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Supplier Diversity Blog by supplier.io

How to Track and Measure Workforce Diversity

Although most procurement teams focus their diversity and inclusion efforts on identifying certified diverse suppliers they can invite to participate in sourcing projects, the practice of tracking workforce diversity is a closely related and complementary effort. 

Workforce diversity programs look at personal characteristics similar to those included in supplier diversity—race, gender, sexual identity, disability status, and military service—and aim to increase their representation in the employee population. 

According to Gartner, “Sixty-nine percent of organizations cite workforce DEI as a strategic priority, but HR still struggles to hold the business accountable for DEI outcomes.” 

Procurement teams can certainly relate to this given the challenge of awarding business to diverse suppliers. 

The key, as with so many other business initiatives, is data. 

Why is data key to tracking and measuring workforce diversity?

Joan C. Williams and Jamie Dolkas recently addressed this topic in a Harvard Business Review article, “Data-Driven Diversity.” As they wrote, “Although tracking data is key to doing better in this arena, most companies have yet to adopt evidence-based, metrics-driven practices—even though they’ve acknowledged DEI as a moral imperative and recognize how it can help their bottom line.”

In other words, a company may recruit and hire with diversity in mind, but until they are tracking detailed data about their employees, they are unlikely to know for sure. 

Companies typically allow employees to self-identify across the range of recognized communities and characteristics, and the data is stored anonymously for the sake of privacy. Different levels of detail may be included depending on program maturity and reporting intentions. For instance, minority employees may be tracked as one group or by individual race and ethnicity, even recognizing the number of employees that belong to multiple groups. 

The other consideration is hierarchy. Knowing what communities are represented on the board of directors as compared to the leadership team or employees can be useful information. 

What are the advantages of tracking and measuring workforce diversity?

There are multiple advantages to tracking workforce diversity, some internal and some external:

  • Companies have the option of reporting on the diversity of their workforce for the sake of shareholder value and/or customer loyalty.
  • Customers with mature supplier diversity programs may also measure and track the diversity of their suppliers’ workforces.
  • Lack of diversity in certain parts of the company or in leadership may not be evident without regular reporting.

Who should be involved in the tracking process?

Before starting to track workforce diversity, companies should solicit input from several functional teams that will either want to be involved or have important perspectives to include:

  • Human resources can share how hiring practices already reflect diversity, equity, and inclusion (DEI) objectives.
  • A DEI officer or team will have a key point of view to offer based on the overall company vision.
  • Procurement can share whether the supplier diversity platform and/or information source they have access to has the capability to support workforce diversity tracking.
  • Legal will make sure everyone who will be involved understands relevant privacy requirements, which may help prevent difficult conversations later on.

What are the benefits of diverse teams?

As I have written previously, diverse teams are associated with benefits such as:

  • Making better business decisions 87 percent of the time.
  • Higher employee retention, with 55 percent of job seekers saying it is very/extremely important to work at a company that prioritizes diversity and inclusion.
  • Approaching facts and ideas more thoughtfully through careful consideration of all ideas at the project level.

These benefits are highly desirable, and the idea of purposefully diversifying the workforce is a generally accepted best practice. And yet, progress and results will both remain out of reach without data and reporting. 

Companies that want to hold themselves accountable for increasing workforce diversity should ensure they have access to relevant data. That is where real progress begins.

To learn how you can grow your diversity and inclusion initiatives, start your supplier workforce diversity analysis today.

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The team has a long history in driving innovative solutions in supplier diversity. We believe that companies deserve solutions that are effective and provide measurable value and results. Started more than a decade ago, supplier.io has rapidly become a prominent provider of supplier diversity solutions to leading corporations. We currently support customers in automotive, healthcare, insurance, retail, manufacturing, education, and banking. One in five Fortune 50 company relies on supplier.io.