Eight Steps for Using Data to Improve Workforce DEI

David Weisenfeld of XpertHR shares an 8-step blueprint for how to use data to audit your organization’s DEI success. 

While data alone cannot paint a full picture of your organization’s DEI success, it is a good place to start. Credit: FreshSplash

In a recent panel on taking meaningful steps toward embedding diversity, equity and inclusion (DEI) in the workplace culture, corporate culture consultant Joy Stephens observed:

“Creating employee resource groups (ERGs) and celebrating diversity days is great, but what happens after that? People will look around if they are not seeing progress.”

In other words, organizations that do not build on their DEI initiatives risk losing talented employees from underrepresented groups—a challenge no company wants to face as the Great Resignation enters its second year. For this reason and many others, DEI issues remain paramount for employers in 2022, as having a plan in place is increasingly viewed as a must-have, not a nice-to-have.

But how do you get there?

While data alone cannot paint a full picture of your organization’s DEI success, it is a good place to start.

That’s where a DEI audit comes into play. A DEI audit assesses a range of diversity, pay equity, HR policies and other factors to identify areas where there is room for growth and specific problems to solve.

According to a recent survey on the topic, DEI audits are still fairly uncommon, with only 14% of respondents noting that their organization has conducted one. If your company is among the majority that hasn’t, here’s a blueprint for how to start.

1. Identify Gaps

A DEI audit is intended to identify where diversity and inclusion gaps exist based on race, gender or other personal characteristics—and to do that effectively, you need to start with a baseline.

While you may select a specific area on which to focus, be open to uncovering potential blind spots as you collect the data. For instance, focusing solely on overall diversity numbers may obscure problems revealed by a deeper dive into employee attrition. Likewise, you may have a diverse workforce, but is this diversity well-represented across all job functions, or is it disproportionately concentrated in one type of position?

Although there is no one-size-fits-all approach, some examples of what to measure could include:

  • The racial, gender and ethnic diversity of staff, middle management and executive team positions;
  • Retention, promotion and attrition rates of underrepresented employees, including how long they remain in one position before being promoted; and
  • The rate at which underrepresented groups apply, are interviewed and are hired for jobs.

Comparing the responses of different groups of employees (e.g. Black, Indigenous and people of color (BIPOC) vs. White; men vs. women; managers vs. non-managers) may help identify teams or departments that are trouble spots and those that are more inclusive.

Another way to use data is to conduct a pay equity audit to uncover whether discrepancies exist based on protected characteristics, including race, ethnicity, gender, sexual orientation (LGBTQ) and age among employees for performing the same or similar work. If the pay data shows a gap, you can then evaluate your total compensation system to ensure there is fairness in the process itself.

The point is to develop as complete and accurate a view into your organization as possible. Admittedly, though, one universal challenge is going beyond race and gender.

“The conversation around disability and ability often gets overlooked,” says Cynthia Owyoung, author of All Are Welcome: How to Build a Real Workplace Culture of Inclusion That Delivers Results and VP of Inclusion, Equity and Belonging at Robinhood. Employers often lack good source data for certain protected classes, including disability, LGBTQ and religion. “People are less likely to self-identify because it has some of the most stigma.”

Approximately 15% of companies use employee focus groups to capture data for their DEI initiatives. Credit: Wavebreakmedia

2. Measure Employee Perceptions

A key factor in the success of any DEI initiative is having the ability to see every person’s point of view.

“You can’t only focus on Black women for instance,” says Stephens. “To be truly inclusive, everyone has a right to be heard.” This includes LGBTQ employees, the differently abled and white men too, according to Stephens.

How you go about collecting this data is up to you. Certain statistics—such as the characteristics of individuals being promoted or represented at each level of the company—can be collected without employee input.

Other fact-finding efforts will require voluntary applicant or employee participation, the most common of which is employee surveys. According to recent data, about one-third (37%) of employers have used employee surveys to collect DEI data about their workforce, followed by analysis of organizational policies/practices (24%), focus groups (15%) and one-on-one interviews (10%), among other options.

When gathering employee perceptions, be sure to include an array of questions to truly assess:

  • Do employees feel heard, understood, respected and valued at work?
  • Do they believe management encourages or celebrates DEI through its actions?
  • Have employees ever experienced micro-aggressions at work? If so, were they comfortable speaking up about them?
  • Are there subtle or overt ways in which employees feel excluded from the team?
  • Is there an effective mentoring program in place?

Just remember: data collection comes with some degree of risk, regardless of an employer’s intentions. Transparency demonstrates commitment to affecting real change and building trust. Make clear to individuals why you’re collecting data and how you plan to use it. And regardless of the source, all data collection efforts must also comply with anti-discrimination laws, such as Title VII of the Civil Rights Act.

3. Compare Your Data with Other Organizations

Benchmarks help determine what goals can be achieved based on the data you collect. Some commonly used benchmarks include:

  • Competitor performance within your specific industry;
  • US Department of Labor and Census Bureau statistics; and
  • College and graduate school graduation rates among various groups.

In selecting meaningful benchmarks, look beyond your industry to see if your workforce mirrors the composition of the community or customers you serve. Establish targets based on future labor market projections within the overall US workforce and population. In addition, evaluate large companywide goals at the division, unit or team level, as different locations or departments may face unique challenges. Then, use those benchmarks to set goals based on that data.

