Employee Resource Groups – just another networking group or a think tank group that directly impacts business?

I recently attended an Employee Resource Group (ERG) Summit, where I had the opportunity to moderate one of the sessions. The theme of this Summit was ‘Maximising the Impact of ERGs in India’ and the speakers in the session I moderated shared their thoughts on ‘Launching an ERG’.

Employee Resource Groups are an important component of a company’s Diversity and Inclusion programme. An ERG is a group of employees who identify with others similar to themselves. This may include, but not restricted to, race, gender, age, sexual orientation, working parents, functional level, disability, veterans, etc. The group comes together and actively engages and gathers around a unifying mission. In most organisations, membership is voluntary and open to all employees. ERGs serve as internal communities, providing personal connections and affiliation for its members and with the organisation. The key mission of ERGs is to promote the well-being of the company and develop mutually beneficial relationships between its members and the organisation’s stakeholders. Previously known as “Affinity Networks” or “Employee Networks”, many organisations’ ERGs are now transitioning to becoming “Business Resource Groups”.

Enough has been said about organisations having groups for its women employees where they network with other women colleagues – often seen as a platform for women to crib about the lack of opportunities for them or another employee engagement initiative. While that is true to some extent, that is not all that ERGs do. Previously thought of as social outlets for race or gender based workplace communities, ERGs are now an important part of organisations that operate in an increasingly global marketplace. Over the years, the work of ERGs has gathered momentum by evolving from being grassroots networking efforts, into formalised business assets that affect workplace, workforce and marketplace results. ERGs are aimed at providing support, enhancing career development and contributing to personal development in the workplace. Potential employees trust and can relate to ERG members with whom they share affinities.

Although ERGs have been around for more than two decades, it is only now that Indian corporates are realising the importance of having these groups become part of the company fabric – something that was earlier perceived as just another directive from the parent company. Organisations in India are slowly realising ERGs assist in fostering an environment that excels in Diversity and Inclusion initiatives by serving as the common voice for employees who identify themselves with a particular diversity attribute. They enable organisations to increase employee engagement, connect to communities in which business is conducted and enhance the bottom line.

The transition from ERGs to BRGs reflects an increased business focus and ERGs can have an effect on several business areas, right from Product Development to Marketing to External Customers and Employees as Customers, from Government Relations and Policies and HR Policies and Benefits to Recruitment and Retention, from Professional Development to Global Development, from Community Outreach to Cultural Assimilation and Supplier Diversity.

So, how do these ERGs / BRGs benefit the business?

1. Talent Attraction – ERG members double up as recruiters by attending conferences and job fairs, promoting the company’s work and hosting networking events. Members of ERGs usually partner with potential employees who are within their area of affinity, thus serving as the voice of the organisation. Many organisations run special recruitment drives to target candidates from certain affinity groups, like women, military veteran or People with Disabilities. I have participated, along with our Disabilities ERG, in a few Job Fairs for People with Disabilities where my organisation has hired several people. During International Women’s Day in March, many Women’s Networks organise recruitment drives for women, where women are invited for interviews. Organisations also encourage their employees to refer candidates during such drives – an employee engagement strategy. 
2. Retention – when employees start feeling disconnected or they start thinking their careers have reached a stage where they feel their careers are stalled, ERGs can address these aspects and improve retention by offering development programmes or mentoring opportunities, thus helping employees realise their potential. One of the speakers at the aforementioned ERG Summit spoke about the Professional Development programmes they run for their women employees. These programmes include trainings and mentoring opportunities. She shared some statistics of women who took up senior roles after undergoing these trainings. It has been proven there are greater returns when organisations invest in their employees – productivity and retention levels are high, thus ensuring greater Returns on Investment. 
3. Talent Development – non-management employees often look to employee networks like ERGs to develop their leadership skills, an opportunity that might not always be available to them. As members of ERGs, all employees play on an even field, thus giving each member an equal opportunity to hone their leadership skills. ERGs are considered one of the best sources to identify leadership talent and nurturing it. Leadership opportunities in an informal setting like Employee Networks go a long way in preparing employees to take up new roles in their careers. Some speakers shared how their organisations consider contribution to an ERG when assessing their employees’ performance. Another speaker in my session, a fresh graduate when he joined his current organisation, shared how he launched the Indian Chapter of their global LGBT Network. He started this chapter as a platform for him to come out to his colleagues and provide others in the organisation and opportunity to come out, if they hadn’t already. Today, this gentleman, in addition to his day job, also leads this LGBT Network. This is a classic example of how an ERG has played a role in helping him bringing his whole self to work and showcase his leadership skills. Listening to this gentleman talk about his organisation supporting him when wanting to do something in a sensitive area like LGBT Inclusion was proof of the importance ERGs have gained over the years, even at the Indian workplace. 
4. Market Outreach – Organisations that are consumer-facing, count on ERGs because they serve as vital focus groups and innovators in terms of products, product placement and understanding the marketplace. These groups can help organisations in reaching customers in untapped or underserved markets. Several organisations today look to their ERGs focusing on generations when developing new products or services. These groups have the know-how of the current market trends. 

Now, more than ever, organisations are leaning on their internal employee networks to succeed in the marketplace. They are looking to solidify the value proposition of ERGs and work towards understanding how these groups can facilitate innovation. As mentioned above, ERGs have been around for more than two decades, but much work still remains in capitalising on the true power of ERGs. The true power of any ERG depends on a company’s business goals, where leadership must look at ERGs beyond networking platform to a strategic resource. As companies around the globe work towards integrating its multigenerational workforce in ethnically diverse markets, those that realise the value of their ERGs will be best positioned for success by using them for the business advantage they provide.