There is no doubt that adequately meeting customer expectations is an essential part of the role of a robust diversity and inclusion organization. By accurately identifying those expectations, and meeting or exceeding them consistently, your department is likely to enjoy happier customers and a healthier perception of D&I’s ability to drive the organization’s bottom line and profits.
A Few Universal Truths and Lessons Learned
Meeting customer expectations can pose major challenges. That’s because expectations are often moving targets: They grow, shrink, change shape and change direction. They shift constantly and easily. And how satisfied (or dissatisfied) your customers are is determined by these expectations and your performance in meeting them. Therefore it is critical that diversity professionals and practitioners utilize specifically structured processes, techniques and tools based on valid scientific processes that are designed to tap into these expectations and deliver value. There are a few universal truths and lessons learned that emerge when we examine the research on meeting customer expectations. They may seem obvious, but they are worth repeating. They form the basis of a comprehensive diversity value delivery system. They remind us that:
• The customer, not the diversity practitioner, determines and defines the quality and value of the diversity initiative delivered.
• Because the customer determines and defines quality and value, these definitions are relative, not absolute.
• Customer evaluations of quality and value are based on what was delivered as opposed to what was expected in terms of results, the implementation process quality and the cost of initiatives.
• Customer expectations are just as important as any other element of perceived value in addition to what is actually delivered; it is critically important to manage these expectations using full stakeholder engagement techniques and processes.
• Because customer perceptions of quality and value are relative, effective service delivery on the part of diversity practitioners and professionals requires adaptation of services to individual and organizational needs. This entails an intentional strategic alignment with the mission, vision, values, strategies and systems of the organization as well as the individual preferences of key stakeholders.
• Any decisions concerning quality and value that fail to take into account customer expectations are immediately suspect and very often produce ineffective outcomes.
The diversity return on expectations process is designed and executed in concert and partnership with the people who will determine the D&I organization’s value. As mentioned in a previous blog, diversity ROI evaluation must be a deliberate and consistent process. The diversity return on expectations process must also possess these characteristics.
The Critical 7 Levels — Don’t Perform Your Initiative Without Them!
Diversity return on expectations must be based on evidence and impact results. I have found it useful to first to distinguish the “evidence-based, outcome-focused” measures from other types of “activity only” measures. Anyone responsible for implementing diversity initiatives is also responsible for evaluation. Whether you calculate the impact or not, from management’s and/or the stakeholder’s point of view, you will always own the ROI of the initiatives you implement. So, the amount of evaluation that you provide to meet expectations depends on the types of decisions that your organization must make and the information needed to make those decisions. There are seven levels you can use in the Hubbard diversity return-on-investment evaluation methodology to effectively demonstrate your ROI impact and show a “chain of impact” to meet customer and stakeholder expectations that is evidence-based and credible:
• Level 0: Business and performer needs analysis.
• Level 1: Reaction, satisfaction and planned actions.
• Level 2: Learning.
• Level 3: Application and behavioral transfer.
• Level 4: Business impact.
• Level 5: Diversity return-on-investment, benefit-to-cost ratio.
• Level 6: Intangibles.
For example, if your only requirement is to ensure that participants have positive attitudes toward the initiative, then a Level 1 evaluation is sufficient. But, if your goal is to determine whether your diversity initiative is having a positive effect on job performance, then you will have to perform a Level 3 evaluation. This also means you will also have to conduct Level 1 and 2 evaluations to assess the learning performance applications and job impact at Level 3 (an example of the DROI chain of impact). They provide the basis for determining whether participants demonstrated that they learned by putting these skills and attitudes to use (verified by a Level 3 evaluation).
There’s no doubt that we must communicate effectively and demonstrate our value to the bottom line. Diversity ROI metrics and performance improvement processes help us focus first on tangible outcomes, then on interventions to meet expectations. When people focus primarily on the intervention, such as the diversity content, the method or the technology, it’s easy to be led astray by current fads, thus wasting valuable time and money. Instead, focus first on the desired outcomes and DROI analytics to determine what kind of measurable diversity intervention, if any, is necessary to meet customer and key stakeholder expectations.
Conducting glitzy diversity training or other diversity activities and implementing fad-based interventions can distract decision-makers from what truly counts. The glitz may make things fun, louder and interactive, not necessarily better. Without a clear, data-based front-end analysis of organizational performance gaps, any intervention, including diversity training and the like, is a guess. Add in sophisticated diversity intervention technologies without an adequate front-end analysis, including metrics, and it becomes an expensive and often complex guess. Systematic diversity training design procedures, for example, must include DROI analytics and metrics, needs assessments, objectives, targeted competency-based design and multilevel evaluation processes. That framework provides a method to get the coveted seat at the C-suite table. Why? Because when used properly, that knowledge base can help companies increase revenue and decrease costs using D&I practices that impact organizational performance outcomes. In other words, you can earn your seat at the executive table by applying what you already know as a diversity ROI-focused professional. It’s successful because the DROI metrics and processes you use are solidly based on the behavioral science research results which provide strategies detailing how diverse people interact and what drives their behavior to produce successful organizational outcomes.
