The Value of LGBT Networks to HRM

March 8 2012. At a spacious, tastefully designed bar in the heart of Amsterdam, about 100 people in business clothing gathered for the monthly gay, lesbian, bisexual, transgender (LGBT) business drinks. As I move around the room I see a good mix of men and women of all ages, and I hear people speaking Spanish, Dutch and English. Many of these people work in transnational corporations. I meet a Latina who recently joined Cisco and is looking to meet people. I run into a client who previously set up the gay and lesbian network in her company. I chat with a friend who, like me, did his MBA at Henley and who now talks with companies throughout Europe about the importance of having policies to improve efficiency by ending any form of discrimination against gay, lesbian, bisexual and trans employees.

I have been asked speak at this event and to briefly share the results of my research into the added value of corporate LGBT networks to companies. I love opportunities like this to share with people how powerful they are.

My research began exactly 4 years ago, when I dropped into the monthly drinks on my way to celebrate International Women’s Day elsewhere. I had just completed my final exam of the MBA and was looking for a research project. David Pollard, one of the forces behind the establishment of the network of professional and corporate LGBT networks now known as Workplace Pride, knew exactly what I could do. I could research, from a business perspective, the contribution of LGBT networks to a company’s bottom line.

I quickly discovered that this approach was revolutionary. Henley Business College had never had a Masters dissertation – that I could find - relating to gay and business. Most literature on gay and business relates to the difficulties of being LGBT in the business environment – an LGBT as victim approach. That is because in most countries, LGBT’s lack many rights, including in the workplace. The Netherlands, by contrast, has granted LGBT people by law almost every conceivable right. What value can LGBT networks offer under these circumstances?

Issues

Laws are one thing, reality is another. LGBT people in the Netherlands are still the brunt of jokes, and even today 30% of gay employees do not dare to be openly themselves at work. While many managers have no issue with a person’s sexuality, others do.  Working in an international climate, being 'out' in the Netherlands is one thing, but how will it affect an employee's potential to go on foreign postings? Some employees fear the consequences of being completely open, in every situation at home and abroad. Others are fearless, but have a nagging sense that by being so they may miss opportunities.  LGBT networks in companies are addressing these and other issues.

Bottom line

What does this have to do with the ability of a company to run a profitable business? One of the tenets of Human Resource Management theory is that competitive advantage means building a workforce that is unique, imperfectly imitable and with no strategic equivalent. Attracting and retaining talent is important to the bottom line, as is utilizing the people – their skills and competencies. Said differently, a company’s assets and resources, its resource combinations and its organizational competencies only have value when they are combined with the skills of the individual and their social networks. My research challenge was to come up with a convincing argument, with concrete examples, that a corporate LGBT network contributes to the profit of its company through its contribution to HR strategies for competitive advantage.

Results

For my research I interviewed network leaders, network members and HR officers in each of the six companies that at that time made up Company Pride Platform. There are at least 5 ways in which corporate LGBT networks contribute the to the bottom line:

1 LGBT networks contribute to finding the right people for the company

The networks are working with the companies to create an environment that is attractive to a diverse workforce. A major focus of several of the networks was participating in Canal Pride. Canal Pride is fun, exuberant and has a pro-gay message. The presence of the corporate networks generates visibility for the company on the day, positive coverage on TV and in relevant industry recruitment publications. HR and network respondents firmly believe this is good for business and good for recruitment strategies. 

2 LGBT networks help companies utilize employees

While line managers are responsible for ensuring that the employees perform in their jobs, the LGBT networks utilize the employees beyond the relationship defined in the professional contract. Most networks pass on information to HR about what works, and what is not work, for LGBT employees and make suggestions on what could be done better.

The networks cross the hierarchical lines, contributing to the company’s ability to adapt to the changing needs of clients, changing economic conditions, and changing perceptions of the social environment.

3 LGBT networks build social capital

Building a company’s social capital enables people to act collectively, for the benefit of the company.  The networks address issues of engagement, sharing of information, cross-silo engagement in strategy development. They also look at where people are being excluded. They create safe spaces where people can explore the question “Is it me, or is there something really going on out there that is making me uncomfortable?” HR sometimes utilizes the networks to learn why people join the company and why they leave.

4 LGBT networks create economic and reliable business resources

The LGBT networks build trust, and act on the trust to share information with each other and with other parts of the organization, including HR. Strong ties among colleagues can translate into economic and reliable business resources, which contributes to the competitive advantage of the company. Most of the networks help the company develop internal efficiencies by creating communication pathways, sharing information relating to HR issues, marketing issues and company products between different sections of the company.

5 LGBT networks link and leverage knowledge within the company

The companies are starting to tap into the knowledge and the external networks of the networks, mainly around recruitment and utility issues . Workplace Pride plays a significant role in developing knowledge that is specific to the issue of homosexuality in the workplace, and at conferences and meetings networks share data, statistics and best practices that are helpful to all their companies.

Scoping LGBT networks within the company

Where do we go from here?

Each network exists in a unique HRM environment. The networks are emerging as professional, social and intellectual exchange networks. In some cases they are partnering with HR in attracting, recruiting and motivating talent at all levels, including the elusive Generation Y employee.

They have the potential to do much more.  Networks could be building more bridges. The structures are there. The networks could be utilized more in recruitment strategies and in gaining access to Gen Y. Employees that are recruited through personal networks come with a ready-made relationship with the company that can positively affect their engagement and their motivation. In their networks of friends and family, network members have potential specialists, contractors and trustworthy market-based staff.

Workplace Pride recently launched the Declaration of Amsterdam, with 10 items on how to design a workplace that works for LGBT people. Networks can use this Declaration as a guideline for their own strategic plan: what exists already in their company, what has yet to be developed? Events like the monthly Workplace Pride drinks are a perfect opportunity for network members to inquire of other networks what they do, what works, what doesn’t work. Ask what they are proud of. Listen with wonder at what they have achieved and what their goals are. Share your own experiences. And bring in experts to work with your network to make more happen, with greater ease.

By Lin McDevitt-Pugh

Lin is owner of NetSHEila, a company specialized in maximizing the value of relationships between people to companies an organizations. She has delivered strategic network development workshops to corporate LGBT networks, business networks and international NGOs in The Netherlands, Africa and Australia. She can be contacted on +31-6-150 48468 or through the contact form on www.netsheila.com. Follow her tweets via @LinMcDevittPugh.