Build BRGs as an innovative business resource!
Copyright by Stephan Klaschka 2010-2024
From my series on how to build a successful BRG.1
The increasing diversity of employees at the workplace led to employees flocking together along affinity dimensions like birds of a feather to form networking groups within organizations. The next step goes beyond affinity and establishes employee resource groups (ERGs) strategically as a business resource and powerful driver for measurable business impact and strategic innovation bottom-up: as a Business Resource Group (BRG).
Limited to social?
Employee resource groups (ERGs) emerge for various reasons. They tend to start with a social underpinning that naturally unites and organizes like-minded employees. ERGs come in different flavors mostly along the traditional lines of diversity characteristics such as ethnicity, skin color, age, gender, physical (dis)ability, sexual orientation, military veterans, etc.
For ERGs, a ‘social stickiness’ is important and can be the key integrating factor of employee populations within organizations. It may also influence the choices of ERG goals and activities to a large extent. This may result, however, in possibly limiting the ERG and its members to be seen as a ‘social club’ of sorts by others. Management, in particular, may not see the direct (or even indirect) positive business impact that an ERG can have.
This is where ERGs can fall short: when they fail to tie a strong business-focused bond that ensures continued support by leadership that in return ensures the ERG can sustain and properly for the better of its members as well as the hosting organization.
Becoming a business resource
From a management perspective, ERGs can provide social ties within the workforce that are mostly seen as favorable ‑ at least as long as it does not affect the employee performance; whether perceived or real.
Better off is the ERG that demonstrates an unambiguous contribution to the bottom line. A clear business value proposition sets a solid foundation that makes it easy to communicate with and convince executives to secure their continued support. The company benefits from positive business outcomes as a direct result of the ERG activities, while it engages employees broader and deeper. This uses more of the employees’ true potential to ‘maximize the human capital’ as an important element also of employee engagement, development, and retention.
This approach serves not only the company but has advantages also for its employees and the ERG in return. The ERG members benefit directly in many ways such as by interesting work outside the immediate scope of their job, by developing new skills, and by increasing their visibility within the organization and continued ‘employability’, i.e. their personal market value as an employee.
So what is the key to success, how do you ‘build’ an innovation-driven and business-focused ERG?
Five dimensions of an ERG ‘business model’
I propose to establish the ERG as a self-propelling and sustainable system, an ongoing process that continues functioning quite independently from changes in the ERG leadership and consistently delivers innovations. Individual leaders are important for operations and make valuable contributions, but the ERG must be able to continue functioning even if key players become unavailable and replaced.
The following dimensions are generic and apply to any organization. Here, we use them to describe a general business model for the ERG:
Strategy
People
Processes
Organization
Metrics & Rewards.
To illustrate the model and make it more tangible I use a generic example. It is based on NxGen (for Next Generation at the Workplace), a generational-oriented and business-focused ERG that I founded. NxGen was nationally recognized in 2010 as a best-practices BRG by the National Affinity Leadership Congress (NALC).
1. Strategy
The strategy brings to the point the ERG’s goal and objectives. A well-thought-out value proposition is a foundation for the ERG.
For example, NxGen is a forum to develop leadership skills, networking, and problem-solving that aims to open up cross-functional/cross-disciplinary opportunities for its active members through strategic business projects with measurable results. As a goal, the NxGen BRG aimed to become a sounding board for management as a valued business resource.
2. People practices
People, active volunteers, are the lifeblood of every BRG. Staffing and selection are crucial and continued activities to induce fresh ideas and prevent burn-out of established BRG members. What you are looking for are active volunteers who are passionate and energetic. You want members who become active change agents, and role models, within the organization. Value a diverse set of backgrounds and capabilities that can complement one another.
Rather than trying to recruit new members, focus on how to attract new members to engage and actively participate (in contrast to the ones signing up to receive email updates or a periodic newsletter, which is a passive form of membership). NxGen membership is open to all employees — beyond typical affinity dimensions.
There is a broad range of benefits for active BRG members that can include (but are not limited to):
Insight and work in other business functions and departments
Members lead a relevant project possibly in another business function
Experiment and learn in a safe and nurturing environment
Develop and apply skills like leadership, consulting, problem-solving, networking
Build an open and supportive network with members coaching each other
Increased visibility within the organization
Potential to open new career opportunities
Making a measurable change in the organization - here and now.
