Introduction

There is a huge difference between saying you want to do something and doing it. The intent matters, but a half-hearted attempt is more damaging as employees and customers quickly spot superficial promises. 

In short, you can say you want to do something, but unless you mean it, there will be consequences, and for businesses competing for top talent, that’s more than mere social media backlash. Unsatisfied employees leave, turnover rates increase as costs of recruiting and onboarding new employees pile up, and workplace morale and engagement suffers. 

There’s a disconnect between the experiences of different demographics in the workplace. According to the SHRM’s research, “49% of Black HR professionals think race- or ethnicity-based discrimination exists in their workplaces; only 13% of white HR professionals agree”. 

The disconnect happens in more areas, as 54% of Black employees feel their workplace is not doing enough to promote racial justice worldwide. In comparison, 29% of white employees think their workplace is not doing enough to promote racial justice in the world. (SHRM)

And there’s often that intricate interplay of various diversities that make up a workforce. Racial diversity is just one kind of diversity. Gender inequality continues to plague the modern workforce. According to the US Bureau of Labour Statistics, “median earnings for women in 2021 were 83.1 percent of the median for men.” 

Age, neurodiversity, and disability are other factors that play in the equation. The BLS finds that in 2021, 19.1% of persons with a disability were employed. Compared to persons without a disability, 63.7% were employed in 2021, and we can clearly see that disability is underrepresented in today’s workforce. 

Only with an honest and thorough look at workplace practices, taking into account the demographics and people data, coupled with targeted surveys, can we be aware of the actual state of diversity, equity, and inclusion in the workforce. 

So, instead of fear-mongering, let’s jump ahead on what companies can do to avoid losing top talent and pioneer successful DEI initiatives beyond the surface level. 

Defining DEI (Diversity, Equity, Inclusion)

Diversity 

Merriam-Webster defines diversity as “the inclusion of people of different races, cultures, etc., in a group or organization.” 

Diversity in the workplace refers to how organizations deal with the inclusion of individuals from various demographics and organizations’ willingness to make an active effort to ensure that people with diverse characteristics are represented across the organizational structure. 

Equity

Equity answers the question: is the approach fair? 

Equity in workplaces is about providing everyone a fair opportunity based on their individual needs.  

If we treat everybody the same way, as if everybody’s background is the same and there are no differences between people, we ignore the realities of these people’s lives. Take a Total Rewards example; an employee with a language barrier does not need the same kind of benefits that a completely fluent person needs.

The main difference between equity and equality is in the approach: how do we help each person advance based on their unique needs? 

Equity puts equal opportunity into context. An employee may have a lower starting point due to a lower level of education. Still, companies can provide learning opportunities and allow these employees a chance to advance, corresponding to their abilities and effort. Taking employees’ differences is critical when creating new policies – to avoid perpetuating systems of oppression instead of building a respectful and thriving workforce where everyone is valued for their contribution. 

Gallup identifies three vital elements of equity: 1. fairness, 2. pay, and 3. opportunities for advancement, and measures them in surveys to get information on how employees feel. These, in turn, provide data for actionable insight.

Gallup’s survey questions: 

1) My organization is fair to everyone. 

2) I am paid fairly for the work I do. 

3) I have the same opportunities for advancement as other employees in my organization.

Inclusion

Inclusion in the workplace is accepting and appreciating people’s differences and valuing employees for their individual contributions and skills. 

Gallup offers a sound framework for measuring levels of inclusion, organized around 7 key pillars: 1. respect, 2. strengths, 3. integrity, 4. authenticity, 5. belonging, 6. trust and openness, and 7. autonomy. 

Gallup’s framework further suggests that inclusive workplaces have a high and diverse number of people agreeing with the following statements: 

1. At work, I am treated with respect. 
2. My current employer is committed to building the strengths of each employee. 
3. If I raised a concern about ethics and integrity, I am confident my employer would do what is right. (Gallup) 

The last point is about not letting concerns be swept under the carpet, covered and silenced. It’s about the accountability of leaders to own up to what they said they’d do and be accountable for staying on course of the organization’s value compass. 

DEI workspace initiatives to try in 2023

In this section, we list 7 initiatives you can start planning and implementing at your workplace today. Most of the initiatives listed fall into any of the three categories: wellbeing equity, financial equity, and career equity. 

1. DEI-friendly Total Rewards packages

Fairness in a workplace goes beyond the pay wages, and Total Rewards is one area where DEI initiatives find the most fertile ground. Total Rewards packages work best to retain employees when they are highly individualized and personalized, tailored precisely to fit employee needs. Benefits, learning, and wellbeing budgets can target those specific needs if we know enough about our employees to design ideal individualized packages. 

