Gwen Houston: Agent of Change

Gwen Houston is no stranger to change, which is a good thing for the general manager of global diversity and inclusion at Microsoft Corp., a company that replaced its CEO and chairman this year.

Houston’s history has led her to not simply cope with leadership transitions but to embrace them, and she said sometimes change offers the best opportunities to advance a company’s engagement in diversity and inclusion. “When companies are experiencing some level of growth, they’re likely to be more reluctant to change. They’re not perhaps as motivated to accelerate their level of D&I engagement.”

As a child in the 1960s in Lafayette, La., Houston was a witness to a population reluctant to embrace diversity. In the heart of the Cajun community, the people were friendly and the air hummed with the fullness of life, but the Jim Crow era hadn’t left yet. Until she was 9, she sat in the balcony of local movie theaters, entered doctor’s and dentist’s offices through the back, and drank from separate water fountains.

But in 1968, the year of Martin Luther King Jr.’s assassination and many Southern demonstrations, Houston’s life changed. With schools desegregating, her parents decided to enroll her in a traditionally all-white school halfway through her third grade year. They believed that people were taught to hate as they grew up and hoped that Houston, the youngest of their three children, would be more open to diversity.

“I can’t imagine making that choice for my kids, but in the end it was the best gift they could have given me,” Houston said. “It prepared me to live in two different cultures. … It helped me to be much more assessing in how I relate to all kinds of people.”

A Nonlinear Path
Such empathy toward varying cultures continued being an asset for Houston, who went on to be a Truman Scholar in college, which is awarded to students interested in public service, before working as a governmental policy lawyer in Texas for 10 years. But as the late 1980s sapped oil money out of the state’s economy and exhaustive legislative sessions sapped passion out of Houston, her mind turned to a more professorial position. When she was offered a job at Missouri’s William Jewell College, where she would teach legislative process to “bright-eyed, incredibly smart and ready-to-change-the-world” Truman Scholars during the summer, she took it. “I thought I’d rather work with young minds than try to do tougher things with those who are a little more set in their ways.”

Although Houston said it was one of the best jobs she ever had, after two years she relocated to the University of Memphis in Tennessee as an adjunct professor and eventually would start on a zigzag path to Microsoft.

By 1993, she was working at FedEx Corp., the town’s largest employer, and faced many of the same attitudes she had as a child. “Memphis at that time was still a very racially polarized environment and at times a very segregated work environment,” she said. “The leadership knew they needed to address this or else new business growth would never occur in Memphis, and companies would move out.”

One way the shipping company approached the issue was through an initiative that promoted the number of female- and minority-owned businesses. Houston had never heard of the initiative, but early on the training exercises awakened issues she hadn’t thought about in a long time —memories of separate water fountains, theater balconies and back-door entrances.

“I was much more conscious of how so much of what we are taught early in our lives can still bring about unconscious bias in the way we behave,” Houston said.

Being able to teach others how to retrain the brain left a deep impression on her, and she realized that being part of an organization’s diversity initiatives was the place for her.

After the program succeeded at FedEx, Houston transferred to the Memphis Race Relations and Diversity Institute, the nonprofit organization that had done the training at FedEx and which was funded by many large corporate entities. It meant a cut in pay, but it also meant focusing on helping the city flourish as a diverse business community, including when Nike Inc.’s two biggest distribution centers moved next door to FedEx.

After learning how to deliver diversity training and education at the new facilities, Houston went to work at the athletics company’s headquarters in Oregon to design and execute an internal program focused on supplier diversity and community outreach.

Four years later, she crossed the country again, this time to Aetna Inc. in Hartford, Conn. “For the first time in my career, I saw an executive leadership team that modeled diversity, not only in terms of representation but in terms of perspective, impact and influence within the company,” Houston said.

But even though the company had been dedicated to diversity and inclusion for 20 years before she arrived in 1999, change was still afoot. Within her first year, the company that had offered a wide array of financial and health care services sold off most of its business branches to focus solely on health insurance.

The transition meant a disruptive cleaning of the C-suite and the installation of new leadership that not only embraced her work but wanted to take it to a higher level. “In my five years there, I experienced the greatest professional growth relative to advancing my initiatives for the company,” she said.

In 2004, however, Houston faced another change, this time in her personal life. Her sister’s family moved to Philadelphia, and Houston wanted to help raise her nephew. She didn’t stay unemployed for long, however, and was soon hired by the Campbell Soup Co.

“Everybody has some level of personal story and nostalgia around the comforts of Campbell’s soup in childhood,” she said. Working for them in Philadelphia gave her a chance to contribute to two upbringings: her nephew’s and America’s. The position would also mean entry into a new industry and provide another way to advance professionally.