At NxGen, we saw younger employees (primarily Generation Y or Millennials, born after 1980) tending to drive the BRG activities most. My explanation is that GenY, in particular, entered the workplace as well-educated professionals, optimistic and motivated to make a difference. GenY was brought up to believe they can achieve anything and are interested in exploring lateral career moves. They are used to collaborating in teams to overcome obstacles and network while leveraging technology effectively to this end. At the workplace at that time, GenY typically was not (yet) part of the decision-making bodies due to their junior positions ‑ but they do want to be heard (and should be listed too given their increasing numbers in the demographic shift of the population that has reached the workforce).
3. Processes
The BRG acts through business-relevant projects. At NxGen, the member ‘grass-roots’ identifies otherwise un-addressed or under-served business needs that the BRG chooses to pursue. Based on a clear value proposition (return on investment, ROI) for the organization, the BRG seeks executive sponsorship for each project. The executive sponsor ensures strategic alignment with the organization’s goal, expertise in the functional area, political support, and funding for the project (since the BRG has no funds of its own).
The project scope often lies outside of the immediate job description of the BRG-appointed project leader allowing for broader hands-on learning opportunities. Applying professional project management methods to all projects ensures the projects deliver the specified deliverables.
The BRG core team steers and administrates the BRG project portfolio which is documented in an annual business plan and shared publicly. As resources are limited, not all imaginable projects can be conducted at once but are staged. Projects can build upon and leverage each other while making use of synergies whenever possible.
In the beginning, it might be challenging to find meaningful projects that make the best use of the BRG’s resources and capabilities with favorable business impact. It takes time and persistence to develop a trustful relationship with executive management and to gain credibility as a BRG to attract more complex and important projects from management in return.
NxGen works and communicates openly, it acts transparently and leverages (social) media to inform and connect with its members and non-members displaying operations and results of the BRG's work.
4. Organization
The NxGen BRG operates within a general framework set by a company’s office to ensure all ERGs abide by the company policies. This office also provides an organizational home for ERGs within the company. It generally coordinates and supports the different activities across ERGs and ensures each ERG has a distinguished executive sponsor to connect the ERG with senior management.
A charter defines the basic roles and processes of the NxGen BRG in more detail and is posted publicly. A core team of active members guides the BRG activities and ensures BRG operability. The core team is led by the BRG’s elected chair and co-chair(s); it further comprises the project leaders, distinguished role-holders, and liaisons to key functions in the organization. The core team members support and advise each other. The BRG provides a safe and social environment that relies on trust among the members to connect, build relationships, network, and run projects.
NxGen actively reaches out to other ERGs, and innovative groups within the organization but also other operating units and companies to cooperate, share, benchmark, and collaborate on common goals.
5. Metrics and rewards system
How do you measure success, i.e. the effectiveness of a BRG? An annual business plan covers the portfolio of BRG projects. It serves as an instrument to measure the BRG performance across all BRG activities that the BRG chair is held accountable for.
What are the rewards for active BRG members? Besides the benefits listed in the above section ‘2. People practices, accountability, and success for individual members derive from their projects or their input to other BRG activities that all have clear objectives and success metrics attached. Driving the change and making a difference is a reward in itself that leads to growth, development, and a sense of accomplishment for the member.
NxGen and individual members received several awards and recognition for their work inside and outside the company which the BRG celebrates in public. Some members list their BRG involvement and experience proudly on their résumé which is an indicator that the BRG’s value proposition is effective for its members, i.e. the members value the BRG membership, projects, recognition, and awards as means of their ‘employability’.
Building the BRG as an innovation incubator
The business model positions the BRG clearly as a powerful business resource for the organization but it can be even more. The BRG can serve as an ‘innovation incubator’ by combining an attractive system with creative space in an effective governance framework. The processes create measurable value for the individual and the organization that can significantly contribute to process innovation and also drive product innovation.
In an empowering bottom-up movement, the BRG directly connects its active members from any level of hierarchy with the decision-makers high up. This bears the potential to cut right through established or perceived boundaries such as hierarchy, bureaucracy, and red tape or functional silos that may severely limit the effectiveness and innovative effectiveness of other units that were created top-down within the organization.
Herein lies the deeper potential of BRGs as a true business resource and going beyond possible self-inflicted limitations to social affinity. BRGs can well be the means that contribute to driving the future success of an organization for an organization that understands and values how BRGs open opportunities to tap into its workforce and unleash hidden potential.
Stay tuned for my next post on: Why too much trust hurts innovation
From my series on how to build a successful BRG (=Business Resource Group) group, i.e. a business-focused ERG (=Employee Resource Group) first published on OrgChanger.com.