Diversity in the Global Marketplace

LISA NUNGESSER

Senior Vice President

Parsons Brinckerhoff Quade & Douglass

To prepare for this talk I did an Internet search on “global marketplace and diversity,” and came up with 42,184 matches. I found that a wide variety of industries were publicizing their needs, making announcements, and selling courses; and the variety of firms was very interesting. There were a number of companies outside the United States and a number of global companies, ranging from transportation companies to Avon and Quaker Oats. Globalization is a very timely issue that is not unique to the engineering and design profession.

I’d like to define a few terms to clarify the framework of my remarks. The terms “global marketplace” and “globalization” are not in the dictionary yet. I would define the global marketplace as a borderless, multinational or multiregional place where goods and services are exchanged. An engineering design firm, which is in a knowledge industry, for example, sells professional services and knowledge. In The Essential Drucker (Harperbusiness, 2001), Peter Drucker, the noted consultant, says we cannot yet tell with certainty what the next society and the next economy will look like, because we are in the throes of a transition. But we do know that they will have a totally different “social complexion” from the current economy and society. Drucker’s choice of words is illuminating— the new society, he says, “will be a knowledge society that has knowledge workers, and the largest, and by far most costly, element of business will be the workforce.” That is the background for discussing the issues of globalization and diversity.

Why is globalization important in engineering? The easiest way to explain it is to look at the shifting market in construction. Back in 1975, the United States accounted for 50 percent of the revenues generated in the construction industry worldwide. In 1998, the United States still accounted for $900 billion



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Diversity in Engineering: Managing the Workforce of the Future Diversity in the Global Marketplace LISA NUNGESSER Senior Vice President Parsons Brinckerhoff Quade & Douglass To prepare for this talk I did an Internet search on “global marketplace and diversity,” and came up with 42,184 matches. I found that a wide variety of industries were publicizing their needs, making announcements, and selling courses; and the variety of firms was very interesting. There were a number of companies outside the United States and a number of global companies, ranging from transportation companies to Avon and Quaker Oats. Globalization is a very timely issue that is not unique to the engineering and design profession. I’d like to define a few terms to clarify the framework of my remarks. The terms “global marketplace” and “globalization” are not in the dictionary yet. I would define the global marketplace as a borderless, multinational or multiregional place where goods and services are exchanged. An engineering design firm, which is in a knowledge industry, for example, sells professional services and knowledge. In The Essential Drucker (Harperbusiness, 2001), Peter Drucker, the noted consultant, says we cannot yet tell with certainty what the next society and the next economy will look like, because we are in the throes of a transition. But we do know that they will have a totally different “social complexion” from the current economy and society. Drucker’s choice of words is illuminating— the new society, he says, “will be a knowledge society that has knowledge workers, and the largest, and by far most costly, element of business will be the workforce.” That is the background for discussing the issues of globalization and diversity. Why is globalization important in engineering? The easiest way to explain it is to look at the shifting market in construction. Back in 1975, the United States accounted for 50 percent of the revenues generated in the construction industry worldwide. In 1998, the United States still accounted for $900 billion

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Diversity in Engineering: Managing the Workforce of the Future in the revenue stream because of construction in the United States. But the worldwide market had grown to $3.2 trillion. Therefore, U.S. market share in construction, although very robust, dropped from 50 to 25 percent. I think that statistic is an easy way to get an understanding of the business imperative of going “global.” A man who works with me is on the board of a major construction firm, and part of his job is to deal with international engineering relationships. He raised three important points in our discussions of what a construction firm needs from us. In the design business, we like to see our energy turned into projects that improve the communities in which we work. Construction companies generally say that, at certain levels, all design firms are technically competent to do a specific project. The things the construction firms look for are quality, innovation, and responsiveness. And responsiveness includes both flexibility and speed. How can companies, agencies, and industries deliver these to their clients? Of course, it’s through people! The question is what kind of people we need and where we will get them. Bechtel is a long-time partner of Parsons Brinckerhoff and has been one of the biggest construction firms for many years. In 1980, a Bechtel executive gave a speech before the Associated Schools for Construction, in which he said, “We need people who are flexible, can effectively wear multiple hats, can work on large, complex projects, are people-oriented, and are prepared for business in the regulatory and litigious society that they are entering.” I would add that it’s also a diverse society. Notice that he didn’t say they had to be good in science or good in math. In fact, he didn’t even say they had to be good engineers. He just said they had to be flexible, wear multiple hats, be people-oriented, and be prepared for the business environment. The underlying assumption of that speech was that engineering capabilities are developed through education, but these other skills are the ones you need to succeed. So, you can see that in a design industry we have both a tremendous opportunity and a business imperative to leverage our diversity to create an environment that will attract and retain top workers who can help us develop the leadership and innovation we need to deliver what our clients demand. Now I will turn to the experiences of our firm. Parsons Brinckerhoff is one of the oldest continuously practicing engineering firms in the United States. We are a privately held company, with more than 9,000 employees working in 250 offices. We operate in 70 countries around the world, and more than 40 percent of our workforce resides outside the United States. That may surprise some people who work with us, but our historic base has actually been international. One of our founders started work on both the New York subway and the Chinese railroads. We have a long history of working beyond U.S. borders. Why should you care what Parsons Brinckerhoff is doing? With some modesty, I’ll tell you that we were pleasantly surprised that Equal Opportunity magazine, which is a career magazine for minority graduates, recently picked

