Workforce Diversity Series: 4 Ways to Build a Diverse Organization

Struggling to understand—let alone increase—diversity? In the second of our 2-part series, Affirmity’s Patrick McNiel, PhD, an expert in workforce analytics and diversity insights, defines 4 best practices HR leaders and recruiters can follow to make it a reality.

Before we can seize the value of diversity to drive critical business goals like customer satisfaction, productivity and innovation, employee retention, and brand, we must first define what we mean by “diverse workforce.”

Last week, we walked through the definition of diversity, a much-used but often poorly understood element of a successful workforce.

With that understanding, we can turn our attention to the question of what an organization can do to improve diversity.

This week, we’ll explore 4 ways that companies can work to build workforce diversity AND boost the likelihood of finding and retaining top performers.

1. Create a More Diverse Pool of Qualified Workers

One method for building your pool of diverse, qualified applicants is to initiate programs that create diversity within the qualified talent pool.

Remember: Diversity as defined in employment laws and regulations hinges on characteristics like gender, race, ethnicity, age, and ability, which are referred to as “classes.” Brush up on this and other definitions of diversity here.

Successful diversity programs include long- and short-term efforts such as

  • Outreach campaigns that encourage people from underrepresented groups to pursue careers in fields that drive your business
  • Scholarships to encourage students to obtain degrees desirable to your industry
  • Internship programs focused on schools whose student populations align with your diversity efforts
  • Internal training programs designed to upskill current employees
  • Employee resource group (ERG) programs to foster professional development among employees and encourage employee referrals of qualified candidates from a variety of backgrounds.

Need better tracking for your employee resource groups? See how an ERG management platform can deliver the visibility you need.

By investing organizational resources in these types of efforts, you can build a diverse pipeline of qualified candidates from which to recruit.

Diversity initiatives that engage employees and the wider community also foster a positive reputation, helping your organization become an employer of choice among diverse groups of people.

2. Recruit Where the Candidates You Seek Go Looking for Jobs

This may seem obvious, but if you want to build a diverse workforce, you must focus your recruiting efforts with that in mind. That means going where candidates who represent particular classes are, and posting jobs in the forums they’re likely to seek out.

For example, to increase representation of Black employees, you might

  • Participate in job fairs at historically Black universities
  • Conduct outreach to groups such as the National Black MBA Association and the Urban League
  • Post opportunities to job boards maintained by relevant professional associations such as the Black Engineer Society.

Similarly, your organization can and should engage in forums that will connect you to female candidates, veterans, and job seekers with disabilities.

Expert Tip: One excellent resource for US employers looking for organizations that can connect them to diverse, skilled job seekers is the Employment Referral Resource Directory maintained by the Office of Federal Contract Compliance Programs (OFCCP). Designed for federal contractors, the directory is available for use by any employer.

3. Use a Recruiting Source Analysis to Reach Diverse Candidates

Your recruiting efforts—and the sources you use to reach job seekers—have an enormous impact on your ability to find and attract qualified and diverse candidates. So it only makes sense to track outcomes by recruiting source.

In this way, you can determine which job boards, forums, and career fairs are worth the effort.

The primary tool for ensuring your sources are effective is what’s known as a recruiting source analysis.

Federal contractors are required to do this as part of documenting what’s known as “good faith efforts.” But all talent acquisition teams should monitor each candidate source for its contribution to reaching candidates in various classes and netting hires from various classes.

Is your good faith effort documentation up to par? See how the right GFE tracking system ensures compliant record-keeping.

Without tracking these metrics to assess the quality of your sources, your talent acquisition team risks both opportunity costs and other negative consequences:

  • No increase in candidate diversity – The most basic form of recruiting analysis is to look at sources of applicants to see if each source is yielding the diversity of candidates you expect.
  • Time wasted for recruiters – If your efforts increase applications from minorities, females, veterans, or individuals with disabilities, but those applicants don’t qualify, the end result is wasted time. Recruiting and screening applicants from poor quality sources will leave your talent acquisition team with little to show for their efforts.
  • Adverse impact – If your efforts are netting qualified but noncompetitive applicants, adverse impact may become a problem. That is, the ratio of applicants in a class to hires in that class will create the perception that your organization is discriminating against the very groups that you’re actively trying to place.

Of course, hiring decisions based on qualifications may be justifiable, but it may take some effort if the need to defend you decisions arises. And it’s always better to invest in sources through which you can attract qualified and competitive job seekers.

By monitoring and analyzing your recruiting sources, you can also ensure that efforts to raise diversity in one area aren’t detrimental to other types of diversity.

For example, because 87% of veterans are male, focusing your recruiting efforts on veterans effectively means focusing on men. So while it is legally permissible to show hiring preference for veterans over non-veterans, you must monitor the impact on representation of females in your workforce. And you may need to counterbalance by increasing outreach through recruiting sources focused on women.

4. Optimize Your Hiring Process for Diversity

As with your recruiting sources, an objective analysis of your hiring process may reveal opportunities to optimize for diversity.

