Such bald pronouncements sound provocative at a time when lawsuits are piling up against affirmative-action programs. Todd Campbell, manager of the diversity initiative at the Society for Human Resource Management, says that if Alliance "underutilized" the Hispanic segment of the labor force, Stokes could make recruiting Hispanics a priority. But turning a priority into an edict might cross the line into what a court would consider discrimination, according to two employment lawyers who talked with Inc .
Asked about that analysis of his practices, Stokes modified his original statement, saying that he requested only that his customer-service hire be "bilingual" -- fluent in Spanish and English. And he insists that his hiring policies conform to the letter of the law. Stokes's wife, Valeria, a human-resources executive, tutors him on the legalities of hiring. In addition, Alliance retains legal counsel to vet its business practices, including diversity initiatives. "I'm not discriminating at all," Stokes says. "I made a conscious decision that I wanted a diverse company, so I recruit from sources -- employment agencies, placement companies -- that are going to give me diverse people."
Alliance's management team supports Stokes's methods wholeheartedly. "I think Herb should be commended for what he does," says Diane McElhany, vice-president of operations.
Stokes's obsession with diversity evolved during his 23-year tenure with industry giant Allied Van Lines, the only place -- other than Alliance -- that he has ever worked. The CEO began his career as a laborer in his native Newark, N.J., and remained with Allied even when he was assigned to an office in Nebraska. But as he advanced into the management ranks, Stokes noticed a disturbing trend: the number of African Americans he saw each day kept shrinking. "It became apparent that there was very little diversity in the company," says Stokes, who was for years Allied's only African American executive. "I had a responsibility to help change that."
At first Stokes sought to reverse the situation by mentoring other African Americans who worked at Allied. But he began to realize that Allied was not unique: the entire relocation industry had the racial makeup of an Iowa lacrosse team. Stokes concluded that he could make a real difference only by starting his own company. So in 1995 he founded Alliance with NFL great Walter Payton, whom Stokes had met at an Allied sales meeting.
For two years Alliance was run out of an office tower in affluent Oak Brook, Ill., an address most start-ups would covet. Stokes hated it. Finding employees was difficult at that location, and everyone who applied for a job was white. "A luxury high-rise didn't recruit the type of people I wanted to employ and didn't establish the image I wanted in the industry," Stokes says. He decided to move Alliance to the inner city, where rents were low and the workforce was diverse. Payton, who disagreed with plans for the business, took the opportunity to sell his piece of the company to Stokes for $10,000. (The former Chicago Bear died in 1999 at the age of 45.)
So in 1997, Alliance established offices in Chicago's West Loop, a shabby neighborhood whose narrow streets are often blocked by trucks backing up awkwardly at warehouse loading docks. Stokes -- a registered Republican who nonetheless refers to Clinton as "my boy" -- relished being an urban pioneer at a time when urban pioneers were becoming fashionable. After learning about the Clinton administration's new welfare-to-work programs, he quickly bought into the concept. By 1999 he had two former welfare recipients on his payroll.
Successful welfare-to-work programs often hinge on retention and good training, and training is a Stokes specialty. As quality manager and later vice-president at Allied, he had supervised the reeducation of the kinds of employees who were most likely to damage sofas. Stokes's solution was ingenious: he ordered the construction of a full-scale model apartment with furnishings that the crews would move in and out, in and out, until they got it right.
Despite his training expertise, Stokes admits that learning to manage welfare-to-work employees took time. The hardest part was persuading workhorses like VP McElhany, whom Stokes hired away from Allied, to be patient and make accommodations. One employee, no longer with the company, angered McElhany by asking to leave work before 5 p.m. because her "brain hurt." "I told Herb that he needed to let the person go," McElhany recalls.
Stokes didn't take the advice. "Diane, here's this woman who has been collecting welfare and watching soap operas for three or four years," Stokes told McElhany. "Now she's sitting in front of a PC all day, entering data. You think her brain don't hurt?"
Another challenge was ensuring that Stokes's welfare hires didn't compromise the quality of the company's service -- the second defining theme in Alliance's culture after diversity. From Allied, the founder had imported the idea of tying pricing to performance benchmarks, which he tracks using Gallup surveys of his customers. Under the system, if a client's employees complain about Alliance's service, for example, Alliance will reduce its bill. If the employees rave, however, Alliance charges a premium. Because the movers' rate of pay is tied to the marks they earn on each move, that quality ethos pervades Alliance.
By 1998, Stokes had assembled an ethnically mixed team for Alliance that provided top-quality service to customers. But Stokes had made little progress toward his other goal -- promoting a diverse workforce in the industry as a whole. So that year he launched Alliance Training Education and Development Inc. (ATED), a nonprofit that solicits government grants for welfare-to-work training projects. Under ATED, Stokes taught a handful of people -- mostly women -- how to pack goods on trucks and operate a call center. Former ATED students now work at several moving companies with which Alliance has partnerships.
Leveraging the small-scale success of ATED, Stokes persuaded Allied Van Lines to donate $100,000 to the Welfare to Work Partnership, a nonprofit based in Washington, D.C. After the check arrived, Stokes's currency skyrocketed, and he became an executive-on-loan to Chicago BizLink, one of the partnership's flagship initiatives. "I think Herb's one of the best things since sliced bread," says Thressa Connor-McMahon, vice-president of Chicago BizLink. "His business acumen is very valuable to us."
