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A Trillion-Dollar Untapped Market

How to Rethink and Create Economic and Social Value with the Black Community
By The Black and African American ERG at Spencer Stuart
February 2022

As we commemorate Black History Month, we are having conversations with Black and African American leaders about tangible ways organizations and managers can advance their diversity, equity and inclusion (DE&I) efforts. We were recently joined by Fagan Harris, CEO of Baltimore Corps and chairman of The Just Economy Group; Margenett Moore-Roberts, chief inclusion and diversity officer at IPG DXTRA; and Shelley Stewart III, partner at McKinsey and leader of the firm’s Institute for Black Economic Mobility; to discuss barriers and opportunities to improve and embed DE&I initiatives. Here are some key takeaways for leaders and organizations to consider.

Moore-Roberts “I would add ‘belonging’ to DE&I,” said Moore-Roberts (left). “We’re all starved for places where we belong. Often, as a society, we operate from a disposition of ‘they/them’; to get to a true sense of belonging, our disposition needs to shift to ‘we.’” She cites storytelling as a powerful tool to combat bias. “If you think about the work that my current industry, communications and marketing services, does, we create stories that shape hearts, minds and behaviors — stories that shape our cultural realities. Over time, these cultural realities become the basis of who does and doesn’t belong,” she said. For example, Crayola’s Colors of the World campaign expanded from 8 to 24 crayons to reflect a more inclusive skin tone palette for people around the world, and helped to reshape perceptions of belonging inside and outside the organization, garnering billions of earned media impressions. She also advises organizations to build teams that match the markets they’re trying to reach. “People want to do business with and work for companies that align with their values,” she said. “Build a value proposition that reflects their lived experience and they will gain loyal consumers.”

Harris People often think of diversity as an input rather than an outcome, Harris (left) said. The key to increasing diversity is to focus on the organizational culture and put inclusion first. The right perspectives also need to be in the room. This means creating psychologically safe spaces for people to bring their full selves to work. This also means leaders need to check in with their team members, especially their often underrepresented Black and African American employees, proactively and regularly, to see how included they feel.

So what happens when progress doesn’t seem possible in the current environment, especially when it comes to hiring talent? Moore-Roberts likened an organization’s culture to an organism: You need to build antibodies, incubation systems or protective support structures for Black and African American and other underrepresented talent to survive until the system is ready for them. “We have to be honest with candidates about what they’re walking into,” said Moore-Roberts. Some may view that change-resistant environment as a welcome challenge; others may quickly become drained and leave.

Stewart Besides it being the right thing to do, organizations that fail to improve the employee and consumer experience for Black and African Americans risk leaving a major opportunity on the table. According to Stewart (left), there is currently $700 billion of untapped value that can be shared across consumers and businesses in the community; by 2030, African Americans will have $1.7 trillion in annual spending power.

Additionally, a $220 billion wage gap exists right now for Black and African American workers, and much of that gap stems from professions that are pathways to the middle class, but take ample investment to pursue, such as law and medicine. To help right these inequalities, Stewart says companies will need to act boldly: “What is the bold thing you will do that’s risky for you? What clients are you willing to walk away from?”

Organizations also need to look at talent and individual potential differently to confront biases. Biases don’t need to be active and conscious to have a negative effect on how leadership decisions are made. Furthermore, the impact of biases on the talent pool has a cumulative impact over time, reducing the diversity of the leadership pipeline at every level. It is important to be clear about what is — and what is not — a requirement for success in the role. For example, Harris notes that an emphasis on technical parts of the job can be used to exclude people of color and recommends giving more weight to lived experiences. He leveraged those who lost service sector jobs at the onset of the pandemic for contact tracer roles during the height of COVID-19 and many have remained in the healthcare industry.

Moore-Roberts recommended rethinking how candidates are presented to demonstrate their unique value proposition, such as their cross-cultural experience. In addition, effective organizations not only attract talent from diverse backgrounds, they set up paths for high potentials of every background to succeed and retain these leaders at higher rates.

While advocates and allies can feel empathetic about racial inequality, that’s not enough. “Let's move from feeling guilty to feeling responsible,” said Harris. “That (guilt) doesn't help our people and doesn't advance the cause.” When progress seems slow, create and celebrate small wins. In addition, understand your KPIs, which need to come from the top.

Sometimes, you have to take uncomfortable positions. Stewart suggests that when met with resistance, lean into the wins and convey that it’s not a zero-sum game. “This is a hard topic, so give colleagues courage to have conversations by giving them the facts,” he said. When someone doesn’t appreciate the importance of inclusion, belonging and diversity, Harris advises building relationships. “If you have someone who doesn’t see the light, see them and help them see that you see them. Pay attention to the feelings underneath all the words, pinpoint when those feelings are unproductive and try to move it to a productive space, and always remind people of the big goals, celebrate the small wins along the way, and never ever give up."

© 2024 Spencer Stuart