What Intel's $US300 million diversity pledge really means

Intel's chief diversity officer Rosalind Hudnell

As controversy flares over workforce diversity in tech, Intel's Rosalind Hudnell is working on an ambitious plan to spark change that could forever alter hiring practices at IT companies.

She realizes, though, that change has to start from within the company, and that it won't come overnight. Hudnell, Intel's chief diversity officer, is responsible for implementing the company's much-publicised $US300 million initiative to bring more women and under-represented minorities into its workforce by 2020. The challenges are many.

The effort comes as an intense debate rages over what's perceived as the technology industry's sexist culture. Microsoft's CEO Satya Nadella, for example, apologized after igniting a firestorm when he said in a public interview that not asking for pay raises is "good karma" for women.

Intel itself was flamed for stumbling into the controversy over GamerGate, the amorphous movement that targets women's influence and participation in gaming. After the movement's supporters complained to Intel about Gamasutra, which publishes game-industry news and has been critical of GamerGate, the company pulled ads from the site. Intel later apologized and reinstated the ads.

Though some companies have taken gradual steps to break Silicon Valley's dominance by white and Asian males, efforts have been inconsistent.

Intel - which had 107,600 employees worldwide at the end of 2013 - employs just 24 per cent women and 4 per cent African-Americans in its US workforce. Those percentages could be improved, said Hudnell.

"We are diverse, but not diverse enough," said Hudnell, an African-American who joined Intel in 1996 after working in the publishing and cable television industries.

Some of Intel's top executives are women, including Renee James, who is president, and Diane Bryant, who runs the company's most profitable unit, the Data Center Group. Intel already provides same-sex domestic partner benefits; it also offers LGBT (lesbian, gay, bisexual and transgender) and faith- and culture-based resources to workers. But gender and race diversity is complicated, and Intel knows workforce parity won't come overnight.

Intel is establishing specific numbers on hiring a more diverse workforce and tying executive compensation to meet those goals, though plans haven't been finalized. But even with Intel's renewed commitment to diversity, the company's workforce will still be just about 32 percent women in five years, Hudnell estimated.

Most of the $300 million earmarked for diversity comes on top of what Intel is already spending, though some of the money is being diverted from current expenditures, Hudnell said. The funds will be applied over five years to change hiring practices, retool human resources, fund companies run by minorities and women, and promote STEM education in high schools.

A diverse workforce is critical in defining corporate culture, competency and values so organizations can function efficiently, said Aditi Ramesh, the female CEO and co-founder at startup firm Plause, a platform for showcasing university student talent. "We need to formulate the appropriate organizational structures from a psychological standpoint as well as technical to better form the company culture for future growth," Ramesh said.

Beyond advancing a societal goal, Intel's efforts to create a more diverse staff could help sell more products. At heart, Intel is a chip company, but it has started to play in areas like wearables, robots, mobile devices and augmented reality. Products are being tailored for different demographics, and "diverse experiences lead to different input, which leads to different engineering solutions," Hudnell said.

A major hurdle, though, is competition to acquire talent. Men who have a bachelor's degree are "overrepresented" in STEM (science, technology, engineering and math) careers, according to a study by the U.S. Census Bureau released last year. The bureau estimates 74 percent of computer professionals and 86 percent of engineers are men.

"In the end, we still have more men in the talent pool that's available," Hudnell said.

Intel aims to build a larger pipeline of qualified candidates over time by investing in STEM education.

It's hard to say whether $US300 million is enough for Intel to achieve its diversity goals, but it's a start, said James Challenger, CEO at Challenger, Gray and Christmas, an outplacement firm.

"If it's successful, and has an impact... then you go back and see if it worked before investing more money in it," Challenger said. "It's unfair to say they could do more. A lot of companies are doing nothing."

Intel's efforts are admirable, but should be carefully monitored, said Gaya Nadarajan, a computer scientist working in South Korea.

"Giving a position to someone just because she is female, but doesn't do the job well, is only going to cause a stir among the male colleagues. Same with race," Nadarajan said. "As long as they employ the right diverse people it should be a step in the right direction."

Nadarajan, who received a doctorate in the field of IT in the U.K., said being a woman in a male-dominated field can be overwhelming, and noted women in technology tend to become entrepreneurs or move on to academia or other careers, she said.

A good remedy is to make males and females work together in small groups, Nadarajan said. Women should also be given more responsibility and management roles, she said.

Intel is monitoring its diversity initiative based on 59 measures related to gender, race, education and corporate role. For example, Intel wants employ more women, Hispanic and African-Americans in technical and engineering roles, which are dominated by white and Asian males. A diversity goal for the technical group will be different from the non-technical group, which employs a larger percentage of women.

Diversity goals are still being communicated, but business processes like hiring will experience big changes. Intel will try to pair applicants to interviewers they feel comfortable chatting with. For example, a woman applicant for a technical job may be interviewed by a woman. The company is also moving to diversify its group of hiring managers.

"You have people who by nature make decisions in favor of people like them, and when the majority of the workforce is men, then you have to put [managers] in place to ensure women have equal access to opportunity," Hudnell said.

Intel will also step up investments in companies run by minorities and women. That means change for the capital investment program, which is known for relying on word-of-mouth for funding decisions and being unresponsive to companies seeking investment.

"We'll be very clear and transparent about what we're looking for," Hudnell said. "We'll have a diverse advisory board that will probably make those decisions," Hudnell said.

Intel's effort to promote STEM education in school will most likely start in working class areas in Oakland and East Palo Alto. In a study released last year by college admission test maker ACT, only one in 10 U.S. high-school graduates were interested in STEM careers.

The education and mentoring portion caught the ears of Kymberlee Weil, who is the co-founder of software firm Intronetworks and also runs consulting firm Strategic Samurai.

Pouring more resources and money into STEM education and mentoring is often overlooked, Weil said.

Weil was nudged into the technology industry after hearing a speech as a student from entrepreneur Lynda Weinman during a conference in 1999. She eventually wrote technology books and founded companies.

"We have an opportunity to become resourceful and encourage exploration into STEM at a very young age," Weil said.

Hudnell agreed, noting that in the US., regardless of race, the top factor for young people going into technology is a parent, relative, teacher or role model connected to the industry.

Intel also wants to drive change at the industry level. Hudnell is working with peers to build a "guiding coalition" for the IT industry to standardize reporting on diversity data, and to create a blueprint for other companies to put a diversity plan into action.

"We're also getting interest from other companies who say 'Hey, we'd like to know where you're going to invest, and we'll piggyback off of you,'" Hudnell said.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for IDG News Service. Follow Agam on Twitter at @agamsh. Agam's e-mail address is agam_shah@idg.com