How to Measure DEI Success? – 6 Key Metrics with KPIs

In modern organizations, data is critical. We use it everywhere from Finance to Compliance, Sales, and Customer Success to make decisions, identify problems, and improve processes. 

But one place where organizations often trip up on their data is with DEI --- because it's not always as clear-cut as measuring revenue, profits, or customer retention. 

Without regular, consistent measurement, organizations will not only find it hard to understand their progress on DEI, but they'll find it hard to make meaningful progress in the first place. 

So, how do we measure diversity and inclusion effectively? 

To measure DEI success, we recommend 6 key methods such as recruitment funnel analysis, employee attrition analysis, gauging employee sentiment, finding progression bottlenecks, analyzing compensation data, and accounting for business outcomes. 

In this post, we'll explain why data is critical to your DEI efforts --- and what you need to measure to see meaningful progress. 

Why Data Matters When It Comes to DEI 

"We've all heard the saying that numbers don't lie," says Laura Mills, Head of Early Career Insights at Forage. "Data is empirical evidence that you're making progress --- or not making progress --- towards your DEI goals. It helps you understand your baseline, but also what's possible. But to make meaningful progress, you need to understand the landscape you're working within first." 

When organizations are first getting started on DEI, they're more prone to setting talent acquisition or workforce composition goals --- such as increasing the candidate pipeline for a particular underrepresented group. And while it's good to have some diversity goals, Laura says organizations can make a more meaningful, long-lasting impact by focusing on equity and inclusion. 

An example here could be that you find that you have a higher-than-average time to hire and a particular reason for that is the usage of unconsciously biased words in job adverts. So, data tells you that using inclusive language could improve your time to hire in this situation.

6 Key DEI Metrics That Matter: How to Measure Diversity in the Workplace 

Moving past the 'D' in DEI means your organization can set more effective goals that align with your diversity and inclusion strategy, and connect more tangibly to business outcomes. 

Here are 6 key metrics that matter when building a more diverse and inclusive organization:

1. Recruitment Funnel Analysis

As we've already said, most organizations start with their recruitment process when looking for hard data on if their DEI initiatives are working.

But here's the difference --- instead of stopping at measuring the demographic composition of your pipeline, try measuring the impact of your process. For example, understanding that candidates with physical disabilities are less likely to make it through your interview round than those without indicates that you have a hiring manager bias problem.

2. Employee Attrition Analysis

Understanding who is most likely to leave in your organization can help uncover ways that inclusion isn't working at your organization --- especially if you're able to view your data at the level of employee dimensions of diversity, tenure, department, and level of seniority.

By doing this analysis you'll understand when to act swiftly with retention strategies for diverse talent. 

3. Gauging Employee Sentiment

Ultimately, inclusion and belonging focus on how your employees feel, and if they're able to bring their full selves to work each day. Understanding this experience will help add nuance to your progression, attrition, and performance data.

4. Finding Progression Bottlenecks

Research consistently shows that employees from marginalized groups experience fewer promotions and professional advancement in the workplace. Measuring the varying promotion rates across different employee groups will help you identify where bias lurks in performance management and progression processes.

5. Analyzing Compensation Data

Employees --- and legal bodies --- are increasingly demanding that organizations work harder to promote more transparent pay practices. When building a more equitable workplace, tracking compensation can help you identify where embedded biases are contributing to financial inequity.

6. Accounting for Business Outcomes

Diversity and inclusion impact the whole business --- not just your workforce. As such, Laura recommends that organizations take a look at how DEI is impacting external-facing factors. 

Diversity, Equity and Inclusion Metrics and KPIs 

Before jumping into the practical details, it’s important that we look back into the basics. This way you’d understand why a certain metric falls under a certain area and why a certain KPI is based on off a certain metric.  

So, what are the key elements of DEI?  

DEI can be broken down into three key areas: 

• Diversity: This refers to the representation of different identities and backgrounds within your workforce. 

• Equity: This ensures everyone has fair access to opportunities and resources, regardless of their background. 

• Inclusion: This focuses on creating a work environment where everyone feels valued, respected, and able to participate fully. 

DEI Metrics vs. KPIs: Understanding the Difference 

Metrics are any data points that provide insights into a particular aspect of your organization's DEI efforts. For example, the number of women in leadership positions is a metric. KPIs, on the other hand, are specific, measurable goals that you set based on your DEI metrics. So, aiming to increase the percentage of women in leadership roles by 20% within a year would be a DEI KPI. 

Now that the basics are covered let's head on to the practical stuff. 

Framework for DEI Metrics and KPIs 

Here are some specific examples of metrics and KPIs you can use to track your DEI progress: 

Diversity Metrics: 

• Workforce demographics: Track the percentage of employees from different racial/ethnic backgrounds, genders, sexual orientations, etc. 

• Candidate demographics: Monitor the diversity of your applicant pool. 

• Leadership diversity: Analyze the representation of diverse groups in leadership positions. 

Diversity KPIs: 

• Set goals for increasing the representation of underrepresented groups at all levels of the organization. 

• Track progress towards those goals over time. 

Equity Metrics: 

• Pay equity analysis: Conduct regular pay audits to identify and address any gender or racial pay gaps. 

• Promotion rates: Track promotion rates for different employee groups. 

• Performance evaluation data: Analyze performance evaluations to identify any potential biases. 

Equity KPIs: 

• Set a target for closing the pay gap. 

• Develop clear criteria for promotions and ensure they are applied fairly. 

• Train managers on unconscious bias and fair evaluation practices. 

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Inclusion Metrics: 

• Employee engagement surveys: Conduct surveys to measure employee sentiment and perceptions of inclusion. 

• Employee resource group (ERG) participation: Track participation in ERGs, which provide support and community for diverse employees. 

• Exit interview data: Analyze exit interview data to identify any inclusion issues that may be driving employee turnover. 

Inclusion KPIs: 

• Increase employee engagement scores. 

• Increase participation in ERGs. 

• Reduce employee turnover among diverse groups. 

Additional considerations include tracking unconscious bias training completion and employee turnover by demographics to identify areas for improvement. 

Remember, choose metrics most relevant to your goals and context, focusing on those actionable and trackable over time. By implementing these diversity KPI examples, you can create a more comprehensive and effective DEI strategy for your organization. 

EndNote

Now, that you have an idea of how to measure diversity, equity and inclusion in your workplace, we believe you'll be able to make a tailored strategy for your organization. 

Develop Diverse is an inclusive communication platform that enables your organization to build and scale a more inclusive recruitment process. Backed by AI and cutting-edge research, our platform helps your organization identify, eliminate, and retrain linguistic bias in written text. Find out more by booking a demo with one of our team members. 

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