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Diversity in Engineering: Managing the Workforce of the Future Parsons Brinckerhoff as the fifteenth best employer for minorities in the United States. This was not just in our peer group of engineering design firms. We were listed with companies like Microsoft and Dell and Intel, and we were ranked higher than McDonald’s, Ford, and Yahoo. Of all of those companies, we were one of the best for minorities. In our own peer group, just this month Civil Engineering magazine rated Parsons Brinckerhoff the eighth best place for civil engineers to work. The competitors that did well were smaller companies, including CH2M HILL, which is a very good employer. I want to highlight a few of the programs at Parsons Brinckerhoff that are especially important for global diversity. In 1997, our CEO and human resources director decided that so many factors affect our workforce beyond the traditional human-resources factors that we should establish a committee that would answer directly to the CEO on diversity issues. We now have four focus groups to help with employment issues, including development issues, recruiting and retention related to women, African-American, Asian-American, and Hispanic-American employees. The women’s group is the oldest, and we sometimes joke that PB stands for “pushy broads.” This group has tackled one issue related to global diversity—that the company had no women of any stature outside of the United States. We did a survey of managers outside the United States to determine their attitudes and found that their attitudes toward women were positive. Managers who had worked with a woman overseas were receptive to the idea of international assignments for women. We then surveyed our women who had worked in our offices abroad and used the list of women who thought things had gone well for future assignments. The company subsequently adopted diversity policies for our global presence that reflect our climate and our managers’ expectations. We noticed that our turnover rate for young professionals was a lot higher than we wanted, so our chairman went out to lunch with a group of young professionals to find out what was on their minds. He learned that they felt they didn’t have enough exposure, didn’t have enough leadership opportunities, and didn’t have enough say in how the company was run. To address their concerns, we created a professional growth network that includes employees in the United States, Asia, and Europe. The participants, who have less than 10 years of experience, have taken on improving college relations, sponsored competitions, provided mentors, and welcomed new people and shown them how to get things done. Our turnover rate has dropped, and the program has given us access to the next generation of leaders. We have also developed practice area networks. We now have about 50 of them related to the disciplines of the people we hire. There might be one mechanical engineer in Tampa and one in Seattle, for example, both in big offices, each one the only representative of that technical specialty. But they do not feel isolated because they are part of a network of mechanical engineers around the world. These networks also are great resources for employees who need advice. We have created networks in 50 different disciplines, and, all of a sudden, we

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Diversity in Engineering: Managing the Workforce of the Future had created a knowledge-based company. For example, let’s say a client asks us if we have any experience using license plate matching for origin destination studies with a certain camera technology. We can send a request out on the appropriate company networks, and we may get 15 e-mail messages back describing experiences in various places. We can then gather the information and pass it on to the client. I have highlighted only a few of our many programs. The global marketplace is already at the door, bringing tremendous opportunities for all of us in engineering fields. Summary of Discussion Gary Downey Virginia Tech Our topic, globalization, is not easy to grapple with. We were fortunate to have an excellent presentation by Lisa Nungesser from Parsons Brinckerhoff, which is out front in thinking through the question of global diversity. We had a wide ranging discussion with some significant disagreements, especially in the first session, and a combination, I think a healthy combination, of optimism and pessimism. Sometimes the optimism was stated more explicitly than the pessimism, but both were clearly present. First, we pieced together some questions from the various comments. What sort of phenomenon is globalization? What new demands do we face because of globalization? What are the key characteristics of workers in a global marketplace? We spent most of our time in both sessions talking about the interesting challenges facing local divisions or local companies and branch offices located offshore or outside the United States. Finally, what best practices exist in industry and in education? Globalization involves doing business in a borderless market, a world in which workers are valued for their knowledge, which calls attention to their education and training. Peter Drucker describes the emerging global workplace as being characterized by a new “social complexion.” The pun regarding race and gender is probably intended. Globalization involves a larger dimension of diversity, and one person suggested that we think about it in terms of “inclusiveness.” Does diversity mean different things in different places? Clearly it does. To the extent that it does and to the extent that there are new dimensions under the label of diversity, we have to be careful to keep the problem of underrepresentation and inclusiveness in mind and not let them be overlooked because of important cultural differences. What does globalization mean for the poor? Is globalization an exciting opportunity? That is one area where we had significant disagreements, but we didn’t pursue the subject very thoroughly. Finally, one person suggested that globalization is absolutely necessary for building a sustainable world.

