If you have direct access to recruiting leaders like I do, you would quickly learn that upward of 95 percent of large corporate diversity recruiting efforts routinely fail to meet their modest diversity goals. In fact, the EEOC reports that diversity employee representation percentages at corporations have barely budged since 1985. The Harvard Business Review even reached the conclusion that “It shouldn’t be surprising that most diversity programs aren’t increasing diversity.”
This universal failure occurs despite the fact that CEOs of most major companies have publicly stated that they enthusiastically support and need diversity at their firms. In fact, diversity recruiting results are routinely so bad that I have concluded that diversity recruiting programs have the highest failure rate of any HR program in corporate America.
Emotion vs. Data
This almost universal failure has one simple cause. And that is that diversity programs are generally managed with emotion and historical best practices instead of a data-driven businesslike approach. In my view, the time has long passed when executives can allow this critical high-impact corporate area to be managed so imprecisely and to continually fail to make dramatic increases in corporate diversity.
Show Me the Money
Historically, diversity recruiting has been managed so loosely because its goals were often quite low (i.e. reach the numbers, minimize legal liability, and make an effort to “do the right thing”). But the current approach needs to radically change as a result of recent research results that reveal that diversity has a significant business impact on overall business results, sales, and market share. And as a result of its impact, diversity recruiting must become a strategic business imperative that cannot be allowed to continually fail. If you haven’t seen this business impact research, here are some illustrative examples.
“Building an inclusive culture is now the No. 1 predictive strategy for global financial performance, bringing this topic into the focus on CEOs and senior execs.” (Bersin by Deloitte)
Companies in the top quartile for diversity … financially outperform those in the bottom quartile. “Gender-diverse companies are 15 percent more likely to outperform” their industry average, “while ethnically diverse companies are 35 percent more likely to outperform” the industry average. And diversity is probably “a competitive differentiator that shifts market share toward more diverse companies over time.” (McKinsey analysis)
“Companies reporting the highest levels of racial diversity brought in nearly 15 times more sales revenue on average than those with the lowest levels of racial diversity.: (Cedric Herring)
Insanity Is Trying the Same Thing Over and Over and Expecting a Different Result
This quote from Albert Einstein best describes today’s situation in corporate diversity recruiting. When you look at the diversity recruiting approaches used by large corporations, you find a level of “sameness” and uniformity that is surprising, especially given the need to develop a competitive advantage. And this “sameness” (i.e. an over-reliance on traditional diversity recruiting tools and a “soft emotional approach” to managing diversity recruiting) is the primary cause for this unacceptably high failure rate.
Even powerhouse recruiting firms like Google that rely heavily on data to improve their regular recruiting, in direct contrast, rely on emotion and tradition when managing diversity recruiting. They simply don’t have the courage to use data to innovate in this area. Instead, what is needed at every corporation is a 100-percent-businesslike approach that relies exclusively on data for identifying diversity recruiting problems and the currently most effective solutions. Incidentally, this recommended approach is the same type of data-driven management approach that is successfully used in other areas of the corporation to market and sell consumer products to the different strata of diversity customers.
Why Must Firms Shift to a Data-Driven Approach?
In order to be effective, recruiting approaches need to adapt to the changing world.
For example, as unemployment rates drop, finding and convincing both regular and diversity candidates becomes harder, so different and less “active” sourcing approaches need to be used. And with the growth of social media, the number of ways to reach prospects has expanded greatly, but the members of the various diversity subgroups (e.g. Mexican heritage, Latin American heritage, South American heritage, and Cuban heritage or European Spanish heritage) all use different social media. And as the global definition of diversity expands beyond race and gender, new recruiting approaches need to be added to meet these added diversity subgroups. And finally, new generations of employees expect different things in a job, so traditional attraction factors may no longer work.
Taken together, this means that in order to remain effective, diversity recruiting strategies, approaches, and tools must constantly be updated. And the best way to ensure that those updates and additions are continually the most effective is to use data to make each of these categories of decisions. Every diversity recruiting leader should quickly be able to answer key executive questions with hard data (e.g. what is the most effective diversity source, employer branding approach, assessment approach, and candidate closing approach?).
Of course, most other business functions have long ago shifted to a data-driven model where 6 sigma quality is measured. But those who run diversity recruiting seem to be satisfied with simply having what I call “a pure purpose” (i.e. improving diversity and inclusion). But instead, what is needed now is for corporate leaders to demand that diversity recruiting and retention programs operate like any other business processes that must be data-driven.
Where Data Is Needed in Diversity Recruiting Decision-Making
Diversity recruiting can be dramatically improved if data is collected and used for decisions in the following areas (Note: you won’t find a single corporate diversity leader that can answer each of these questions with data).
Candidate research data — you can only fully understand and therefore effectively attract and sell the very best diversity talent if you know this information for the prospects in each diversity subgroup:
- The steps in the job search process used by your diverse recruiting targets.
- Where diverse prospects would most likely find out/read about your company or your jobs.
- The keywords that diverse prospects use when they search for job openings.
- The attraction criteria that diverse prospects use to add a company on their “short list.”
- The company and job attraction factors that would convince diverse prospects to actually apply for one of your jobs.
