By Patricia Brown
It has been eight years since Dale Caldwell — then one of the few African-American senior managers at Deloitte Consulting — took a hard look at the demographics and the lack of minority representation among the upper ranks of the management consulting profession.
After surveying colleagues at 12 competing firms and tallying up the admittedly unscientific research, the raw head count of minorities in the profession was "dismal," he says. Out of thousands of managers among the industry's top firms in 1994, Caldwell estimates that including himself there were 11 black partners and 24 senior managers.
It's hard to gauge exactly how much progress consulting firms have made to open their corner offices to African-American and Hispanic occupancy in the years since. But it's clear that these firms still have a long way to go before they look anything like the diverse workforce of corporate America — particularly at the higher ranks.
Take three of the most important companies in the world: AOL Time Warner, American Express, and Merrill Lynch. The CEOs of these empires are all African-American, and there's no doubt that Richard Parsons of AOL, Kenneth Chenault of Amex, and Stanley O'Neal of Merrill will expect, if not demand, that their consultants better reflect the American workforce as it exists today.
Indeed, any company that has not learned to appreciate the importance of a diverse workforce need look no further than the changing demographics in America. The U.S. Office of Employment predicts that 29 percent of the U.S. labor force will be composed of minorities by 2008. The U.S. Census Bureau, meanwhile, notes that minorities — Hispanics, African-Americans and Native Americans — today make up 25 percent of the population; in 50 years, that number will grow to 38 percent.
But minority representation is not something the management consulting profession likes to discuss. Of the ten top-tier consulting firms contacted for this article, not one would disclose minority presence among its partners, citing reasons that revolved around a handful of issues such as private company regulations or pending IPO status. The universal response underscores the ongoing struggle to modernize the profession's workforce, and raises troubling questions for consultants already being taken to task by clients, who in the wake of Enron's collapse, find themselves under fire for having acquired consulting services from their Big Five auditor.
"They keep minority numbers close to the vest, because it's embarrassing," says Dexter Bridgeman, African-American CEO of Diversified Communications Group, Inc., a firm that consults with management consulting firms on their diversity initiatives. Despite the fact that many consulting firms are setting up diversity panels and diversity boards within their companies and appear to be putting a tremendous effort behind these initiatives, "nothing ever really gets changed," he says.
The White Bastion of Partnership
A benchmarking report from the New York–based Association of Management Consulting Firms (AMCF) bears this out, with what few numbers are available about the role of race in the industry.
In its most recent report, Operating Ratios for Management Consulting Firms, a survey of 58 firms, minorities did not even rate a statistically significant presence within the partner ranks among "typical" consulting firms. Only at "high profit" firms did minorities begin to make an appearance at a measurable percentage of current employees — and even then, they did not make it past the management consultant level.
But why? It is also a fact that firms, particularly the largest companies, are putting millions of dollars behind their efforts to attract minorities. Many have formed affinity and mentoring programs, forums where people of like race or gender can gather for informal and formal networking sessions; they're kicking off massive recruiting initiatives at top-tier universities in search of the nation's brightest minority students. Even more important, they're beginning to feel pressure from their own clients to offer up more diverse consulting teams, ones that better reflect the employee demographics of today's Fortune 500 companies.
The answer, as these firms are quickly learning, is that changing written — and unwritten — processes, conventions, and traditions can take years. Firms are seeing first-hand the fierce competition for Ivy League–educated African-American and Hispanic students. And as the careers of minority consultants progress, HR folks complain that it becomes even harder to retain black and Hispanic talent and project color up the ranks, because of poaching from other consulting firms and even from their own industry clients.
But that is only part of the problem.
Bridgeman says that there are systemic issues at many firms preventing minorities from penetrating the white bastion of partnership in the consulting profession.
"Making partner is a very political process. A lot of it is based on whom you know, who's mentoring you, and who's pushing you along." It's one of the greatest problems in building a diverse workforce within management consulting firms, he explains. "An African-American or Hispanic person could walk into a firm, and there's no one who looks like him or her who's a senior manager or principal, and especially who's a partner, so you have no one to mentor you along in the process."