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Diversity in Engineering: Managing the Workforce of the Future What sorts of new demands are created by globalization? In the construction market, the global market share for U.S. companies has dropped from 50 percent to 25 percent. So our organizations must focus intensely on quality and responsiveness. There are significant variations by industry, which is certainly an important area to study. Globalization also raises concerns and creates dangers. Is there a loss of jobs or a potential loss of jobs for U.S. engineers? What are the implications? What about domestic education? If we are competing globally for a fixed labor pool, isn’t this another reason for expanding the domestic pool of engineers? Finally, it is important, especially in the wake of September 11, that we understand global diversity inside the United States. People from many countries died on September 11, but in many places non-U.S. born populations in this country are relatively invisible. Worker characteristics in an environment of globalization must include not only technical capabilities, but also other sorts of skills. Workers must be people-oriented, able to wear multiple hats, and be well versed in the business, as well as the social and litigious nature of today’s society. We spent most of our time discussing the issues facing the local division of a company operating outside of the United States. Each company operating outside the United States must address the question: Am I a visitor, or am I here for the long haul? If I am here for the long haul, I must make a serious commitment to accommodating myself to the environment in which I am working. But the issues vary from country to country, and companies must tailor their programs appropriately. Companies need a top-down commitment to inclusiveness, whatever that means in the local context. Even the word diversity can get us into trouble. The word means different things in different places, and we need to be more sensitive to that. This is an emergent issue that was identified in a recent Catalyst report, Passport to Opportunity: U.S. Women in Global Business (2000). The second group spent some time discussing the problems of two-career families. What happens when a spouse, whether female or male, would also like to work in another country? We also spent a lot of time talking about what I would characterize as “somebody has to understand the Russians.” Bob Spitzer talked about Boeing’s experience in Russia and described the qualities of the Russian engineers, who are quite good and sometimes even embarrassed the Americans. It is important that we understand these people. Over the course of two sessions, a number of examples of cultural differences were raised. A woman leader is perceived differently in Taiwan and Brazil and in Japan. We heard a story about an e-mail joke in South Africa that was considered very funny in South Africa but would be considered sexual harassment in the United States. Malaysia has hiring quotas, and you had better follow them. The population of Turks in Germany is increasing. Should global diversity managers be knowledgeable about demographic trends and try to build their companies in a way that anticipates demographic changes? Workers in London tell us to stop sending Americans to be their bosses. That is a diversity

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Diversity in Engineering: Managing the Workforce of the Future issue for Duke Energy. If we sell airplanes to Spain, we should hire their workers as well; we had better locate some kind of a production and research outfit in the country. As we develop linkages, many different types of questions will arise that will involve our understanding perspectives that are different from ours. This was a common theme in our discussions. Finally, we must be careful about imposing U.S. expectations on people in other countries. The cell phone and beeper are anathema to engineers in some cultures, and the idea of being accessible 24 hours a day is repugnant to some people. There was a brief discussion about the current European slow movement, which is characterized locally as resistance to Americanization. Many Europeans understand globalization as Americanization. I’ll give you a quick summary of a few of the best practices we discussed. First, it is important for companies to conduct research across divisions, to constantly monitor and understand the organization. Second, it is important to develop a global diversity policy. Parsons Brinckerhoff, for example, developed a professional growth network by country, not continent. It is possible now to build practice-area networks, in which all of the mechanical engineers knowledgeable in such and such an area can form a virtual group and mentor one another across national boundaries. A big issue for any company that does business in more than one country is certification. The requirements for engineers and licensed engineers varies from country to country. Europe, in particular, is struggling to develop a concept of the European ingenieur. I am purposely using the French word for engineer, but the big challenge was how to license British engineers, which the French and Germans opposed. Certification is a difficult issue. A global diversity policy should be incorporated into every division of the company throughout the world. We spent a fair amount of time talking about language training. This summer I took a group of women undergraduate engineering students to Paris for two weeks. We visited Renault, where a woman engineer, who had come originally from Purdue by way of Germany, and is now a senior manager, argued for the importance of language training. Until she developed language skills, she said, she had trouble finding work in Europe. Joan Straumanis from the U.S. Department of Education described the University of Rhode Island double-degree program in engineering and German, specifically for German-speaking engineers. It is important to preserve heritage languages so these are not lost. We need to take advantage of people’s capabilities, including their knowledge of languages. This raised the general issue of helping engineers to be open to other cultures, which led to a discussion of engineering and the humanities and a course called Engineering Cultures that is now available, or soon will be available, as a continuing education tool for engineers interested in learning about Japan, Europe, and Russia; down the road other modules will be available on Korea, China and Taiwan, India, Mexico, and Brazil. The course is designed specifically for

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Diversity in Engineering: Managing the Workforce of the Future continuing education purposes, and the goal is explicitly to help engineers understand other engineers raised in other national cultures. The course will also be available as modules or as a one-semester course for students at the undergraduate level. Lastly, Great Leaders See the Future First (Dearborn Trade, 2000) by Carolyn Corbin, was recommended to us. Corbin includes information on demographic trends in her discussion of global diversity.