Why is business getting diversity so wrong?

July 11, 2016 Kim Schollick No Comments

In the second season of HBO’s Silicon Valley, showrunners Mike Judge and Alec Berg added a female engineer character to the cast, in the wake of criticism that the show was too male-oriented.

 

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Silicon Valley’s Carla Walton sets Jared Dunn straight. Source: HBO/via rebloggy.com

 

In something of a nod to that criticism, and to the diversity debate in general, the episode in question features a scene wherein the four male protagonists argue the merits of hiring women for the sake of it.

“We want to hire the best people — who happen to be women, regardless of whether or not they are women. That part is irrelevant,” Jared says, twisting himself into a complicated pretzel of logic.

It’s a decidedly meta bit of commentary and, by all accounts, an accurate reflection of how a lot of recruiters approach the topic of diversity. Diversity is good. Tokenism is bad.

While most of us can agree that diversity in the workplace is a good thing (YouTube commenters notwithstanding), most industries have struggled to embrace the concept in any kind of meaningful or effective way.

It’s a topic that was addressed at large at InspireFest recently, an international festival of technology, science, design and the arts, held in Dublin. In this video, a panel made up of representatives from industry leaders Sodexo, Fidelity International, Accenture and Dropbox talk about why diversity and inclusion need to remain a priority for companies who want to remain competitive in this day and age.

 

 

Stuart Warner, head of of technology at Fidelity International, acknowledges this by stating:

“I think it’s fair to say at the moment that we don’t represent our client base. And I think if you look forward two to three, four, years out, it’s going to be even more different. So if we don’t keep up and we don’t change our workforce, that’s going to be a real challenge, to compete.”

And therein lies the crux of the issue – despite the fact that the diversity debate has been going on for 20 years or more, very few companies have made significant strides in the right direction.

Take a look at Google.

In recent years, Google has recognised the need to improve diversity, and last year committed $150 million towards a campaign to improve diversity not just at Google, but in the tech industry at large. However, recently released statistics on the demographics of Google’s workforce indicate that their attempts to improve diversity aren’t going so well. Take a look:

 

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As you can see, any increases in diversity have been fairly negligible. In fact, the percentage of African-American and Hispanic employees remained static between 2014 and 2015. And if Google – a company with a seemingly infinite number of resources at its disposal – can’t adequately tackle the issue of diversity, what hope do the rest of us have?

Most diversity programs don’t work

Google isn’t alone in its failure. A recent article in the Harvard Business Review shines a spotlight on the fact that, as a general rule, most diversity programs aren’t increasing diversity. Given that it’s been a hot topic in the business world since the late 90s (thanks, largely, to a string of highly publicised discrimination lawsuits), why haven’t we seen significant shifts in workforce diversity in that time?

According to Frank Dobbin (professor of sociology at Harvard University) and Alexandra Kalev (associate professor of sociology at Tel Aviv University), the answer to that question lies in our tendency to push back against ideals foisted upon us.

Most diversity programs, according to Dobbin and Kalev, take a fairly heavy-handed approach, favouring strategies and procedures that are mandatory and inflexible. The most common strategies are, unfortunately, generally the least effective. Let’s take a look at three of those strategies, and why they don’t work.

Diversity training

Diversity training isn’t what we’d call a fresh concept – it’s been widely used in a number of organisations since the 1960s, primarily as a way to reduce racial tension in the wake of the Civil Rights Movement in the US. Since then, it’s been used to increase sensitivity towards those members of society most likely to face institutional discrimination, in both public sector and private sector environments.

Diversity training seeks to increase sensitivity to marginalised groups, thereby increasing the rates at which they’re hired and retained. However, there’s significant research that indicates that they can actually have the opposite effect.

 

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Unsurprisingly, Diversity Day goes terribly wrong on The Office. Source: NBC/via keysmashblog.com

 

A 2009 article in the Annual Review of Psychology that looked at almost a thousand reports on reducing incidences of prejudice found that the positive effects of diversity training rarely last more than a day or two, and that it can actually trigger something of a backlash. This can be attributed to two factors. One – diversity training tends to favour negative reinforcement; that is, focusing on the consequences of discrimination rather than the benefits. And two – most diversity training is mandatory, with the message being, ‘if you don’t like it, you know where the door is’.

