Discover more from AfterWork Reading
Fresh Fundamentals: Embedding DEI from Day 1
This article discusses why embedding DEI early is key for long-term success. We’ll suggest actions which don’t only signal virtue, but create impact by baking DEI into your company's DNA.
We have sunsetted the AfterWork Ventures Substack. The original post can be found on our website here.
Every startup founder will tell you that managing rapid growth in their business - juggling priorities, dodging minefields, and improvising on new challenges - is an all-consuming task. Success is only possible through sharing the load - and it’s not just about getting the right people into the business, but ensuring there are the right processes, practices, and protocols to set them up for success.
When you’re scrambling to put processes in for the first time, it can be easy to overlook the importance of embedding Diversity, Equity, and Inclusion (DEI) into the fabric of your company. Even those with best intentions might not know when to start!
In this article, which we’ve co-written with The Dream Collective, we discuss why embedding DEI early is key for long-term success. We’ll suggest actions which don’t only garner attention and signal virtue, but actually create impact by baking DEI into the fabric of your company’s DNA.
Before we jump in - let’s talk about what there is to gain from embedding DEI sooner rather than later. Not only is it the right thing to do, it’s also good for business. Diverse, equitable, and inclusive workplaces promote respect and understanding, which in turn fosters closer teams and deeper trust between team members, creating more engaged and committed employees. These workplaces also stimulate innovation - bringing together differently-wired minds to tackle complex challenges from all vantage points. Decision making is enhanced when all voices feel equally heard; and diverse perspectives shed light on new markets and demographics. All these benefits manifest in the top-line - a recent Harvard Business Review found that more diverse companies report 19% higher revenue.
Finally, the modern workforce expects DEI to be upheld - as we’ve written about previously, we foresee the next generation of blazing talent shunning workplaces that fall behind. With all that as a backdrop, let’s dive into the ways startups can embed DEI from the very start.
1. Define your DEI ‘why’
As a starting point, get clarity and buy-in on why DEI matters to your business - by articulating how it is explicitly linked to your vision, purpose, and values. This lays the critical foundation for your DEI plan, ensuring your ambition doesn’t become lip service or an output that never sees the light of day. As a senior leadership team, ask yourself the following questions:
Why is DEI important to your company? To you personally; to your employees; to the market; to your investors?
Why is it important that it happens now?
How will DEI help grow and scale your business?
How does DEI relate to your business’s vision and mission?
This precision and connection of DEI to your core business will add teeth to your ambitions and galvanise the team to turn intent into action.
At AfterWork Ventures, one of our core beliefs is that brilliant founders can come from anywhere. However, our individual heuristics for what good founders look and sound like are inevitably filled with biases - and disproportionately coloured by our own life experiences. This is one of the reasons we embedded DEI into our operating model - by becoming a community-powered VC fund. We invite our community members to chime in on all the investment opportunities we evaluate - including to challenge our biases, and bring their unique perspectives to the table. Their collective contributions not only add richness and depth to our decision making, they force us to challenge our own biases.
2. Build or shape your leadership team
Once clarity on ‘why’ is established, it’s important that your leadership team reflects your DEI principles. Genuine commitment requires proactive, continuous action - and the tone is set from the top.
You can start by mapping out the diversity that’s present in your leadership team - across not only demographic vectors (e.g. gender, ethnicity, age, LQBTQI+ status) but also other spectrums (e.g. where they grew up, what they studied, where they’ve 'previously worked, whether they identify as neuro divergent or having a disability). After you’ve created a baseline, identify where you’re well represented and where your organisation lacks representation.
Recognising the gaps between your stated DEI ambition and the composition of your leadership team is a confronting, but crucial step in the process. Once you’ve identified the gaps, you can create a plan to fill them - with long term measures such as hiring and progression plans, and short term measures to bridge the gap - such as with advisors, mentors, and board members.
