With a greater need to attract talent from diverse backgrounds amid challenging economic environments, HR leaders are placing diversity, equity, and inclusion (DEI) objectives at the center of their hiring strategies.
The goal is to achieve an inclusive work environment and corporate culture in which the employee base is equally represented by voices across various demographic groups and perspectives. This is often done by setting quarterly recruitment targets in key areas of the business – known as a headcount-driven model – with progress communicated internally to the firm and, when relevant, to shareholders, customers, vendors, and the board.
Making hiring targets actionable and effective, however, is easier said than done. There are several inputs that must be factored into the hiring strategy to 1) establish actionable DEI metrics and 2) sustain and achieve a diverse workforce.
Actionable, Measurable DEI Hiring Targets
A baseline understanding of the current representation in the organization is key. This information constitutes all demographic groups against all departments and business segments.
The most commonly evaluated demographic groups include:
- Age range.
- Disability status.
- Gender and gender identity.
- Languages spoken.
- Military or veteran status.
- Sexual orientation.
Once there is agreement on which demographics to monitor, take the following actions:
- Establish a target total headcount number for the period in which the employer is seeking to achieve targets.
- Consider historical turnover for defined demographic groups to achieve a precise headcount number for each represented group.
- Apply an assumption for the percentage of total hires each group will comprise during the given period. This figure ensures leaders have a tangible metric to factor into scenario and forecasting processes.
- Utilize these assumptions to understand the headcount surplus required for meeting targets in each employee demographic.
Meeting headcount initiatives is a multi-year process with incremental progress milestones along the way. As HR leaders begin to see forecasted versus actual hiring data, they can refine their hiring strategies and further develop a more realistic sense of what can be achieved and in what timeframe. The byproduct is more precise hiring targets, greater efficiency throughout the hiring lifecycle, and more effectively embedded DEI into organizational culture.
Case in Point: A Headcount-Driven Model for Fulfilling DEI Targets
A company was re-evaluating its hiring strategy to increase the representation of underrepresented groups in its employee base. By using a headcount-driven model, as described above, and leveraging historical analysis, the company was able to set comprehensive hiring targets for the next five years.
The company had to weigh its hiring ambitions against the feasibility of achieving targets given the locations in which it operates and the verticals within the organization. As part of this effort, leaders specifically wanted to expand representation in already-growing departments to ensure staff were best aligned to high-growth opportunities and the trajectory of the business.
To support this initiative, CrossCountry Consulting performed a comprehensive analysis, which achieved the following:
- A detailed summary of the current employee base and percentages of demographic groups in each department.
- A headcount projection to be met over the course of five years, accounting for natural attrition and fluidity in the market.
- A hiring model for the excess headcount needed to reach the total projected target, with specific annual targets.
- Quantifiable hiring scenarios across each demographic based on how fast the company moved (aggressive, baseline, low).
With a DEI headcount-driven model, the company could benchmark the female employee demographic, for example, as 40% of all hires in year one, 42% in year two … and up toward 50% by year five. The model and analysis allowed for flexibility in the hiring strategy, enabling the company to calibrate to achievable targets while still making and demonstrating measurable progress.
What to Do Next
By setting clear objectives, executing a defined plan to accomplish them, and communicating the importance of DEI to the business, companies of every size and industry can differentiate themselves from competitors and offer unique value propositions to a larger pool of applicants. This requires a close partnership between operations and finance teams to ensure business drivers and recruitment drivers align – and that the right technologies and processes are in place to support and fuel onboarding and time-to-productivity once hires are made.
For its part, HR must own the conversation and attainment of hiring targets based on its assessment of current- and future-state organizational diversity. As is the case for any significant transformation of this kind, sufficient project management and change management support must be deployed, especially if working on accelerated timelines. The highly cross-functional nature of impacted stakeholders necessitates a holistic methodology when implementing DEI initiatives.
For expert support assessing current-state headcount metrics and future-state headcount target-setting, contact CrossCountry Consulting.