The results? Five years after implementing mandatory diversity training for managers, companies saw no increase in the proportion of white women, black men and Hispanics in management. Furthermore, the numbers of black women and Asian-Americans of both genders shrunk by an average of 9% and 4%, respectively.

Despite these fairly discouraging figures, diversity training is still widely used – by around half of midsize organisations, and nearly all of the Fortune 500.

Hiring Tests

Hiring tests are another tool that businesses use to try and fight bias. By assessing the skills of candidates with a standardised test, you are, in theory, ensuring managers hire the best candidate for the job, regardless of race, gender, sexuality or any other discriminatory factor.

While the rationale behind using hiring tests makes sense, the reality is that they don’t work as they should. Ultimately, managers don’t like being told who they can and can’t hire – and as a result, tend to conduct the tests selectively, allowing them to ‘cherry pick’ their preferred candidates.

And even if managers are testing every applicant, in a lot of situations, they’re simply ignoring the results. In her book Pedigree: How Elite Students Get Elite Jobs, Lauren Rivera unravels the way employers define and assess merit differently for different applicants. In her investigations, she observed just that. For white, male applicants, flubbing a test was glossed over. For female and/or black applicants, it was a kiss of death.

Performance ratings

We tend to think of performance ratings as simply a way to separate the wheat from the chaff – the old ‘rank and yank’, as it were. However, they’re also a way for companies to ensure that managers are making pay rise and promotion decisions that are free from bias.

For companies, it’s good insurance – having systems in place to ensure merit-based decisions means that discrimination lawsuits have less chance of sticking.

Unfortunately, things aren’t that cut and dry. Studies show that those in charge of performance ratings tend to give women and minorities worse ratings than they’re entitled to. Other managers rate everyone at the same level, thus justifying any promotion or pay rise decisions they may make going forward.

Essentially, the human element in performance ratings means there’s room for manipulation – and consequently, there’s no evidence that performance ratings actually serve to boost diversity. In fact, five years after being implemented, most companies see, on average, a 4% reduction of white women in management.

The good news – there’s some hope

It’s easy to look at what are clearly some fairly discouraging statistics, and decide that improving diversity in the workplace is a task destined for the too-hard basket. If a company like Google can spend $150 million on diversity and yield negligible results, is any of this really worth it?

Well, yes. As we discussed in our team building series, diverse teams produce far better work than homogenous groups. On top of that, a 2015 study from McKinsey shows us that companies with more diverse workforces perform better financially.

The good news? There are strategies that get positive results – you just need to change your way of approaching diversity.

The key thing to keep in mind is that people respond poorly to concepts and ideas they feel forced to adopt. Traditional diversity programs are something that evokes an eyeroll from participants, and an apologetic air of sorry guys but we have to do this from management.

Instead, you need to frame diversity as a positive – something that will benefit both the company and its employees. You also need to frame it as something that employees have a choice in engaging with.

According to Dobbin and Kalev, there are three factors that can make diversity programs yield positive results. They are:

  1. Engagement
  2. Exposure
  3. Encouragement

Engagement is key. In their research, Dobbin and Kalev looked at a couple of underused methods of improving diversity – one being college recruitment programs.

Inviting – but not mandating – managers to participate in programs such as these has a measurable, significant impact on workplace demographics. Managers who elect to participate in college recruitment programs tend to become champions of diversity, apparently seeing the merits of the concept once they’re actively working towards it. On top of that, programs targeting women saw the proportion of women in management rise around 10%, whereas programs focusing on recruitment of minorities increase the proportion of African-American managers by between 8% and 9%.

Exposure is another factor to consider. There’s a wealth of evidence to suggest that, when diverse groups work together as equals, and towards a common goal, bias is significantly dampened.

Part of this may lie in the fact that a large part of bias has its roots in stereotypes and assumptions, in the ‘othering’ of those different to ourselves. When people are able to work with people different to themselves, we see a reduction in biased attitudes, and subsequently, an increase in diversity.

Encouragement is the final piece of the puzzle, but that may be something of a misnomer – it’s more like incentivising people to do the right thing. And one of the most effective ways of doing that is with social accountability.