Here’s an example of how Lyka have gone about this:
3. Baseline the current state of DEI practices in your organisation
The next task is to quantitively and qualitatively diagnose whether DEI best practices are currently embedded into your business. This can be done across four pillars - hiring, training, promotion and culture.
The Dream Collective has put together a free DEI maturity evaluator tool that can help you determine which of the 4 pillars require the most focus.
Additionally, you can use surveys and interviews to investigate who in your organisation feels like they are empowered to succeed and recognise whether there are certain groups who feel unsupported or unheard. It can be helpful to create a heat map to visualise places where you may be falling short, and therefore focus your efforts to close the major gaps.
4. Set DEI goals and create accountability mechanisms
We've all heard the saying, "What gets measured gets done” - this holds true for DEI initiatives. As a leadership team, set tangible and measurable DEI goals for the next 6 months, year, 3 years, and 5 years. Make sure these goals are ambitious but achievable. Next, create and embed accountability mechanisms for regular reporting.
Implementing this ‘hygiene’ will keep your teams focused on progress against goals, and allow they to steer the course in a timely fashion if results need to be removed.
Finally, create multiple opportunities and channels for your employees to communicate what they are experiencing, seeing and hearing on a regular basis. Not everyone will feel psychologically safe with one communication channel or take up the opportunity without consistent, gentle encouragement . The goal is to acquire real-time, honest, and unfiltered feedback. Use your organisational insight to determine which channels might work best for you.
5. Build your product and services with DEI in mind
The new products and services you develop should embody the DEI values you have established. To truly live your DEI values, you must make it a priority to explore how what you’re putting out into the world may be contributing to society's inequities, and channel the team’s energies into designing products that promote equity and inclusion.
Multitudes is an example of an engineering team analytics tool that has been built on DEI principles. Multitudes ingests behavioural data about engineering teams (starting with Github and Slack integrations). But instead of highlighting simplistic indications of performance, Multitudes steps back and looks at the holistic picture of the team's process and culture, including indicators of collaboration, wellbeing and inclusiveness.
For example, metrics like the Participation Gap (the gap between the quietest and loudest voices, an indicator of psychological safety) and Feedback Flows (which shows who gets feedback, how much, and from whom) are analysed - and engineering leaders are equipped with actionable insights about where there might be gaps in inclusion, and how to act on this insight. If you’re interested in building happier teams by embedding DEI accountability into your engineering function - consider joining Multitudes’ beta!
Moreover, Multitudes takes the adage ‘walk the talk’ incredibly seriously, and has implemented a suite of DEI initiatives within its own organisation. DEI is integrated through everything the business does - in the product development phase, they get feedback from a diverse group of people and commit to an intersectional evaluation of all their models with input from across their team. Additionally, they provide allyship training for all employees, which they translate into an allyship action plan with an accountability buddy. These larger initiatives are supported by smaller actions, such as making all salaries transparent, and rotating ‘housekeeping’ tasks across business levels - so the same people don’t always end up stacking the dishwasher. When they hire, they reach out across their network and ask people to share job opportunities in different communities; and when interviewing candidates, they explicitly ask questions like, "What actions have you taken in support of DEI?".
6. Cascade understanding of DEI’s value across the whole organisation
Finally, take the time to thoughtfully cascade communication your ‘DEI why’, goals, and accountability mechanisms across the whole organisation. You must be consistent and proactive about how you articulate and communicate your DEI ‘why’ to your team, customers, and community - be transparent about your current status, and how you’re tracking against plans to close the gap. This comms can’t be a one-time message - but something that needs to be integrated into every communication channel with your employees on a consistent basis - be unafraid to communicate explicitly about your DEI purpose, how it ties to business success, and the strengths, challenges and opportunities it presents.
If you’re a start-up that’s recently gone through the process of embedding DEI in your organisation - let us know what’s worked, what hasn’t, and learnings from the process!
Enjoyed this edition of AfterWork Reading? Subscribe for weekly content about startups and venture investing.