Reasons You Should Measure Diversity

If you want to take your company in a new direction, it helps to have a map and a plan. That’s why your goal to improve diversity should begin the same as any other business endeavor – with numbers and a careful look at your current situation.

For years, it’s been well established that more diverse companies tend to be more successful and profitable. Gender diversity among leadership roles, for example, makes a company 21% more likely to experience above average profits, according to McKinsey & Company. Similarly, companies were 33% more likely to have above average profit performance with greater ethnic diversity.

So, it’s clear your company has every reason to become more diverse. As you set out to do so, it’s important to develop a system of measurement so you can track and quantify results. There’s also the added opportunity to provide greater transparency as well, as more companies are publishing their diversity data to reflect accountability and a willingness to find ways to improve.

Transparency is Valuable in 2020

As you begin this process, it’s important to know that nobody is expecting your company to be perfect. They’re expect you to find ways to improve.

So even if your early datasets don’t necessarily tell a great story, that’s okay. It’s better to be real. You’ll have all the more to show for it later as you make continued progress.

A fantastic example of this realism came from the American clothing manufacturer Levi Strauss & Co. midway through this summer. They took the bold step of publishing their diversity statistics alongside their plan to make improvements to them. And they didn’t hold anything back. They were exceptionally clear about the fact their “numbers reveal dire underrepresentation of black employees,” and that it “required immediate action and sustained effort to correct.”

The company then detailed about 10 different initiatives that it would then be taking as part of a commitment to change. These included the implementation of a new executive-level head of diversity, candidate interviews conducted by a panel of diverse leaders, a new corporate career path program, expansions to professional development opportunities, racial equity training, and more. They also indicated these were just the first of many additional forthcoming changes.

Not only is this a great way to reflect awareness and a commitment to change, it’s also frankly a solid long-term marketing strategy. Levi’s post about their diversity statistics received more than 19,600 likes on Instagram in less than 24-hour period and was widely shared even further through other media outlets. That’s a major burst of traffic, and one that can be built upon in follow up posts for years.

Metrics You Can Use

As you start gathering your data, there are a few different metrics that you should incorporate into your findings. Each has their own strengths and weaknesses, so the experts strongly recommend using a blend of most or all of these types of datasets:

• Straight counting.
  Count your employees and determine demographic percentages – fairly straightforward. But know that it only tells part of the story. In the example of Levi’s, the company noted that it’s overall percentage of white employees was 37%, which makes them sound diverse. But at the corporate level, white employees made a majority share at 55%, reflecting significant minority executive underrepresentation.
• Measure influence.
  Beyond straight numbers, measure job titles, levels within a company, and how demographics are represented across your leadership, power, and influence structures.
• Publish pay scales.
  Measure and publish the salaries of your workers. Salary does not need to be kept secret, sharing details about it helps to level the playing field.
• Measure promotions, career growth rates, and retention.
  Make demographic comparisons between career growth rates to determine your company’s effectiveness at empowering success. Compare average retention rates and longevity between demographics too.
• Gather direct feedback.
  Survey your employees to gain more insights into how they view your diversity programs and what suggestions they may have for programming. Do your employees feel a sense of belonging? Do they feel like they have a voice in your company?
• Track recruitment and hiring rates.
  Monitor the numbers of applicants you’re receiving based on demographics to find ways to increase your job opening marketability to various groups.
• Document complaints and their resolutions.
  Careful documentation of complaints can help you ascertain which demographic groups are more likely to be the targets of discrimination in your organization.

These are by no means the only options available for building diversity statistics, but they’re a great start. By learning more about your own performance, you can set benchmarks and begin identifying targets that you want to reach.

Like any other aspect of business, change happens through the numbers. Start measuring your diversity today, share your numbers with the public, and begin an open discussion about ways you can make improvements.