Report
Inclusion Isn’t Just Nice. It’s Necessary.
How a survey quantifying the responses of more than 27,000 employees proves the business value of inclusion.
—Poul Due Jensen, CEO of Grundfos
How Grundfos Leveraged Workplace Data to Advance Diversity and Inclusion in the Manufacturing Industry
When water pump manufacturer and innovation leader Grundfos was looking to build more diversity and inclusion among its 20,000 employees, the organization partnered with BCG to launch a full-scale transformation to increase diversity and inclusion in manufacturing.
The Challenge
In 1944, Poul Due Jensen designed an irrigation pump to help Danish farmers. A year later, he founded Grundfos, now the world’s largest pump manufacturer. His company is still thriving, and so is the passion for innovation that led to its creation: Grundfos’s market-leading solutions addressing water and climate challenges have improved quality of life for millions.
In the 1960s, Grundfos was one of the first companies to design a flexible workshop for workers with disabilities. That forward thinking has led to an increased percentage of Grundfos employees who have a disability—and the company remains committed to this focus.
More recently, Grundfos set representation targets for women. While women make up 34% of the company’s workforce—well above industry benchmarks for women in manufacturing—Grundfos is actively working to increase the number of women at the company and has set a goal of achieving 27% women in leadership by 2025.
The company is now run by Poul Due Jensen’s grandson, who shares his name and, as CEO, has helped guide Grundfos’s continued success through an appreciation for diversity and inclusion in manufacturing. This progress is critical in countries such as Denmark, as the Nordic region has struggled to embrace diversity and inclusion in business.
The Approach
What does “good” look like when it comes to diversity and inclusion in manufacturing? BCG’s first step was creating a company-wide dialogue about the diversity, equity, and inclusion (DEI) topics that matter most to employees.
- Assessing Diversity and Inclusion. BCG conducted a survey of relevant DEI metrics, both internal and external. Everyone at Grundfos, from entry-level staff to top executives, was invited to express their opinions. In the end, BCG analyzed the results and developed measurable, attainable goals.
- Recognizing the Critical Need. Grundfos then conducted one-on-one interviews with senior management to understand their DEI aspirations and pinpoint “what good looks like.” Half felt that DEI was of high importance, while the other half felt it was important but not critical. As one leader commented, “DEI is the single-highest priority that Grundfos should have right now—we need diversity to keep innovating.”
- Looking Beyond Grundfos. BCG analyzed DEI data from other organizations to better understand the competitive landscape and establish tangible benchmarks and best practices for diversity and inclusion in manufacturing.
- Leveraging Tools for More Equality and Inclusion. BCG’s Workforce Inclusion Scorecard and Evaluation (WISE) tool measured representation across the full employment life cycle, which showed the need to promote women, reverse high levels of attrition in early-career employees, and address the underrepresentation of workers with disabilities or health conditions across both shop floor and office workers. (The category of “workers with disabilities” includes, but is not limited to, Grundfos employees with physical disabilities, chronic health conditions, neurodiversity, and/or mental health conditions.)
- Building an Inclusive Mindset. BCG’s proprietary Diversity and Inclusion Assessment for Leadership (DIAL) survey, which garnered more than 5,000 responses, dug deep into employee sentiment. It was also the first time Grundfos employees had been directly asked about their perception of inclusion in the workplace. Although overall feelings of inclusion were high—and exceeded industry benchmarks—some groups, particularly women and LGBTQ+ staff, saw room for improvement. Meanwhile, white heterosexual men underestimated the challenges these other groups face.
The Results
BCG used these responses to help Grundfos target opportunities that would help kick-start its journey to become a leader in diversity and inclusion in manufacturing and beyond, as well as to understand which areas are the most urgent. From the top down, a dedication to DEI has taken hold, as evidenced by new company-wide initiatives, more resources available to employees, and the establishment of a DEI Council.
Grundfos credits the success of its DEI initiatives to having an all-in attitude. Real, substantive change can’t happen without commitment from across the organization—and a DEI budget to match.
Once these efforts launched, Grundfos management was no longer split on the importance of DEI. Leadership became outspoken advocates not only within Grundfos but in public and online as well. A follow-up DIAL survey reveals that overall sentiment had improved as well, with many employees expressing that they had never felt so seen or included until now.
By August 2022, Grundfos had made significant progress on over half of its targets, particularly in advancing and recruiting women at the company. Leadership roles for women increased from 23% to 24%, and representation of women in senior management jumped from 10% to 16%.
How Data Became Action: Setting DEI Themes and Targets
From the research and focus groups, BCG and Grundfos developed five themes and aspirational targets to be met by 2025:
- Leadership commitment through role-modeling and embracing differences
- An inclusive culture by ensuring global staff is welcomed, valued, respected, and supported
- Advancement and recruitment of women to increase gender equality in manufacturing
- Early career development to support new colleagues to grow professionally and encourage retention
- Increased representation of people with disabilities or health conditions to empower them with a fulfilling work life
Leading with DEI
Grundfos formed a diverse ten-member DEI Council made up of senior leaders to meet these targets and inspire change both inside and outside the organization.
Enhancing Diversity
Grundfos also established four employee resource groups (ERGs) to meet its diversity-based target areas. Each has programmed events—for example, conferences to empower women in manufacturing, a keynote speech from a Grundfos leader with dyslexia, and another keynote speech featuring a transgender CEO. These events, and others like them, have drawn hundreds of attendees and inspired those who may feel “different” to live fully as their true selves.
In less than a year and a half, more than 800 employees across nearly 40 countries joined one of the Grundfos ERGs. In 2022, the global ERG leads received nominations for Employee of the Year at the Danish Diversity Awards and together won the Diversity and Inclusion Initiative of the Year.
* The category of “workers with disabilities” includes, but is not limited to, Grundfos employees with physical disabilities, chronic health conditions, neurodiversity, and/or mental health conditions.
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