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ERGs can address innovation and talent development, report advises

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Employee resource groups can provide some of the most powerful tools for addressing the challenges defining the next decade, such as talent development; cohesion and connection; and innovation and performance; according to an analysis by Great Place to Work, a workplace culture research and consulting firm. 

“The best ERGs will evolve to meet the moment, empowering their leaders, building wide bridges throughout the organization and nesting subgroups to meet the unique needs of an incredibly diverse workforce,” the May 8 report noted.

However, ERGs face barriers to fully reaching this potential, Great Place to Work’s research found.

For example, ERGs may boast a robust membership but still struggle to have an impact on the organization, with members perceiving poor support from leaders and getting frustrated with a lack of accountability to them and their diversity, equity, inclusion and belonging goals, according to the report.

It outlined five steps organizational leaders can take to remove these barriers:

  • Add ERG responsibilities to job descriptions and formalize ERG leadership with clear expectations and incentives that align with measurable business outcomes;
  • Increase recognition and rewards for ERG service, such as factoring it into performance reviews and promotion decisions;
  • Set goals for ERG members to grow their networks and provide them with opportunities to build ties across the company;
  • Outline a nesting structure for ERGs by using focus groups to discover what connections they’ve built, what subgroups would offer value, and what groups are feeling left out; and
  • Recognize the work of ERG members across the organization, such as through company town hall meetings, and give ERG members face time with key business leaders.

ERGs aren’t new to corporate culture; in fact, they’ve been around for more than 40 years, according to the report. Aimed at fostering DEIB in the workplace, they are known for broadening the professional networks of underrepresented employees and providing a psychologically safe place for connection, experts have noted.

Moving forward, ERGs can also be a catalyst for innovation, the Great Place to Work report found: Its research showed that opportunities for innovation are much higher for ERG members than for non-members.

“By bringing together an otherwise disconnected group of roles within the organization, ERGs will create serendipitous collisions that lead to bold new ideas for the business,” the report said.

Additionally, to position ERGs as talent centers, organizations should tap them to manage systems for tracking internal talent and for connecting employees with opportunities, the report suggested.

As ERGs evolve, HR professionals will play a key, but delicate role in the process, previous McLean & Co. research emphasized.

In particular, while providing support, HR must be careful not to overtake an ERG’s efforts, McLean said. To skillfully balance these priorities, HR should first understand an ERG’s needs and goals and then create pathways for it to receive formal support (such as through funding, recruiting and the ability to run initiatives) and to grow and be sustained, the advisory firm recommended.

Notably, the number of HR departments using third-party D&I consultants has been inching down since 2021, with only 10% of respondents telling HR Dive last year they were outsourcing the investment, a decrease from 12% two years earlier, according to HR Dive’s 2023 Identity of HR Survey. ERGs were touted by experts as one way employers could continue to invest in DEI without breaking the bank.

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