Having a diverse workforce has many benefits, including improved financial results, organizational and team performance, and innovation as well as better problem-solving and decision-making and increased creativity.
“Diversity is who we are — each of us is diverse,” says Kim Drumgo, director of diversity and inclusion for the Association of International Certified Professional Accountants (AICPA) and vice chair of the AICPA National Commission on Diversity and Inclusion. “Inclusion, on the other hand, is what we do with that diversity.”
The AICPA recently released “a revamped version of its diversity benchmarking tool,” the Accounting Inclusion Maturity Model (AIMM), according to CPA Practice Advisor. It’s one of several new or improved tools on the market for organizations to measure the impact of their diversity and inclusion (D&I) programs. Last month, business intelligence firm Visier launched a new software as a service (SaaS) “analytics solution that provides executives comprehensive up-to-date visibility into the state of diversity and inclusion within their organization,” according to the press release.
“Whatever you’re doing in HR, you should have data,” says Ian Cook, vice president of people solutions at Visier. A recent Visier survey found that 35% of diversity officers don’t have that basic data. Others only gather the data once per year to report to the Equal Employment Opportunity Commission (EEOC), and “they treat it as a reporting chore as opposed to a piece of insight that actually drives the business.” Visier wanted to change organizations’ approach to D&I to gather data continuously and convey that data meaningfully to the managers who make a difference.
Collecting Diversity Data
From demographic information to hiring decisions and training assessments, there are a variety of metrics to look at when evaluating the effectiveness of your D&I programs. In fact, Culture Coach and the Diversity Dashboard created a diversity metrics model that includes over 75 metrics. Kari Heistad, CEO of Culture Coach, says that when selecting metrics, leaders should answer five questions:
- What strategic goal are we helping to achieve with the D&I program, and which metrics will demonstrate how successful we are at helping to accomplish it?
- Where are we spending the D&I budget, and which metrics will demonstrate an ROI on that spend?
- Which metrics are our customers asking for?
- Which metrics do we need to track in order to keep pace with market trends (e.g., the diversity of the senior leadership team or the board of directors)?
- Which metrics are key indicators of employee success or failure and of critical gaps in employee development and retention?
At a more basic level, it’s a good idea to take a look at who your organization employs. This number should go beyond overall ratios across the organization, says Cook. For example, break down your gender ratio at each level of your organization. “It’s gone way beyond, ‘The business should be 50/50 women,’” he says. Now, organizations should also be asking, “Do we have women at positions of influence?”
Cook gives an example of a client organization that was trying to improve the ethnic diversity of its workforce. While the company was hiring more people from underrepresented ethnic groups, its overall diversity numbers weren’t changing. So, leaders looked closer at the numbers and identified “certain manufacturing plants where high-performing people of color were paid fairly,” but people of color who performed at an average level were being paid less than white employees with comparable performance. This discrepancy was causing turnover; while the company was bringing in new people of color, it was losing others.
Cook says that what’s important is “the capacity to track [the metric] at all three stages of the employee life cycle: when you’re finding those people, as they’re inside your business and understanding the volumes at exit.”
The AIMM, meanwhile, helps firms answer three questions, according to Drumgo: “Where are they on their diversity journey, where do they need to go and how should they create an inclusive environment?”
To determine which metrics to use, she recommends beginning by identifying your D&I goals. “If the firm wants to create an inclusive environment, [it] should measure employee engagement survey results by gender, generation and ethnicity.” Other metrics include hiring data, turnover and promotion statistics, performance evaluation data, and team assignments. “These measures aren’t only to measure growth but [also] to measure consistency and to uncover unintentional bias that might exist in various ‘day-to-day’ processes,” she adds.
Rich Lanchantin, CEO of Qstream, believes there are two key metrics for assessing the impact of a D&I program. The first is learners’ engagement in the program, which can help L&D leaders evaluate employees’ “willingness to learn, understand and adapt.” The second is participants’ understanding and practice of D&I concepts.
Using Data to Gain Executive Buy-in
Training Industry research has identified the prioritization of training at the organizational level as one of the most common challenges faced by learning leaders. Just as learning leaders must be prepared to defend their programs to the executive team, so must D&I leaders.
First, says Drumgo, it’s important to understand that “key stakeholders may struggle to grasp the importance of diversity and inclusion.” The best way to understand where they stand on the topic is to have conversations with them. “These conversations should be personal, because how people feel about D&I is personal, and we all see it differently.” Once you understand where a leader is coming from, she says, you can make a convincing case for D&I.
“We’re miles away from, ‘You should do this because it’s a good thing to do,’” says Cook. Organizations are starting to see, “Diversity’s the right thing to do, and it’s the smart thing to do, and here’s all of the evidence that shows that.” He recommends providing both the “moral argument” and the “smart business practice” argument to skeptical stakeholders.
Lanchantin says if you can connect D&I with business metrics, “that is very powerful intelligence” for stakeholders. In order to provide that intelligence, he recommends “embrac[ing] technology-driven learning to educate and shape employee behaviors, measure the impact of D&I programs, and highlight gaps in understanding.”
Similarly, Heistad says, “Senior leaders all have issues that keep them up at night: finding top talent, keeping ahead of the competition with products and services, selling into new markets, and how to create sustainable growth in a rapidly changing marketplace.” Gain their buy-in by demonstrating how D&I plays an important role in addressing those challenges.
Creating an inclusive environment for a diverse workforce is no longer a “feel-good” initiative; it’s a business imperative. Simply closing your eyes and throwing a program at a dartboard won’t do the trick. By identifying important metrics and continuously evaluating impact, you can make the case to stakeholders and create a more effective, and inclusive, organization.