During Fair360, formerly DiversityInc’s Women of Color and Their Allies event on Nov. 4, Dr. Chris Parker, director of research and data analytics for Fair360, formerly DiversityInc provided a behind-the-scenes understanding of how a scorecard is typically developed, who should be involved in the process and the numerous successful outcomes that can arise as a result of having a scorecard in place within your organization. Here’s a look back at Dr. Parker’s presentation and some of the vital information he provided.
The Importance of a Scorecard
Dr. Parker explained that “Tracking the progress and results of diversity initiatives can be a challenge, especially for diversity and inclusion professionals who come into an organization where there is so much work to be done. That’s where a diversity scorecard can truly come into play and assist in a department’s efforts.” Scorecards are an ideal tool for measuring specific diversity goals, such as how many women were recruited in a certain fiscal year; how many women were promoted, including what levels; the percentage of women being provided with raises or bonuses; or even the number of cases of discrimination that may have been reported. By “keeping the score” on how well an organization has been doing on various measures related to strategy, policy or other business imperatives, you have a much better means for tracking the overall progress of certain goals and objectives.
“Scorecards help us direct attention and focus to a particular issue that’s of strategic import to us,” said Dr. Parker “They give us a clear sense of what our progress is towards that goal, and when well-designed, they really give us some understanding of what we need to pay attention to in terms of process in order to continue to improve our performance.”
General Principles That Make for Good Scorecard Design
- Focus on making sure that your scorecard is aligned well with your overall strategy, and that you are able to clearly show progress.
- Make sure that your scorecard can be instrumental in giving you a sense of where your progress is relative to your overall goals. “Of course, the scorecard itself has to be tailored to the audience that’s going to be viewing it and that’s interested in it,” said Dr. Parker. “What is of interest to the C-suite might be very different from what is of interest to a particular business leader or managers further down in the organization, and making sure that you’ve tailored the metrics that are on the scorecard to those different audiences is going to be critical.”
- In addition to focusing on the outcomes you’re trying to achieve and your progress relative to those outcomes, make sure you’re also focused on the process by which you get there. “It’s important not only to have metrics, but to refresh those often,” Dr. Parker explained. “If you can automate that process for refreshing those metrics so that they’re real time or as close to real-time as possible, that is an ideal situation.”
- Review your scorecards on a regular basis. “A scorecard that you see once every six months or once every year is going to be of less use than something you’re reviewing on a monthly, weekly, or quarterly basis,” he added.
- Tie your metrics to overall compensation. “Whether it’s a bonus structure or whether it’s an integral part of your performance management system, this kind of incentive-based motivation is terribly important in setting up a system that works,” Dr. Parker advised.
Key Scorecard Metrics to Use Related to Women of Color
“Scorecards can include a number of different subjects and areas in the D&I space: discrimination, supplier diversity, charitable efforts and much, much more,” said Dr. Parker. “But if you really want to home in and focus on the demographic of improving representation of women of color, and especially representation of women of color in management positions, there are some of the areas where I believe it’s really critical to focus:
- Representation itself. “In terms of processes that are going to be driving representation, of course we look at your hiring and your promotion processes,” said Dr. Parker. “What’s the representation you see within those processes? Is it serving to increase or decrease the representation that you already have? If a greater percentage of your hires are women of color, relative to what you already have in the organization, then you’re adding some diversity.”
- Hiring, promotions, and turnover, perhaps broken down by different races such as Asian, Black, or Latinx. “If you’re promoting at a greater rate than what currently exists within your organization, then you’re increasing representation of women of color in higher levels of management,” Dr. Parker said. “Also, the converse of that is true [when we] look at turnover as well. You can be bringing people into the organization and pulling them up through it, but if you’re also losing them at a high rate — at a rate that’s higher than the representation that you have in your current workforce at that current level — then you have a problem. All the work you’re putting into development and attracting talent is being lost, so tracking turnover as an aspect of representation is really important as well.”
- Numbers of people in “majority” groups within your organization, whether it’s white men, white women or whites in general. “Looking at these figures will provide a point of comparison of how you’re doing with this demographic relative to these other groups, especially if you’re going to be charting change over time. Seeing the movement of a group that you’re interested in progressing relative to these other populations is going to be critically important,” Dr. Parker explained. “In addition to representation, you also want to look at the processes that are driving that representation. So representation is a rear view mirror look, it’s what you did before. If we start to look at the processes that you have and how well those processes are working, then we can see what’s likely to come in the future. And that’s really where the power of a scorecard can effectively be realized.”
