As workplace DEI efforts continue to evolve, employee resource groups stand out as one of the top tools to drive diversity forward.
As employee-led internal groups, employee resource groups (ERGs) foster inclusion, empower employees, and boost teamwork and connectivity. These net positives can help support and retain diverse team members while also contributing to stronger product development, customer service, and marketing. Plus, ERGs serve as meaningful connection points, especially for underrepresented employees, while at the same time strengthening employees' sense of purpose at work and capacity for collaboration and innovation.
Ninety percent of Fortune 500 companies have employee resource groups, reports McKinsey and Company. And their research shows a direct link between effective ERGs and employee inclusion: "Employees who rated their ERGs effective or very effective were much more likely to say they feel included than employees who rated their ERGs ineffective or very ineffective."
Ahead, we'll define employee resource groups and outline five best practices for employee resource groups to succeed.
What is an Employee Resource Group?
Also known as affinity groups or employee networks, Employee Resource Groups (ERGs) are volunteer-led internal networks typically formed by demographic, whether that's job role/function, generation, gender, sex, or another characteristic. Why are employee resource groups important? Employee resource groups are an asset to organizations, creating diverse learning and collaboration opportunities, fostering inclusion, and bolstering employees' sense of purpose within the organization.
ERGs first started in response to racial conflicts that "exploded during the 1960s," according to research from the University of Southern California's Center for Effective Organizations. In 1964, Rochester, New York became the first American city to experience a "modern-day race riot." Black employees at Xerox Corporation, at the time headquartered in Rochester, came together with the support of then-CEO Joseph Wilson to form the first-ever ERG, the National Black Employee Caucus. The mission? "To address the issues of overt discrimination and agitate for a fair and equitable corporate environment."
The establishment of the National Black Employee Caucus created a model for future ERGs encompassing other shared employee characteristics and interests. For example, the first LGBTQ+ employee resource group was founded at Hewlett Packard in 1978.
In all, ERGs serve as an integral space for underrepresented team members, fostering inclusion, community, and collaboration. In addition to advancing DEI, the top reported benefits of ERGs include connecting with leadership, engaging outside of the office, finding and forming allyships, and advancing one's career.
Best practices for employee resource groups
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ERG best practice No. 1: Define the ERG's purpose
For a successful employee resource group, start out by zeroing in on the ERG's purpose. This will ensure the employee resource group is on the path toward efficacy, writes McKinsey and Company. To capitalize on and create accountability around this singular focus, McKinsey also recommends that employee resource groups:
- Create a charter outlining "the ERG's strategic objectives."
- Draft annual plans detailing initiatives that connect back to the overall strategic plan.
- Define "who is accountable for the initiatives and how ERG members support them."
- Establish metrics "to assess the impact of initiatives and programs"
- Creating a mechanism for "soliciting feedback" and analyzing metrics
- Adjust ERG goals and initiatives as necessary.
Next up, we'll dig into how ERGs can strategically align with organizational goals.
ERG best practice No. 2: Align ERG and organizational goals
Not only are effective employee resource groups marked by "a distinct purpose," they're also "focus[ed] on strategic alignment, per McKinsey. Aligning ERG purpose with organizational and/or business strategy not only results in a more effective group, it also boosts interest in the group overall from both a member and business leadership standpoint. "When employees perceive their efforts as directly impacting business outcomes, they are more likely to get involved," according to the Center for Work and Family at Boston College.
Aligning an employee resource group's purpose with organizational goals could take the form of setting objectives that align with company values, DEI initiatives, or industry and business targets.
ERG best practice No. 3: Connect with leadership
Every employee resource group needs a leadership connection. The support of executive leadership can contribute to the group's overall success, offering opportunities for financial support, sponsorship, mentorship, professional development, and more. "As a best practice, effective ERG leaders take advantage of strong connections within their organization to get access to the right people and funding required to sharply execute their initiatives," per McKinsey. "Depending on the ERG’s purpose and goals, the connections could be to other ERGs, to internal functions (such as recruiting and social responsibility), or to members of senior leadership who can help provide input on business topics and support the ERG at large."
ERG best practice No. 4: Create community
Employee resource groups are one of the best ways to foster a sense of community, belonging, and connection at work. For underrepresented employees in particular, McKinsey says ERGs foster "connections that counter the feelings of being an 'only' within an organization." Furthermore, employee resource groups are also pivotal in creating visibility for underrepresented workers in large organizations.
ERG best practice No. 5: Engage beyond the ERG
Employee resource groups are enriched in manifold ways when they intentionally engage outside of the ERG and workplace settings. For instance, ERGs with a strong leadership connection and sense of community can also be critical players for advancing diversity, equity, and inclusion in the workplace at large. They do so by staying attuned to member needs and communicating them as needed to senior leadership. Take, for example, employee resource groups for caregivers. Such ERGs have gained a lot of traction following the COVID-19 pandemic, reports the Wall Street Journal. These groups "have successfully advocated for a spectrum of benefits at some companies. Among other things, a growing number of companies have gotten employees paid time off for caregiving outside of sick days and parental leave, as well as coverage for the cost of home-care aides."
Employee resource groups also have the opportunity to make an impact beyond the workplace too. By volunteering in the local community, ERGs can contribute to causes aligned with the group or organizational mission while also boosting brand awareness and creating opportunities for future partnerships. Plus, it's another way to build connectivity and sense purpose.
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