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Valerie J. Hoffman Seyfarth Shaw LLP

Part 1 - Understanding & Constructing Diversity Metrics: Basic & Beyond Part 2 - Diversity Metrics Workshop: Developing Metrics You Can Put Into Practice. Valerie J. Hoffman Seyfarth Shaw LLP. Understanding & Constructing Diversity Metrics: Basic & Beyond. Overview: Diversity Metrics.

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Valerie J. Hoffman Seyfarth Shaw LLP

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  1. Part 1 - Understanding & Constructing Diversity Metrics: Basic & BeyondPart 2 - Diversity Metrics Workshop: Developing Metrics You Can Put Into Practice Valerie J. Hoffman Seyfarth Shaw LLP

  2. Understanding & Constructing Diversity Metrics: Basic & Beyond

  3. Overview: Diversity Metrics • Diversity: what is it? • Diversity metrics: what are they? • Why should we measure diversity? • Aligning your diversity efforts • Choosing efforts to measure • Choosing diversity characteristics to measure

  4. Overview: Diversity Metrics • Qualitative and quantitative measurements • Conducting initial assessments • Setting legally defensible targets • Periodic measurement and progress reporting • Using results to fine tune additional or alternative efforts

  5. Affirmative Action & Diversity • Affirmative Action • Actions taken to ensure nondiscrimination of females, minorities, veterans, and individuals with disabilities • Mandated by law • Diversity • A bigger picture • Embraces each trait that makes us unique • Not mandated by law

  6. Defining Diversity • Workforce Diversity- group and situational identities of workers by: • EEO characteristics: race, color, ethnicity, sex, age, religion, disability, veteran status • sexual orientation • family & marital status • economic background & status • geographical background & status

  7. Defining Diversity • Behavioral Diversity-identity of the worker in his/her: • styles of work, thinking, learning, communication • aspirations • beliefs/value system • employee attitudes & expectations

  8. Defining Diversity • Structural Diversity- identity of the worker or group according to: • worker status: full-time, part-time, temporary • organizational role: management, white & blue collar functions • division • parent company or subsidiary • strategic alliances & cooperative ventures

  9. Defining Diversity • Business & Global Diversity- identity of the business in its: • expansion & segmentation of customer markets • types of products & services • operating environments • legal & regulatory • labor market realities • community & societal expectations/relationships • business cultures & norms

  10. © 1996 Implementing Diversity by Marilyn Loden

  11. Benefits of a Diverse Workforce • Increase in productivity; optimizing performance • Reduced turnover • Improving teamwork • Attractive to talented candidates • Enhancing the success of acquisitions

  12. Benefits of a Diverse Workforce • Improving global competency • Improving your organization’s perception in the eyes of your customers • Improving your organization’s reputation within the community • Strengthening EEO and Affirmative Action performance

  13. Why Measure Diversity? • Baseline: where we begin • indicates strengths • indicates gaps • assists setting of priorities • helps drive diversity strategy • directs attention toward key focus areas

  14. Why Measure Diversity? • Progress reports • allow progress to be measured year-over-year and quarterly • help direct resources to areas of most need • reality check: are there other barriers? • diagnostic tool for reassigning resources • Consider establishing accountability measures for leadership

  15. Aligning Diversity Efforts • Who has a stake in the success? • CEO • Human Resources • Recruiting • Marketing • Community Relations • Communications • Legal • Everyone

  16. Aligning Diversity Efforts • Marketing plans • Recruiting and talent identification • Employee development plans • HR & Compensation department • Affirmative action management • Diversity management • Public relations communications

  17. Coordinating Efforts & Metrics • Agreement, if possible • Who measures what • Who shares what with whom • What should have limited distribution • Use of attorney-client privilege

  18. Choosing Efforts and Characteristics to Measure • What is most important for your organization? • employee • customers • community • What data do you have? • What data is readily available? • What data is lawful to collect? • Limitations in non-US locations • Privacy concerns

  19. Measurement Pitfalls • Lack buy-in from leadership • Measuring too much or not enough • Not aligning measures with program objectives • Not able to compare progress year-over-year • Inconsistent measurement practices • Low data integrity or statistical errors • Legal issues • Quotas

  20. Keys to Success • Consider data integrity a key issue • Use both quantitative and qualitative measures • Develop measures that are aligned with your diversity strategy • Go slowly; less is more at first • Consistency

  21. Basic Quantitative Metrics • Workforce Demographics • Race, Ethnicity, Gender • The “Super AAP” • Quarterly progress • Year-over-year trends • By business unit and department • By job level

