How To Improve Executive Sales Diversity in 2021
Peak Sales Executive Search is committed to helping companies meet their talent goals and grow the bottom line. That includes helping companies meet their recruiting diversity goals so that they can better connect with employees and customers. There are four specific reasons why pursuing diversity in recruitment grows companies.
Why Improving Diversity Matters To The Bottom Line
Company leaders already have a full schedule of priorities to manage. Why should diversity and inclusion become a priority? There are four reasons why it matters.
- Executive teams with women have greater financial performance. Companies in the top quartile for executive team diversity were 25% more likely to have above-average profitability in 2019. That’s not all. The financial performance associated with diversity is growing over time. In 2014, there was a 14% likelihood of above-average financial performance due to gender diversity, according to McKinsey.
- Executive teams with ethnic diversity outperformed less diverse companies by 36% in 2019. Likewise, the financial outperformance linked to diversity has increased over time, according to McKinsey data.
- Avoid expensive customer boycotts. There is some evidence to suggest that consumers have a higher chance of boycotting brands with diversity problems. In 2020, nearly 40% of consumers are currently boycotting a company. Approximately 1 in 5 of consumers said “the diversity of a company’s executive suite factors into their decision to spend money with that company,” according to a Qualtrics study.
- Diverse Sales Teams Increase Revenue. Research reported in Harvard Business Review found that a salesperson who shares the same ethnicity as a client is more likely to close the sale. As the population becomes more diverse, the diversity of your sales team needs to keep up.
Despite these clear benefits, a significant number of companies are struggling to make real progress on diversity and inclusion. Let’s take a closer look at the data.
Struggling With Diversity Recruitment? You’re Not Alone – But We Can Help
A growing number of companies are taking action to improve diversity in the C suite, but progress remains relatively slow.
- CEOs. As of December 2019, women held 6% of CEO positions in the S&P 500, a list of large publicly traded companies. By the end of 2020, that figure rose to 7.8%.
- Senior Managers. A study of Fortune 500 senior managers found that 79.5% are men. The same study found that Latino and black executives are underrepresented in senior executive roles.
- Signs of Diversity Progress. Consider HubSpot, a successful marketing software company based in Boston. The business’s 2019 diversity report found that women held 44% of all company positions, but that figure drops to 36% in sales (up from 32% in 2018). While the company is making progress, it still has room to improve. For example, 100% of Vice Presidents at the company are white, and minorities make up 15.3% of sales positions.
HubSpot shows that progress is possible. Let’s look at specific techniques that can help you attract more diverse candidates for executive sales positions.
Crafting A Diversity Friendly Recruitment Process
The following steps will help you improve the quality of your job postings to attract more diverse candidates:
1 Start by recognizing “hire like me” bias
In 2018, Amazon revealed a major diversity hiring problem. The business used a hiring algorithm that systematically discriminated against women.
According to Reuters, the root cause of the bias was:
“Amazon’s computer models were trained to vet applicants by observing patterns in resumes submitted to the company over a 10-year period. Most came from men, a reflection of male dominance across the tech industry.”
Such bias is not limited to algorithms or technical job postings. There is a psychological tendency called “Like Me Bias,” which means that people favor people like themselves. By the logic of this bias, a white man is more likely to select more white men for interviews. Left unchecked, people will tend to hire people like themselves, which means diversity objectives may not be met.
Once a company’s diversity weakness is understood, such as overwhelmingly favoring male candidates at Amazon, it is easier to make the case to seek out more diverse candidates.
2 Recognize “last person” hiring bias
According to the BBC, many employers “often use the last person to hold a post as a benchmark for the type of candidate they’re looking for.” Some aspects of this tendency are positive – like seeking an executive track record managing a large department. However, it is also possible to systematically overlook diverse candidates.
Avoid this trap by starting with a blank piece of paper. What skills, education, and accomplishments could help a person add value in a specific position?
3 Rewrite job postings to reduce barriers
There are a few ways to revise your job postings to encourage more diverse job applicants.
- Avoid masculine wording. The specific words used in a job posting influence job applications. Researchers have found that “masculine wording” (e.g., leader, competitive, dominant) tends to discourage female applicants.
- Use blind resume reviews. Unfortunately, some employers systematically favor applicants based on a name. Sadly, African-American and Asian-American job applicants who “whiten” their resumes (i.e., removing information about their race) received more callbacks, according to a study of 1600 job applicants. Likewise, recognizing that penalizing candidates with job history gaps may penalize working parents who took time off work to care for young children.
- Use standardized job interviews. Asking the same standard questions to each candidate can reduce bias, according to research reported in Harvard Business Review. You might ask questions about how a candidate has rewarded and retained top-performing sales representatives for an executive sales role. Alternatively, consider asking applicants for a sales executive role to describe their most significant sales management accomplishment. Such questions help candidates to focus on specific job-related accomplishments.
- Use work sample tests. This type of test is common practice in technology roles where a job candidate is asked to complete a coding test. A work sample test for executive sales leadership might be more difficult, but it is still possible. For example, ask an executive to review sales representative performance reports and provide coaching suggestions to improve performance. Alternately, you might ask an executive sales candidate to prepare a short presentation on their approach to fostering a positive remote sales culture.
The Fastest Way To Improve Diversity in Executive Sales Hiring
Recognizing hiring bias is worthwhile to work, yet the data is clear. Many employers are struggling to make progress on diversity recruiting. Fortunately, there is a way to significantly reduce hiring bias problems, such as the “hire like me” bias.
Work with an outside recruiting firm that knows how to seek out more diverse candidates proactively. An external recruiter can also facilitate blind resume review, so hiring executives are less likely to make discriminatory decisions about who they interview. Contact Peak Sales Executive Search today to discuss ways to reach your diversity recruiting objectives.