How to build a racially diverse workforce

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How to build a racially diverse workforce

© 2019 Advisory Board • All rights reserved • advisory.com

Today’s Research Experts

Christopher Kerns

Vice President,

Executive Insights

[email protected]

@CD_Kerns

Micha’le Simmons

Managing Director,

Workforce Research & Inclusion

[email protected]

http://www.advisory.com/



3

Source: Lorenzo, R, Voigt, N, Tsusaka, M, Krentz, M, Abouzhar, K, “How Diverse

Leadership Teams Boost Innovation,” Boston Consulting Group. January 23, 2018;

Tulshyan, R. “Racially Diverse Teams Outperform Industry Normsby 35%” Forbes, Jan 30,

2015; Bourke, Juliet. “The Diversity and Inclusion Revolution: Eight Powerful Truths.”

Deloitte Insights. Deloitte, July 22, 2018

Workforce diversity matters for bottom line and our mission

Diverse teams improve business outcomes

Higher revenue due to innovation from

companies that have more diverse

management teams 19%

Inclusive leaders unlock higher performance

Likelier to financially outperform industry

median, companies ranking in the top quartile

of executive-board diversity43%

Likelier to experience above-average profits,

companies in the top quartile for gender

diversity on their executive teams21%

Diverse teams innovate more

And financially outperform more homogenous ones

Increase in

team performance 17%

Increase in

decision-making quality 20%

Increase in

team collaboration29%




4

Source: HR Advancement Center, Annual Turnover, Vacancy, and Premium Labor Benchmark Generator,

2019, https://dag.advisory.com/2013_B_DAG_BGFramework/Main/I/HR_TV_Sys/050ffaee-a15b-4efa-8a04-

59f09e3847bd/2016HRACX154?m=7080001

.

One-third of frontline staff are racial or ethnic minorities



https://dag.advisory.com/2013_B_DAG_BGFramework/Main/I/HR_TV_Sys/050ffaee-a15b-4efa-8a04-59f09e3847bd/2016HRACX154?m=7080001


5

Source: HR Advancement Center, Annual Turnover, Vacancy, and Premium Labor Benchmark Generator,

2019, https://dag.advisory.com/2013_B_DAG_BGFramework/Main/I/HR_TV_Sys/050ffaee-a15b-4efa-8a04-

59f09e3847bd/2016HRACX154?m=7080001

Racial diversity drops by half in frontline management





6

Source: HR Advancement Center, Annual Turnover, Vacancy, and Premium Labor Benchmark

Generator, 2019, https://dag.advisory.com/2013_B_DAG_BGFramework/Main/I/HR_TV_Sys/050ffaee-

a15b-4efa-8a04-59f09e3847bd/2016HRACX154?m=7080001

Racial diversity in senior leadership drops by two-thirds from the frontline





7

Source: HR Advancement Center, Annual Turnover, Vacancy, and Premium Labor Benchmark Generator, 2019,

https://dag.advisory.com/2013_B_DAG_BGFramework/Main/I/HR_TV_Sys/050ffaee-a15b-4efa-8a04-59f09e3847bd/2016HRACX154?m=7080001; McKinsey and Company,

Women in the Workplace 2019, https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2019.pdf.

Racial and ethnic diversity decreases drastically toward the top

HR Advancement Center interviews and analysis.

33.90%

15.24%

9.97%

Frontline staff Managers Senior leaders

Percentage of racial and ethnic minorities (median)

Racial and ethnic diversity in the

health care workforce (median)

2019

n=42

68%

57%

51%

45%

35%

18%

24%

26%

27%

30%

10%

12%

14%

17%

16%

4%

7%

7%

12%

18%

C-Suite

VP

Director

Manager

Entry-levelWomen of color

Men of color

White women

White men

All industry workforce diversity by level




https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2019.pdf


8

Build a racially diverse workforce

Instill accountability for racial and ethnic

diversity in your workforce

Invest in an equitable, inclusive

employee experience

Cultivate the next generation

of diverse leaders

Debias the hiring process





‹#›

Road map9

Instill accountability for racial and ethnic diversity in your workforce




10

Source: “Diversity and Disparities: A Benchmarking Study of U.S. Hospitals in 2015,” Institute for Diversity in Health

Management, Health Research & Educational Trust (2016): http://www.diversityconnection.org/diversityconnection/leadership-

conferences/2016%20Conference%20Docs%20and%20Images/Diverity_Disparities2016_final.pdf

Too reluctant to set diversity goals

Health Care Organizations

with Executive

Compensation Tied

to Diversity Goals

Health Care Organizations

with Documented Plan to

Increase Number of Ethnically

Diverse Executives on Senior

Leadership Team

31%20%20%

1Lingering stigma

of “affirmative

action.”