  22. Workforce Demographics • Employee composition v. external availability • External applicants v. hiring • Employee composition v. external applicants v. hiring • External applicants v. internal applicants • Internal applicants v. promotions

  23. Workforce Demographics • Internal & external applicants v. placements (hires & promotions) • Promotions v. feeder jobs composition • Voluntary terminations v. employee composition • Involuntary terminations v. employee composition • Compensation (base, bonus, perks)

  24. Advanced Workforce Demographics • Performance ratings v. employee composition • Performance ratings v. employee compensation • Performance ratings v. performance improvement plans • Training opportunities v. employee composition • Developmental opportunities • High profile/visibility opportunities • Global assignment opportunities

  25. Advanced Workforce Demographics • High potential list composition • High potential list v. feeder jobs • Comparative success of multiple year HiPo’s • Analysis of reasons for involuntary terminations • Analysis of reasons for voluntary terminations

  26. Other Advanced Quantitative Metrics • Management level composition & movement • Generational composition & movement • Sexual orientation composition & movement • Flexible work arrangement participation • Employee resource/ affinity group participation

  27. Other Advanced Quantitative Metrics • Diversity council participation, efforts • Executives’ diversity activity involvement • Board of Directors composition • Customer composition • Community composition

  28. Generational Composition Studies For employee development & turnover issues Caveat: evidence of age discrimination? • Traditionals: born between 1928-1945 • Baby Boomers: born between 1946-1964 • Generation X: born between 1965-1980 • Generation Y: born between 1981-2000

  29. Qualitative Metrics: Diversity Activities Can evaluate (by grading or pass/fail) quality of effort & results of business unit or department: • Diversity strategy developed • Diversity message communicated • Diversity on meeting agendas • Diversity in succession planning, HiPo pool development

  30. Qualitative Metrics: Diversity Activities May also evaluate quality of diversity activities by: • surveying participants and reporting areas of consensus and their comments • incorporation of suggestions as improvements to future activities enhance credibility of efforts

  31. Other Advanced Quantitative & Qualitative Metrics: External Talent • Success in sourcing diverse candidates • Job boards • Colleges & universities • Employee referrals • Diversity activities • Internships • Agencies & search firms • Add return on investment analysis

  32. Other Advanced Quantitative & Qualitative Metrics: Customers & Community • Community • diversity in charitable giving • increases in supplier diversity • number of suppliers v. total • dollar value v. total • percentage of supplier dollar value • Customers • increase in sales to/revenue from diverse communities

  33. Establishing a Process for Progress • Conduct initial assessments of chosen metrics • Set legally defensible targets, not quotas • Best practice: Inclusion, not preferences • Most lawyers say, “Composition goals safest at no more than 100% of availability” • If you adopt preferences, must have • “Manifest imbalance” and • a narrowly tailored remedy by • scope and a • limited timeframe

  34. Establishing a Process for Progress • Periodic measurement and progress reporting on achievement of targets • including individual manager report • for business unit and department • Fine tune over time by adding alternative measurements or eliminating ineffective ones • consider metrics a “work in progress” • learn what is useful and motivates without being unlawful

  35. Diversity Report for Managers Sample of Basic Report for each VP’s business unit and each department • are we attracting diverse talent? • metric: employee composition v. external availability • are opportunities flowing to everyone who seeks them? • metric: internal & external applicants v. placements

  36. Diversity Report for Managers • do we have turnover issues? • metric: involuntary & voluntary terminations v. group composition • am I & my direct reports supporting employee diversity activities? • metric: internal activities report for each • to what improvements in diverse recruiting, or customer & community relations am I & my direct reports contributing? • metric: external activities report for each

  37. Advanced Diversity Report for Senior Managers & HR • is our performance rating system evenhanded and aligned with our compensation system? • metric: performance ratings v. compensation • are training & development opportunities & our identification of management talent inclusive? • metric: employees selected for training, developmental opportunities and high potential list • additional metric: HiPo list composition v. composition of feeder jobs

  38. Advanced Diversity Report for Senior Managers & HR • is everyone on our high potential list able to succeed? • metric: comparative numbers of promotions of HiPo’s on list for multiple years • why are we losing employees? • metric: analysis of reasons for involuntary & voluntary terminations • additional metric: analysis of exit interviews for additional qualitative data

  39. Legal Issues • Goals & targets are NOT quotas • Measurement= Evidence; be prepared to remedy problems of unlawful discrimination found • Beware of bonus programs to reward diversity activities • Employee morale issues of those who feel excluded can cause other legal issues • Generation studies may be problematic

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