Diversity tips from shop floor up

9 November 2007 by Virginia Galt - Globe & Mail

When a delegation from China recently toured Vancouver-area Future Shop stores, Kevin Layden was the only one in the group who needed an interpreter.

In every store they entered, Chinese partners of the retail chain met Future Shop employees who not only talked the same technical language - they were all in the electronics retailing field - but spoke Mandarin as well.

"They didn't need translators. I did - to keep up with what they were talking about in the stores," recalled Mr. Layden, former president of Future Shop's corporate parent, Best Buy Canada, who was recently promoted to chief operating officer of Best Buy International.

Among the Canadian hosts to the Chinese delegation was Yingming Gao, manager of a Future Shop store in Surrey, B.C., and a 12-year veteran of the company.

He joined within a month of landing in Canada with an undergraduate degree from China and a law degree from the University of London.

The opportunity to meet and talk strategy with executives of Best Buy's joint-venture partner, Jiangsu Five Star Appliance Ltd., "was awesome," says Mr. Gao, who grew up near Nanjing, was excited to learn about Best Buy's plans to open a store there, and offered to help.

"I told him: 'Be careful what you wish for,' " Mr. Layden recalls. "We'll probably look to Yingming to help us with the Five Star brand in China. While it's not [yet] confirmed ... it's likely that he would end up taking an assignment in Nanjing."

There is nothing unusual about Canadian businesses having multiethnic work forces, given the cultural makeup of the country.

It's still relatively uncommon, however, for organizations to try to turn that diversity into a competitive advantage, as Best Buy is doing in tapping its Chinese-Canadian employees for hands-on help in its expansion strategy for China.

Indeed, Best Buy Co. Inc. is among the few companies that have taken their diversity strategies to a whole new level by going, quite literally, to the shop floor to draw on the knowledge of employees from different cultures - and, in some cases, grooming them for promotion and international assignments, Joel Fatum, a managing partner of executive recruiting firm Odgers Berndtson, said in an interview.

"It's unique for an organization to leverage diversity to this extent - not only to satisfy diversity issues politically and socially, but actually leveraging their own diverse work force to come up with strategy," said Mr. Fatum, who advises corporations on how to identify and develop internal talent in addition to recruiting from the outside.

Prem Benimadhu, vice-president of governance and human resources management at the Conference Board of Canada, says that most Canadian employers have good intentions about making their work forces more multicultural, but many have not yet developed strategies for managing that diversity, and tapping the expertise of new Canadians from different cultural backgrounds.

That notion found evidence in a survey that the Conference Board carried out last year of 120 major Canadian employers on their diversity initiatives.

In a report analyzing the survey results, the board said that "while Canadian organizations ... stated a strong commitment to diversity, their performance on diversity-related measures (such as representation rates, integrated strategic plans, and diversity-related investments, activities and initiatives) is mediocre.

"There is a gap between policy and performance, with many organizations failing to follow through on their stated commitment to diversity with initiatives and practices that foster and sustain diverse and inclusive work environments."

Still, Mr. Benimadhu says, there are signs of progress. "All the organizations are playing catch-up, but I think Canadian organizations have moved a long way toward recognizing diversity as a major strength of theirs."

Accounting firm KPMG LLP has reaped the benefits of having employees who can relate to its increasingly diverse client base at home as well as abroad, says Steven Watts, an Indo-Canadian and a partner in the firm's financial services audit practice.

"Last year, we won the audit of one of the Indian banks here [in Toronto]. One of the success factors, notwithstanding this being a KPMG client back in India, was the fact that I, being Indian, understood the culture, knew who they were back in India and knew what they were about," he says

"From a business-case perspective, at least to them, it was highly valuable, and we see that increasingly in our marketplace here."

Future Shop has long recognized the benefits of being able to serve customers for whom English is a second language in their mother tongues, Mr. Layden says. This advantage has now extended beyond the Canadian border.

Last year, Best Buy established a presence in China when it acquired a majority interest in Five Star, one of the country's largest retailers, with more than 130 stores. Rather than impose its corporate culture on Five Star, Best Buy has left its operations intact and plans to pursue a "dual-brand strategy" by gradually introducing Best Buy stores to the Chinese market as well.

The first Best Buy store opened in Shanghai earlier this year. Drawing on the market intelligence of its Chinese management partners at Five Star, as well as advice of its Chinese-born Canadian employees, Best Buy is now making plans to open a store in Nanjing.

Mr. Layden says the key to managing diversity, and to understanding different cultures, is to listen, learn and adopt the best ideas from a variety of sources, rather than imposing one corporate viewpoint.

Mr. Gao, who is expected to take on a management role in the Nanjing store, understands the differences in business philosophy, as well as the cultural differences. He aims to help Best Buy and Five Star bridge differences without disrupting Five Star's relationship with customers.

"I'm trying to do my best to bring the Future Shop values and culture into a different market."

Future Shop, which has been operating in Canada for 25 years, has a long tradition of hiring immigrants, many of whom have post-secondary degrees and professional qualifications from their home countries but cannot easily get accredited to practice in their fields, Mr. Layden says.

This has given Future Shop and, by extension, Best Buy, an incredibly rich talent pool to draw from, he says, adding that a number of Best Buy's Canadian-based employees have been reassigned to the company's international arm.

"Wherever we can, we work with folks like Yingming to help us in other cultures, in other countries. That's our goal," he says. "The Future Shop organization has always been historically very diverse and, as we do work with China, or we do work with Turkey or other countries or other cultures, we usually don't have to look very far to find people in our organization who are from those backgrounds."