To understand where your process may be interfering with diversity initiatives, companies are encouraged to conduct a disposition analysis and a hiring process analysis.

What is a Disposition Analysis?

A disposition analysis is an objective assessment that examines

  • The last step in the hiring process that each applicant reached
  • The applicant’s status on some tracked characteristic (usually a class)
  • Decisions made at an applicant’s last step (e.g., rejected, withdrew, or hired)
  • Reason for that decision (not enough experience, didn’t like hours, not enough pay, failed drug test, etc.).

The power of a disposition analysis is that it can help pinpoint reasons that certain classes of people are withdrawing from or failing at some point in the application process.

For example, if a disproportionate number of female candidates who have passed the qualification stage are withdrawing because of the hours or travel requirements, a company seeking greater gender diversity may want to review the importance of those requirements.

A disposition analysis can also point to opportunities for a company to invest in diversity outreach and initiatives. For example, if a disproportionate number of minority candidates are being disqualified because of a lack of experience, the company may want to beef up internships or mentorship programs.

What is a Hiring Process Analysis?

A hiring process analysis is a thorough examination of the process by which an organization screens and assesses job seekers and makes hiring decisions. The goal of a hiring process analysis is to identify potential adverse impact across the hiring process overall, by uncovering any statistically significant differences in hiring rates.

A hiring process analysis begins by calculating your applicant-to-hire ratio for one or more protected classes (women, minorities, job seekers over 40, veterans, and/or individuals with disabilities).

If applicant-to-hire ratios signal potential adverse impact, companies should follow up with a steps analysis.

What is a Steps Analysis?

A steps analysis isolates where in the hiring process—the in-person interview, for example—that a class (or classes) of candidates aren’t being advanced in proportion to those candidates reaching that step. If one or more steps appear to be impeding your workforce diversity goals, you can then review options, including

  • Modifying one or more steps
  • Combining and weighting steps
  • Eliminating or replacing steps.

For example, a steps analysis reveals that females pass phone interviews much less often than males. Possible causes include a biased interviewer, differences in questions being asked of men and women, or the relevance of the questions to the job.

A steps analysis serves two important functions. First, it fulfills a regulatory requirement in cases where adverse impact has been found. Second, it either narrows down the causes of adverse impact or reveals that negative impact is diffused across multiple steps.

Often a steps analysis is paired with a disposition analysis. Together, these analyses identify whether, and hopefully at what step, adverse impact is occurring.

If impact can be isolated to a specific step, focusing a disposition analysis on that step may shed light on the cause. If impact cannot be isolated to a specific step, a disposition analysis can span multiple steps to reveal more diffuse patterns.

Take, for example, a process that allows for candidates to be eliminated based on inexperience at steps 1, 2, or 3. If dispositions at these three steps all indicate that female candidates or candidates with disabilities are failing at a higher rate because they lack experience, this serves as evidence that class inexperience is causing adverse impact for women or individuals with disabilities.

Note that none of these analyses create or hinge on quotas. Rather, they increase the likelihood of finding qualified, competitive, diverse candidates with a better chance of being hired.

Bring your diversity strategy to life. See how a disposition or hiring decision analysis can deliver the actionable insights you need.

The Compounding Positive Effect of a Diverse Workforce

Having a diverse workforce has been shown to positively influence just about every measure of organizational success you can name.

The specific causal effects of diversity on positive organizational outcomes are difficult to show through rigorous scientific studies. But many likely causes are both logical and supported by the evidence:

  • Diversity in class means diversity in other traits. Organizations with employees of diverse gender, race, veteran status, and ability are more likely to have an effective mix of skills, knowledge, perspective, ideas, and thinking. This broadens the capabilities of a workforce and sets a foundation for greater creativity, flexibility, and adaptability.
  • Working with diverse people builds critical skills. A diverse workforce can be thought of as built-in, ever-present training in communication, emotional control, human variability, tolerance, varied perspective utilization, and a host of other positive factors.
  • Diversity fosters psychological safety. At most US companies, the workforce is already at least somewhat diverse. By increasing representative levels of diversity, companies can create a better environment—one in which employees can feel safe. This is due to a number of reasons, but primarily because diversity will necessitate a culture of inclusion.

People want to work for an inclusive organization—one with a reputation as a workplace where they can feel welcomed and respected for their talents. A workplace in which they can thrive and grow.

What’s more, diversity tends to reinforce itself over time.

As that happens, an organization will become more attractive to a greater pool of talent. Which, in turn, increases the statistical likelihood of hiring better talent (assuming your selection methods are good), along with the likelihood that this talent will stay.

And as every savvy business leader knows, companies are built or broken on the competitiveness of their talent.

About the Author

Patrick McNiel, PhD, is a principal business consultant for Affirmity. Dr. McNiel advises clients on issues related to workforce measurement and statistical analysis, diversity and inclusion, OFCCP and EEOC compliance, and pay equity. Dr. McNiel has over ten years of experience as a generalist in the field of Industrial and Organizational Psychology and has focused on employee selection and assessment for most of his career. He received his PhD in I-O Psychology from the Georgia Institute of Technology.