Employee Resource Groups (ERGs) have transitioned from grassroots initiatives fostering diversity and inclusion to strategic organizational assets. Despite their prevalence, theoretical understanding of ERGs remains fragmented, with existing research emphasizing psychological benefits for members but offering limited insight into their organizational impact. To address this gap, we conducted two studies: inductive interviews with DEI leaders to explore ERG purposes and processes and a quantitative analysis of employee perspectives on ERG effectiveness. Our findings reveal distinct organizational logics driving ERG strategies, contrasted with employee-level experiences of belonging. We categorize ERGs into forms based on their primary purposes, offering a framework to clarify their diverse roles and strategic applications. This framework helps organizations design and evaluate ERGs to meet specific goals effectively. Our research highlights how organizational beliefs and narratives influence ERG outcomes, offering actionable insights for HR professionals and leaders to align ERG design with organizational and employee needs, while mitigating unintended consequences. This work advances understanding of ERGs as a dynamic diversity practice critical to organizational success.
