As the world becomes more digital, data has become an indispensable resource for organizations seeking to promote diversity, equality, and inclusion (DEI). People analytics (the discipline of utilizing data to guide HR decision-making), has become an important driver of DEI for global organizations.
In the past, HR departments frequently made employment, promotions, as well as other HR-related decisions based on subjective opinions and intuitive emotions. This strategy frequently led to implicit bias and a dearth of diversity in organizations. By offering a more accurate and comprehensive view of the workforce, people analytics enables organizations to take data-driven decisions, that foster DEI.
Why is People Analytics so Important to Diversity?
Enhancements in DEI do not happen by accident. Companies must develop policies to encourage racial and gender diversity. Equally important is the need to evaluate the results.
According to management sage Peter Drucker, "You cannot improve what you do not measure." People analytics, or the compilation of HR data regarding employees and performance, is vital for this reason.
If you want to evaluate your organization's diversity and inclusion initiatives, your HR department must:
- Perform a demographic analysis of your talent.
- Evaluate their performance.
- Monitor their progression within the organization.
This will indicate, for instance, whether a specific racial subgroup is underrepresented in employment or whether a specific gender is largely absent in promotions.
7 Ways People Analytics Helps Build a More Diverse Workforce
By using people analytics, you can promote diversity in several key ways:
1. Decide when to provide unconscious bias training
People analytics can assist organizations in identifying implicit bias patterns in the employment and promotion systems. For instance, a study of promotion data could reveal that some groups with comparable qualifications are consistently overlooked for promotions. This will indicate when training on implicit bias is necessary.
2. Engage and retain workers from minority backgrounds
People analytics can be used to determine variables that lead to high attrition rates, especially among underrepresented groups. For instance, an examination of exit interviews might reveal whether certain employee groups are more likely to quit because of a lack of guidance/support or microaggressions.
3. Incorporate DEI into your hiring practices
An examination of job ads and applications may disclose that only certain applicant groups are routinely underrepresented. This information can be used to make recruiting efforts more equitable and diverse -- for example, by rewriting job postings.
4. Close the wage gap
A review of salary figures could disclose that certain employee groups are underpaid when compared to their peers for performing the same work. By tackling these disparities, organizations can foster a more equitable and fair workplace.
5. Identify places where you are falling behind
To effectively and successfully hire a diverse team, a company must first recognize its current diversity gaps. People analytics provides the HR department with a comprehensive understanding of the existing workforce composition. This information enables the extraction of individuals according to their age, sex, and ethnicity.
6. Make data-driven HR decisions
When making decisions, such as performance incentives, HR can rapidly generate a report using people analytics. This could include a twenty-year history of performance incentives in relation to years of service, departmental revenues, revenues by area, gender, and male: female ratio. Trends of prejudices in the past are readily identifiable, necessitating data-driven bonus structures.
7. Present diversity as a real, quantifiable issue
The most effective application of people analytics is the presentation of visual data to demonstrate a DEI problem and persuade decision-makers. Statistical reportage and infographics enable leaders to comprehend and act upon data and findings.
How to Implement People Analytics for Workforce Diversity
Your human resources data is ubiquitous and plentiful. HR data exists in various formats, languages, and technologies. There is one tier of data that is visible, easily accessible, and relatively straightforward to report. We consider this to be primary HR indicators and standard reporting.
We find more actionable and business-relevant analytics below the surface. This multidimensional analysis enables you to comprehend all facets of your employee demographics, HR programs, and employee experience via the lens of diversity, equity, and inclusion.
It is advisable to spend some time autonomously analyzing and documenting each of your HR functions (i.e. HRIS, LMS, talent management, hiring, etc.) before installing a dashboard for people analytics.
Key Takeaways
Focusing on DEI is essential for organizations seeking to create workplaces that reflect the society we live in. Moreover, there is a well-established correlation between investments in this area and positive business outcomes and increased profitability.
A McKinsey study revealed that margins increased by 8% for every 10% increase in the racial and gender diversity of senior executive workgroups in the United States. By leveraging people analytics meaningfully, you can transform your culture to provide a more positive AND productive working experience to employees from all walks of life.
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