender, work experience, and even mindset, among others. The higher the variability in a company to the board of directors, the more superior the performance will be, all else being equal.

Camille P. Schuster, PhD.
BrainTrust

Diversity does not mean choosing one underrepresented group and working to include that group to the exclusion of other groups. This is not a one-dimensional problem so solving the problem does not happen with a one-dimensional solution.

Shawn Harris
BrainTrust

Systems thinking is underrated.

Rachelle King
BrainTrust
This was not unintended. This is a result of bias among decision makers at Walmart. The collective efforts to balance gender representation across their work force only revealed that bias. The hiring and advancement decisions from those efforts were all intentional. Instead of taking an outward look and suggesting efforts in one area have caused problems in another area, Walmart may want to look internally at who is making hiring and advancement decisions. Have they instituted bias training among hiring managers? How are they holding managers accountable at every hiring decision? Are hiring managers being provided a racially diverse and gender balanced pool of qualified candidates? These are questions all companies should be asking these days, not just Walmart. It feels like a slight in accountability to say this was unintended. Walmart’s talent acquisition teams along with managers and executives empowered to make hiring decisions are responsible for the diminished presence of Black employees in leadership positions. Walmart is a very smart company with an extremely talented employee pool. I have no doubt that with… Read more »
Ryan Mathews
BrainTrust
The simple answer is they can’t as long as they are operating on an, “identity hiring model.” We saw the unintended consequences of this in the early years of Affirmative Action programs where people who were, “double,” or, “triple,” minorities, i.e., Black lesbians, for example, commanded extraordinary salaries. It’s really a simple math problem. To be representative of the nation at large in general a work force/executive team would have to be roughly 50.52 percent female; 60 percent White; 19 percent LatinX; 12 percent Black; and 6 percent Asian-American, and roughly 24 percent LGBTQ+. But diversity and inclusion programs aren’t solving for representation, they are solving for reparations. In the case of women, that works out. Most feminists would agree that if a statistical majority of executives in corporate America were women, promoted and compensated at the same rate as their male peers, a large part of their job would be done. But if we apply that same logic to race, it fails, because that would mean 60 percent of all executive positions would need… Read more »
Scott Norris
Guest

Your point about geography is very appropriate in this context. Fayetteville is a lovely university burg with some nice features and a progressive spirit — but it is by no means a major city and its airport (while charming) is not a hub. It’s a company town, not one that you’re going to want to put roots into and not one where your relatives live. And it’s surrounded for several hundred miles, unfortunately, by a lot of people who really don’t want Black, Hispanic, or Asian folks moving in, especially if they’re being paid well. If you moved your family to rural Arkansas, would you feel safe letting your Black son drive to high school?

Ryan Mathews
BrainTrust

In today’s America? Absolutely not.

RandyDandy
Guest
6 months 16 days ago
As one who has worked where hires based on notable gender/race initiatives were in place but proved far less effective than promised, one has to wonder if the intentions were real. Or, all along, was the plan to bring in more from one group minus that of another, while maintaining as much status quo among the more powerful ranks? I can’t say this was in the minds of execs at Walmart. But I also highly doubt they were not aware of just how many “shares of the pie” they were willing (or able) to dole out. Further, if the idea is to represent all types in the upper echelons as they compare to the diversity of their general workforce, isn’t all that data readily apparent? To make the basis for higher-up hirings about something else (or, oops, creating unintentional consequences) seems a pretty flimsy argument. Also, for the mere sake of “ticking off boxes” (and I hope this does not sound flippant), would a company hiring a POC, trans, non-binary, handicapped person be allowed to… Read more »
Craig Sundstrom
Guest

Correlation isn’t causation, and I really don’t see any explanation why increasing the percentage of women caused a decline in other percentages; maybe there was a reason — lack of college black females with advanced degrees? But it’s not explained here.

More generally though, I would say the answer is likely to be “no.” A goal simply pulled out of the air to satisfy some interest group is unlikely to be successful … satisfying several such goals is almost certainly going to fail.

Patricia Vekich Waldron
Staff

WMT successfully addressed one aspect of diversity and learned that it’s a multi-dimensional problem that requires wide-ranging change. They can take what they learned promoting women, broaden the scope to include more categories of diversity and use metrics to understand how the overall profile of their workforce changes over time.

Kim DeCarlis
BrainTrust

There is a growing body of evidence that diversity drives improved business performance. While this effort at Walmart had negative unintended consequences, it should be commended. And Walmart should be challenged to pay attention to the supply chain of talent ready for management and executive roles. By continuously developing talent across the diversity spectrum — sponsoring college programs, scholarships, internships and mentorship — businesses will increase representation and be less likely to have forward movement with one group mean regression for another.

Mark Price
BrainTrust

I often speak to clients about the law of unexpected consequences — “there are ALWAYS unexpected consequences.” No matter how committed an organization is, change is bumpy, uneven and not always moving forward. But if an organization stays true to their mission and values, progress will be made nonetheless. The unexpected consequences that come from increased transparency is feedback and engagement — both positive and negative.

The benefits of increasing diversity are numerous — with one of the greatest being bringing diversity of thought and perspectives. Something is always lost when a company does not look like their customers. Insight from a more diverse workforce will pay for years to come….

wpDiscuz
Braintrust
"This is not a one-dimensional problem so solving the problem does not happen with a one-dimensional solution."
"This is a result of bias among decision makers at Walmart. The collective efforts to balance gender representation across their work force only revealed that bias."
"...it’s hard to craft a solution to a problem you can’t, or don’t want to honestly, define, and that’s why unintended consequence start popping up."

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