7 Ways HR Can Build A Fairer, Data-Informed Culture

People data and analytics is now one of the hottest, most in-demand skills for HR professionals and ranks as one of the most important human capital trends for organizations today. Companies are looking at data to inform decisions and answer questions such as: Who will leave and when? How do our capabilities compare to competitors? What skills and talent do we need? This kind of data provides insights and can help decision-makers by answering these questions and more.

As humans, we have nearly 200 types of cognitive bias that affect our decision-making. We see these when we notice others who tend to only seek out information that confirms what they already believe or when we hear someone say they “knew it all along” after an event has occurred.

Here are seven ways leaders can help their company ensure a culture of fairer data-informed HR decisions:

1. Develop Organization-wide Definitions of Fairness

You’ll probably never build a single metric or universal definition of fairness that applies in all cases — in fact, there are more than 45 definitions for “fairness” listed in the Google Developers Glossary. So start by identifying your organization’s highest-priority aspects of fairness. Then create several compatible definitions based on metrics and standards that work in different use cases and circumstances.

2. Promote Fairness with a Strong Business Case

Explain why fairness is essential to your bottom line. Present your ideas in business terms and gain the support of trusted stakeholders known for making evidence-based business decisions. For example, draw a clear line between fairness and diversity. Then share how a recent McKinsey study spanning 15 countries and 1,000+ companies found that those in the top quartile of gender, ethnic, and cultural diversity outperformed those at the bottom by 25 to 36%. There’s nothing like robust metrics to support your case.

Promote Fairness with a Strong Business Case

3. Embrace Technology while Accepting its Limits

Technology can be a powerful tool for identifying and correcting bias in people processes. It may never be able to ensure that all data-informed decisions are fair and that all bias is addressed, but don’t let the lack of perfection hold you back from leveraging it. New technology emerges daily that supports fairness in data-informed HR decision-making. So, keep up to date on new product developments and build a constantly evolving portfolio of software, tools, and procedures focused on increasing fairness.

4. Conduct Fairness Audits

Fairness audits are objective, systematic methods that look at an organization’s people data policies, practices, and procedures. Audit goals vary: One goal could be to look for potential issues that make an organization liable to legal action. Another could be to identify ways to improve fairness-related practices.

A fairness audit could be done through software tools, the help of an external expert, or even through an internal review. What’s most important is that they are completed on a regular basis by someone who understands your organization’s definitions of fairness and that any issues or opportunities are acted upon.

5. Find the Underlying Cause of Your Problem

When you do discover a problem, look for the underlying assumptions or processes that need to be changed. Biases are often unconscious, and unfairness is generally the symptom of more than a single decision. This makes the underlying cause of a problem difficult to detect.

Consider using an approach loved by toddlers around the world: Ask “why?” at least five times. Here’s an example of how the technique might work for you. Problem: Diversity in our organization is 45%, but only 5% of executives match our definition of diverse. There are usually multiple underlying causes and simply identifying potential causes won’t solve the problem. Action is still needed. However, until you identify and address the underlying issues you won’t see change.

6. Make diverse, Cross-group Collaboration a must

A diverse group will be better able to identify and solve issues of unfair bias in systems. So be sure to include individuals with a diversity of thought and experience at each stage of the process to lower the likelihood of unintended biases creeping in unnoticed.

Solicit input from across the organization by bringing together experts from multiple departments such as HR, data, technology, and legal to identify and promote opportunities for new or improved people-related data systems. Collaborate with vendors or in-house data professionals to develop and improve operational practices and ethical standards that make the use of people-related data systems fairer.

7. Keep the H in HR

In many cases, there isn’t — and shouldn’t be a substitute for human judgment in HR decision-making. Fairness in recruiting, employee evaluation, and other HR decision-making requires human participation.

Consider the interview process: It is completely possible these days to remove the human and allow data from video interviews to make decisions. When asked about such an approach, 67% of respondents in a Pew Research study felt this would be unacceptable. The reasons they gave? It would be flawed or biased and that “humans should evaluate humans.” Among those who believe it is acceptable, they still believe this approach would have flaws, bias, and fairness implications.

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Fairness is becoming an important part of business success — achieved by doing right by people and doing right in the world. Our new, analytics-based environment provides opportunities to define fairness for the organization, build a business case for it, and collaborate with groups within and outside the organization to create and maintain it. The challenge is to be aware of the opportunities and seize them when they appear.

Source: https://hbr.org/2020/11/7-ways-hr-can-build-a-fairer-data-informed-culture