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Chapter Three Essay: Outline
“An Integrated Approach to Managing Diversity in Organizations”
I. Introduction
a. An integrated approach to managing diversity suggests that diversity is
comprehensively incorporated throughout an organization
b. Diversity becomes part of the organizational strategy
c. Purpose: to describe an integrated approach to diversity management that
consists of three levels of organizational change and seven diversity components
d. Verizon and Kraft Foods are used as examples throughout
II. Three Levels of Organizational Change
a. An integrated approach is effective because it addresses diversity’s complexity
by operating on three different levels of organizational change
b. Structural Interventions: focus on the formal systems that guide and control the
work of the organization.
i. Examples: inclusive recruitment strategies, metrics, retention practices,
integration of women and minorities into executive positions
c. Cultural Interventions: are the basic assumptions, values, beliefs, and ideologies
that define an organization’s view of itself, its effectiveness, and its environment.
i. Examples: leadership commitment, effective organizational
communication about diversity, clarity about how diversity fits within
the organizational strategy, having diverse organizational members in
decision-making and policy-making positions, diversity training, and the
creation and development of external relationships.
d. Behavioral Interventions: seek changes in behavior, attitudes, and perceptions
within and between individuals and work groups that support or hinder the
goals of diversity.
i. Examples: Comprehensive diversity education and training, the creation
of employee resource groups, and mentoring programs.
III. Diversity Components
a. Authentic Leadership Commitment
b. Clear Organizational Communication
c. Inclusive Recruitment Practices
d. Long-term Retention Strategies
i. Work-Life Balance
ii. Domestic Partner Benefits
e. Incorporating Diversity Into Main Work of Organization
f. Diversity Management Metrics
i. Diversity Management Metrics
1. Hubbard’s Diversity ROI Analysis Model
a. Step 1: Develop Initial Analysis and Planning
b. Step 2: Collect and Analyze Data
c. Step 3: Isolate Diversity’s Contribution
d. Step 4: Convert the Contribution to Money
e. Step 5: Calculate Costs and Benefits
f. Step 6: Report Data
g. Step 7: Track and Assess Progress
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ii. Measuring Diversity’s Impact
g. Expansive External Relationships
i. Supplier Diversity
ii. Community Outreach and Philanthropic Contributions
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Chapter Four Essay: Outline
“Exemplary Diversity Leaders and Organizations”
I. Excellence in Diversity Management Leadership
a. Andrea Jung, former Chairman of the Board of Avon
b. Irene Rosenfeld, CEO of Kraft
c. Antonio Pérez, CEO of Kodak
d. Ivan Seidenberg, former CEO of Verizon
e. J.W. Marriott Jr., CEO of Marriott International
f. Kenneth Chenault, CEO of American Express
g. Mike E. Ullman, former CEO of JCPenney
h. Indra Nooyi, CEO of Pepsico
II. Top Companies for Managing Diversity
a. #1: Pricewaterhouse Coopers
b. #2: Sodexo
c. #3: Kaiser Permanente
d. #4: AT&T
e. #5: Proctor & Gamble
f. #6: Ernst & Young
g. #7: Kraft Foods
h. #8: Deloitte
i. #9: Prudential Financial
j. #10: Colgate-Palmolive
III. Case Study: Diversity as Strategy: IBM and the Leadership of Louis Gerstner
a. Introduction
i. 1993: Gerstner took over at IBM when IBM was struggling as a company
ii. 1995: Gerstner launched a diversity task force initiative that became a
cornerstone of IBM’s HR strategy.