Little did she know Campbell’s was about to experience something new, too. The CEO, Doug Conant, had moved into the top position just two and a half years before her, and the family-owned company was in survival mode. “Doug wasn’t as interested in hearing my strategy and understanding how diversity and inclusion could really help us grow strategically in the new market,” Houston said. “Finally I got in his ear, and he became one of the most well-versed and dynamic leaders on the topic.”

Just Keep Swimming
By the time Houston left in 2008, after building the company’s program from the bottom up, Conant was named CEO of the Year by Diversity Best Practices and went on to win the Catalyst Award prior to his 2011 retirement. Meanwhile, Houston was on the other side of the country.

Houston knew Conant was planning to retire, and Microsoft was calling. That didn’t make the decision easier, however. “Not only was I leaving a great CEO, but also leaving my family,” she said. “While I had some insights about Microsoft’s culture when I was living in Oregon, I wasn’t sure if it was the right fit for me.” The opportunity to grow her skills on a global platform was too good to pass up, however, and in September 2008 she became the technology titan’s general manager of global diversity and inclusion.

Lisa Brummel, executive vice president of human resources at Microsoft, made the decision to bring Houston on board. She wanted to find someone who understood the company’s global perspective and culture but also “somebody who was going to integrate diversity and not necessarily keep diversity off on an island run as a separate function,” Brummel said. “What I really want at Microsoft is not to even have a diversity leader but just have it as part of our business.”

When Houston arrived, she was put in charge of making sure the strategic direction, implementation and alignment of Microsoft’s global diversity and inclusion initiatives had a maximum influence on the company’s business growth and talent strategy. But that goal wasn’t readily attainable yet.

Microsoft was stuck in its programs because of its leaders’ unorganized passion, Houston said. “While that felt good, sometimes it felt a little unwieldy. I couldn’t get my arms around all the activity. And people were doing a lot of things in the name of diversity with great intent but not great execution.”

Houston calls the situation “the Nemo effect,” in reference to Pixar’s film “Finding Nemo.” In the film, the young clownfish protagonist learns that when fish try to independently escape from a net, none of them can succeed until they all swim down together. Her job, therefore, was to get the leaders at Microsoft to swim in the same direction.

Two methods of streamlining remedied the situation. The first was a maturity model that ranks progress across teams to determine what their next steps should be depending on how far they’ve come. Also, some 2,300 managers subsequently became part of a diversity and inclusion commitment to hold leaders accountable by it being tied to performance metrics and compensation; their ability to follow diversity initiatives was reflected in their pay.

Houston said the commitment drove a game-changing approach to the employees’ responsibility for accelerating diversity and inclusion at Microsoft. “You probably hear people talk about what motivates behavior is compensation, but while that’s somewhat true at Microsoft, I think more what motivates it is competition.”

That spirit was the biggest game-changer in Houston’s work, and soon old and new programs began to show results. Microsoft’s DigiGirlz initiative — which started in 2000 and aims to expose middle and high school girls to science, technology, engineering and math opportunities — has now reached 23,000 people, three of whom now work for the company. A newer program, Microsoft 4 Africa, grows business in four countries across the continent using input from summits featuring native technologists.

A Global Lure
Less than five years into her career at Microsoft, change found Houston again. In February the company named Satya Nadella as its new CEO and former Symantec Corp. CEO John Thompson as chairman Bill Gates’ successor. Any diversity executive would feel the effects of such a shift, but Houston’s experiences have prepared her for it.

She said maintaining a stable diversity initiative has a lot to do with having a great strategy from the beginning. “For Microsoft in particular, we have had solid business strategy along the way with some shifting opportunities to rethink our business model.” She credits Nadella and Brummel with helping to build a strong foundation so that even in the midst of transition there is “unwavering leadership support.” The talks she used to have with former CEO Steve Ballmer continue to happen with Nadella, who already has been involved in championing the company’s disabilities initiatives.

Having direct leadership support and engagement is a common asset among companies facing leadership changes. Ken Barrett, General Motors Co.’s chief diversity officer, was put in a similar position when Mary Barra became the automaker’s CEO in January. Part of his team’s duties include making sure that leadership stays informed and involved in the diversity and inclusion mission. “Engagement at all levels of the organization has to be the goal,” Barrett said in an email. “We are all part of the master plan. None of us are observers. It is indeed a team effort.”

Another similarity between the two companies is their holistic approach to diversity and inclusion. Houston said that’s where she would like to see improvement. Microsoft’s strategy focuses on three pillars: representation, inclusion and innovation. Although the company embraces the first two, Houston would like to see it pay equal attention to internal stories that show how diversity in the workforce can lead to greater marketplace improvement, especially through employee resource groups and networks.

According to Brummel, Houston practices what she plans to preach. “She hasn’t done it from an ivory tower,” Brummel said. “She’s gotten out amongst the people of the team, the leaders and the employees, and she’s really driven an agenda.”

Kate Everson is an associate editor at Diversity Executive. She can be reached at