If you’ve worked in diversity, equity and inclusion (DEI) in the public sector, you’ve probably been told at least once that you need to make “the business case for equity.” This is shorthand for “show me how DEI actions will create economic benefits.”
At its best, “the business case” presents an alternative to well-worn, deficit-based narratives by illuminating the connections between us. “The business case” demonstrates –and sometimes even quantifies-- how exclusionary policies and practices hurt us all through higher costs, inefficiencies and lost opportunities.
We’ve gotten used to observing racial disparities in education, income, and employment and talking about what to do about them. This deficit-based approach is unhelpful for many reasons, including that it presents low-income people and People of Color (POC) as problems to that need be fixed, which is wrong, damaging and counterproductive.
On the contrary, “the business case” presents racial equity as an opportunity for our collective growth, with a focus on leveraging the existing, undervalued assets in our communities.
In this way, “the business case” is a welcome reframing of the issues. It can help private sector businesses understand that DEI is closely related to the bottom line. This is a good thing. But we need to be careful that we don’t lean too heavily on “the business case” framing in government because government is not a business. Public agencies are not profit-driven; they are institutions established for the common good. A focus on the business case for DEI can distort the actions governments take to advance their mission.
Let’s look at some examples. The first one shows how the business case for equity can be helpful in the government context; the second demonstrates its limited applicability.
Example 1: Bus Driver Shortage
Metro Transit, the Twin Cities’ transit agency, is experiencing a multi-year shortage of drivers. The combination of retirements and other attrition, along with low unemployment, has made it nearly impossible for the agency to keep all the buses on the road according to schedule. On some days this means that trips get cancelled, leaving customers waiting for a bus that isn’t coming. This results in the loss of customers and revenue (in lost fares).
This shortage has led the agency to think creatively about recruitment efforts, and many of their efforts fall under the banner of diversity and inclusion. They’ve asked themselves: how can we broaden our pool of applicants? How can we attract and retain diverse bus drivers so that our business can run smoothly again? The agency has used current drivers to participate in recruitment events in their own communities, including drivers from the Hmong and Somali communities. They’ve examined the hiring process to remove opportunities for unconscious bias to unfairly influence it. They’ve taken steps to make their workplaces more inclusive.
Despite these actions, the agency continues to struggle to maintain a full workforce of drivers, and likely will until the economy and larger factors shift. But their diversity and inclusion steps have helped to stem the tide; without them the agency would be in much worse shape. And the fact that the actions didn’t completely solve the problem doesn’t mean that they weren’t the right thing to do. Perhaps the agency simply needs to do more, or different, diversity and inclusion programs for bus drivers.
Example 2: Making Transit Affordable
Let’s consider another example from the same agency.
As Metro Transit considered raising fares in 2016, a proposal surfaced to allow eligible low-income people to qualify for a discounted fare. Community and transit advocates raised their voices in favor of this program as a necessary step to allow low-income people to reach their destinations, whether it is school, work, the grocery store or the doctor. They were already struggling to pay the regular fare; an increase would be an additional barrier to them.
As the fare increase gathered a sense of inevitability, the staff at Metro Transit researched program models and created scenarios to predict their impact on the budget and operations. They found that, across all models, the program would be a hard hit on the already-strapped budget. The size of the hit depended on many factors, such as the price of the discounted fare, if it would affect a person’s decision to use transit more, and how many people were eligible to enroll (and how many did).
Intricacies aside, the low-income fare, which would surely provide people access to opportunities, would have a negative impact on the agency’s budget, both in the short and long term. Not only would the agency miss out on the regular fare revenue, but it could affect the large amount of revenue the agency received from counties, which purchase and distribute fare cards to their social services clients. And in the long run, if the program is successful, and low-income people are able to be mobile and get to their destinations, their incomes will hopefully increase. While this is a welcome social outcome, for Metro Transit it often means that people no longer need their services because they purchase a car.
In the end, Metro Transit rolled out the program, which provides $1 transit fares to qualified people. Although no evaluation of the program has been released to the public, it appears that it has been successful in making transit more affordable to the people who most need it, while containing its impact to the budget. It was the right thing to do, and it’s helping people. But if staff had used only a “business case” lens it never would have happened.
Limitations
As the examples show, the “business case” can be applied in government, but it has major limitations. Clearly, it shouldn’t be the only reason for agencies to advance DEI. If decisions are made only through that lens, agencies will miss out on many effective ways they can advance their missions.
Here are some other ways it is problematic:
The language is misleading and potentially harmful. “Running government like a business” fails to recognize the fundamental differences in the sectors, including the governance model, mission and metrics of success. It takes the focus away from the people being served and shifts it to money.
It’s about putting equity in white majority culture terms. Sure, this can help people who feel unaffected by racism to see the need for action. But let’s call it what it is: self-interest. It’s saying to white people that we should care about racism because it harms us. In the bus driver example, if the agency had not faced a shortage of its usual worker pool –white men with commercial drivers licenses—they may not have done the DEI work at all. In this example, DEI becomes a priority only when other options have been exhausted.
Its application is often uneven and reflects the biases of those in leadership, who are disproportionately white men. In my experience, policy and program changes to advance DEI often face a higher level of scrutiny and analysis by leaders. In this way the “business case” supports status quo power structures over innovation and equity. Staff rarely are asked to make a business case for an ongoing program; in practice it is mostly applied to new proposals. Regarding the second example, the same kind of “business case” analysis is not applied to services that already benefit high-income riders. If it was, it would show that the people with the highest incomes pay the least for transit because of programs such as MetroPass. These subsidies to riders who are often white, wealthy and suburban would not necessarily prove to be smart business decisions.
The timing is off. Sometimes it will take a long time for the benefits of DEI to bear out. If we are only focused on the solutions that have the most immediate impact on the “business,” we might miss out on those that will have the largest benefit to the mission over the long term.
Alternatives
Despite its limitations, there can be value in showing connections and causal relationships between DEI investments and other goals we care about. But what are those goals? And who defines them?
Here are some ways government agencies can expand their thinking around “the business case” and use it to advance DEI:
Use a collaborative, community-engaged process to clearly define the agency’s goals and priorities. Sometimes agencies have too many goals, and it’s not clear what is most important. Other times the staff are focused on goals that are different than the community’s priorities. In the case of Metro Transit, the mantra has traditionally been “ridership and revenue.” While these are important for operations, they do not relate directly to riders’ experiences. More often riders want to know they can get to their destination safely and in a reasonable amount of time. A robust community engagement process can clarify what priorities are most important.
Then use these community-driven goals to screen opportunities, programs and policy changes. Apply this lens to everything the agency does, including existing programs. Everything needs to be on the table and DEI needs to be incorporated into all our actions. In this way, the “business case” analysis and an equity analysis become one in the same.
Find ways to build empathy and trusting relationships between agency staff and the people they serve. One-on-one interviews and other forms of engagement can provide context and help to interpret data, and inform what data is collected in the first place.
Think long-term. Some investments are worthwhile but won’t pay back for a generation or more.
Ultimately the “business case” is only helpful if it opens discussions around the fundamental questions, such as: Whom do we serve? What are our goals? And, how does our community define success?
But too often the “business case” framing has been used in government to benefit those who already hold the most power. So let’s just skip it, get back to basics and recognize that equity is the business of government.