iii. IBM created eight task forces
iv. IBM transformed into a more diverse company that views diverse
employees as a competitive advantage
v. Hired Ted Childs: IBM’s vice president of Global Workforce Diversity
b. Constructive Disruption
i. Each task force was comprised of 15-20 senior managers, cutting across
the company’s business units
ii. Task forces included: Asians, blacks, GLBT, Hispanics, white men,
Native Americans, people with disabilities, women
iii. Sponsors were not necessarily constituents of their groups
c. Pillars of Change
i. Demonstrate Leadership Support
1. CDO works as a partner with the CEO
2. Leaders are actively involved and act as role models
ii. Engage Employees as Partners
1. Employee Resource Groups encouraged employees to act as
partners in decision making
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2. Task force work is now focused on tactical issues
iii. Integrate Diversity with Management Practices
1. Leaders hold managers accountable
2. Diversity is essential to all aspects of management
iv. Link Diversity Goals to Business Goals
1. IBM developed client base among women-owned businesses
2. Focused on outside markets such as Asian, black, and Hispanic
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TEACHING NOTES FOR CASE STUDIES
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[TEACHING NOTES FOR CASE STUDIES]
AUGUSTA NATIONAL GOLF CLUB:
MEMBERSHIP FOR WOMEN OR STAYING THE COURSE?
This teaching note was prepared by Ray B. Swart, Ashish K. Singh, and Andrew Nelson under
the direction of James S. O’Rourke (Eugene D. Fanning Center for Business Communication;
Mendoza College of Business; University of Notre Dame).
Purpose of the Case Study
1. To provide students with an example of the communications aspects of a private entity
fending off influence from an outside group.
2. To encourage students to think about how they would approach the situation from the
perspectives of the various stakeholders.
3. To help students understand the importance of communication during a prolonged
conflict.
Identifying the Business Problem
Martha Burk of the National Council of Women’s Organizations sent a letter to William
Johnson of the Augusta National Golf Club urging him to admit a female member to the
club. He denied the request and he released the television sponsors from their
commitment so that Burke could not make targets out of them. The estimated advertising
revenue lost would be $7 million. Augusta National can probably withstand this loss for
a certain period in the near term. Clearly, they would prefer not to. The long-term
viability of the brand is at stake, and worthwhile community and national charity causes
may end up being the real victims.
Forecasting the Most Desirable Outcome
Augusta National and the NCWO make a quiet, non-public agreement whereby the
NCWO will ease their pressure and Augusta will agree to admit a female member before
the 2003 Masters Tournament. Both sides agree to make no public announcement when
this occurs.
Identifying the Critical Issues
1. Protecting a private entity’s right to run its own business within the limits of the law
and community standards.
2. Should a private club that hosts such a “public” event, be held to different standards
than other private organizations?
3. Addressing the social issue of gender equality.
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4. Managing corporate reputation and stakeholder contacts via the mass media.
5. Engaging in communications under close media scrutiny over a prolonged period of
time.
Possible Solutions to the Problem
We can learn from this case how both sides could have handled the situation differently.
Ms. Burk could have taken more time to learn about Augusta and the Masters. She does
not seem to have a sense of awareness of the history of either the club or the tournament.
She could have tried to arrange private meetings and conversations with Mr. Johnson to
discuss her concerns. Once a relationship was established, she could have made a private
request to Mr. Johnson to admit a female member and see how he would have reacted.
Mr. Johnson could have brought Ms. Burk to Augusta or met her at another location to
discuss the matter privately. Perhaps he could have explained to Ms. Burk why her
request was not something that was going to happen immediately, but that it was under
advisement with the leaders of the club. He also could have explained that Augusta only
invites new members when another member leaves or dies, and that admitting a female
would be considered at that time. He certainly did not have to sound so defensive in his
response.
Explaining How to Communicate the Solution
Both sides would have been better served to keep the media out of this debate. Private
meetings and discussions would have been the best method to communicate with each
other because then both sides could have talked openly and honestly without worrying
about how each would appear to outsiders.
Teaching the Case
1 Week Prior
Distribute Part A of the case at least one lesson before going over it in class. Inform the
students that they will be discussing many issues including:
Dealing with external stakeholders trying to influence your organization.
How a special interest group should go about influencing policies.
Analyzing the business issues in a sports-oriented case.
The importance of being able to effectively communicate via the media.
First 30 Minutes of Class
Initially, review the facts of the case in Part A. After a few minutes, have the students
identify the following:
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The critical issues
The stakeholders
Possible solutions from this point forward
What can be learned
Summarize Students’ Responses
Ask students for their opinions of how the issues could have been resolved in a more
rational manner. Items for discussion include:
Objectives: What should each stakeholder be trying to accomplish?
