Employee resource groups

History

For the past 30 years, ERGs have helped a diverse range of groups obtain a voice within large corporations. They began as race-based employee forums that were created in response to racial tension in the 1960s. ERGs got their start when Joseph Wilson, the CEO of the Xerox Corporation took action after the violent race riots in Rochester, New York in 1964. He and his black employees formed the first caucus group in order to address the issue of discrimination and to help create a fair corporate environment. Xerox launched the National Black Employees Caucus in 1970 and a decade later followed with the formation of the Black Women's Leadership Caucus (BWLC). Early in their history, these affinity groups were a risky and political tactic of advocating for equal pay and equal opportunity. It was common for early members to feel nervous about speaking up to management about their minority status for fear of seeming like a troublemaker or having an individualistic mind-set. While original ERGs were often seen as threatening by managers, today these groups are often initiated by administrators and are a common tool for managing diversity. As of 2007 ninety percent of Fortune 500 companies have ERGs.

Types of ERGs

There are numerous types of ERGs existing at different companies. Here are some of the most popular:

Goal-oriented events

Successful ERGs will combine business and employee goals to provide maximum benefit. Some general common practices of these include: providing cultural support and diversity insight in company products, missions, or methods; developing products and branding for diverse target markets; and building company reputation through active community involvement. In addition, ERGs often provide resources for professional development, fostering a learning environment for better company contributions. Further, many ERGs are active in employee recruitment and engagement, attracting employees who identify with the company from the very start. Talent acquisition, communication with executives, culture awareness and change, and development are at the core of ERG functioning.

Events hosted by ERGs range from in-person networking days to shared spaces for information sharing on company networks. ERG members may personally benefit from leadership and diversity training, mentoring, professional development, and skills workshops uniquely tailored to group goals. On the company scale, ERG members may provide diverse perspectives on marketing techniques, participate in product development evaluations, and communicate with executives through advisory panels. Outside the company, many ERG members advocate for larger cultural and social goals, whether for LGBT community support, multicultural rights, workplace equality, or political activism. In addition, community service has been noted as a significant part of ERG activity; this enhances company reputation while fulfilling personal goals of the employees. Though there aren't prescribed actions for ERGs to take, most ERGs are responsible for their own goals, leadership structure, and functioning. The actions are driven by the interests and characteristics of the group members, and are most successful when they are supported by executives in the company.

Role of technology

With the surge of computer mediated communication, ERGs have embraced social media and online communication to connect previously disconnected members. Of most popular use are internal social networks, external social networking like Facebook or Twitter, blogs, internal collaboration and blogging sites, webinars, podcasts, and wikis. These tools facilitate planning events and engaging in constant communication with group members. With lack of physical presence, collaboration is still possible. The most successful ERGs utilize multiple forms of social media to address the needs of all group members and ensure awareness of group events.

ERG structure and alignment

Though ERGs may be operated in different ways, groups usually align with some aspect of the business. Frequent alignment occurs with diversity or business and talent initiatives, where ERGs are utilized to further business objectives and maximize employee engagement and contribution. While some ERGs may have a larger percentage of the employee population involved, the average rate of membership is 7.9% of employees. Participation is usually driven by interest in sub-groups, the mission of the ERG, or the rewards and incentives for participation.

ERG councils are one form of leadership within companies to collaborate among groups; this is growing in large businesses globally. Additionally, company leaders and senior executives play a role in supporting ERG functioning, and offer recognition and acknowledgement of ERG leaders as an incentive for participation. When ERG participation is rewarded in some way, whether through intrinsically motivated accountability standards or external benefits, engagement grows. In terms of accountability, peer or leadership review, business sponsorship, and elected membership serve as motivating factors. Traditional rewards for participation include personal development or advancement opportunity, cash bonus, or non-financial rewards. Not all ERGs give tangible rewards, as participation and engagement are desirable from the start.

Companies with ERGs

Almost 90% of Fortune 500 companies report having ERGs in 2011. Because of this rising popularity, many companies have adopted practices and have begun financially supporting resource groups. See the list below for a small sample of some of the companies with ERGs that have been analyzed in the relevant ERG research.

Benefits members of the ERG

One of the major benefits that ERGs bring to their members is support. ERGs establishes a support group of people who share a common stories or experiences. These groups also provide fellowship and friendship for its members. Further, ERGs can have direct effects on the corporate culture by allowing the members of the ERGs and other employees to feel comfortable with differences within their organization.

