CVS Caremark Corporation

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1 CVS Caremark Corporation Supporting the Diversity Mission Through Colleague Resource Groups Catalyst Perspective Employee resource groups (ERGs) are a core component of many organizations diversity and inclusion efforts. As outlined in the six-part tool series The Catalyst Guide to Employee Resource Groups, ERGs can be a valuable resource to a broad and diverse range of employees as well as to businesses at large. Welldesigned, well-integrated, and sustainable ERGs can play a critical role in creating inclusive cultures and, if designed as such, in driving business results. This Practice featuring CVS Caremark s Colleague Resource Groups (CRGs) demonstrates key elements of successful ERG design, implementation, oversight, and activity. Of particular note are the organization s approach to overcoming challenges; the strong and well integrated connection with the business case and the organization s strategic diversity management mission thanks to a clear value proposition and holding CRG leaders accountable for executing that vision; and a diverse range of activities and opportunities, including mentoring and feedback forums, that raise the CRGs from affinitybased networking groups to career-development and business-outcome driven resources for individual employees and organizational leaders alike. History and Launch of the Activity, Program, or Policy CVS Caremark has a deep history of commitment to diversity and inclusion. The organization s strategic diversity management mission is to drive individual growth by making sure to access 100% of 100% of colleagues; in essence, to get the most out of employees by giving everyone the opportunity to bring their whole selves to work and leverage their full potential. Achieving this mission is based on efforts across four key pillars, all targeted at driving business outcomes. 1. Workforce representation speaks to the demographic makeup of the employee base, ensuring a diverse talent pool that mirrors customers and communities served. 2. Colleague engagement centers on creating an inclusive organizational culture that embraces both attribute and behavioral diversity emphasized in the first pillar. 3. Talent systems is comprised of what is referred to internally as the four P s: policies, practices, programs, and procedures all in support of managing the diverse talent within and across the organization. 4. Marketplace diversity focuses on four C s: customers, clients, communities, and constituents covering the full spectrum of the CVS Caremark external stakeholders that are invested in and affected by how well it manages diversity. Catalyst

2 CVS Caremark is dedicated to educating, equipping, and empowering all employees to own the organization s diversity mission and the work that centers on it. The company s philosophy is that diversity management is not a function of department or title, it s a business process. Nor does it belong solely to the Chief Diversity Officer (CDO) and the Strategic Diversity Management (SDM) team, the two corporate entities responsible for ensuring that the right strategies and tools are put in place. CVS Caremark s philosophy is anchored in the belief that it takes each of the over 200,000 employees across the organization to manage diversity. One of the principal ways the company can accomplish this is through the Colleague Resource Groups. Strategy of Activity, Program or Policy CRGs were initially designed as networking groups, with an early focus on facilitating internal connections, annual engagement survey scores and community service. Over time, the scope of the groups purpose and activities expanded and with that came a change in nomenclature from networking groups to Colleague Resource Groups. The intention of the re-naming was to reinforce the new value proposition of the CRGs: that employees, and therefore the employee groups, are a resource to the organization and its leaders in driving business results. Carefully selecting an appropriate name was seen as a critical first step in communicating the scope of the work of these groups and the concept that they are a resource that drives business. Networking and service remain central to the CRG efforts and activities, but no longer represent their full mission. As of early 2014, there are 12 CRGs in existence, with 27 chapters across the United States. CRGs are generally constructed around shared interests or affinities and include everything from nationality and race/ethnicity-based groups (e.g., Asian, Black, Latino) to LGBT, health and wellness, veterans, younger generations, people with disabilities, and family-focused groups, among others. The Women s Success Network was one of the first to be established, as it had already been in place for over six years, and today has a membership of over 1,000 employees. The most recently formed CRG, Fit Club, started in 2013 and focused on health and wellness, broke over 1,000 members in its first six months of existence. These two CRGs currently have the most members. Infrastructure and Oversight All CVS Caremark s CRGs are the product of voluntary efforts, from their top leadership to frontline employees. They are open to all employees and benefit from the support and engagement of colleagues across the organization, from diversity oversight at the Board of Directors level through to the enthusiastic participation of field retail employees. All members of the Executive Steering Committee, comprising the CEO and the CEO s direct reports, sponsor at least one CRG. Sponsors are asked to commit to the role for two years. They provide a senior executive leader voice of the CRG to the CEO and also champion the CRGs with company leadership such as the Diversity Leadership Management Council, a group made up of 15 senior leaders from around the company at the VP level and above. In addition to this Catalyst