Leaders are afraid of

“lowering the bar” and often

react negatively to quotas.

2Misconception

that “I’m not

biased.”

Leaders feel if they value

diversity, then representation

will eventually change. They

hesitate to acknowledge their

inherent unconscious bias.

Two Factors Contributing to

Senior Leaders’ Reluctance





11

Clarify your commitment to increase racial and ethnic diversity

1Align with diversity

in your community

Track progress

toward your goal

42Prioritize key roles

to increase diversity

3Define your goal

• What does racial and

ethnic diversity look like

in our community?

• What specific types of

racial and ethnic

diversity do we need to

increase to mirror our

community?

• What levels in our

organizations are lacking

racial and ethnic

diversity?

• What are in-demand,

key positions that we

should prioritize?

• Identify process metrics

e.g., number of racial and

ethnic minority candidates

for roles

• Monitor retention of racial

and ethnic minorities

• Report progress toward

your goal to board and C-

suite at least quarterly

• How much do we want

to increase racial and

ethnic diversity over the

next three years?

• How will we establish

shared accountability?

• What talent

management processes

will have to change to

support this goal?





‹#›

Road map12

Cultivate the next generation of diverse leaders




13

What comes first: diverse staff or diverse leaders?

A Chicken-or-Egg Question

Senior leaders can’t

build a diverse

leadership bench if

there aren’t enough

diverse staff in the

pipeline

Frontline staff need

to see diverse

leaders to pursue

leadership roles

Start with the Top? Start with the Bottom?





14

Source: Garman AN, Tyler JL, “CEO Succession Planning in

Freestanding U.S. Hospitals: Final Report,” prepared for the American

College of Healthcare Executives, October 27, 2004; Workforce Best

Practice Collaborative interviews and analysis.

Succession management key to diversifying leadership ranks

17%

Succession

Management

Leadership

Development

ScopeCritical positions,

high-potential leaders

All positions,

all leaders

Objective

Prepare leaders for

next-level role

Improve leader’s

performance in

current role

Typical

Development

Methods

Hands-on

project work

Classroom training

complemented

with projects

Differentiating Leadership Development

ACHE’s¹ Definition of

Succession Planning

“A structured process

involving the identification

and preparation of a

successor for a given

organizational role that

occurs while that role is still

filled.”





15

Source: Grossman R, “The Care and Feeding of High-

Potentials,” Society for Human Resource Management, August

1, 2011; “Corporate Performance at Risk as Today’s Rising

Talent Prepares to Jump Ship,” Corporate Executive Board,

June 1, 2010; HR Advancement interviews and analysis.

Falling into common biases when evaluating talent

Leader Misperceptions When Selecting Hi-Po Talent

Common

pitfalls:

Potential

consequences:

“Mini-Me”

Younger version of current leaders;

similar qualities and experiences

Staff distrust in selection

process

“Old Faithful”

Reinforcement

of status quo

Long-time employee; loyal to leaders;

has deep institutional knowledge

“Ivy League”

Poor performance in

position

Highly intelligent; may hold several

degrees; performs well in academia

DATA SPOTLIGHT

Percent of managers ineffective

at identifying high-potentials

due to inconsistent standards48%





16

Underrepresented staff face unique challenges in moving up

Faced with pervasive

stereotypes

Navigating as a minority in

a majority environmentLocked out of informal

mentorshipChallenge:

Representative

example:

Whenever I step up to take the

lead on my team, I get the sense

that I’m perceived as bossy.”

Everyone is very direct with their

supervisor. I grew up in a culture

where it was polite to defer. It’s hard

to know how to conform.”

I see that Bob is mentoring Greg.

I’d like that, but I don’t know who

to reach out to…”





17

Two approaches to increase leader diversity

BO

TT

OM

-UP

Mentorship or Sponsorship Peer Cohorts

Goals Evaluation of high-potential talent

TO

P-D

OW

N

Formalize Accountability

Address Unique Barriers

Give senior leaders formal goals for

increasing diverse representation

Provide a mechanism for diverse staff to

form meaningful professional relationships

with senior leaders that can help guide their

career progression

Support diverse staff by providing formal

opportunities to connect and relate to

peer colleagues

Establish clear, consistent criteria to evaluate

your top talent





‹#›

Road map18

Debias the hiring process




19

Source: Kang SK, et al., “Whitened Resumes: Race and Self-Presentation in the Labor Market,” Administrative Science Quarterly, 1, no. 34 (2016):

https://www.scribd.com/doc/305221179/Administrative-Science-Quarterly-2016-Kang-0001839216639577#download&from_embed