During the Covid era, we saw a rise in benefits directed at caregivers, people who assumed a caregiving function in their families. Those people appreciated flexible and hybrid work arrangements. There are also various fertility, adoption, and surrogacy benefits that companies like Apple and Google successfully provide their employees.  

There is also a rise in various wellbeing programs targeting employees’ wellbeing, including physical and mental health (mental health apps, teletherapy, 1on1 therapy, aids for disability such as body aid devices, etc.), financial wellbeing (retirement plans and 401 programs, student loan aids, career-advancing opportunities, etc.), and social wellbeing. 

One great tip for companies who are only pioneering a DEI initiative is to offer recognition programs tailored around DEI initiatives for greater cultural impact, integrating DEI goals with company values and communicating those with the entire workforce.

Options are as numerous as the diversity in the workplace, and Total Rewards experts carry out a huge responsibility to offer flexible and personalized packages that secure the agility and loyalty of a thriving workforce.  

→ For more about benefits, please see our suggestions for 30 employee-retaining perks here. 

2. Dedicated recruiting strategies to hire more diverse talent

Recruiting is the fastest way to hire new diverse talents for companies that still need more diversity in their rows across the organizational structure. 

For each role, there is a diverse pool of talents your company may not be tapping into. Here’s a mind-boggling stat: based on 2020 Census data, the average US unemployment rates are higher for people who are Black (11.5%) or Latinx (10.6%), compared to the average US unemployment rate, which is 8.1%. This leads us to conclude that minority populations are more likely to be unemployed. 

Combining recruiting strategies with comprehensive upskilling strategies could turn low-skilled employees into professionals fitting in their roles, loyal and thankful to the employer that made the mobility possible. There is an excellent payback for companies who understand investing in diverse talent can be rewarding both ways. 

Every step of the recruiting process influences a candidate’s experience – the potential employee experience. Ensure these practices are genuinely inclusive. One tip for honing recruiting for diverse talent is to disclose pay wages in job advertisements. Transparency in pay is the leading tool for closing the wage gap that divides white men from women and people of color. To be transparent about pay wages includes being transparent about the existing pay gap, which entails lots of sincerity from the employers. Still, it helps with being taken seriously and not as companies who do DEI half-heartedly and just because everyone else is doing it.

3. Leveraging AI and people data to maximize DEI efforts

The 2021 Ceridian Executive Survey found that “86% of employer respondents are using or planning to use analytics and artificial intelligence (AI) tools to inform DEI initiatives”. 

Leveraging people data, or people analytics, means a lot of things, from using AI to scan data to take stock of how diverse the existing workforce already is, to ensuring that the data collected provides actionable insights and future predictions.

For example, using people data in the DEI context could refer to looking at average tenure for people of a particular demographic and taking steps to prevent turnover from happening by redesigning total rewards offering to make staying and excelling at a company an alluring opportunity. 

Another example where AI can help is scanning job adverts to detect biased and non-inclusive language that may repel talents who would excel in the role. 

4. Internship programs from a diverse pool of candidates

Previously, we mentioned dedicated recruiting strategies to attract diverse talents. 

Companies engaged in long-term planning for DEI are starting even earlier. Summer programs for talented high schoolers can be an excellent foundation for hiring these young talents down the line and are highly beneficial for employers and future employees alike.  

Inclusive internship programs allow employers to tap into a diverse pool of motivated candidates and assess them before they actually employ them. For young interns, internships are a great way to learn and build connections even before they finish their studies. 

The internship programs need to be designed with diversity goals in mind. When a workforce is representative of the customers, customers not only take notice, but that company may be able to serve those customers with their unique perspectives in mind.

5. Upskilling and reskilling for your existing workforce

Sometimes, horizontal mobility can be as valuable and motivating as vertical mobility for employees. You might have untapped talent already at your disposal, and companies may benefit significantly from developing their employees instead of losing them and recruiting new ones. 

Typical examples are people with low educational backgrounds entering the workforce as customer support agents, and companies offering reskilling might find excellent programmers among these employees. Another example is offering women who are under-represented among programmers a chance to learn new skills that will allow them to enter that field.

6. Hiring diversity professionals

Diversity professionals are the people who will work to integrate the company’s DEI goals on a global and local level, ensuring that DEI goals are ingrained as values, and own and propose initiatives and programs and track them for predefined KPIs to ensure sustained progress. 

