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Unfairness in Tech - a $16B Problem

· Technology,diversity

Unfair treatment is the biggest driver of employee turnover, and it is a US$16B problem for tech companies. Study shows that unfair treatment is the single largest driver of turnover affecting all groups and most acutely affects underrepresented professionals.

Recently it was alleged Uber has misused its technology to deceive Authorities worldwide. They also hit the NY Times headlines earlier this year for its aggressive, unrestrained work culture and sparked an international debate about misogyny and misconduct in tech.

Then last Friday it was alleged that Google officials testified in federal US court that it would have to spend up to 500 hours of work and $100,000 to comply with investigators’ ongoing demands for wage data that the Department of Labor believes will help explain why it appears to be systematically discriminating against women. Google, with more than 21,000 employees and nearly $28 bn annual income, was attempting to present itself as “too big to comply”, suggesting that the company should be able to skirt anti-discrimination laws just because it is large and has a complex compensation model across its international workforce.

We have all read these types of stories, and the accounts of high profile whistleblowers leaving their jobs because of broken or toxic work environments and Glassdoor exposes. While people leave their jobs for a variety of reasons, from the desire to accelerate their career trajectory, greater cash incentives to a shorter commute or simply a transition of industry or careers, the Tech Leavers Study - a first-of-its-kind national US study examines for the first time, why people voluntarily departed their jobs in the tech sector.

This study, delivered by the Kapor Center for Social Impact and Harris Poll, sheds some interesting perspectives on what drives top talent to exit and what companies can do to mitigate the strategic and reputational risks. The study surveyed a nationally representative sample of U.S. adults who had left a job in a technology-related industry or function within the last three years.

The survey found that unfair treatment was the single largest driver of turnover affecting all groups, and most acutely affects underrepresented professionals.
Unfairness-based turnover in tech is a problem estimated at $16B a year.

This report showcased 4 key takeaways

  1. Unfairness drives turnover
  2. Experiences differ dramatically across groups
  3. Unfairness costs $16 billion each year
  4. Diversity and inclusion initiatives can improve culture and reduce turnover— but only if they are done right.

The study showed:

  • Nearly 40% of US employees surveyed indicated that unfairness or mistreatment played a major role in their decision to leave their company, and underrepresented men were most likely to leave due to unfairness.
  • 1 in 10 women experienced unwanted sexual attention, while LGBT employees were most likely to be bullied and/or experience public humiliation.
  • 78% of employees reported experiencing some form of unfair behavior or treatment; Women from all backgrounds experienced/observed significantly more unfairness than men and unfairness was more pronounced in tech companies than non-tech companies.
  • Underrepresented men and women of color experienced stereotyping at twice the rate of White and Asian men and women with 30% of underrepresented women of color were passed over for promotion.
  • Experiencing and observing unfairness was a significant predictor of leaving due to unfairness,
  • The more bullying experienced, the shorter the length of time that employees remained at the company.

So how can tech companies change the game to retain top talent?

  • Nearly two-thirds of tech leavers indicate that they would have stayed if their employer fixed its culture.
  • Having a diversity and inclusion strategy was associated with fewer reports of unfairness, significantly lower sexual harassment, bullying and stereotyping, and lower rates of leaving due to unfairness.
  • Having a comprehensive diversity and inclusion strategy in place had a much greater impact than having individual initiatives (e.g., unconscious bias training).

What can companies do?

There is no question that the war on acquiring and retaining top talent in the tech industry will continue to be a challenge to secure a competitive advantage.

From a reputation standpoint, smart companies appreciate that in order to attract and retain talent, it's no longer only about marketing and communicating their technology brand or focusing on "what they do" – i.e. "what product/or service" the company has promised to its customers - it is also about the stakeholder's perception of how well it fulfil these promises to its stakeholders based on "who they are and how they operate" - so they need to get this right. Workplace, citizenship and governance are 3 of the 7 dimensions that drive corporate reputation (Fombrun, 2004).

The Tech Leavers Study recommends these 3 strategies:

1. Implement Comprehensive D&I Strategies with a top-down approach.

2. Create Inclusive Cultures.

3. Develop Effective and Fair Management Processes.

While they all can contribute positively to a company's reputation and can add some value to reducing talent churn and lowering cost of acquisition, fundamentally, they must be integrated into the DNA of the company, rather than added as a point in time band-aid solution or public relations agenda.

My mentor Mike Love, (former Advisor to Margaret Thatcher and Former Comms Director of BT, Microsoft and McDonald's) would tell me it's even simpler than that. They should simply remember:

4. Adopt LEADS.

  1. Is it Legal? (Both locally & internationally),
  2. Is it Ethical (Is it regarded as unethical behavior by stakeholders even if legal?),
  3. Is it Acceptable (Is it criticized by some, but regarded as acceptable by most who matter most),
  4. Is it Defensible (Could we defend our action if this became front page news?) and
  5. Is it Sensible - Even if it failed all or some of the EAD criteria - does it still make good business sense?”

As a start to solving this billion dollar challenge, perhaps all tech companies should take Mike's advice and apply "LEADS".

Discover the full report here: http://www.kaporcenter.org/tech-leavers/

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