Qualified Black and Asian candidates less likely to receive call backs

Commitment to diversity not enough

Call-Back Rates for Resumes of African

American and Asian Candidates

“Whitened Resumes: Race and Self-Presentation

in the Labor Market”

• Resume audit of pro-diversity organizations—those with

diversity statements on their websites

• Two versions of identical resumes: one “whitened,” one

“non-whitened”

• African American and Asian candidates were more likely to

receive a call back if they changed their names and

included “white” experiences

• Researchers found that organizational diversity statements

are not actually associated with reduced discrimination

STUDY IN BRIEF

increase in call back

rates for African-

American candidates

with ‘whitened’ resumes

14%

increase in call back rates

for Asian candidates with

‘whitened’ resumes

11%





20

Over-relying on our gut to make hiring decisions

Affinity Bias

The tendency to view favorably others who are

like us, and to hold unfavorable views of those

who are unlike us.

“Look, we’re all a bunch of alphas on this team

and he was just so passive, he’ll be eaten alive.”

Halo/Horns Effect

The tendency to view a person or group

positively (halo) or negatively (horns) based on

a single attribute or pre-existing like/dislike.

“She said all the right things, but I’m worried

that she’s been too long in the private sector. ”

Perception Bias

The tendency to form assumptions or judgements

about a group that make it impossible to

objectively assess an individual.

“I’m only interested in Ivy League graduates, I

need the best and brightest for my unit.”

Confirmation Bias

The tendency to seek information that confirms

existing beliefs or assumptions about a person

or group.

“He was a typical millennial, no tie, weak

handshake, he’s not a serious candidate.”





21

Source: Mercy Health: Using evidence to drive hiring and

advancement, https://www.aspeninstitute.org/of-interest/mercy-health-

using-evidence-drive-hiring-advancement/.

Mercy Health increases non-white hires with objective hiring assessments and standardized interviews

HR Advancement Center Interviews and Analysis

Category Description Assessed via

Skill Reading prose, Reading

documents, Quantitative reasoning

ETS WorkFORCE

Competency Perception, Service orientation,

Active learning, Office

administration

Standardized

recruiter interview

Competency Time management, Influence,

Teamwork, Critical thinking

Standardized hiring

manager interview

Overall Fit Index Conscientiousness, emotional

stability, agreeableness, etc.

ETS WorkFORCE

20%Percentage point increase in

non-white hires (from 18% to

38%)

6.6%Percentage point increase in

total non-white workforce

makeup (from 13.4% to

20%)

18.7% First-year turnover (reduced

from a baseline of 25.3)

6 days Decrease in time-to-fill

(37 days to 31 days)

Mercy Health standardizes evaluation criteria

to reduce interview bias



https://www.aspeninstitute.org/of-interest/mercy-health-using-evidence-drive-hiring-advancement/


‹#›

Road map22

Invest in an equitable, inclusive employee experience




23

Source: McKinsey and Company, Women in the Workplace 2019, https://wiw-

report.s3.amazonaws.com/Women_in_the_Workplace_2019.pdf; Center for

Talent Innovation, Being Black in Corporate America,

https://www.talentinnovation.org/_private/assets/BeingBlack-KeyFindings-

CTI.pdf;; Employment and Discrimination: Exploring the Climate of Workplace

Discrimination from 1997 to 2018, https://www.paychex.com/articles/human-

resources/eeoc-workplace-discrimination-enforcement-and-litigation.

Employee experience often less favorable for people of color

Is this a place where people of color want to work?

Of all employees think

their company D&I

efforts are ineffective

60%

Black employees more

likely to report intending

to leave their job

within 2 years

30%

69%

51%

33%

69%

48%

31%

63%

42%

27%

62%

44%

31%

56%

35%

24%

I have equal opportunity forgrowth and development

Promotions are fair andobjective

I have the sponsorship neededto advance my career

All men White women Asian women Latinas Black women

Employee sentiments about career

investment by race/ethnicity and gender

n=68,500

Workplace complaints due

to race/color discrimination,

the highest of any category,

only 15% resolved

35%




https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2019.pdf

https://www.talentinnovation.org/_private/assets/BeingBlack-KeyFindings-CTI.pdf

https://www.paychex.com/articles/human-resources/eeoc-workplace-discrimination-enforcement-and-litigation


24

Source, HR Advancement Center, how Employee Resource Groups Drive Diversity, Inclusion, and

Business Outcomes, https://www.advisory.com/research/hr-advancement-center/resources/2019/how-

employee-resource-groups-drive-diversity-inclusion-and-business-outcomes

Children’s Minnesota engages and retains staff of color

HR Advancement Center Interviews and Analysis

Children’s Minnesota

5,200-employee pediatric health ; relevant specs • Minneapolis, MN

• Children’s MN uncovered disproportionate turnover

among employees of color

• Through six listening sessions with employees of color,

facilitators uncovered need for more training and development

opportunities, a desire to have a greater sense of belonging,

and manager training on managing diverse teams.