Thus, by beginning with a comprehensive business needs analysis at Level 0, you can align your efforts with key stakeholder expectations. Conducting a diversity return-on-investment study that demonstrates how you met and exceeded stakeholder expectations requires that you clearly identify what you want to know as a result of implementing the study. This should be based upon, at bare minimum, the identification of a business problem or opportunity related to the organization’s key business strategy. Second, you should be prepared to list a series of research questions you would like answered or hypotheses you would like to test. These questions may include things such as “In what racial categories do we have the most turnover?”; “What diverse customer markets are not utilizing our products or services?”; “How can we improve the idea and solution generation (creative) process using current cross-functional diverse teams to improve operational performance?”; and “Which diversity initiatives produced the greatest diversity ROI.”
While planning ways to address these research questions and ideas, it may be helpful to begin with the end in mind. That is, think of what will appear on your research report to stakeholders, create placeholders for them, and then generate the questions or hypotheses that must be answered for data to show up on the report as results. The final step in this phase is to summarize the questions you would like answered and formulate diversity measurement study objectives that will guide your work. The clearer a diversity professional/practitioner is on the desired Level 4 business impact results of a solution, the better chance that their time and effort spent will accomplish the expected results in the most cost-effective manner. A common mistake diversity practitioners/professionals make is defining desired results in the context of diversity outcomes instead of aligning diversity to the strategic goals, mission, values and vision of the business or organization. Examples of Level 4 business or organizational goals include:
• Increased sales.
• Increased employee retention.
• Improved market share in targeted emerging markets.
• Enhanced communication skills across generational differences.
• Improving work-life management skills.
• Enhancing perceptions of brand image in the communities served.
• Increased profitability in select products and services.
DROE Is a Key Indicator of Value
When executives talk with diversity and inclusion practitioners/professionals about an observation that may require a new initiative, many diversity practitioners/professionals retreat to their department and start designing and developing suitable programs. Sometimes, a training or business needs assessment is conducted, but it is rarely taken beyond identifying simple training activities to a level that will meet critical performance and business needs.
Stakeholder expectations define the value that diversity and inclusion practitioners/professionals are responsible for delivering. It is imperative that you ask stakeholders questions to clarify and refine their expectations across all seven levels of the Hubbard DROI Evaluation Methodology. This is a negotiations process in which diversity and inclusion practitioners/professionals make sure that the expectations are satisfying to the stakeholder and realistic to achieve with the resources available.
Diversity and inclusion practitioners/professionals need to convert the typically broad, unquantified expectations into observable, measurable Level 4 business impact results by asking the question “What will success look like to you?” These Level 4 results become the targets upon which collective diversity and inclusion efforts are built. This step is critically important because often stakeholders and others view diversity and inclusion as concerned with programming that only involves issues of representation through the lens of race, rank and gender. They do not see D&I as a science-based organizational performance improvement technology.
If, for example, the required business-focused solution involves diversity training, the practitioner should work with the managers of the intended training participants. Together they should identify the critical behaviors diversity training graduates must consistently exhibit on the job to produce the desired results. Only then should the practitioner proceed with the traditional identification of learning objectives.
At the same time, the practitioner should ask what evidence will be required at each of the seven levels to show that the initiative was a success. When the diversity ROI measurement, tools and techniques are defined at the start of the initiative, it makes it easier to conduct an effective evaluation regarding the degree to which stakeholder expectations were met.
Business Partnership Is Essential to Creating Positive DROE
Once there is a clear understanding of the results and outcomes to be produced, the next step involves the diversity practitioner working with business managers and supervisors to create a tactical execution plan. This is necessary because training events alone typically result in only 15 percent transfer of learning to on-the-job-behavior, according to educator and consultant Robert Brinkerhoff.
Historically, diversity training initiatives are focused on affecting Level 1 and Level 2. However, the largest DROE occurs at Level 3, on the job. For maximum DROE, there needs to be agreement about the intensity of efforts required from all departments before, during and particularly after the diversity training intervention. Specifically, diversity practitioners need to partner with supervisors or front-line leaders:
• At checkpoints during the diversity training design stage.
• Before diversity training to prepare participants.
• After the diversity training to support and monitor trainee performance on the job.
When participants return to the job after training, required drivers — processes and systems that reinforce, monitor, encourage and reward performance of critical behaviors on the job — must be in place to provide both support and accountability for consistent performance of critical behaviors. The degree to which drivers occur relates directly to the extent to which critical behaviors are performed. Performance of critical diversity-related behaviors is what yields business-level results. It is these results that determine the DROE from the customer’s point of view.
How to Get Started
It is imperative to get started building DROE in your organization today. Here’s how:
• Identify key stakeholders that judge the success of diversity initiatives.
• Get to know your stakeholders and identify their priorities.
• Create a diverse, cross-functional advisory committee with representatives from critical business/organizational units and the D&I organization.
• Select a strategic diversity Initiative, and use the DROE process.
• Monitor and realign your efforts to meet changing expectations.
Managing diversity return on expectation is an essential skill and competency for all D&I practitioners and professionals. Using it effectively can make the critical difference in whether your D&I organization is seen as merely a cost of doing business or a real strategic business partner in the success of the organization. Creating and managing the DROE process is a proven, credible approach to drive D&I value and results for your internal and external customers.
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