Definitive Guide to Diversity Hiring

Definitive Guide to Diversity Hiring

Diverse companies perform better. This cold hard reality should be enough to spur any organization to try and create a more diverse workforce. But as well as getting business results, running a hiring process that tries to give every candidate an equal opportunity to land the role is a critical part of Ethical Hiring principles. In other words, it’s just the right thing to do.

Are you looking to make your candidate pool more diverse? Do you have D&I goals to hit? Struggling to actually achieve any meaningful change? You’ve come to the right place. This is the definitive guide to diversity hiring.

The talent acquisition teams of many enterprises are all scratching their heads, trying to figure out how to make their teams more diverse. It’s important that the diversity goals though be within the framework of meritocratic hiring - that is, the best person gets the job. Looking for more ways to make your hiring process more ethical? Check out Alooba’s Ethical Hiring Guide for more info.

In this guide you will learn:

  • what is diversity hiring & why does it matter
  • why traditional hiring approaches do not lead to diversity
  • common reasons companies fail to implement diverse hiring
  • how to transform your hiring process using skills-based screening & structured interviews

What is diversity?

According to the Cambridge Dictionary, diversity is defined as ‘the fact of many different types of things or people included in something; a range of different things or people.

Normally when it comes to hiring and people, diversity would be thought of as people who are different to each other in some way. Crucially, this does not just mean ‘fewer white heterosexual men’. If your current organization had no heterosexual white men, then hiring one would increase your diversity, not reduce it. It’s all contexual, and clearly the location of your organization and your industry place a big part in this.

So diversity of people really comes down to hiring people from a variety of backgrounds, races, religions, genders, sexes, socioeconomic statuses etc.

This must still be within the guise of meritocratic hiring. Nobody wants to be a ‘diversity hire’. The goal is not to hire a diverse set of people at any costs. The goal is to hire the best person for the job. The trick is to make sure that everyone has an equal opportunity, and then within that the system needs to be designed so that the best person is hired, irrespective of who they are. Check out our Ethical Hiring Guide for more details.

What is a diverse candidate?

A diverse candidate is normally defined as someone who is atypical in some way from the current set of employees in the company. This could be based on their ethnicity, gender identity, sex, sexual orientation, nationality, religion, whether or not they’re disabled, or any other dimension, relative to the rest of the employees.

What is the benefit of diversity hiring?

Hiring a diverse set of people has been shown to drive superior business results. Presumably this is as a result of having people with different perspectives, a broader range of skills & experiences, which ultimately drives better creativity and decision making.

Additionally, candidates now intentionally seek out organizations with a diverse workforce. In fact, Glassdoor found around 76% of candidates reported that a diverse workforce is an important factor when evaluating offers from organizations. Candidates will be actively evaluating diversity throughout the hiring process with your organization.

And it’s not just potential new hires that value diversity. The same Glassdoor survey found that the majority of current employees think that their organization should be doing more to promote diversity.

Where do we find diverse candidates?

Finding diverse candidates is actually a lot simpler than what you might think. In most geographies, there will likely be a large scale dominant jobs board, where the vast bulk of candidates go to find positions. For example LinkedIn, Seek, Monster etc. Posting roles here immediately gives you access to a massive scale of candidates, very easily.

The trick is really in how you use these jobs boards effectively. Re-thinking your hiring to not only source candidates from near your office will give you the biggest improvement in diversity. Clearly, if you only hired people in Austin, Texas, vs everywhere in the United States, or everywhere in the world, the diversity of candidates is by definition greater, as you increase your hiring pool. It also gives you access to the best candidates, irrespective of where they are.

In addition to passive sourcing, you could proactively do outreach to candidates who fit your diversity requirements to feed them into your hiring funnel. This is clearly a lot less scalable and the costs will add up quickly.

Should we hire for diversity or ability?

This is an unfortunate question as it’s not an ‘either or’ scenario. Ethical hiring tells us that we should set up our hiring process to give us the best chance to hire the best person for the job, irrespective of who they are. That is, hiring should be meritocratic.

The issue is that for a variety of reasons, traditional hiring is not meritocratic as not every candidate is afforded the same opportunity as each other. By following ethical hiring principles, you can reduce the inequality of opportunity in your hiring process that’s currently holding back some candidates.