3 executive-level involvement, the Strategic Diversity Management Department (SDM) team provides high-level support and guidance to the CRGs in the alignment and delivery of their mission and goals with the broader organizational diversity management strategy. There is a designated program manager on the SDM team who is responsible for tracking metrics such as membership, both to ensure accountability and to help support activism and membership. This SDM team member also holds monthly meetings with CRG leaders. The SDM team also serves as a liaison for the CRGs with other key stakeholders, approves annual funding, drives branding and communication, and facilitates succession planning for CRG sponsors and chairs. Overall, the company s approach to CRG management and oversight is one that recognizes that one size does not fit all. There is a concerted effort to balance centralized governance, which provides uniform supports and consistent integration into the rest of the business, with local empowerment that allows tailored approaches to executing the CRGs individual visions. CRGs are spread across CVS, including some retail, field-based and distribution center groups. To maintain employee activity and engagement, chapters must have at least ten colleagues as active members and a business plan that rolls up into the national CRG s agenda. Each chapter is also required to have a chairperson at the director level or above to ensure sufficient autonomy to make decisions without having to go through multiple layers of approval. Outside of recognized chapters, individuals who may not be able to collect ten members for a chapter can still be part of the national group by joining conference calls, attending meetings and events virtually, or connecting to the CRG through , company intranet, etc. CVS Caremark noted that a number of contractors were attending different monthly cultural events, demonstrating their interest and engagement. In response to this display of interest, CRGs were opened to contractor and temporary employee membership as of the first quarter of These employees can now attend events and sit on committees, though they cannot serve in leadership roles. Key Programmatic Elements For employees across the organization, membership in a CRG provides a number of benefits. Visibility and access to senior leadership is often a big draw for employees, as CRGs provide an opportunity to meet and work with leaders who they might not otherwise have encountered. In addition, employees from across the distinct business units at CVS Caremark who might not otherwise have the reason or the opportunity to interact are able to come together in the CRGs, connected by a common ground. Leadership development and skill building are also key components of CRG participation, particularly for those employees who take on one of the many leadership roles, for example chapter chair or committee lead. For many administrative and front-line employees, these positions represent leadership opportunities that they may not always have access to in their day jobs, providing an invaluable chance for skill building and career development. Catalyst

4 Along with the broader scope of networking and skill building both related to career development and diversity management CRGs provide a number of activities and events for individuals centered on their chosen affinity or interest. In addition, a significant responsibility of being a CRG member is a willingness and ability to serve as a representative of the company and be a force multiplier for the company s focus on diversity internally and externally. Members are therefore expected to have a desire to continuously educate themselves on the evolving issues of diversity management. Workshops, panel discussions and presentations, guest speakers, cultural events and celebrations, cross-group collaborations, and community engagement are some of the many ways in which CRG members are exposed to educational and awarenessbuilding opportunities across a broad array of diversity topics. Finally, CRG members also engage in two key activities that have proven to be of interest and beneficial to the groups across the board: mentoring and community engagement. Mentoring: As the CRG program expanded, the organization reached out to employees to ask how it could better support the groups and serve the needs of their members. The number-one response was a call for more mentoring and sponsorship opportunities. This overwhelming request for additional supports in establishing such relationships led to the development of a robust online mentoring service and knowledge-sharing tool. A well-received mentoring program started by the Women s Success Network was already in place, but difficult to take to scale. Leveraging feedback from the CRGs, the organization chose to partner with an external web-based social learning and mentoring service to construct and implement an enterprise-wide mentoring program which could be rolled out to all CRGs. The program, called Colleague Connect, can be accessed by all employees using an address, including personal addresses. In this way, all employees, including those without a company address (such as hourly workers), are able to access the service. Mentors and mentees are referred to as advisors and learners, and interact within a one-to-many approach to mentoring and social learning. Mentoring is not always provided by a senior employee to a more junior colleague. Instead, learner-advisor relationships can be bi-directional and are based on skill sets of interest, which can be held or sought out by anyone. As an example, a seniorlevel employee may be interested to learn more about leveraging social media and can identify an advisor who may be junior to her who is able to teach her about the subject. Mentoring connections are generally focused on career development and have a direct line to the organization s competency model, helping employees expand their knowledge and skill sets. Starting a new mentoring relationship in the Colleague Connect system is termed opening an engagement, and can be initiated by either a learner seeking an advisor or an advisor offering to support any interested potential learners. Employees can declare themselves in the system as an advisor and/or a learner from the outset, but can also search by keywords and join an engagement based on a topical interest, deciding after finding an engagement whether they would like to join in the role of a learner or an advisor. Catalyst

