How Data-Based Methods Can Achieve Racial Equity in the Workplace

A recent study conducted by nonprofit consulting firm FSG outlines data-based methods for improving racial equity in a company’s customer-facing frontline workforce.

The researchers identified 23 practices grounded in data that advance racial equity at work.

These practices fall into three brackets — culture, management and advancement — and are meant to guide business leaders, managers and human resources (HR) professionals. To be clear, FSG does not frame advancing frontline employees of color as charity work or altruism. These methods are designed to help businesses capitalize on the competitive advantage of racial equity.

The strategies are based on extensive data, including interviews with executives, experts and frontline employees of color; a literature review; and data on HR practices from employers at 75 national retail firms between 1971 and 2002. The strategies identified in the paper were found to have a statistically significant effect on the advancement of frontline retail employees of color.

A method that eclipses tradition

The research focuses on frontline employees of color because they are more likely to remain in their entry-level positions compared to their white counterparts. Structural barriers repeated and reflected in corporate cultures, management, and promotional systems make it challenging for frontline employees of color to thrive and advance in their workplaces.

The researchers contend, “Companies that are successful in increasing racial equity go beyond traditional diversity and inclusion efforts by shifting their management and HR practices and transforming their company cultures.”

One company that FSG highlights is Starbucks. This may come as a surprise, as one branch in Philadelphia was in the news in 2018 for racial profiling that led to unlawful arrests. In fact, it is the aftermath of that very event that is the focus of the report’s praise. Starbucks did not brush the incident off with a sincere apology. Executives did apologize, but they also closed all stores and paid all employees for anti-bias training that is now part of employee on-boarding.

Starbucks also reassessed how it hires and promotes employees with specific attention to race and gender. Equity is no longer a mission with intangible methods — the company’s procedures and goals are articulated and actionable.

Starbucks provides the example of a nuanced equity strategy that touches on more than one of the report’s evidence-based practices. Starbucks has (at least) exhibited accountability for its actions, ongoing training for all employees and support systems designed specifically for frontline employees of color.

Businesses like Starbucks, Sodexo and Walmart (also lauded in the report), however, are unique in their DNA-changing approaches to equity.

“Many employers have implemented diversity and inclusion efforts, but these have not been sufficient to improve experiences of and outcomes for frontline employees of color,” the report's authors note.

These researchers suggest five steps for companies that want to make a real commitment to equity:

1. Understand the intricacies of the internal and external factors that contribute to racial inequity.
2. Collect quantitative and qualitative data on employees that is disaggregated by identifiers like race and gender.
3. Use the 23 evidence-based practices from the report to evaluate the company’s current state of affairs, especially for frontline employees of color.
4. Pilot evidence-based practices and assess whether they are working for employees.
5. Measure, modify and share progress and lessons.

The competitive advantage of racial equity

The business benefits of improving racial equity — and the ramifications of leaving a vacuum — have recently seen increased attention. Last year, 101 investment companies signed a statement asking companies to release data about their workplace equity practices and policies.

The form is still open for investors to sign on.

Outside of pressure from investors, FSG researchers also outline business benefits that include reflecting an increasingly diverse customer base, tapping into the full potential of the company’s talent, creating a more engaged and productive frontline workforce and more.

The report states that 67 percent of job-seekers consider the diversity of a company's workforce before taking a job.

Equity is serious business. This FSG report takes the ambiguous and formless business equity of the past and brings it to the future, where concrete, actionable steps lead to empowered workers and workplaces.

Image credit: Omar Lopez/Unsplash and Starbucks