• In an effort to improve retention and employee engagement

by acting on these themes, Children’s Minnesota decided to

build out a robust Employee Resource Group program.

• Children’s MN decreased the number of “under engaged” and

“somewhat engaged” employees of color by 3%; engagement

for employees of color has increased by 6%

CASE EXAMPLEChildren’s Minnesota employee resource group

success factors

• Dedicated time to participate: Children’s MN ERG members

get up to 12 hours paid time annually. Allies get up to 4 hours

of paid time annually.

• Formal goals: ERGs advance key workforce priorities

including recruitment, retention, inclusion, and community

engagement

• Executive commitment: Senior leaders participate in all

ERG events and serve as ERG sponsors

New hires in 2018 that are

people of color1 in 3

6% Increase in employee

engagement for staff of color



https://www.advisory.com/research/hr-advancement-center/resources/2019/how-employee-resource-groups-drive-diversity-inclusion-and-business-outcomes


25

Source: Why your top performers quite and how to keep them,

https://www.advisory.com/daily-briefing/2018/01/23/why-people-quit.

Surface career goals and unique barriers for staff of color

Learn What Is Most Important

for Their Future

• Are there any responsibilities you

don’t want to let go of?

• What skills do you consider most

critical to your development over

the next year?

• Is there something I can do to

make this job feel more fulfilling

for you?

1

Understand the Frustrations

They Can’t Live With

• What frustrations or parts of this

job or team dynamic keep you up

at night?

• What’s one thing that might make

you not want to work here?

• If you were to give your next

manager advice on how to best

support you given your personal

style, what would you share?

2

Surface Relevant Professional

Goals and Life Events

• Where do you see your life going

in the next three years?

• What challenges might that create

for you in your current role?

• How can I best support your

progress toward your future

goals?

3

FOR MORE RESOURCES

on stay interview questions visit this link.




https://www.advisory.com/daily-briefing/2018/01/23/why-people-quit

https://www.advisory.com/daily-briefing/2018/01/23/why-people-quit


26

Your next steps to build a racially diverse workforce

Action ResourcesEvaluate • Workforce diversity benchmarks: Access within the annual turnover, vacancy and

premium labor benchmark generator in related resources “Health System Workforce

Benchmarks

• How to embed diversity and inclusion in organizational strategy: Assess how well your

talent management strategy advances diversity and inclusion

Educate • Diversity, equity and inclusion conversation starters: Understanding and discussing

identity in the workplace

• Webinar: Mindset of an inclusive leader

• Webinar: Social determinants 101

• Webinar: Health equity 101

• Podcast: Why racism is a health care issue

Commit to

workplace

diversity and

inclusion

• How employee resource groups drive diversity, inclusion, and business outcomes:

Lessons from organizations with highly effective employee resource groups

• How to build a diverse leadership bench: A Q&A with Ricardo Forbes, former Chief

Diversity Officer, Baptist Health South Florida, to learn more about how Baptist Health is

builds a diverse leadership teams.




https://www.advisory.com/research/hr-advancement-center/tools/2010/human-resources-benchmarking-initiative

https://www.advisory.com/research/hr-advancement-center/resources/2019/embed-diversity-and-inclusion-in-workforce-strategy

https://www.advisory.com/research/hr-advancement-center/resources/2020/understanding-identity-in-the-workplace

https://www.advisory.com/research/health-care-advisory-board/events/webconferences/2020/building-true-health-equity/the-mindset-of-an-inclusive-leader

https://www.advisory.com/research/population-health-advisor/events/webconferences/2019/population-health-101/social-determinants-101/ondemand

https://www.advisory.com/research/population-health-advisor/events/webconferences/2019/population-health-101/health-equity-101/ondemand

https://www.advisory.com/daily-briefing/2020/06/04/racism-health-care-issue

https://www.advisory.com/research/hr-advancement-center/resources/2019/how-employee-resource-groups-drive-diversity-inclusion-and-business-outcomes

https://www.advisory.com/research/hr-advancement-center/expert-insights/2017/how-to-build-a-diverse-leadership-bench


Meet our experts

Christopher Kerns

Vice President,

Executive Insights

[email protected]

@CD_Kerns

Micha’le Simmons

Managing Director,

Workforce Research & Inclusion

[email protected]



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https://www.advisory.com/

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How to build a racially diverse workforce