Does traditional hiring promote diversity?

No, not at all. Traditional hiring is fundamentally broken in so many ways, and this is just one aspect to it.

At its core, traditional hiring is not merit-based. Traditional hiring is all about making gut feel decisions based on intuition, not data. It is not designed to ensure that the best person gets the job, so it’s no wonder that it does not promote diversity.

Here’s a few ways in which traditional hiring does not promote diversity:


Unrealistic requirements

Job ads often include a massive laundry list of skills, even when they’re not actually required. The more ‘required skills’ or ‘required experiences’ there are on the job description, the smaller the set of candidates who fit those requirements, obviously. A really common complaint from candidates is that once they start the role, it’s been massively overhyped, and most of the required skills & experiences are not actually needed at all.


Overeliance on referrals

Many organizations rely heavily on internal referrals when hiring, especially when they’re in the earlier stages. This is understandable because sourcing can be very slow and expensive, and an internal recommendation from someone who’s presumably great, tends to carry a lot of weight.

However, the issue with this is pretty clear. As humans we have a similarity attraction bias where we tend to be friends with - and like people - who are in some way similar to us. So if you focus on just hiring people like your current people, that’s a surefire way to not get a diverse workforce.

Only hiring locally

Traditionally organizations have just hired people that live within commuting distance of their office. And, despite the last few years of pandemic and complete normalization of working from home, organizations still persist with needlessly narrowing their candidate pool to just their local area. While this reduces the pool of potential candidates by around 99.999%, it also serves to radically reduce your ability to promote diversity.


Persisting with CVs

Traditional hiring uses manual CV screening as the main way to decide which applicants to then interview. Unfortunately, manual CV screening is rife with bias because of all the irrelevant noise on a CV. E.g. a CV contains someone’s name (gender), last name (ethnicity), education history (age & religion), address (socioeconomic status) and numerous other things that are totally irrelevant to determining if this is the best person for the job.

Manual CV screening is full of different types of biases, like the halo effect, horn effect, similarity attraction bias, illusory correlation, beauty bias and more. Here’s a discussion of the issues with CV screening, including the biases involved.

Arbitrarily excluding candidates

Unfortunately traditional hiring is full of lots of ideas that are quite oldfashioned and simply don’t stack up. A lot of these biases are hidden as ‘rules of thumb’, but it’s important to call out what they are - biases. E.g. ‘Their CV contains some spelling errors, therefore they don’t have the right attention to detail’, ‘They’ve mainly worked in consulting - we don’t hire consultants’, ‘They’ve worked in banks - they won’t be able to adapt to our tech company culture’. None of these things actually matter, and yet companies insist on using them.


Using unstructured interviews

Most companies rely on several unstructured interviews as their main evaluation method in the hiring process. However, these are the least predictive of any method. In fact, unstructured interviews are basically worthless, and have very little predictive power. It’s not only that they don’t help, it’s worse than that. They are almost certainly counterproductive when it comes to your diversity hiring goals. With unstructured interviews, it’s easy to exclude any candidate for any reason, without any evidence to support that.

While you might not call your interviews ‘unstructured’, however it’s important to realize when they are. Here’s some signs that you’re practicing unstructured interviews:

  • The final decision at the end of the interview is just a yes/no, based on how the interviewer felt the interview went
  • The interviewers are different for each candidate
  • The questions asked of each candidate are different
  • The candidate’s response for each question is not scored
  • The interview is ‘just a casual chat’ or ‘a quick catch up’ or a ‘pub test’

So, have you been running unstructured interviews afterall?

No objective skills tests

Many organizations just use a few unstructured interviews to decide who to hire. This is winging it and basing everything on a gutfeel and intuition, not actual data. Without an objective and accurate measure of whether or not the candidate can actually do the job (i.e. their skills), then what are you even evaluating?

What are common mistakes companies make trying to hire diverse candidates?

Many companies have an unfortunately narrow definition of what ‘diversity’ means. It almost always just comes down to gender, or really, the ‘Let’s hire more women’ strategy. This is very simplistic, as humans are more complex than just gender.

Humans are multi-dimensional, so to the extent that you would like to hire a diverse set of people, it would be quite ironic that your definition of diverse is lacking diversity.