It seems obvious, but setting and pursuing goals demonstrates to your employees that your DEI strategy is real. Credit: Jeff Bergen

4. Determine Goals

It seems obvious, but setting targeted DEI goals based on the data—and then actually pursuing those goals—demonstrates to your employees that your DEI strategy is real.

“You need to be intentional about it,” says Matthew Camardella, co-chair of the Affirmative Action and Office of Federal Contract Compliance Programs (OFCCP) practice group at Jackson Lewis. “It can’t just be platitudes, or you don’t move the needle.”

In setting goals, prioritize any problem areas first and evaluate contributing factors to gaps that may exist. For instance, a lack of diverse employees in leadership, such as token or no representation of Blacks or women at higher executive levels, may be driven by factors including lower rates of promotion or mid-level hiring.

Keep in mind, however, that diversity goals should be aspirational, not a strict quota. While it is legal to set a goal of having a certain percentage of Black or LatinX employees, for instance, outright racial balancing is unconstitutional, according to the Supreme Court.

“Issues arise when an employer sets aside jobs, for example, in an effort to meet specific diversity goals,” explains Camardella. He notes that tying bonuses to hiring numbers increases the likelihood that quotas will be set based on race and other characteristics. Instead, achieve diversity goals by broadening the pool of job candidates and looking for talent in different places. (See step 7, below!)

5. Commit toAccountability

Achieving diversity is just one part of the DEI process. It’s not enough to cultivate a diverse workforce if all employees don’t feel fully welcome and included. If employees feel valued and connected and have a sense of belonging, they are far less likely to leave.

There is also a growing trend towards publicizing information on workforce representation and pay equity. Being forthright around your goals and progress ensures your company’s DEI efforts are perceived as more than just lip service.

Achieving both inclusivity and transparency requires commitment at all levels of the organization. One strategy for achieving accountability is to incentivize managers for DEI activities. This may include rewards for:

  • Participating in a set number of diversity outreach and recruiting events per year;
  • Attending Employee Resource Group (ERG) meetings for diverse groups;
  • Sponsoring cultural events; or
  • Establishing key relationships with at least one diversity organization;

It also may include performance reviews that require managers to provide concrete examples of their efforts to develop diverse employees or steps taken to make their teams more inclusive.

Again: While it is legal to set a goal of having a certain percentage of Black or LatinX employees, do not reserve positions based on those characteristics. Refer to EEOC guidance on distinguishing affirmative action goals from a racial quota to avoid running afoul of the law.

6. Get Buy-In from Senior Leadership

When it comes to the existence of pay inequities at companies, HR professionals suggest one root cause is senior management. That’s according to 322 employers responding to a recent survey on Pay Equity, which found that 53% of companies that self-reported pay inequities believe senior leadership has a high impact on driving pay disparities within their workforce.

Chief diversity officers and senior vice presidents for DEI can play a valuable role. But there needs to be buy-in from the top of an organization to achieve meaningful change.

To achieve that, HR should show leaders how DEI matters for the business from a competitive standpoint.

Senior leaders should be visible participants in promotion, recruitment and retention efforts earlier in the process, which will help the organization’s bottom line. They also should attend various ERG meetings on occasion to show support to employees from diverse groups.

“Connect with senior leaders on an emotional level,” Owyoung advises. Ask them, “Why does this matter to you?” Every leader has felt excluded at some point in their lives, and remembering those moments can help them connect to the experiences of people from underrepresented backgrounds, she explains.

Targeted recruitment is another way your organization can make positive DEI strides. Credit: Laflor

7. Engage in Targeted Recruitment

Some data suggests that relying solely on the same methods an organization used in the past, or relying too heavily on employee referrals, may result in a less-diverse range of candidates. Another way your organization can make positive DEI strides, therefore, is through targeted recruitment efforts.

In some ways, the pandemic has made this effort easier. After all, if a job can be performed remotely, then your pool of potential candidates becomes infinitely bigger. “It doesn’t matter if you’re in Ames, Iowa. You can recruit much more broadly now because you can sit people anywhere,” observes Camardella.

All that is needed is to make connections with the appropriate groups. Consider recruiting among:

Ensuring a diverse recruiting team can also help with your outreach efforts. Just be sure that all interviewers—even interviewers from underrepresented groups—receive diversity, equity and inclusion training so they do not unwittingly act on stereotypes. This includes unconscious bias training so that interviewers do not act in a way that may hamper opportunities for diverse candidates.

Finally, avoid inquiring about a candidate’s salary history. Many states and localities already limit or prohibit such inquiries, because they can perpetuate existing pay gaps. If a candidate volunteers their salary history information, do not rely on it when making hiring decisions or determining the individual’s compensation.

8. Create Ongoing Review Process

Achieving success with DEI requires the same level of focus, measurement, time, attention and energy that employers use to meet other business objectives. Since there’s no such thing as a DEI quick fix, ongoing data collection should be part of your organization’s DNA!

This includes measuring not just diversity but also how the employer is faring in terms of equity and inclusion. Share the findings with your leadership team and get buy-in about next steps. This review process will demonstrate whether new initiatives are succeeding and, if not, may provide insights to help pivot to something more effective.

The Bottom Line

Employers do not accidentally or organically arrive at a diverse, equitable and inclusive workplace; it is a major cultural change which occurs over time. And, DEI can at times remain an uncomfortable topic. But for leaders who are willing to step up as role models and create a safe, inclusive space for all employees, the risk will be rewarded.

 

This article was authored by David Weisenfeld with insights from Joy Stephens, Cynthia Owyoung and Matthew Camardella.

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