Depending on the size and needs of your organization, companies can dedicate one diverse professional role or an entire committee. Additionally, to amplify the reach of DEI initiatives, companies can organize employee resource groups, which can work wonders in conjunction with diversity professionals.

7. Internal audit for bias

An internal audit detects racism, sexism, ableism, ageism, and other -isms that threaten psychological safety of all employees.

It’s a cumbersome task because of the bias most people need to be made aware of, so often, it is better to enlist external help for the audit.

After the internal audit, there may be a need for additional training for your managers. They need to learn to recognize microaggressions and be self-critical enough to recognize unconscious bias. 

Following a quote by Steve Goldberg, “Line managers are the stewards of HCM”, we need to ask an important question. Are managers empowered to carry out the DEI values and commitments? A global strategy fails on a local level if managers are not adequately trained for DEI values, conversations, and treatment of employees while demonstrating DEI values in action. 

Benefits of social diversity in the workplace 

Numerous studies examine the effects of diversity on group dynamics, concurring that diversity makes teams more productive, engaged, and more robust in performance. 

Benefit 1: Inclusive environments are engaging

Inclusive environments are more productive and engaged. Gallup finds a correlation between levels of inclusion and engagement. In Gallup’s Q12® survey, people who are engaged are 5 times more likely to strongly agree with the statement that they are treated with respect.  

Benefit 2: Diverse teams outperform homogenous groups 

Due to diversity in expertise, experience, skills, and thought processes – diverse teams have better problem solving and the ability to see the bigger picture and broader contexts. 

According to McKinsey’s analysis, there is a strong business case for gender, ethnic and cultural diversity in corporate leadership: “ Companies with more than 30% women executives were more likely to outperform companies where this percentage ranged from 10 to 30%.”

McKinsey’s findings on ethnic and cultural diversity report that “in 2019, top-quartile companies outperformed those in the fourth one by 36 percent in profitability, slightly up from 33 percent in 2017 and 35 percent in 2014”.

Benefit 3: Diverse teams are better at making decisions 

Due to the variety of perspectives, expertise, and unique individual skill sets in diverse teams, these teams are better at making decisions 87% of the time over non-diverse teams. 

Benefit 4: Diverse teams are more innovative 

Diversity also boosts creativity and innovation, reports Innovation Management. Integrating different points of view ensures that teams come up with unique solutions. 

Additionally, 74% of millennials believe that their organization is more innovative when it nurtures a culture of inclusion.

Benefit 5: Diversity attracts talent 

Glassdoor’s report finds that more than 3 out of 4 job seekers (76%) state that a diverse workforce is important when evaluating companies and job offers. 

Benefit 6: Diversity improves retention 

Truly inclusive environments are respectful of everyone, support employees’ psychological safety, and strongly impact feelings of wellbeing and belonging, further resulting in better employee experience, which leads to lower turnover and better retention. 

Deloitte’s study found that workplace belonging can lead to an estimated reduction of turnover risk by 50%, and a 75% decrease in employee sick days.

Recognize diversity in the workplace by introducing new employee recognition programs that are tailored for your company culture. Check out our program sampler below:

Conclusion

In this article, we have defined DEI and explained how concepts of diversity, equity, and inclusion work in practice. We have listed several benefits for businesses to consider as an incentive to work on DEI strategies and provided 7 DEI initiatives to plan for 2023. 

Businesses no longer view DEI initiatives as separate from their business goals and understand that DEI impacts retention, engagement, and innovation in the workplace. As more and more companies adopt initiatives that improve diversity in the workplace, these measures must go beyond the surface level. 

One challenge lots of companies and leaders bump into is that DEI initiatives are not something one can set up, run and be over with. Whatever DEI initiatives are most fitting to your organization and workforce’s needs – you will have to set it up with actionable steps you can handle according to what amount of resources your company is willing to dedicate. This includes setting up well-defined KPIs to track and sustain the progress – which takes dedicated and perpetual effort. 

Long-term strategies trump short-term strategies. You need to track representation, hiring, retention, engagement, inclusion, and advancement (how people move horizontally and vertically around the organization). – all this by organizational level, locale, demographic, tenure, etc. 

DEI initiatives work best when they are an integral part of a company’s culture, and that includes setting an example. Does your board have diverse talent? Are you able to show the diversity you preach? Leaders lead by example, which sometimes entails stepping down so that diverse talent can prosper and diversity is reflected in leadership positions.