We also see a lot of organizations paying lip service to diversity, without any real, meaningful change. Actual change means structural change to your hiring process, so that it’s set up properly to attract, select & hire the best candidate for the job.

How to design a hiring process to hire diverse candidates?

Designing a hiring process that attracts, selects & retains diverse candidates is not actually as hard as it seems. If your organization is already data mature, it should be simpler. With a culture of making decisions based on facts and not feelings already established, it should be easier to then hire based on facts too.

Here’s 10 changes you can make right now to improve your hiring process to promote diversity. We’ve tried to make this guide practical, with each improvement tagged by its potential impact and the difficulty of implementing.


1: Define what you’re looking for

Impact: Medium & Difficulty: Easy

We find that lots of organizations skip or gloss over the most crucial step when deciding who they’ll hire. They might say something like ‘we need a new developer’ or ‘I want to hire 3 more product analysts’. This is the starting point, but you really need to be precise in exactly what you’re looking for and why, and get it down on paper.

Without defining this up front, you open yourself up to ‘moving the goalposts’ midway through your search, and arbitrarily excluding candidates on a whim. This is where bias easily comes in, and your diversity efforts are undone.

2: Adopt a remote-first culture

Impact: Large & Difficulty: Large

Since 2020 and the start of the Covid pandemic, remote work has been completely normalized, at least for ‘professional’ roles anyway. The world is very big, and the world really is now your oyster.

3: Adopt an ethical hiring process

Impact: Large & Difficulty: Medium

We encourage all our customers to embrace an ethical hiring process. Here’s a quick guide that breaks down what exactly ethical hiring is. One of the two core principles of ethical hiring is that hiring processes should be set up to be meritocratic.


4: Disclose the full remuneration details

Impact: Small & Difficulty: Easy

By disclosing your full remuneration details up front, you’ll avoid perpetuating existing pay differentials among different groups. Pay transparency is a key component of ethical hiring.

5: Make sure the job ad doesn’t deter candidates

Impact: Small & Difficulty: Easy

In the job ad, make sure you don’t accidentally deter great candidates. Job ads often contain a massive list of skills and requirements, that actually aren't needed for the role. There’s often a real mismatch, with many roles oversold in terms of what’s actually needed.

6: Minimize reliance on referrals

Impact: Small & Difficulty: Easy

We’d recommend not being overly reliant on internal referrals for new candidates. The issue is that the recommendations will tend to just lead to more of whatever current team you have. However, if you’re looking for diversity in your candidate pool, then you’re better off looking to open your sourcing wide by making use of the mass-market jobs boards (e.g. LinkedIn), and then proactively reaching out to targeted candidates. Proactive outreach is of course expensive and unscalable, but it’s at least a quick-fix to change the diversity of your team.


7: Replace manual CV screening with skills quizzes

Impact: Large & Difficulty: Easy

CVs contain a whole world of irrelevant noise about a candidate, that has nothing to do with whether or not they’re the best person for the job. A CV reveals someone’s gender, ethnicity, socioeconomic status and more etc., and is not predicitve of the person’s work performance. In fact, manual CV screening often misses the best candidates completely.

By using an objective skills-quiz instead, you open up opportunities for the best candidate to shine, irrespective of what their name might be. Here’s a comprehensive guide for replacing CVs with skills quizzes.


8.Replace unstructured interviews with structured interviews

Impact: Large & Difficulty: Easy

Unstructured interviews are, effectively, worthless. This salient fact seems to have been missed by almost all organizations and all hiring managers in the world, given how persistently unstructured interviews are done.

You can now easily run structured interviews using Alooba Interview.

9. Avoid the dreaded cultural fit interview

Impact: Large & Difficulty: Easy

Cultural ‘fit’ interviews, almost by definition, seek to find people who are the same as what you already have. So from a diversity perspective, this really does not make any sense.

Apart from that, the best candidates for the position are easily rejected arbitrarily at this stage

10. Reduce the emphasis on interviews

Impact: Large & Difficulty: Easy

Interviews, relative to work sample tests, skills assessment, or IQ tests, are a relatively poor predictors of on-the-job performance, yet for most organizations, this is all they do. Interviews are inherently in favour of extroverts and against introverts, and those with autism, social anxiety and other things.

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