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DEIB Technology Is Evolving to Meet the Moment

March 26, 2021 Employee Experience
Stacia Sherman Garr co-founder and principal analyst RedThread Research
By Stacia Sherman Garr

The last 12 months delivered a wake-up call. Long-simmering social and race issues that were near the surface for decades boiled over into view on top of the massive disruption caused by the COVID-19 pandemic.

These events changed the ways we live and work especially for underrepresented people, many of whom saw their livelihoods disappear seemingly overnight. And for many, new jobs weren’t on the horizon as the net employment loss for 2020 reached 8.8 million workers, according to U.S. Bureau of Labor Statistics figures.

For some businesses, responding to these issues meant making pledges, such as:

  • Peloton donated $100,000 to the Asian American Federation to support Asian communities. 

  • Nike donated $500,000 to nonprofits supporting Asian American, Middle East, and Pacific Islander communities. 

  • PayPal created a $500 million fund to support Black and minority-owned businesses.
  • PepsiCo committed to increase the number of Black managers in the company by 30 percent by 2025.
  • Investment firm Andreessen Horowitz donated $2.2 million to start the Talent x Opportunity fund supporting entrepreneurs from underserved communities.
  • IBM discontinued research and development of facial recognition technology due to potential human rights and privacy abuses. 

These companies, along with many others worldwide, made promises to improve the quality of society and the workplace by recognizing existing racial biases and assuring consumers and employees alike that they would make meaningful changes. But when? The opportunity to do that is here and now.

Companies are under increasing pressure to follow through on promises made last year. Business leaders can do this by focusing on diversity, equity, inclusion, and belonging, or DEIB, and integrating this into organizational operations. Technology is a critical component of DEIB practice, yet few are able to leverage it successfully.

The latest advances in technology, such as artificial intelligence, machine learning, natural language processing, and organizational network analysis, can help leaders monitor data, identify emerging patterns and trends, receive analytical insights and recommendations, and achieve scale. Organizations that are serious about systemic change should take a good, hard look at DEIB technology for the capability to enable such changes.

Related Article: Now Is the Time to Redesign the Future of Work

DEIB Technology: An Evolving and Maturing Market

By DEIB technology, we mean "enterprise software that provides insights, or alters processes or practices, at the individual or organizational level, in support of an organization’s efforts to become more diverse, equitable, and inclusive, and to enable belonging.”

We published our first in-depth research in 2019 into diversity and inclusion (D&I) technology. In the two years since, the market has dramatically changed both in its make-up and what it represents, as reflected in the expansion of D&I to include the concepts of equity and belonging, or DEIB. Our latest research shows just how much the market has changed.

From 2019 to 2021, the number of HR tech vendors offering DEIB features or functionality has gone up 136 percent, and the number of DEIB tech vendors is up 87 percent. The two-year compound annual growth rate (CAGR) of the market is 59 percent, and the overall market size is $313 million, up 36 percent.

These are strong statistics, especially considering how chaotic 2020 was. But they also show a growing need by organizations to address DEIB and better understand how technology can help. As we explain in our 2021 research, DEIB technology helps business by:

  • Improving the organization’s understanding of DEIB and the complexities surrounding it. 

  • Promoting objective decision-making. 

  • Flagging and mitigating bias. 

  • Ensuring equal access to opportunities for all within the organization. 

  • Creating transparency and accountability. 

  • Scaling DEIB efforts throughout the organization. 

However, in order to leverage DEIB technology successfully leaders must have a clear understanding of the tech available in the marketplace, and how it can help them achieve their business goals.

For instance, before purchasing new DEIB technology leaders should be aware of what already exists in-house. Especially in the last few years, we’ve begun to see DEIB capabilities incorporated in human capital management and human resource information systems as well as talent management systems and products that focus on a specific talent area, such as employee development.

In addition, leaders should work with IT functions when considering any technology. IT can more easily highlight where DEIB capabilities may already exist in-house as well as help strategize and implement new technology additions.

Related Article: How Companies Can Bake Diversity and Inclusion Into Their DNA

A Key Benefit of DEIB Tech: Data and Analytics

Identifying, analyzing, and democratizing DEIB data is becoming a critical focus among forward-thinking organizations. Some leaders are now using DEIB data to understand the experiences of diverse populations, identify and understand networks among different groups, analyze DEIB data for deeper insights and build greater accountability.

Technology can play a critical role in enabling all these areas, helping drive greater accountability and transparency by tracking and measuring progress and actions at both the individual and organizational levels.

Insights from that data analysis can enable employees and leaders to monitor and change their own behaviors. The bottom line is this technology can help everyone understand how their actions can impact DEIB outcomes and even offer recommendations about those actions.

What Leaders Need to Know Before Buying

Before purchasing any new DEIB technology, here are three considerations:
  1. Be aware of the benefits and the risks of using DEIB technology (see Figure 1).
  2. Be clear about your own needs. Leaders need to understand where they are on their organizational DEIB journey and what they hope to achieve, identify if a vendor can support them, and determine whether additional services such as consulting, programming or network administration may be required.
  3. Audit existing in-house tech that can potentially be leveraged for DEIB purposes. Many vendors have added DEIB capabilities to their platforms and software. Leaders should establish whether they have the expertise in-house to conduct an audit or need outside help, determine what technology the organization has that may offer DEIB functionality and how advanced it is, and identify technology needs based on audit results.

RedThread Research Infographic on Benefits and Risks of DEIB Technology
Figure 1: Benefits and Risks Associated with DEIB Tech. Source: RedThread Research, 2021.

What's Next for DEIB Technology?

In the coming months, we expect to see:

  • DEIB technology continue to surge and proliferate through HCM and talent management systems, offering more options and solutions for DEIB functionality.
  • More organizations focus on inclusion and belonging, especially with studies showing that more people choose to work at a company primarily for its culture. But those cultures will have to respond to social and racial injustices, be they #BLM or #StopAsianHate. 

  • Organizations demand more from DEIB technology above and beyond just providing data. Through analytics, it needs to recommend and prioritize actions for leaders, connect those actions to business outcomes, and offer “what-if” scenarios should those actions not happen.

Even though DEIB technology is a critical component of driving DEIB efforts, leaders would be wise to remember that it is just that – one critical component in the entire approach. Leaders must align it with the organization’s overall DEIB purpose and strategy to make real change happen. 

About the Author

Stacia Sherman Garr is co-founder and principal analyst at RedThread Research and a thought leader on talent management, leadership, diversity and inclusion, people analytics and HR technology.


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