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HR / People Analytics · how-to

Diversity Index → EBIT regression — in R

A composite-index-driver analysis. Every step below is the same analysis rendered for R — grounded in the source, honest where R can't do a step cleanly.

Same analysis, your tool

SCORE-INDEX
convert raw group counts into a single trackable diversity metric
df$EthnicityDiversityIndex <- rowMeans(df$items)
SCORE-INDEX · mechanical
same index treatment for gender composition
df$GenderDiversityIndex <- rowMeans(df$items)
REGRESS
estimate how each diversity index moves EBIT
lm(y ~ x1 + x2, data = df)
VALIDITY · mechanical
keep only a statistically reliable model
cor(df$measure, df$criterion)   # criterion validity
PREDICT
translate diversity indices into a bottom-line forecast
predict(model, newdata = df)
Grounded in
Predictive HR Analytics with Excel — §18.1/18.2 Simpson's Diversity Index & EBIT regression

Doing HR / People Analytics work?

The full HR / People Analytics guide covers this and the whole workflow around it — reconciled from the field’s best books.

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