Opening the door to the executive suite

October 16, 2006|By Kenneth Arroyo Roldan and Gary M. Stern

When PepsiCo named Indra Nooyi its chief executive officer in August, several articles extolled the company for hiring a female CEO. Ms. Nooyi's appointment was also newsworthy because of the paucity of minorities who have been allowed into the executive suite. But most articles avoided the bigger point: Why haven't more mid- to senior managers who are minorities been permitted into the corridors of power? And more important, what needs to be done to expand the opportunities for women, Latinos and African-Americans in corporate America?

The statistics tell the dismal story. Among Fortune 500 CEOs, only 11 were women and seven were African-Americans, according to a recent survey. Though Hispanics and African-Americans together total 27 percent of Americans, they represent only 3 percent of CEOs of all public companies. And even though Latinos make up 14 percent of the U.S. population and are one of the fastest-growing groups in America, not one Hispanic is CEO of a Fortune 500 company. (Carlos M. Gutierrez was CEO of Kellogg's before being named commerce secretary last year, and William D. Perez resigned as CEO of Nike in January.)

Corporate America has not ignored the problem. Most large companies have done an effective job of recruiting minority talent, mostly at entry levels. But once hired, the minority employee often treads water. The problem is that many minority employees do not start their corporate careers on a level playing field. While white, male candidates often use their networking connections from their parents' friends and from professionals such as their doctors, minority employees typically lack a "godfather" or mentor who can help them master corporate politics or navigate the tricky corporate minefields. When companies don't pay attention to developing minority candidates, mentoring them and showing them the ropes, many eventually leave the company.

Many talented minorities are qualified and have a successful record that should earn them entrance into the corporate suite. What kind of feedback are these minority employees receiving? The refrain they say they hear most often in their performance appraisal is, "You're not ready yet."

What does this mean? Does it suggest that the minority employee doesn't possess the talent, intelligence, experience, moxie - or all of the above? How can talented minority managers acquire the requisite experience if their managers don't provide them with challenging corporate assignments such as being named chief of staff, serving as a dealmaker or acting as chief negotiator for an acquisition?

The problem isn't only with companies that fail to develop talent. As Shakespeare wrote, "The fault, dear Brutus, lies ... in ourselves, that we are underlings." Latinos, in particular, are often risk-averse once they land their first jobs. In order to move up, most senior executives must be mobile, willing to move from one city to another - and perhaps back again. But in our experience, many Latinos do not want to move out of their comfort zone, and they pay a huge price in their careers for their lack of risk-taking.

For the situation to change, three things have to happen:

First, minorities, once hired, must be groomed to be leaders. Paired with a senior executive, a minority candidate must learn how to play corporate politics and navigate the corporate world to advance.

Second, minorities whose performance warrants it must receive equal opportunity at challenging assignments - the ones that get noticed and help candidates progress into the executive suite.

Third, human resource departments must demonstrate courage and ensure that performance appraisals are based on objective criteria, not subjective perceptions.

If these changes are made, we'll see more minorities follow in the footsteps of Indra Nooyi.

Kenneth Arroyo Roldan, CEO of an executive search firm specializing in diversity recruitment, and Gary M. Stern are co-authors of "Minority Rules: Turn Your Ethnicity into a Competitive Edge." Their e-mails are kroldan@wbbusa.com and garystern@aol.com.

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