The business value of diversity and inclusion (D&I) is clear. Case in point: McKinsey & Company’s 2018 “Delivering through Diversity” report stated companies in the top quartile for ethnic/cultural diversity on executive teams were 33 percent more likely to have industry-leading profitability. Additionally, companies in the top quartile for gender diversity on executive teams were 21 percent more likely to outperform on profitability and 27% more likely to have superior value creation. These facts are proof that efforts to elevate your D&I initiatives can have a bottom-line impact on your organization.
If you’re reading this blog, you probably realize that investing time in D&I is worthwhile. Moreover, that without inclusion, diversity is unsustainable. Additionally, the idea of “belonging” is becoming increasingly important to a strong D&I strategy. Belonging is the sense that all employees can be their authentic selves, and as such, are essential to their team’s success. However, to continue effectively driving your D&I initiatives in the right direction, you need to know what is working and how well.
The metrics that measure the success of any people initiative are the same for D&I. Performance indicators, especially financial performance (specifically profit margin), should be paired with softer metrics for a complete picture. Correlate financial performance with measurements of employee engagement, employee retention, talent attraction, customer orientation, employee satisfaction and employee participation in decision-making.
In addition to these, there are a couple of specific initiatives you should implement to focus on measuring D&I:
From a broad view, your company may appear to be diverse, but consider segmenting the company several ways to ensure it is representative of all levels and functions. Completing a quarterly or biannual report that shows the following (compiled from Project Include) will lend insight into your initiatives’ success:
Employees overall, by function, seniority and tenure (cut by demographics)
Employment status (i.e., full-time, part-time, contractor) (cut by demographics)
Management and leadership (cut by demographics)
Salary (cut by demographics) – Raises and bonuses (cut by demographics)
Board of directors (cut by demographics)
Candidate pools and hiring funnels, by role (cut by demographics)
Voluntary and involuntary attrition rates (cut by demographics)
Promotion rates (cut by demographics)
Formal and informal complaints (cut by demographics) – Complaint resolution status (cut by demographics)
If you are not already conducting surveys to gain insight into employee experience, now is the time to start. You will want to understand the extent to which all employees feel included, empowered, safe to be themselves and safe to share their opinions. This is crucial in measuring your organization’s inclusivity. Overall employee engagement data, cut by demographics, is also revealing. Are all employees similarly engaged?
Implementing a D&I strategy is only the start to becoming an inclusive company. Measuring the results to help guide your continued efforts will ensure success.