Audience: With whom should each side be trying to communicate?
Message: How should these ideas be communicated to the various audiences?
Media: By what medium should the messages be delivered?
Results: How will each side know if they have been successful?
Last 15 Minutes of Class
Distribute Part B of the Case. End the discussion by talking about the implications of Part
B.
Timeline of Events
April, 2002 Lloyd Ward, an African-American member of Augusta National Golf Club,
comments that he would work from within Augusta National to lobby for
women’s membership. Of the matter, he says, “Inclusion does not just mean
people of color.”
June 12, 2002 A letter is sent from Martha Burk, Chair of the National Council of Women’s
Organizations, to William Johnson, Chairman of the Augusta National Golf Club,
requesting Augusta to open its membership to women.
July 8, 2002 Mr. Johnson sends a brief reply to Ms. Burk.
July 9, 2002 Mr. Johnson issues a press release with rather harsh words directed at Ms.
Burk and the NCWO.
July 30, 2002 The NCWO sends letters to the CEO’s of each of the television sponsors
(Citigroup, Coca-Cola, General Motors and IBM) of the Masters television
broadcast asking them to suspend their sponsorship of the tournament. A letter
is also sent to Tim Finchem, Commissioner of the PGA, requesting that the PGA
withdraw recognition of any kind from the Masters Golf Tournament.
Aug. 15, 2002 Rick Singer, Director of Worldwide Sponsorship Marketing for IBM, sends a
response letter to Ms. Burk indicating that IBM will continue to sponsor the
tournament.
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Aug. 20, 2002 The NCWO sends a follow up letter to the CEO of IBM saying that
Mr. Singer’s response did not address points made in the NCWO’s original letter.
Aug. 20, 2002 Mr. Finchem sends a response letter indicating that the PGA will continue to
recognize the Masters as a Major Championship.
Aug. 22, 2002 Leah C. Johnson, Director of Public Affairs for Citigroup, says that they are
communicating their views privately with Augusta National.
Aug. 30, 2002 A press release issued by Mr. Johnson states that since Augusta National is the
NCWO’s true target, he will not request the participation of the television
sponsors during the 2003 tournament. Instead, the event will be conducted by
the Masters Tournament.
Aug. 31, 2002 Ms. Burk says the NCWO will now direct its attention to CBS.
Sept. 18, 2002 Ms. Burk sends a letter to Sean McManus, President of CBS Sports, asking CBS to
suspend broadcasting the Masters.
Sept. 19, 2002 The NCWO issues a press release about its letter to CBS. Mr. McManus responds
by saying that CBS will continue to broadcast the Masters.
Sept. 26, 2002 Ms. Burk begins sending letters to CEOs who are reportedly members of
Augusta asking how they can be members of a club that discriminates against
women, which is contrary to the policies they have in their own companies. 55
members are targeted.
Oct. 5, 2002 About 20 Augusta members are concerned about the approach that Mr. Johnson
is taking and Sanford Weill, CEO of Citigroup, issues a statement through Leah
C. Johnson that he favors opening up Augusta’s membership to women.
Oct. 8, 2002 Lloyd Ward sends a letter to Ms. Burk offering his support for women
membership.
Oct. 17, 2002 Ms. Burk and the NCWO plan to next target sponsors of other PGA tournaments.
Nov. 12, 2002 Mr. Johnson’s Q & A session with John Boyette, sports editor of The Augusta
Chronicle, is released along with a statement by Mr. Johnson that appears in The
Wall Street Journal reaffirming the club’s membership policies. Ms. Burk states
that they will continue to pursue the issue.
Discussion Questions
1. What are the basic business issues in the case?
2. Should Augusta National admit women members? If so, when? Who would be likely
candidates for such membership?
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3. Who are the key stakeholders other than those mentioned?
4. Should the NCWO continue to press this issue? If so, how? Are Martha Burk’s tactics
likely to alienate any of her key constituents?
5. What are the possible ramifications for both Augusta National and the NCWO?
6. What problems might prominent members (CEOs) of Augusta face?
7. What other courses of action could have been pursued by key individuals?