Another benefit of ERGs is the professional development that they foster. This professional development often comes in the form of mentoring and workshops. ERGs also provide an effective way for employees to network with other employees who share the same experiences, and through some of their company wide events, members can have the opportunity to meet other employees or management who are not in the ERG but are supportive of the cause .

Further, ERGs have the potential to create more equality for their members. ERGs promote diversity by ensuring that all members of an organization or business have the same opportunities in having a voice in the company, access to the same information that can help their employment success, helpful networks with other employees, the opportunity to contribute ideas, and the opportunity to advance within the company. Further, in the spirit of equality, one of the goals of ERGs is to raise awareness for these different groups of people. This awareness benefits the members of the ERGs and other employees within the company to promote a productive and inclusive work environment.

Benefits the organization

Many of the advantages of ERGs to the organization or company are tied to the aforementioned personal benefits because when the members of ERGs are benefiting, it will lead to employee satisfaction, which is productive for the company. Further, ERGs are often founded on the premise of contributing to the success of the company. Since ERGs typically have to be approved by the organization itself, the ERGs will claim to support some of the same goals as the company, which can include promoting diversity and employee satisfaction. ERGs can foster employee satisfaction because employees feel better about going to work when they know that their company has a legitimate interest in issues that are meaningful to their personal life. It is because of this increased employee satisfaction that companies with affinity groups are often rated some of the best places to work.

Brings about broad change

Employee resource groups have the potential to bring about broad change. They serve as an organized and established platform that employees can utilize to promote change. These changes occur in the form of policy changes, cultural changes, and improved relationships between the employees and employers. ERGs can have effects beyond those for the employer and employee, however, and instead they can promote employee activism outside of the workplace and they focus on causes of a larger societal scope. For instance, many ERGs provided aid Hurricane Katrina victims, which leads to the argument that ERGs are expanding to also affect the world community.

To employees

There are multiple disadvantages to employees in ERGs. Sometimes other employees resist the changing culture of the American workforce and the diversity that ERGs promote. People with these views are often opposed to change and the uncertainty that follows. This discrepancy between the ideals of the ERG and the ideals of other employees has the potential to cause rifts. Additionally, our society is currently emphasizing that an employer should meet all of an employee's needs, and ERGs are said to further this notion. Some believe that this thinking is dangerous if taken too far because it could make an employee too dependent on their employer. If ERGs are leading activists to make their lives revolve even more around work, such negative implications could arise.

Some also believe that it is dangerous for an ERG member to be strongly invested in the possibility of change provided by their ERG. By becoming so invested in an ERG, there is a greater probability that that member may lose sight of the larger change that they want to see in society by instead focusing too much on the prospect of change in their specific company. Along the same lines, others believe that radical members of ERGs have to find a careful balance between supporting their cause and supporting their workplace. Since radical advocates for a cause tend to feel deeply about the issues, they can feel pressure from their advocacy groups to yield more influence in their ERG, while their ERG needs them to adopt a more conservative approach in order to contribute to and deal with the business.

To the organization

ERGs have the potential to create strained relationships between members of the ERG and upper management. Because of the fact that these management personnel have the ability to affect promised jobs and bonuses, there are situations that have the potential to arise in which ERG participation leads to discrimination. To combat this potential disadvantage to ERGs, some believe it is necessary for them to focus on gaining trust, joint learning with management, and forming alliances in order to promote change.

Competition among ERGs

Within many organizations the various ERGs compete for funds and impact on the company, and this competition can lead to various negative effects of ERGs. It is found that ERGs would be more influential if they supported one another in the promotion of diversity within the workplace, but this empathy often does not happen because of the inherent difficulties that it poses.

There are numerous reasons for these disparities. One reason is that ERGs come with historical social tensions that widen the gap between groups. For instance, African American groups can fear that white women groups will take the company's concentration off of diversity and instead turn it to work/life balance. Members often want their ERG to seem unique to capture the attention of leaders in the organization, which makes supporting other ERGs more difficult. It is apparent that companies are less likely to make too many changes, so the more ERGs, the less true impact that each can have.

If ERGs cooperated with one another, they would exemplify an ideal that they promote, which is to effectively and respectfully work in a diverse workplace. Their cooperation would be an excellent example of this principle, even though it would take effort to promote. Currently, Human Resource departments at some companies are focusing on bringing these ERGs together through diversity councils.