Cornell Hills, a black partner with PricewaterhouseCoopers in its Washington consulting practice, agrees that one of the biggest challenges for minorities in consulting is more amorphous than figuring ROI. "People need to be mentored into what kind of attitude is expected to move them up through the ranks. Many minorities don't have that." Hills notes that while many minorities are capable of rising to the corner offices, they often do not have the role models or road maps that explain exactly what's needed to take them there. "It's not just showing up to work early and staying late. There's a specific type of attitude that makes you successful, and it's not something that's intuitive. If no one is showing you that or telling you that, you're not going to get it."
Caldwell believes that it has more to do with familiarity: "People are comfortable with people like themselves and people who have the same style." He, however, is more "optimistic" today than he was eight years ago, and notes that "firms recognize there's a problem." In the years since taking his informal survey of fellow consultants, Caldwell has helped start the National Association of Black Management Consultants (NABMC), a group dedicated to increasing the number of minorities in consulting, to help with many of these issues.
If nothing else, the major firms are reinvigorating their commitment to address the issue.
"We are going to make this [its diversity initiatives] a lasting part of our business that will have an impact on the workplace, workforce, and marketplace," says Mark Farrington, director of diversity at PricewaterhouseCoopers. "That's why we're doing this. Not because some people think it's the right thing to do, or that it's our moral obligation. It makes good business sense."
Christine Murphy, director of diversity with Deloitte Consulting, concurs. "Our clients are driving a lot of this change as well. Clients want to see consultants who look like them and think like them and understand their culture. You can't bring in a group of 12 white males to a client … and they include one lesbian, one African-American and one Hispanic on their side of the table."
A homogeneous group that thinks the same way, and comes at problems or sees issues from the same perspective, does not generate the varied ideas that would come from having diverse groups. "It's all part of the paradigm shift," contends PwC's Farrington. "Thirty years ago, people thought that these diverse groups disrupted continuity because they were different and didn't think the same. Now, mirrored thinking is not the way business is going. Companies are moving toward more creative thinking about how value can be added."
Undertaking these initiatives, say consulting firm officials, takes time, consistency, and support from the highest leaders in the company. "In some respects, diversity management processes are like a marathon. By the time one person gets it and crosses the finish line, somebody else is just starting out," says PwC's Farrington.
Making Inroads at Booz Allen
Reggie Van Lee is one person who's crossed the finish line. As the managing partner of Booz Allen Hamilton's New York office, the firm's largest commercial venue, Van Lee has come a long way from his intern days as an entry-level associate in 1984. Today he sits on Booz Allen's board of directors and runs the communications, media, and technology practice for the firm in the United States. Van Lee was also the first officer in charge of the company's African-American Core Team, a forum started in 1995 that specifically watches out for African-Americans and their specific issues within the firm.
Blatant racism and discrimination, he has found, are not as much the issue as basic human resource management practices.
"The reality was that there were few blatant issues of bias or racism in the firm. But back in 1995, minorities and women weren't getting the same level of mentorship that others were getting. We wanted to put some sort of entity into place that would look after the African-Americans and hold people's consciousness aware of the issues," says Van Lee.
In the first year, the group produced a plan that included a workplace harassment policy to reduce or eliminate discrimination due to ethnicity, creed, or color, and a number of mentoring and minority recruitment programs.
Van Lee has since transitioned the leadership role to two other African-American partners, but he cites the success of the Core Team through definitive numbers. "At the time the Core Team was created, there were only two African-American partners in the firm. Now we have five, so we've been able to spread and extend the work of the African-American Core Team even more."
It is progress, albeit not dramatic. But Booz Allen arguably has the best record in the profession for attracting people of color to their senior ranks and retaining them.
The idea of diversity is nothing new. Many firms initiated programs more than a decade ago directed at females. In fact, these groups set important precedents that have been used by today's minority affinity groups
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