- Talent development processes, with a specific focus on mentoring, sponsorship programs and succession planning efforts. “Very often, organizations are going to be focused on ‘who are the individuals that have the most runway ahead of them.’ Who can make contributions in the future, and who have we identified as a high potential person or part of the succession plan for the future in terms of preparing talent to move up within the organization,” said Dr. Parker. “Those are critical areas. And very often, they can be roadblocks for people. If you’re not seen as having high potential or you’re not part of the succession plan, then your prospects for moving up within the organization can be limited.”
- Employee attitudes. According to Dr. Parker, when factoring employee attitudes into a scorecard, you should particularly look at data from employee surveys including overall engagement, feelings of inclusion and belonging and whether those are areas of strength for you within specific demographic groups.
Calculating the Data for Your Scorecard
“Within the broad areas I’ve just outlined, there are really two categories of metrics that you could consider looking at,” Dr. Parker advised. “One is the actual percentage of people in those different slices that I’ve talked about. So a different slice of management, perhaps the percentage of women of color within your promotions; your new hires; your turnovers; or perhaps number of people participating in different talent development programs. Those percentages are going to be really important, especially when you track them over time or look at them relative to some other standard that you have in terms of what you’re trying to achieve. What we’re seeing with our best-in-class companies is that they set their own standards for what is an appropriate level of diversity for women of color, and really push themselves to try to achieve improvements relative to what they see in their organization now.”
In comparison to percentages on a scorecard, some companies and D&I professionals also present their data as a ratio. “Although I don’t see them as often as percentages, ratios are a good way to monitor whether the representation you’re seeing in a particular segment of your population is proportional to some other reference point,” explained Dr. Parker. “For example, a ratio could be used to look at the percentage of women of color within your overall management, relative to the representation that you have in your overall workforce for women of color.
“Numerically, if your ratio is close to one, then that indicates a level of proportionality in terms of accurately representing the women of color in management, relative to the women of color that you have in your overall workforce. And you can apply this principle in many different ways; I could look at my senior level leaders, the people that report to the CEO, or the top couple of slices of the organization, and say, ‘To what degree do I see a percentage of women of color in that area that matches the percentage of women of color that I see in my overall management?’ If I see some issues there, that could indicate that there’s a ceiling or something that’s blocking women of color from rising up in the organization. We can also apply this same principle when looking at hiring promotions or talent development programs. For example, if I have a focus on improving things for women of color, then I’m going to see a ratio that’s higher than one. Or if I’m concerned that I might have an under-representation of a particular group, I can look at my ratios and see which fall markedly below one.
Additional Best Practices to Consider
- Transparency is key. “That is the basis of what we believe and how we operate within Fair360, formerly DiversityInc,” said Dr. Parker. “Even internally, you’ve got to be truthful with yourself about what’s going on within your organization. For a company where transparency is more difficult, if you could construct a scorecard that serves as a guidepost and a leadership tool for your senior leadership team, you should. Even if you have some concerns around perhaps fielding lawsuits, have concerns that the data might be used to paint the organization in a negative way in terms of its public image, there’s still no reason why you can’t use and develop scorecards that are used internally in order to create awareness amongst your management team of what’s really happening with respect to your efforts to manage diversity and how well you’re doing in that department.”
- Keep your data current. “The more often you can look at it and update it, the better,” said Dr. Parker. “Your best option, especially with human capital metrics, is setting things up so they update automatically. As the data is collected, as people are placed in positions, as people are promoted, hired and fired, your scorecard should be updating automatically as your HR system is updated. You should also frequently review your data. Having it available for leaders all the time is a great practice, but if you’re not doing that, at least make sure your metrics are reviewed on a regular basis — at least quarterly, but ideally monthly — to ensure you really see trends as they’re evolving and to make sure that you stay on top of how your efforts are progressing.”
- Don’t make the common mistake of measuring what’s easy instead of what actually aligns with your strategic goals. “If there’s a disconnect between the scorecard — the metrics that it’s covering — and the strategy that your organization has, that’s going to be a prescription for disinterest in that data,” cautioned Dr. Parker. “That would be my prime pitfall to avoid; not keeping your data relevant to your goals. You also need to ensure there is some level of buy-in from the company’s leaders that these are the right metrics. If the decision makers are involved in the process, scorecards can actually produce business results. But if your leaders are not convinced of the effectiveness of the data you’re tracking, creating and maintaining your scorecard could feel pointless.”
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*Note: quotes have been edited lightly for length, clarity, and readability
