Hacking Diversity In Tech By Emphasizing Retention

Conversations around diversity in tech often focus on the “pipeline” and getting more people from underrepresented groups through the door. But that’s just a first step. The next, most critical step is retention. There’s no point in a company using its resources to hire a diverse people if they’re not going to offer them an environment that is both supporting and nurturing.

“It’s not to say that you shouldn’t focus on [hiring], but to focus on that and not focus on retention, it’s like you’re filling up a leaky bucket,” Paradigm CEO Joelle Emerson tells me.

Paradigm is a consulting startup that focuses on diversity. It’s currently working with high-growth companies like Pinterest and Slack on fostering and retaining a diverse workplace. That’s because if companies can’t effectively retain diverse people it’s a huge waste of money and resources. In fact, the cost of recruiting and hiring a new employee is typically 20 percent of the annual salary for that person, according to the Center for American Progress.

“I think that [retention is] as important if not more important because you don’t want to churn out diversity,” Twitter Engineering Manager Leslie Miley, who is black, tells me. “Because if you churn out diversity, that says a lot about your culture. Companies that do churn out diversity will never be able to increase their diversity. It sounds very simple, but it’s really interesting to see that some companies haven’t figured that one out.”

Losing diverse employees could mean a couple of things, Miley says. It could mean either that it’s a culture that doesn’t recognize diversity matters, or it could be that there’s just a bad apple driving people out the door.

“I have actually seen that previously in my career where one person can create an environment that is just chilling for people of color,” Miley says. “There’s one example, but I won’t name the company, by the time they realized that there was a problem, it was too late.”

Even though Miley didn’t specifically call out Dropbox, my bet is that he was referring to the situation with former Dropbox employee Angelica Coleman, who says she left the company because of its unsupportive environment.

Women leave tech companies at twice the rate of men, according to a study by the Harvard Business Review. The most common reason is the working conditions (e.g. no advancement, number of hours, low salary).

One way to combat retention issues is by determining if your company is at risk of them, which can be accomplished through surveys, Emerson says. These surveys should ask employees things like how long they plan to be at the company, how they perceive diversity and inclusion in the company, and if they are aware of opportunities for advancement. And one way to signal to diverse employees that there are opportunities for advancement is to ensure there are people from underrepresented backgrounds in leadership roles.

Companies also need to recognize that a high retention rate of diverse employees doesn’t necessarily mean the company’s doing anything right, Emerson says. People might be forced to stay on at a company because of financial reasons, not because they actually enjoy working there. “If people aren’t leaving, companies sometimes make the assumption that everything is fine, and that’s not always the case,” Emerson says.

Productivity startup Asana, another high-growth company that Emerson works with, recognizes that retention of diverse employees is really important, but it tries not to create mechanisms just to keep people at the company.

“Instead we rely on our own values as the north star, and literally hold ourselves accountable, Asana Head of Recruiting Andy Stoe says. “We also try to remove the ‘golden handcuffs’ so people want to stay at Asana for the right reasons.”

The “golden handcuffs” Stoe is talking about are the benefits, like stock options and other deferred payments, that aim to discourage people from leaving the company. Asana has tried to loosen the handcuffs by changing the standard terms that apply to the company’s new stock options.

In the past, employees had just three months after leaving Asana to exercise their options before they were forfeited. Now, employees have 10 years to exercise those options from the date Asana grants them, even if they leave the company before that time.

Ultimately, tech companies need to be thoughtful about the kind of work environment they create, and how they enable diverse employees to seek and attain opportunities for advancement. Companies also need to be aware of what is incentivizing people to stay. Is it because of the company’s supportive, nourishing environment? Or, are employees staying because of the golden handcuffs around their wrists? If it’s the latter, something needs to change.