Hispanic, Other Ethnic Groups Growing In Workforce; Having Positive Effect On Product, Service Offerings
As the number of Hispanic and other ethnic groups grows in the workforce, new approaches to management and marketing need to be adopted by small- and medium size companies, particularly in the retail sector.
In developing marketing and servicing programs, many companies fail to realize the advantages these groups offer in terms of reaching out and adding clients and customers.
Given the growth in purchasing power represented by Hispanic and other ethnic groups, many companies fail to fully utilize and take advantage of the built-in interrelationships they offer.
One approach is suggested by an Organizational Development Consultant who reported on his recent work on how restaurants can increase revenues by understanding cultural differences.
According to Greg W. Hudgins, “companies are adopting new multicultural strategies in order to promote understanding of ethnic differences and increase the bottom line.”
Greg W. Hudgins is a nationally-known organizational development specialist.
One-Year Study
Hudgins’ theory is based on a one-year study he conducted at Bittersweet Catering & Café, a metropolitan Washington, D.C. caterer, restaurant and bakery.
Bittersweet is a reflection of most restaurants in the United States, where 22 percent, or much higher, of its restaurant employees are Hispanic and 49 percent are not fluent in English. Hudgins found that if restaurants are to perform at their peak, management and staff must clearly understand each other while appreciating and celebrating their differences. It is not only good for the work environment, but it is good for the bottom line.
Study Chronicles Success
One year after the study, Bittersweet won the “Retail Business of the Year Award” from the Alexandria, Virginia Chamber of Commerce. The owner, Jody Manor, said, “I was delighted to be recognized by my peers; but my real reward is the improved work environment for all of my staff that helped me streamline my business while increasing revenues. The willingness of all members to take risks and new responsibilities has enabled them to be self-managing and has increased their earning power significantly. Bittersweet is very profitable as a result.” Other employers report success in motivating Hispanic workers to not only take advantage of management opportunities but also to reach out to their communities to encourage patronage. As The Wall Street Journal reported late last year, “diversity is no longer a matter of doing what is fair, it’s a business imperative. Companies need a rich mix of employees with varied perspectives and experiences.” One case cited by the publication is the International Business Machines Corp. efforts.
“10 years ago then-CEO Lou Gerstner took a look at his senior executive team and concluded it didn’t reflect either IBM’s customers or talent pool. He launched a new diversity initiative, which continues today under CEO Sam Palmisano and which seeks to understand and appeal to a much broader group of employees and customers. The benefits to IBM’s bottom line have been dramatic.”
Some Downside
Of course, such programs, particularly in retail, can have a downside. Many proprietors are concerned that other patrons may be discouraged from shopping or eating in establishments where the customer base becomes too heavily weighted in one ethnic group or another.This sometimes comes about because adjustments in product mix and offerings sometimes result in dropping lines that appeal to other audience groups. At the same time, items that appeal to one group may not appeal to other customers.With Hispanic groups traditionally spending less on foods and other non-basic items, smaller firms need to balance new marketing initiatives with their efforts to maintain their current customer base.
Another aspect of this trend is the need for management to adjust its policies and procedures to take into account language and other impediments to employee growth.