5 Volunteering & Community Engagement: Colleague Resource Groups have shown a strong desire to help their communities and have embraced opportunities to volunteer. CRGs participate in many community events and support local nonprofit organizations. Giving back to the communities in which CVS Caremark operates aligns with the organization s purpose of helping people on their path to better health, as well as the communities aspect of its diversity management mission. CRGs are provided a six-page guide with stepby-step instructions for engaging in volunteering and accurately tracking volunteer hours. Volunteering engagements are logged using Community Crew, an online portal accessible to all CVS Caremark employees that helps them search for volunteer opportunities, log and track volunteer hours, connect with colleagues, create group events, and donate to causes they care about. Each CRG has its own group page on the portal. The organization believes strongly that its employees can be a great resource to the communities where they live and work, and is proud to facilitate and support their service and engagement. In fact, when a group volunteers more than 50 hours for one nonprofit, that nonprofit becomes eligible to receive a donation through the Volunteer Challenge Grant program made possible by the CVS Caremark Charitable Trust, Inc. These grants, ranging from $500 $2,500, are made to eligible 501c3 public charities or public schools located in the United States, and provide financial support for hundreds of nonprofits each year. Success Factors: One key to the effectiveness and sustainability of the CRGs is the extensive support and guidance they receive. A robust library of presentations, flyers, and step-by-step guides outline nearly every aspect of the CRG program, from business-plan templates, to member roles, to communication forms. Additionally, events and other pertinent updates are shared across the organization in a number of ways. The organization s intranet hosts a calendar of events for employees, an all-colleague newsletter regularly communicates the benefits of CRGs, closed-circuit TVs in a number of corporate offices display CRG key messages, and posters placed in each of CVS 7,600, stores nationwide display information about CRGs. In-store posters also have QR codes which employees can scan with their smartphones, directing them to a site where they can get more information about CRGs and how to get involved. These widely distributed, readily accessible, easy-to-use, and comprehensive materials can be credited with much of the CRGs growth, and also with their ability to function with a considerable degree of autonomy while staying true to the organizationallevel infrastructural requirements and strategic priorities. A second success factor for the CRGs is their role as a formal mechanism for employees to provide feedback on strategic initiatives. The groups provide a channel through which colleagues across all business lines and levels of the organization can communicate up about issues, concerns, and suggestions relevant to their experiences at CVS Caremark and in the broader community. The company taps into this great resource for feedback and information by sometimes calling on a CRG to serve as a sort of learning laboratory or focus group. For example, the President of MinuteClinic, the retail medical clinic division of CVS Caremark, used the Latino CRG to help him and his leadership Catalyst

6 team understand how that part of the business could best serve the Latino population. As part of the process, CRG members were provided questions to discuss in focus groups, and also asked to go home and ask these questions to their families and neighbors, soliciting further feedback from the community to help the business best meet the needs of its clients and customers. Likewise, the LGBT-focused group, C-FI (Colleagues for Inclusion), was consulted to provide advice on restructuring benefits in response to the repeal of DOMA. Driven, the CRG for millennials and other early career employees, was asked for feedback regarding CVS Caremark s presence in the digital space and how the organization can best leverage technology. Challenges: One of the challenges that the CRG program is currently addressing is the perception that participating employees have to be of a certain affinity to join a CRG, which is not true. You don t, for example, have to be a woman to be in the Women s Success Network. In response to this challenge, the company s CDO, David Casey, created a video stressing the openness of the CRGs and encouraging everyone to be a part of a CRG. The video was posted on the organization s intranet and a version for the external company website is in production to be used as a recruiting tool. This communication strategy, among others, has already resulted in some traction, with several of the CRGs showing a more mixed membership. Funding can also be a challenge, particularly as it pertains to funding budget growth to match membership growth. A number of options are in consideration as part of ongoing efforts to figure out how to effectively and fairly allocate monies. A set amount of funds is allocated for the CRG program at large. Whether that budget should be allocated to individual CRGs based on size and activity level, or simply distributed equally across all groups regardless of scope and engagement level, remains a challenging question. Currently each CRG is allocated the same amount, but the issue is under discussion. CVS Caremark s retail-based structure and geographic spread constitute another significant challenge. The company currently has more than 200,000 employees in 45 states, the District of Columbia and Puerto Rico, with the majority of employees working part time in a retail environment. This makes it difficult to reach out to those employees and sustain their involvement. Turnover is not uncommon among those positions, so continued commitment in a CRG is not guaranteed, leaving CRG leaders having to continuously re-start the process of engagement with new employees. Also, the voluntary nature of CRG participation means part-time workers are not paid for the time they dedicate to the group. The most successful response to these difficult challenges is clear and effective communication of the value proposition of CRG membership. Demonstrating that most of the CRGs offer some form of training and development, cultural competency training, mentoring, and access to senior leadership provides a considerable draw for employees. Helping all colleagues understand the what s in it for me? value proposition is critical for encouraging participation. Catalyst

