Dear Workforce How Do We Measure ROI on Diversity

By Staff Report

Sep. 14, 2006

Dear Blending:

Promoting the concept of diversity in the workplace is, above all, a process of education. Organizations that report the greatest success (and fewest problems) with diversity obtain maximum productivity from their total workforce. The fundamental concept that your people must understand is easy to grasp: Organizations that get maximum productivity from a wide variety of people tend to perform better than those organizations that don’t.

We have not seen a valid tool for accurately measuring the return on investment in diversity, nor do we believe one exists that would work in a universal sense for most organizations. This article, Diversity’s Business Case Doesn’t Add Up, casts doubt on the claims of some companies that they have proved the ROI of their diversity efforts.

That is not to say that there’s no business value in managing a diverse workforce well; it’s just that no reliable method has been developed to measure that value definitively. That being said, if Company A has developed systems, procedures, policies and a culture that allows men and women from diverse backgrounds to succeed, while Company B’s systems work only for certain types of people, it stands to reason that Company A is going to perform better. The argument needs no help from a measurement tool.

Some people will resist your effort to promote diversity, no matter how skillfully executed. Don’t let that deter you. Also, don’t fall into the trap of implementing diversity programs for business reasons, only to have them devolve into tools of political correctness. That would lend credence to skeptics who doubt the value of promoting workplace diversity.

More than gender, race, ethnicity and sexual orientation, diversity manifests itself in an almost unlimited array of dimensions. For examples, diversity can be broken down into:

  • Education (where, and how much)
  • Regional origin
  • Age
  • Marital status
  • Parental status
  • Communication style
  • Various and sundry other ways

Bear in mind that diversity efforts should highlight both differences as well as similarities that exist among your workers. Recognizing differences along with similarities helps you build an organization that captures the best work from all kinds of people.

Make your company a great place to work, for as wide a variety of people as possible. Avoid getting too hung up on trying to prove the ROI of diversity, and spend more time (and money) on things that simply make sense. Ultimately, being successful with diversity means nurturing a culture in which diverse people can be happy, productive and successful.

SOURCE: Richard Hadden and Bill Catlette, co-authors, Contented Cows Give Better Milk,, December 14, 2005.

LEARN MORE: United Technology Corp. uses diversity as a recruiting strategy. Also, please read how Pepsi is tracking its diversity outreach.

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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