There’s no arguing that a positive, healthy mindset of inclusion and belonging makes us better humans. There’s also no arguing that this inclusivity drives the type of sociological equity that makes the world a better place. The part that may still be debated in the dark, quiet corners of some corporate boardrooms is how much impact a great diversity, equity, inclusion and belonging (DEIB) initiative can have on the business’ bottom line. After all, most learning and development (L&D) organizations don’t offer much evidence that their training programs are “working,” and even fewer up-level that evidence to business impact and return on investment (ROI).
That said, business partners who spend budgets on training don’t like being in the dark! They’ve never been hungrier for some hard data showing how their DEIB initiatives can change behaviors on the job, drive higher levels of performance, and ultimately achieve a positive ROI. So, here’s a real-world research study hot off the presses to shine a little light into those dark corners.
A Case Study at Indeed
Indeed is the No. 1 job site in the world¹, with over 300 million unique visitors every month.
In 2022, their forward-thinking employee development and DEIB+ Learning teams joined forces to equip Indeed managers with the skills and tools required to lead more inclusively.
To do this they partnered with a live, online training provider to create a customized, best-in-class DIEB+ training experience and launched a live learning program titled “The Inclusive Manager.” The program was a unique blend of classes designed to support managers to develop and implement key behaviors of inclusion such as building trust, addressing microaggressions, embracing diversity and creating a culture of belonging. In each session, managers were challenged to commit to making one small change to their work practice based on what they learned. This commitment was then tracked and revisited during the following session.
What We Measured
In 2022, a study was conducted using a sample of 146 managers to quantify how the application of skills and techniques taught in the program could promote key inclusive behaviors on the job and drive higher performance, as well as other key outcomes for the business. To measure the impact of the program, a six-level evaluation strategy was employed.
| Level | Measures… |
1  |
Satisfaction: Did they like it? |
2  |
Learning: Did they learn anything? |
3  |
On-the-job Improvements: Did they do something differently, better, or more frequently |
4  |
Business Impact: Did it impact business performance? |
5  |
ROI: Was it worth it? |
6 |
ROI Maximizers: Did support from the participant’s manager drive higher impact? |
What We Found
Levels 1 and 2
Class ratings on engagement and value were aggregated post-program with an overall average score of 4.8 out of 5. New learning was also assessed post program, and 95% of participants gained new and valuable knowledge about inclusion that was relevant to their role.
Level 3
Participants’ improvements on specific inclusive behaviors were assessed 60+ days after training. The behavioral outcomes were reported on a five-point scale ranging from “no improvement” to “exceptional improvement”.
Key findings included:
- 100% of participants showed improvement in building higher trust relationships with their direct reports, with 52% showing significant to exceptional improvement.
- 100% of participants showed improvement in behaviors that created a heightened sense of belonging within their teams, with 48% showing significant to exceptional improvement.
- 95% of participants were more likely to recommend Indeed as an inclusive place to work.
- 90% of participants reported that their direct reports were voicing more of their ideas and opinions.
Level 4
To measure impact to the business, we took a two-pronged approach:
- Human resources (HR) metrics: How did the learning impact key HR metrics like retention and promotion? To measure and isolate the training effect on retention, we used a control-group analysis that compared the turnover rate (%) of our 146 trained participants to a twin sample of un-trained managers. Within 90 days post training, results showed a reduction in turnover of 2.09 managers. We could attribute this directly to training because of the control group that “controlled” for all other factors which may have affected turnover. A similar analysis using the same control group technique to isolate the effects of training on promotion resulted in 9 managers being promoted.
- Performance metrics: How did the learning impact the job performance of participants. To isolate the impact of training on performance, we asked participants to estimate their increases in productivity and contribution, and then adjusted for error by factoring in only the participants who had significant behavior change on the job at Level 3. That is, we only took the % estimates from those who transferred and applied a significant amount of the training to their jobs and assigned a 0% estimate to everyone else. This brought an original estimate of 56% for everyone to a more conservative 30%. So, our final results here showed an overall increase in productivity per participant of 30% attributable to training.
Level 5
To develop our ROI, we had to take the benefits we found at Level 4 and monetize them so we can compare them to the costs of training. Here’s what we did:
- To monetize our HR metric results, we used industry research on turnover that quantifies and monetizes the cost of replacing employees based on their salary and the complexity of their role. This can typically be 50% of their salary for lower-level roles, and run as high as 200% for higher, more unique roles. We used a very conservative one to one ratio. As for our promotion rate gains, although positive, we did not monetize any of our findings and did not include them in our final ROI.
- To monetize our performance gains, we used an industry standard of pay for performance which translates an employee’s performance at 1 to 2.5 times their salary. That is, employees have to contribute at least the value of their salary, or it would not be profitable to employ We used the most conservative one to one ratio.
Overall, when the analyses and results of turnover and performance were monetized, we ended with a benefit of over $10,419 per participant. When we compared this to the cost of training (which we dramatically inflated by including the cost all the participants that were scheduled to take the training, not just the 146 in the study) we ended with a final ROI of 699%.
Level 6
Did manager support back on the job help enhance training transfer, business impact and ROI? To conduct this analysis, we broke our sample up into two groups: those participants who had “high” manager support and those that had “low” manager support. Here we found those who received high manager support back on the job as they applied their inclusive behaviors had 55% greater impact and ROI than those that did not have manager support. This significant finding underscores the fact that precious training dollars can be maximized when participants return to better, more supportive post-training climates.
Here’s a snapshot of the results at all levels of impact:
Good for People, Good for Business
This case study provides our industry with some much-needed data on how DEIB training is not just the right thing to do from a people perspective, but also from a bottom-line business perspective. Companies like Indeed who are prioritizing these initiatives don’t just grow engagement, happiness, and their reputation as a great place to work, but they also grow revenue via increased productivity, and cost savings via decreased turnover. And that’s not including the abundance of other benefits at Level 3 and 4 that we didn’t seek to quantify and monetize. For instance, think about the incredible impact all these inclusive managers can have on their direct reports’ engagement, productivity and intent to stay with the company. These cascade effects could easily and exponentially increase what’s already an extraordinary ROI.
We all knew that building an inclusive culture of belonging would make employees happier. And we also knew that these happier, more productive employees would make our business partners happier. But up until now, we just didn’t have the numbers and data to show how much happier. With more case studies like this one, to shine a light on the amazing benefits of diversity training instead of just the costs, we will indeed be able to pull even the most skeptical business partners out of the darkness, and finally give them the results they’ve been waiting for.
References:
- ¹ Comscore, Total Visits, September 2022
