The greatest obstacle to using numbers to measure diversity impact is the mistaken idea that they are difficult to understand.
I’ll admit that using numbers to make better decisions can involve some high-powered mathematics, but you don’t have to be a mathematician to use numbers. You can view everything you do from three important points of view.
One, set the direction you want to move in. Two, plan how you are going to move in that direction. Three, do the work to get to where you want to go — implement your plans. For an organization to succeed, everyone, every day must account for these three points of view. In many organizations, the executives alone set direction. Managers do the planning, and the rest of the employees implement tasks on the front line. But all diversity-related projects involve setting direction, planning and implementation.
For instance, we have all planned, cooked or enjoyed meals. Someone must set the direction, or choose the recipe and determine the menu. Someone must plan to buy the ingredients. Finally, someone must cook the food and serve the meal. The same person may perform all of these tasks, or they may be done by a team.
Measurement plays a unique role for direction setting, planning and doing. Robert Reid, a process improvement specialist, developed Reid’s three rules measure, analyze, and do — MAD. He suggests there should be no process without meaningful measurement and recording, no recording without analysis and no analysis without corrective action. I feel these same rules apply when considering strategies to implement performance measurement processes for diversity and inclusion.
Measure. Measuring diversity and inclusion’s impact begins by assessing the organization’s needs, and identifying gaps in performance and the reason for those gaps. The process involves collecting the right kinds of data. Logging numbers doesn’t help anyone unless the data is meaningful, and someone has time to analyze the data and look for patterns.
If diversity is to address an organization’s strategic business challenges, it is imperative that business needs are clear. Start with the strategic business plan. The strategic business plan, or its equivalent, can offer a wealth of information regarding areas where diversity can make a difference. It is critical to examine the organization’s key goals and objectives, core business strategies and tactics, marketing and sales targets, production or operational issues, recruitment and retention issues, succession plan challenges, productivity issues, legal compliance concerns, customer service challenges, globalization plans, and the like. Examine each area to determine where diversity could have a direct or indirect effect on the business. The results of this activity should form the foundation upon which to create diversity initiatives.
Analyze. Formulate research questions. That is, know what you want to know. This involves formulating research questions that help give you answers to establish baseline diversity measures or calculate change and impact. Useful approaches to formulate research questions include starting broad, then narrowing the focus. Using strategic business plan information as your guide, focus on helping the organization solve and/or prevent business problems as well as improve business operations. An example might include questions such as:
- What is the distribution and retention impact of women and minorities in management positions above the first level?
- What is the diversity makeup of our customer base by product line and market share?”
- What factors make the difference for high productivity among diverse work teams and their impact on customer service ratings?
- What percentage of mothers return to work after maternity leave by diverse groupings compared to industry and majority group norms?
These research questions should help align and link a diversity initiative with the strategic plan. If they are systemic, diversity initiatives will also proceed along several lines at the same time. Activities such as child care services, flex time, flex-place strategies, parental leave options, mentoring and others could be in action simultaneously.
Let’s suppose at the end of a two-year period, management notes a 45 percent decrease in turnover among female managers. The effect of this decrease is an identifiable value to the organization in lower recruiting and training costs. However, which of the above programs caused the improvement during that period? Most of the time, diversity can take only partial credit for improvement. To help isolate the effects of an initiative from other factors that could have affected the result, you will need to go beyond standard control group analysis to use one or more techniques to isolate extraneous factors such as trend line analysis, forecasting and employee and supervisor estimates.
Do. If you are going to study diversity and inclusion initiative processes and activities, seeing patterns and gaining insights is of little value unless you use that information to improve those initiative’s processes and activities. Measurement has a unique and special role in helping set direction, analyze results and plan to achieve a measurable outcome-based performance impact.
Applying MAD skills to your diversity and inclusion initiatives can provide a great framework to produce higher levels of diversity and inclusion performance, impact and results.