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Systems Theory is the understanding of how smaller parts within a system relate to the larger whole.
There are 5 key items that determine job satisfaction for employees.
ERGs drive workforce retention and are necessary for creating engaging work environments.
Credit: WOC in Tech Chat
With the most expensive line item in most businesses being labor, it is in a company’s best interest to keep as many valuable team members as possible. When viewing retention through the lens of diversity, it is imperative to develop best practices to create an inclusive workplace prioritizing the satisfaction of ALL employees. In this article, we will explore how Systems Theory can engage your diverse talent and help them progress in the business while saving you time and money in recruitment.
What issues affect retention?
The hiring process can be time-consuming, costly and tedious. In the effort to find the best candidate possible, most companies are willing to invest in the search. According to a talent acquisition study conducted by the Society for Human Resources Management (SHRM), the average cost-to-hire is over $4,000 with the cost more than tripling when hiring executive positions, which can cost upwards of $14,000. The pursuit for the creme-de-la-creme is pricey but according to the same study, 26% of new hires leave a role after only one year with their fairly new employers. So what causes employees to leave for another employer? Inc.com listed communication, management behavior and workplace environment as reasons why your staff may be headed for the door.
These three simple yet critical issues are important to most employees, including people of color. In a study completed by The Kapor Center, 62% of employees would remain with their employer if they had taken steps to create a more respectful and positive work environment. In addition to being unseen and unheard, SHRM discovered that employees feel the following also impacts job satisfaction and retention:
Respectful treatment of all employees at all levels;
Trust between employees and senior management;
Opportunities to use their skills and abilities at work.
These markers of employee satisfaction are important to view through the lens of anti-racism in the workplace, due to the potential of microaggressions between the employee and senior leadership, lack of professional development opportunities and fair compensation. Systems Theory can assist with mitigating employee dissatisfaction and lay a solid foundation for open communications and inclusivity.
What is Systems Theory?
Systems Theory is the understanding of societies and organizations as complex, large, open systems that are interconnected and interdependent on smaller groups/organizations, which affect the outcomes of the bigger entity. The smaller parts affect the outcome of the wider entity as well and act as a reflection of the whole, and vice versa. These systems are so intertwined that it is impossible to remove ourselves from it. Whether you zoom in or zoom out, you see the same patterns and trends reflected.
One example of this theory in action is the racist rhetoric in the United States about Mexican immigrants being dangerous led to the 2019 shootings in an El Paso Walmart. If we accept white supremacist delusion as a system, we understand that we are all living within the system, which is why it is important to recognize the how it works and how it keeps us complicit in the system. Understanding our interconnectedness gives us the power and the knowledge to dismantle it.
How does Systems Theory apply to business?
In business, we see Systems Theory at work throughout the entire organization. For example, operations, sales and accounting teams are all smaller departments with their own processes and micro-cultures that contribute to the profitability and macro-culture of the larger company/organization. If the larger company celebrates inclusivity and prioritizes equity but the operations and sales teams are racially homogenous or permit microaggressions against LGBTQIA+ coworkers, the larger organization’s DEI goals will be inhibited by the inconsistency of the smaller departments’ behaviors, highlighting the disparities within the workplace and illustrating the issues taking place in the larger system at the organizational level as well as the societal level.
On the other side of the coin, if marginalized employees feel welcomed, respected and valued within their own departments, they are more likely to have the feeling that the organization as a whole also cares for them and values them. They’ll have a better perception of the larger business and likely remain with the employer for longer. Employers will find that centering equity in their decisions and employee satisfaction for marginalized employees, will in turn, support all employees at the company and provide general benefits for an all-around, more engaged workforce.
Credit: WOC in Tech Chat
How to Use Systems Theory to Increase Retention
Hone and Own Differences
Women, people of color, LGBTQIA+, neurodiverse and employees with disabilities enter the workspace with their own unique experiences, thoughts, ideas and cultural norms that influence their perspectives. Rather than trying to fit the candidate into the company’s cultural box, welcome their personal and professional experiences within team meetings and one-on-ones and find ways to connect their perspective to the organization's mission. It will encourage honest and innovative ideas that embrace each other’s differences and foster progress within the business, adding to the progress of their departments and the larger systems/organizations.
This strategy allows for employees to help address company issues, develop and highlight leadership abilities with executives and foster deeper and more meaningful relationships within the business. With minorities pacing to become the majority in 2044, Employee Resource Groups or ERGs are important for creating space for staff members from different teams and backgrounds to collaborate, educate and grow outside of their normal job descriptions. ERGs can be developed around race, nationality, ethnicity, culture, age or sexual orientation. Once clear and measurable goals are established for the ERGs, these smaller groups utilize the connections of the employees to affect the greater sum of the whole business.
Toyota is an excellent example of a company who used their ERGs effectively to increase retention. During their 2017 headquarter office consolidation and relocation to Plano, Texas the mobility corporation knew they had the potential to lose talented employees in their former California, Kentucky and New York locations. Adrienne Trimble, former Executive Lead of Diversity & Inclusion at Toyota Motor Company North America, stated that the executive teams leaned into their ERGs, also known as business partner groups (BPGs), and hosted 1 representative from each BPG for a 5-day stay in the Dallas suburb area.
Credit: LinkedIn Sales Navigator
As employees find their niche within these smaller groups, they begin to explore other avenues of professional growth within the company such as senior leadership positions, have access to potential mentors and additional skill building while adding value to the group and the company overall because they feel a sense of community and belonging. However, the employer must create these spaces that allow the marginalized employee to deepen their relationship with the company, connect emotionally and create a sense of belonging.
Although it may seem daunting, it is important to remember that we naturally live in complex human systems that affect all aspects of our lives: personally, within families, in auxiliary groups, society and in business. Just as you choose to create and implement systems that foster equity between us in society (i.e. wheelchair accessible ramps on sidewalks that can also be used by a mom with a stroller or a non-disabled individual with joint issues) we must also create equity in the workplace by owning and utilizing differences of marginalized groups while developing spaces that allow them to contribute, connect, grow and discover places of belonging.
Operating in a system is our default, natural state and we can either be pro-system or anti-system, there is no neutral ground. If we understand and recognize the oppressive systems that we, by default, live in, work in, and measure success by, we develop stronger agency and take actions (such as the ones above) to dismantle those limiting and oppressive systems .
Have additional questions? Reach out to The Acacia Company to find out what retention strategies may work best for your business.
Definition of Systems Theory- Open Systems Theory for Arts and Cultural Organizations: Linking Structure and Performance – by Yuha Junga and Neville Vakharia | The Journal Of Arts Management, Law, And Society 2019, Vol. 49, NO. 4, 257–273
Britannica.com - Definition of Systems Theory
SHRM - How to Reduce Employee Turnover Through Robust Retention Strategies
Harvard Business Review - What Black Employee Resource Groups Need Right Now
US Census Bureau - New Census Bureau Report Analyzes U.S. Population Projections