7 Catalyst Change Drivers 1. Connection to the Business Case CRGs are strongly connected to the four pillars of CVS Caremark s diversity mission: workforce representation, colleague engagement, talent systems, and marketplace diversity. This integration with the business case and broader diversity work is achieved principally through the CRG planning infrastructure. A group cannot become a recognized CRG unless it submits, and gets approved, a business plan that addresses all four pillars. The business plan of every CRG must speak to: 1. How it will help recruit talent (generally associated with whatever affinity is associated with the group, e.g., a disability CRG will support the recruitment of people with disabilities). 2. How it is going to mobilize employees to get involved and be engaged in creating a culture of inclusion. 3. How it will help drive some of the talent systems such as mentoring and leadership development. 4. How it can help the organization meet its marketplace objectives and be a company of choice for the diverse demographics the organization serves. In this way, CRGs are not just internally focused, but are expected to assist CVS Caremark in better serving its customers. To facilitate this process, all groups are provided a business-planning template. In the format of a simple, easy-to-follow PowerPoint deck, the template asks employees to identify a few bullets under each of the four diversity management mission pillars to demonstrate how their CRG is going to support those efforts and help the company execute its strategy successfully. The CRG must also identify its executive sponsor and other key elements of infrastructure, including a proposed annual budget and mission and intent statements. 2. Senior-Level Leadership/Involvement The organization s most senior leaders are sponsors for the groups as part of their roles on the Diversity Steering Committee. This demonstrates senior-level commitment to diversity, and a willingness to not only talk the talk but also walk the walk by giving time and role modeling behaviors that foster diversity management. Having senior-level sponsors also buffers against pushback from mid-level managers who might be concerned about their direct reports committing time to this extracurricular when they have targets to meet and other business priorities. The participation and leadership of the company s most senior executives sends a clear message that the CRGs are valued, worth everyone s time, and should be supported at all levels. There is also a key distinction between leadership support and leadership participation a point that is made clear in the executive sponsor toolkit outlining the roles and responsibilities of CRG sponsorship. Sponsors are accountable for helping to make sure the CRGs are connected to strategic business objectives and are expected to be a verbal and visible champion of the work of the CRG, attend key events, help complement or supplement the CRG budget from corporate diversity (e.g., with extra funding for internal training and development), and make decisions to help execute the CRG business plans. Catalyst

8 The Impact of the Activity, Program, or Policy Total participation in the CRGs has grown from about 500 at year-end 2011 to about more than 4000 at year-end The goal is for 9% participation across all employees non-exempt employees and 20% of all exempt employees in the next three years, which would amount to about 20,000 individuals. Many success stories have also emerged from the CRGs. For example, the CDO hired two people on his team due largely to his exposure to them as CRG leaders. These two individuals did not work in the same part of the organization as the CDO, but he was able to see them in action in their leadership roles within the group and then act on their potential. This is one of many stories of how the increased visibility and leadership skills that can be built through a CRG have led to positive career outcomes, such as promotions and expanded roles. Organizational Information Founded in 1963, CVS Caremark is today the second-largest drugstore chain in the United States, as well as a leading pharmacy benefits manager. The company has over 7,600retail pharmacies, more than 60 million plan members, and a retail health network consisting of over 68,000 locations across the United States, reaching approximately 6 million customers daily. The company s net revenues are currently more than $126 billion. Catalyst

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