Let’s take something like pay rates. There’s a very hush-hush culture surrounding pay rates and salaries in most industries and workplaces. Pay negotiations are conducted behind closed doors, employees are discouraged from discussing pay with their colleagues, and rarely do job ads openly state what salary a successful candidate can expect.

It’s such an ingrained concept that most of us never question it, but the reality is that it’s something that can be problematic. After all, if pay rates and salaries are kept secret, it’s a lot easier for management to pay people unfairly compared to their peers.

 

Mr. Burns makes the most of a lack of transparency. Source: Fox/via giphy.com

 

A field study by Emilio Castilla from the MIT Sloan School of Management confirmed this very theory. When a firm found that African-American employees were getting smaller raises than their white counterparts (even when these employees had identical titles and performance ratings), Castilla suggested a policy of transparency, to encourage a level of social accountability.

It worked. In Castilla’s study, the very real gap in raises disappeared once managers knew they would be held accountable by colleagues.

Do all workplaces need to think about this?

Let’s, for a moment, jump back to a statement we made earlier in this piece:

Diversity is good. Tokenism is bad.

There are few people who would disagree with this statement. Advocates for diversity in the workplace do not expect businesses to hire lesser candidates simply for the sake of diversity. Every business owner and hiring manager has the right to hire the best candidate for the role, regardless of who they are.

Unfortunately, most of us are prone to some level of unconscious bias, which means that, generally speaking, our belief that we’re acting pragmatically is just that – a belief.

An oft-cited example is how the musical world has attempted to combat sexism during auditions for symphony orchestras. As recently as 1970, the major orchestras in the US were made up of less than 5% women. In a bid to address this fact, orchestras began using ‘blind auditions’ – that is, people audition from behind a screen, so the jury cannot see them. In some auditions, they lay carpet across the stage, so the clicking of a woman’s heels cannot be heard.

 

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Springfield Elementary: Leading the charge in orchestral diversity. Source: Fox/via simpsons.wikia.com

 

And here’s the rub – blind auditions work. Since their implementation, the proportion of women in orchestras has steadily increased.

But can this approach be adopted in more conventional workplaces?

The Victorian Government is trialling ‘blind applications’, in an attempt to minimise unconscious bias in the hiring process. The trial has been spearheaded by the Minister for Multicultural Affairs, Robin Scott, who noticed his wife, Shaojie, received a lot more responses to job applications when using her anglicised name, Jade.

This trial will see the Victorian Government removing personal details – such as name, gender, age and location – from job applications.

So what can you do?

Trying to improve diversity in the workplace is not what anyone would call a simple task. To do it successfully, you need to eschew common wisdom on the topic, adopt new approaches, and find ways to challenge your own unconscious biases.

That’s a tough gig, no matter how you slice it.

Luckily, a number of tech solutions to this very human problem have appeared in the market in recent years.

GapJumpers allows employers to host ‘blind auditions’ (their website talks about finding great talent the way The Voice does), where they set challenges they can use to evaluate talent. Candidates apply by completing these challenges, and the employers only receive CVs and contact details once they’ve selected a pool of candidates to interview.

Textio, on the other hand, is a service that tries to head off bias issues at the recruitment stage, by helping employers avoid weighted language in job listings and candidate emails. While Textio evaluates your job listings on a number of factors (length, positive language, overuse of corporate cliches, etc) it also highlights words or phrases they’ve found tend to put off certain groups of candidates.

Blendoor is an app that aims to eliminate bias by removing a candidate’s name and photo from their application. Created by Stephanie Lampkin, an African-American woman with a strong engineering background, the app’s website claims to be all about ‘merit-based matching’. Still in beta, the app has already gained a lot of attention in the media.

While, historically, we might not be great at creating and developing diverse teams, it’s encouraging to see the amount of research, innovation and effort that’s going into addressing the issue.

As Claire Cain Miller at The New York Times says, “Despite the digitization of job listings, human-resources departments have not changed much from the analog days. And, according to decades of research on the topic, humans just aren’t that good at hiring.”

The good news is not that we’re getting better, but that we’re finding ways around the fact that we’re just not that good at it.

Diversity isn’t just an important social goal – it also gives significant fiscal returns. Choosing to ignore it in 2016 is choosing to be behind the times, and behind your competition.

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