Diversity & inclusion: 4 steps to drive concrete change
Companies have made D&I a priority in their workforce, but tangible results have been difficult to truly deliver.
An effective diversity and inclusion (D&I) strategy is a necessity in today’s corporate environment. The importance of the matter has surged given the pivotal socio-economic events that occurred over the last 16+ months – and we can only expect the conversation to grow louder. Younger generations entering the workforce have made it especially clear that inclusive atmospheres are pivotal in choosing an employer, with 83% of Gen Z candidates stating that a company’s commitment to diversity and inclusion is a deciding factor.
Related: Driving DEI: A key element in growth and innovation
Beyond talent, the financial benefits associated with diverse working environments are abundant. Organizations with 30% or more female executives are more likely to outperform companies with lower percentages. And for every 10% more racially or ethnically diverse a company’s senior leadership team is, earnings before interest and taxes (EBIT) is nearly 1% point higher. The financial advantages have caught the eye of executives as boards are increasingly tying D&I initiatives to C-level pay.
Roadblocks to progress
Companies are continuing to accelerate their D&I initiatives, perceivably making progress over the past 12-plus months. In fact, the vast majority–a staggering 90%–have made D&I a priority in their workforce. But concrete and tangible results have been difficult to truly deliver. Why?
For starters, few organizations actually set overall business goals and metrics tied to D&I efforts – only 7% of organizations have achieved real advancement, experiencing positive impacts from D&I-related initiatives. This disconnect is hindering progress by leaving brands without concrete benchmarks (such as industry and geographical location to measure real progress). And making lofty commitments with no strategy to achieve goals or simply throwing money at the problem won’t solve anything. Companies have collectively spent $200 billion towards advancing diversity initiatives, but there is still significant room for improvement. For instance, Google spent $114 million in 2014 and $150 million in 2015 on diversity efforts, yet in their 2019 diversity report, African Americans still make up only 2% of their tech workforce.
Many organizations also make the mistake of restricting their recruitment efforts to their own geographies rather than expanding their search to include areas with a higher representation of diverse talent. Oftentimes this isn’t intentional. The issue is these organizations have limited or no access to diversity and inclusion data, which leaves gaps in an organization’s view of where they stand. By only looking at their own geographies, companies miss out on higher representations of qualified diverse talent located elsewhere that could potentially join their teams.
Companies want to make good on their D&I commitments. The roadblocks to reaching their goals are not deliberate. A refocus in approach is what’s needed. Here are four steps companies can take that will put their organizations on firm footing for the future.
Evaluate and assess your current position
Companies must look inward and gain a deep understanding of their organization’s current state: What are its strengths? Weaknesses? Values? By understanding where your company stands, organizations can then map out where they’re going and where they ultimately want to be. It is also critical to determine what success means and what that will look like along your company’s journey, which goes much further than simply setting goals. These objectives must be reasonable, attainable, and most importantly – measurable. Comprehensively defining your company’s expectations ultimately sets your organization up for better success in achieving these goals.
Replace assumptions with data-driven decisions
Data is the driving factor in creating change. While conventional methods are still important tactics – employee referrals, institutional relationship building, staff training, etc. – financial and human resource investments will only build true momentum if organizations (1) have the tools to impact their ability to build a competitive diverse pipeline of candidates and, (2) have data-driven insights to quickly gauge, track, and compare their current internal performance against industry, national, and competitive benchmarks. Companies can harness the power of technology to include more candidates from underrepresented groups at the front of the recruiting funnel.
AI and predictive intelligence tools help employers bring diverse workers into the door faster. By predicting which candidates are most likely to have diverse backgrounds – gender, national origin, ethnicity, veterans, and more — technology is enabling organizations to identify and include prospective hires with the right skillsets and from underrepresented communities in their talent pools.
Start from the top – management must lead the way
The process starts from the top down and should be ingrained in every organizational decision – management must “walk the talk”. Transparency is key as employees will notice if an organization isn’t upholding its commitment to D&I. Leaders are responsible for driving forward these initiatives and maintaining employee morale. Lack of action to back up these goals can result in increased turnover, lack of motivation, and more.
And don’t ignore the contingent workforce. Contingent labor is increasingly a key feeder of permanent talent. Recent data shows nearly one-quarter of organizations transition between 25% and 49% of their contingent labor to full-time status and another 11% transition between 10% and 24%. Yet only 16% have specific D&I goals in place for their contingent workforce. This is a major roadblock to real D&I progress that requires a shift in the mindset around the contingent workforce as a permanent worker strategy.
To enact real change, companies must use D&I as a lens through which senior leaders invest, act and make decisions. From acquiring new talent–both permanent and contingent–to building equity with that talent, to competing in the market, and beyond.
Keep your eye on retention
Hiring a more diverse workforce is only the start, and inclusion efforts should continue long after the onboarding process. If organizations are unable to retain the talent once hired, no real progress has been made.
Companies should prioritize and incorporate Workforce and Workplace Culture initiatives to make employees feel supported to foster retention, which in turn will attract more talent as people want to work where they feel represented. For example, women are 1.68 times more likely to be open to leaving their current roles than men if there are fewer women colleagues represented in their workplace.
Because D&I is not a one-and-done or ad-hoc initiative, participation in internal Global D&I Corporate Councils, external community groups, to personal development and mentor programs are many ways to offer prolonged support to employees.
The stronger the commitment, the stronger the results.
Moving forward
D&I breeds innovation, bringing together a pool of people who come from different backgrounds, life, and work experiences thus fostering more creative ideas and solutions. In today’s high-tech world, using the vast amount of available data to drive decisions will result in the creation of truly diverse talent pipelines. Data helps companies to make smarter, confident, and more proactive decisions on where and how to invest in talent diversity and boost employee representation.
Your workplace must emulate your area, a true reflection of where you live, work, and play. Making promises to appease stakeholders is no longer going to cut it. Employees, customers, and investors alike want – and need – to see concrete progression. Those who don’t step up to the plate will quickly fall behind.
William T. Rolack, Sr. is vice president of Diversity and Inclusion at Workforce Logiq, a PRO Unlimited company. William has extensive experience helping companies achieve their business goals by leveraging diversity and inclusion initiatives. He currently leads the internal diversity and inclusion strategy at Workforce Logiq and advises clients on how to improve their own diverse workforce and human capital management strategies.
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