Employee Resource Groups are becoming a key tool in a business’ arsenal not only for employee engagement but also reaching new markets, employer branding, and recruiting of specific groups of people. The reason behind this versatility of benefits is simple: a wide range of employees are members.
Since ERGs are based on common interest or common identity, not common seniority level, they draw members from the newest junior employee all the way up to the CEO, in some cases. Many organizations also require executive champions for an ERG to be founded, all but guaranteeing the needs of the ERG are brought to the c-suite.
But not all ERGs are created equal. There are three main kinds of ERGs, each with its own reasons for existing and with its own benefits and and drawbacks. If you’re thinking of founding an ERG, you have to be aware of what kind of group you need (and what your company is ready for)
The Social ERG
Definition: The Social Group ERG is one that is focused on the community it serves within the organization, whether it be interest or identity based. The groups operate on a “build it and they will come” model, believing that the current model of social life at the firm is lacking either in a type of social event (i.e. a panel or restaurant nights) or lacking a certain kind of social life (i.e. an LGBT-friendly event)
Main value: Employee Engagement. These social clubs might throw awesome parties, bring cool speakers into the company for panel discussions, or just offer a new space for people with common interest or identity to meet. Don’t underestimate the business value of connecting on common ground – it makes that extra question you had or suggestion you have to make something better at the firm fall on receptive ears.
Main drawback: Vague ROI. Hosting social events is par for the course of any organization, but they are seen as occasional fun things. If you want to create a formal, organization sanctioned (and often organization funded) group, you will have to make a stronger business case for a social club as the ROI isn’t clear. This can be avoided by tying your business case to employee engagement metrics, such as retention rates, engagement rates, or workplace happiness rankings (whatever your firm measures).
Best for: Companies that have a more homogenous culture that you are trying to shake up in some way. This isn’t always around discrimination or negative issues – your organization could have a strong 9-5 culture where everyone is gone by 5:30 pm and you want to use the social ERG to draw people into the office after hours to strengthen co-worker bonds. It could also be helpful for identity based ERGs (LGBT, women’s, military veteran, Black, Aboriginal, working moms, etc.) where there is a small, but tight knit, community of people who want to be able to organize socials and parties that make them feel more comfortable and welcome at the firm (allies welcome!).
The Advocacy ERG
Definition: An advocacy focused ERG seeks to improve the lives of a certain group of people in the firm, and are often identity based. These groups run a mix of strategy meetings, targeted events to raise awareness, and working with external groups where appropriate. The executive champion is most important for ERGs with this purpose because the ERG works on the business case but it’s up to the Exec Champion to fight for these issues in the c-suite.
Main value: Flexibility. This type of group has the most power to take bits and pieces from each style. An advocacy focused ERG is likely to host social events, taking tips from the Social ERG, and partner with a few external groups, taking hints from the External Partnerships ERG. Since advocacy takes multiple forms, this type of ERG is the most flexible.
Main drawback: They can be political. Many issues that an advocacy ERG might take up could be considered overly political – and their leaders equally political for bringing up the issue. If your company’s culture is not receptive to perceived politicization, the group and its members could face social ramifications. These can be avoided by grounding your arguments in your organization’s own words (mission statement, core values, etc.) and studies or other objective evidence that show your cause is not just the feelings of a group, but a good business decision.
Best for: Organizations that have a lot going on, but the interests of a specific group might be falling through the cracks. This can either be through simple ignorance – people didn’t know the issues existed – or potentially some wilful ignorance where the issues were discredited initially. If it’s the former, be ready for your opportunities to educate; be patient, helpful, and work to become a trusted partner for those “stupid” questions people were afraid to ask. If you face the latter, be prepared to make a strong business case and get ready for some pushback while you work to change minds within the organization.
The External Partnerships ERG
Definition: An External Partnerships ERG is focused on getting the name of the company out in a specific, often identity based context. These groups work with nonprofits and ERGs at other firms to build up the respective networks of its members, which in turn is used to bolster the brand of the company, sales and partnerships, and overall community goodwill (which translates to talent acquisition and retention prowess).
Main value: Employee Empowerment. These types of groups require a lot of trust from the organization, noting that the group is getting budget and even sometimes time off (or paid overtime) to work with external partners and host internal/external events, all for the benefit of the firm. For employees they get the opportunity to take ownership in their firm and for the organization they have the chance to scale their success through people they didn’t initially plan for. It also gives employees the opportunity to connect with their communities, which has links to retention, engagement, and productivity.
Main drawback: Stepping on toes (internally) and Knowing whom to partner with (externally). When you start any new organization with a large cross section of would-be benefits – talent acquisition, sales, branding, etc. – it’s likely you will step on toes of people in the organization whose job it is to do at least a part of your ERG work. Avoid this by having a main focus (i.e. just talent acquisition, so you know who your internal partners are) and work on building the remaining benefits as a value-add, not a value-core.
Knowing whom to partner with can make or break this type of ERG. In the LGBT space alone, there are thousands of potential options. Keeping in mind that an ERG has very limited budgets and even more limits on time (leaders of ERGs are volunteers and have a full-time job, after all) means that they have to make the right decisions quickly. Avoid this in the beginning by looking at where your competitors or clients are sponsoring; if you’re new to the space, rely on their expertise in finding the high quality organizations. As you gain experience in the space, don’t feel obligated to remain with organizations and partnerships if you are not servicing your main goal. If you chose the focus as talent acquisition and one of your partners is not providing any good talent or talent branding, it might be worth using those dollars to check out another group for a year. Be wary of hopping from group to group – it takes a couple years for ROI to come – but don’t trap yourself either.
Best for: Organizations who already understand the value of the community in question but do not have the resources within the organization to grow in that market, either due to lack of time or simply that no one has stepped up in the past. Instead, they support members of said community within their own firm and empower them to make the best decisions for the organization.
Which type of ERG does your organization need? Depending on where you are, what your goals are, and what the firm culture is, you can choose one of these group styles or take bits and pieces of each to create a custom ERG that suits your needs.
Have experiences founding ERGs? Tell them in the comments!