- The communication channels that diverse prospects/candidates prefer.
- The turnoff factors that could possibly discourage diversity prospects.
The best sourcing data — you must ask the best diversity finalists and new hires to identify the specific sources that had the most influence on their decision to apply. With this data, a firm can focus its prospect finding efforts on the most effective sources for quality diversity hires for each diversity subgroup (i.e. referrals, job boards, boomerang rehires, etc.):
- Use data to identify the most effective diversity referral approaches.
- Use data to identify the most effective social media sites for reaching diverse prospects.
- Use data to identify the most effective individual sourcers, recruiters, and hiring managers.
- Use data to identify the firms to target because they have the best diversity talent pool.
Candidate closing data — because top diversity candidates are in high demand, it takes a powerful and data-driven approach to successfully sell your finalists in each diversity subgroup. The required data include:
- Job acceptance criteria — directly ask diverse finalists the positive factors that need to be met before they can say yes to your offer.
- Deal breakers — identify any concerns or deal-breaker issues that must be alleviated before a diverse candidate will say yes to an offer.
Other important data for recruiting decision-making — you will need additional data for making recruiting decisions in other areas, including:
- Prioritization of jobs — not all jobs, when filled with a diverse employee, produce the same positive business impact (i.e. in most cases, jobs involved with selling, customer contact, and product design require an employee base that reflects the customer base). So data must be collected that identifies which jobs, when filled with a diverse person, have the highest impact on business results. Obviously, recruiting resources need to be focused on those jobs.
- Diversity prospect/candidate segmentation — lumping all diverse prospects together is a common but ineffective practice. So use data to identify any distinct diversity subgroups that actually share common attraction factors and issues. Without these commonalities, each diversity subgroup must be treated as unique with a customized recruiting approach.
- Correlation with business results — in order to build the business case for diversity, the statistical correlation between improving diversity percentages and improving team performance must be calculated and widely reported.
- Where are the problems? — recruiting leaders can’t simply be allowed to speculate about which recruiting step their most serious diversity problems are occurring at. Instead, data must be used to identify where in the recruiting funnel the most impactful diversity recruiting roadblocks or problems are occurring (i.e. at which step, from the volume of diverse applicants, to the fit determination phase, the interview, and on to the offer acceptance phase). Also, after each major diversity hiring failure, a formal failure analysis must be conducted to determine what went wrong in order to avoid future errors.
- Motivators — diversity recruiting works best when everyone is highly motivated. So data must be used to identify the most effective motivators that influence managers (and employees) to proactively seek out and hire quality diverse individuals (i.e. metrics, sanctions, bonuses, or promotion criteria).
- Key attraction/selling points — you can’t effectively attract or sell diverse candidates unless you know your firm’s strongest selling points for diverse individuals. You can gather that information with a survey your own employees to identify the exciting practices, programs, and compelling features that make your firm superior to others for diversity candidates.
- Measuring quality of hire — literally no firm that I have encountered measures the quality of hire among diversity hires. However, you can’t simply be happy with gross hiring numbers. Instead, you must also measure quality of hire to ensure that you’re getting the top-performing diversity hires available. Performance matters in every area, and diversity recruiting and retention should not be exempt.
- The impact of speed on diversity hiring success — data must be collected in order to determine if a slow hiring speed has a significant impact on diversity hiring success (because most top performers are snatched up within 10 days).
- Retention effectiveness — it is expensive to lose recent new hires. So recruiting must be supplemented with the most effective retention strategies, approaches, and tools for keeping your top-performing diversity hires.
I have written extensively about what’s wrong with diversity (pretty much everything) and unfortunately diversity recruiting is no exception. Given its long track record of failure, it’s time for a dramatic change in how diversity recruiting is managed. The first step is to permanently discard the overused and invalid excuse of “there’s a shortage of diversity.” Yes, it might be true that for an entire industry that there is a shortage of diversity. However, in a global economy where remote work is possible, for any single corporation, there are more than enough diverse individuals to fit their needs (provided that they are willing to offer remote work and to poach from other companies). No company will get more than their fair share of the available supply of diverse talent if they don’t have the courage and the right recruiting tools to “poach” them away from your competitors.
The second step is for your diversity team to adopt the principle that you will no longer use any sourcing or recruiting tool that hasn’t proven its effectiveness with data. Once you adopt this principle, you will immediately begin to see progress. Because your data will tell you what’s working and not work, you can shift your resources to the tools and approaches that actually work for each diversity subgroup. Dropping effective historical approaches and replacing them with more effective ones is especially critical in diversity recruiting. This is because, in my experience, I have found that more than half of all current corporate diversity recruiting subprograms simply don’t produce measurable results and a positive ROI!
It’s time to put the blame where it should be. Using 20th-century decision-making approaches and tools in a 21st-century world of recruiting is no longer acceptable. If you want diversity results you need to measure it, reward it, and use data to continually update your recruiting approaches. And one last thing, you will need the courage to innovate and to poach, which is unfortunately extremely rare in the ultraconservative world of corporate diversity that viciously resists every opportunity to boldly change.
As seen on ERE Media.