Better hiring: Do you want investment? Do you want top talent? Do you want great products? Do you want profitability? Of course your answer is yes to all, which is why inclusive hiring is key for you!
Compelling reasons to prioritize good hiring:
- Avoid costly mistakes. A bad hire is costly, especially for a startup, where teamwork, morale, collaboration are essential, and lost productivity, time, and energy is devastating. According to the U.S. Department of Labor, the price of a bad hire is at least 30% of the employee’s first-year earnings. For a small company, an investment in the wrong person is a threat to the business.
- Make more money: Boston Consulting Group finds a strong and statistically significant correlation between diversity and overall revenue. Companies with above-average diversity have revenues 19% higher than their below-average counterparts.
- Improve the odds of getting VC attention: Investors are increasingly seeking diverse teams because they see higher returns on average. If you lack diversity, they will notice and will wonder why you haven’t noticed, too. Having diverse founders may open the doors to other investor introductions.
- Develop better products: Diversity can unlock innovation, expand networks, and drive growth. Diverse people bring different perspectives, reduce blind spots, and help ensure product/market fit.
- Gain access to networks and customers: People like you probably have similar networks as well. Scaling a startup is all about breaking into new markets and signing up new customers. The highest levels of diversity can bring in nearly 15X more sales revenue than companies at the lowest levels.
- Attract top talent: McKinsey & Company points out in a study Why Diversity Matters that more diverse workforces are better able to win top talent and improve their innovation and customer orientation, employee satisfaction, decision making, and that leads to better financial performance.
- Retain top talent: Emerging studies suggest that diversity helps with retention. Employees feel valued for their individuality and unique contribution so they are more likely to stay engaged for longer periods of time.
Here’s how to hire better (in the same amount of time):
1. Write Better Job Postings
- Draft inclusive job descriptions in a way that makes everyone feel welcome. Use tools that aid in “spell checking” for unconscious bias and make recommendations for improving job descriptions such as Textio and BeApplied.
- Add you are “an equal opportunity employer,” or better yet, a diversity statement in your own words.
- Mention benefits such as flexible work schedules or the ability to work remotely.
- Minimize requirements and double-check they are necessary to perform the job not just copy/paste from another job listing. Encourage people to apply if they feel they can do the job, even if they don’t meet 100% of the requirements.
- Focus on values and mission. Help people connect their work to the larger mission and impact, and give them room to innovate the “how” to achieve the job deliverables.
2. Expand Your Recruiting Sources
- Post on a variety of job sites. If you want to hire women, take a look at the aptly named Hire More Women in Tech site for tips and sites where you can post jobs.
- Decrease reliance on referrals. Referrals may speed up the hiring process, but at the expense of limiting your pool, losing top talent, and perpetuating implicit bias. Reliance on referrals can result in a homogeneous culture and blind spots, so invite your team to share diverse referrals.
3. Use Best Practices in Reviewing Applications and Interviewing
- Anonymized selection. Consider removing or moving to the end of the application, the candidate’s name, gender, age, and education. This puts the focus on the work experience and qualifications and helps reduce the impact of unintended implicit bias for male and female reviewers. Pymetrics and BeApplied are a couple of service providers.
- Establish clear criteria. Ensure everyone on the hiring team is on the same page about how candidates should be evaluated. Define the skills and company values you are looking for. Write down explicit criteria and use the same questions for all candidates consistently. Clear criteria reduce subjective critiques and unintentional discrimination from stereotypes.
4. Set a Diversity Goal
- Include diversity in your company values. Setting your intentions around diversity is the first step and promotes accountability. Target achieving diversity in your executive and tech teams as well as for the company overall.
- Track metrics. Be aware of how many women and people from under-represented communities apply, interview, are hired, and eventually, as your company grows, are promoted. Setting this equitable expectation will set the stage for improved future hiring and scaling.
FAQ on Inclusive Hiring Practicies
We have a small budget and a very busy schedule, we don’t have time for inclusive hiring.
Inclusive hiring is not just the right thing to do, it’s the profitable thing to do. Many successful startups and unicorns incorporate inclusive hiring practices because it can bring greater profits, more innovation, and make it easier to attract and retain top talent. Companies committed to diversity stay ahead of rivals by 19% on financial metrics.
I want to support inclusive hiring, but there are few women/minorities in STEM.
Women are actually the majority of STEM graduate students and they earn a majority of STEM bachelor’s degrees in the US, but only 20% of tech industry jobs are held by women. Reliance on referrals and homogeneous sourcing, as well as poorly written job descriptions can limit the pool of talent applying.
Moreover, your team doesn’t only need programmers. Like most companies, you need business and operations managers, marketers, sellers, accountants, customer success leaders, user experience experts, writers, etc. Your idea deserves a diverse team.
Startups tend to work longer hours, and it is too hard for women.
Gender is not a determinant of who is willing to work a lot of hours for self-realization and dreams. Don’t make assumptions. (By the way, marriage/children are not disqualifying attributes).
However, working continuous overtime is not great for everyone on your team. After long hours, employees turn less efficient, less creative, and more susceptible to anxiety and depression. Consistent overtime will inevitably result in high turnover. Workaholism does not translate to productivity or efficiency. Do it for a sprint, but try not to make it a regular practice. Keep sustainability and employee retention in mind.
We only consider the best candidates. We don’t hire for gender or color.
Of course there are women and other under-included people who meet the bar. Companies with poorly designed hiring processes often fail to meet and evaluate qualified candidates. The effort to reach a diverse talent pool is tiny compared to the cost and effort resulting from bad hires and turnover.
Diverse candidates from different backgrounds come up with innovative ideas and bring perspectives that can help the company avoid blind spots. They may have demonstrated grit or overcome barriers to get where they are. Including diverse talent does not lower the bar, it raises the bar.
We already have a [fill in the blank] on the team, diversity goal met!
Bravo! it is a good start, but having one [fill in the blank] person on staff is not equal to diversity. Diversity is a continuous process. Continue to put in place and practice inclusive hiring.
I’ll get to it later.
Getting diversity on the team is a lot easier when there are only 3 employees than when there are 20 who are all the same. No one wants to be an “only” and ratios matter. Prospective employees look at your website and, if they don’t see people like them, they are less likely to apply. Startups that embrace diversity and inclusive hiring have the opportunity to get things right from the beginning.
The Center for Information Technology Research in the Interest of Society (CITRIS) and the Banatao Institute drive interdisciplinary innovation for social good with faculty researchers and students from four University of California campuses – Berkeley, Davis, Merced, and Santa Cruz – along with public and private partners.
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