Measuring DEI Impact

At HTVB, we often talk about being ‘outcomes-focused’ when it comes to implementing initiatives and strategies for diversity, equity, inclusion and wellbeing, but most importantly, when measuring the impact for our clients.

What do we mean by "outcomes-focused"?
An outcomes-focused approach prioritises measuring the results of DEI initiatives rather than simply tracking activities. While outputs, such as the number of DEI training sessions or diversity profile of job applicants, are important, they don't tell the whole story.
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True impact is reflected in the changes that occur within your organisation and your broader community. This requires a strategic approach to KPI development and a variety of measurement techniques that this blog will explore.

KPI development in DEI
The most important place to start is to ensure you are aligning KPIs with strategic outcomes. To ensure that KPIs accurately reflect the goals of your DEI strategy, they must be directly linked to specific outcomes associated with the headline goals or strategic objectives within your strategy. Therefore, your strategic objectives should be bold but measurable. This allows you to clearly define what success looks like for that specific strategy ie, if we go ahead and deliver everything in the strategy, what will actually have changed?

Next, it is time to create metrics that directly measure progress towards these objectives. For example, if an objective is to increase leadership diversity, a KPI could be the percentage of women [and other marginalised communities] in leadership roles rather than just the number of women who have taken part in leadership development programmes.

Using different types of KPIs
Outputs: Measuring Activities
These KPIs track the actions and efforts undertaken to promote DEI:

• Number of DEI training modules completed: Quantifies training participation.
• Diversity of job applicants: Measures the breadth of talent that have been attracted to the organisation and filled in your diversity monitoring forms.
• Employee participation in ERGs (employee resource groups): Can indicate engagement or growth in employee resource groups.
• Number of DEI-focused events held: Tracks whether you have delivered your planned engagement activities.

Caution: Focusing solely on output KPIs can create a false sense of progress. It's essential to correlate these activities with desired outcomes.

Outcomes: Measuring Results
These KPIs assess the results of DEI interventions but are usually based on some kind of assumption that the actions and steps within your strategy have directly influenced the result you are aiming for in the KPI:

• Employee satisfaction scores, broken down in an intersectional way: Indicates how different groups feel about the workplace.
• Turnover rates among diverse groups: Measures retention of diverse talent but ultimately how valued and included they feel too.
• Promotion rates for diverse employees: Tracks how equitable advancement opportunities are, and how well interventions relating to leadership and progression are working.

A note on assumptions: Assumptions in impact measurement are the underlying beliefs or beliefs that inform our understanding of cause-and-effect relationships. These assumptions can be helpful in guiding our research and analysis, but it's important to be aware of them and to consider alternative explanations. By acknowledging and addressing potential assumptions, we can improve the accuracy and reliability of our impact measurements.

Measuring impact: KPIs for progress
These KPIs gauge the broader influence of DEI efforts as a collective and can be used to help identify return on investment:

• Revenue growth from diverse customer segments: Demonstrates the business impact of DEI.
• Innovation metrics (e.g., new patents, new products): Correlates increased diversity and inclusion to enhanced innovation, creativity and problem-solving.
• Employee productivity: Measures the overall wellbeing and inclusion impact on the performance of the workforce.
• Brand reputation or familiarity: Measures the impact of external campaigns on building customer perceptions and widening of the potential market share to include more diverse customers.

Techniques for measuring Impact: beyond the numbers

Whilst quantitative KPIs are valuable tools, it's essential to remember that they are just one piece of the puzzle. Qualitative data, employee feedback, and storytelling are equally important in understanding the true impact of DEI initiatives.

Many organisations fall into the trap of using KPIs solely as a checklist, focusing on outputs rather than outcomes. This can lead to a superficial understanding of DEI progress. To truly measure impact, KPIs should be used in conjunction with several methods including:

Qualitative data analysis: Gather input from your employees, customers, stakeholders and communities. Use expert researchers to conduct surveys, interviews, focus groups, to provide data that can be used to assess DEI progress. As with any research, clearly articulate the specific questions you want to answer through the research. Remember that data can also be found in impromptu conversations, written comments on internal/external channels, or suggestion boxes.

Market research: Don’t forget that market research can be used to play a crucial role in understanding how DEI efforts are perceived by external stakeholders. This is especially when expert researchers are able to gain feedback from a wide range of communities and provide intersectional insights. By measuring brand perception, customer loyalty, and engagement metrics, organisations can assess the impact of their DEI initiatives on their reputation, customer base, and market share.

Case studies:
Case studies are powerful tools for illustrating the tangible outcomes and impact of DEI initiatives. For example, focus on an outcome and use case studies to either share personal narratives of employees who have benefited from DEI initiatives, such as promotions, increased job satisfaction, or improved work-life balance. For example, if a company implemented a mentorship programme for women and subsequently saw an increase in the number of women in leadership positions, a case study of a woman’s journey through the programme to the leadership role can demonstrate the programme’s effectiveness.

Outcomes harvesting:
This approach involves systematically identifying and documenting the positive changes resulting from DEI efforts. It helps to connect activities to outcomes and impact. Look for patterns by analysing data to identify common themes and trends that indicate positive outcomes. Be mindful of other factors that may have influenced the outcomes and ensure that the connection is clear and compelling.

Note: this is the approach HTVB takes based on our learnings from working to measuring and evaluating the impact of social programmes we have been part of. We have taken learnings from the sport for development sector and good practice relating to developing theories of change.

If you are finding measuring the impact and return on investment (ROI) of your dei work, get in touch with us so we can help! 

- Hayley Bennett, Director of HTVB