LAS VEGAS — What diversity, equity and inclusion (DE&I) metrics does your organization track? If it's like the majority of organizations recently surveyed, it probably tracks the diversity of the people it hires and the diversity of the individuals it recruits. The diversity of employees retained, along with other areas such as the diversity of workers who participate in development opportunities, tend to be tracked less frequently.
But DE&I efforts should not end once workers are hired. Executives must regularly monitor all related metrics and use that information to better manage DE&I and communicate their progress, researchers for Harvard Business Review Analytic Services wrote in a new report, Creating a Culture of Diversity, Equity and Inclusion, which was conducted in partnership with the Society for Human Resource Management (SHRM).
The report was released Sept. 10 at the SHRM Annual Conference & Expo 2021, which is taking place in Las Vegas and virtually. It is based on findings from online surveys of 1,115 North American organizational leaders conducted in April and May 2021. The research was sponsored by Trusaic, a regulatory compliance software company in Los Angeles.
"Tracking DE&I metrics across multiple business processes—hiring, promotions, compensation, development opportunities and more—is critical," said Trent Burner, SHRM-SCP, SHRM's vice president of research. "If you don't know where you started from or where you are currently, how do you know if you've made any progress?"
That data can show employers where DE&I is—and is not—embedded within the organization, establish benchmarks, gauge progress, and help identify areas where interventions and changes are needed, the researchers noted.
"Access to timely and reliable data is central to closing the gap," they wrote in the report. "In our study, higher-performing organizations go broader and deeper in monitoring how equitable they really are; they track all three aspects of diversity, equity, and inclusion; and they measure DE&I progress across a wider range of metrics."
"Data is the critical compass that can lead your organization to a safer, more welcoming, more representative and more participatory place," they added.
Among the findings:
- 74 percent of all respondents track the diversity of new hires.
- 64 percent track the diversity of individuals they recruit.
- 47 percent track the diversity of employees they retain.
All other aspects of diversity are tracked by less than 40 percent of respondents.
Survey respondents were categorized as "leaders" (those who rated their organizations as very successful at improving DE&I), "followers" (those who rated their organizations as moderately successful) and "laggards" (those who rated their organizations as unsuccessful at improving DE&I).
"There is an enormous gap among leaders, followers and laggards when it comes to having a culture that consistently supports DE&I," the report stated.
The findings highlighted the importance of leadership's commitment to DE&I: 50 percent of laggard companies cited a lack of leadership commitment as hindering efforts. Only 5 percent of leader companies said this is an issue. The most notable difference among respondents is that leaders were more likely than followers and laggards to track diversity for development opportunities (45 percent versus 26 percent and 10 percent, respectively).
Organizations categorized as leaders also were significantly more likely than those in the other two groups to set goals for diversity levels among senior executives and board members. Some organizations have set goals to increase representation at the vice president or director level and above.
Use Data to Drive Outcomes
The report recommended the following strategies for using metrics to improve DE&I:
- Establish a base line and set goals. This can help determine an organization's readiness and ability to make sustainable change.
- Regularly measure progress. Organizations identified as leaders are twice as likely as those identified as laggards to regularly review compensation decisions and retention rates for equity, and four times as likely to regularly review performance evaluations and promotion decisions for equity, the research found.
Among respondents who track DE&I, 47 percent measure progress of diversity and equity goals at least twice per year; 43 percent measure progress of inclusion goals at least twice per year.
- Widely communicate progress. Sharing information about DE&I improvements reinforces an organization's commitment and accountability; 47 percent of organizations considered DE&I leaders shared their metrics with all employees, twice as many as laggard organizations.
"Many organizations share their DE&I metrics with their senior leaders and board of directors, but leaders in this space tend to share their DE&I metrics with their employees as well," Burner said. "Although some businesses might initially feel uncomfortable doing this, it can be a great strategy to ensure buy-in and support from employees for the company's DE&I efforts."
- Identify where interventions might be needed. Segmenting data by departments or units helps identify areas of concern that could be hidden in otherwise positive trends. The same idea applies to population identities; the experience of Asian women at your organization, for example, might be quite different from that of women overall or Asian employees overall.
- Hold the organization accountable. Data can be used in conversations with senior leaders, opening the door to talking about what those leaders will do to improve representation in their departments, for example.
Laggard organizations were three times as likely as leader organizations to suffer from a lack of accountability (57 percent versus 19 percent), the report found. Leader organizations were much more likely to assign accountability beyond HR to include the CEO (71 percent), business unit heads (54 percent), department heads (50 percent) and managers (44 percent).
"Even leaders who are committed to increasing DE&I face challenges on a daily basis," the researchers acknowledged in the report. The answer "is to be transparent about conflicting priorities and to work through them as best [you] can. Getting to the point where diversity, equity, and inclusion are ingrained in company culture and practices will take years."
DE&I is a "critical strategic priority for many organizations," Burner observed, but many struggle to successfully create a workplace that is diverse, equitable and inclusive. "Those who have been successful at doing this have experienced improvements not only in team diversity and pay equity, but also in employee engagement, collaboration, retention and their ability to recruit top talent."