Does it really matter if women are in the workplace?
I can’t tell you how many times I’ve been asked this question. And my answer is always the same - an emphatic YES.
Why Does it Matter?
You can look at the issue from two different perspectives, human and financial, and both go hand-in-hand. As SAP’s Anka Wittenberg says, “‘Building an inclusive culture’ is now the #1 predictive strategy for global financial performance.”
Engaged Women are Essential to the Bottom Line
Any manager can tell you that engagement is a key tenet of employee success.
Take this case study as an example. New Century Financial Corporation, a U.S. specialty mortgage banking company, found that account executives in the wholesale division who were actively engaged produced 28 percent more revenue than their colleagues who were actively disengaged. Employee engagement doesn’t merely correlate with bottom line results, it actually results.
What drives engagement? Feeling respected, heard, and like a true member of the team. Having strong mentors. Seeing others in leadership positions who look like you.
Now, consider that nearly half of the U.S. workforce is women.
If half of your workforce is not feeling respected, is not feeling heard, and does not see a future within the organization, they are not engaged. And if they’re not engaged, you’re losing money.
The Value of Diversity in the Workplace
There’s intrinsic value in diversity, as aptly stated by Lauren Rivera of the Kellogg School “Diversity—be it demographic diversity or diversity in background knowledge—has benefits: it helps groups make better decisions, increases group motivation, enhances creativity, and can be a strong draw for clients.”
Study after study has shown the power of diversity.
Deloitte Australia, for example, studied the business impact of diversity, inclusion, and engagement. One of their most notable findings was that teams and organizations that are seen as highly committed to diversity and inclusion can outperform peer groups by 80%.
Why? Phillips, Neale, and other researchers have found that when a group is more socially diverse, members are more likely to contribute their unique perspectives and knowledge to the table. This sparks individuals to adopt a more holistic and sympathetic approach to problem solving, and leads to better decision-making.
This doesn’t happen overnight. It takes intentionality, hard work, and an ongoing commitment to create team and workplace environments where every worker feels free to contribute their perspectives.
The Impact of Women Executives on Business Outcomes
It’s not enough to just have women on the team. It’s essential they take leadership roles, as well. And unfortunately, there’s still much work to be done to get to gender parity at the executive level.
As of January, 2019, 24 women led Fortune 500 Companies, representing just 4.8% of the CEOs. The Global Strategy Group found that “One in four Americans say there are no women in leadership positions at their current job,” the same percentage that “think it is more likely that humans will colonize on Mars than that half of Fortune 500 CEOs will be women.”
While female executives and board members are relatively rare, their impact is immense:
Gender-diverse executive teams consistently positively correlate with increased profitability. [McKinsey]
Fortune 1000 companies with female chiefs outperformed the S&P 500 index over their respective tenures, with an average return of 103.4% for companies with female CEOs, compared to an average return for the S&P 500 over the same time period of 69.5%. [Forbes]
Workplaces with the highest gender diversity in managers deliver 34% of revenues from innovative products as compared to 25% from workplaces with the least. [Boston Consulting Group & The Technical University of Munich]
Companies with the most women on their boards of directors outperform those with the fewest women on ROS by 16%. [Catalyst]
As Stefano Natella, Credit Suisse’s Global Head of Equity Research told the Washington Post "You can argue whether companies are performing better because they have more women in management or because better companies employ more women."
So, how do we get more women into these positions where they’re making a remarkable impact? The obvious place to start is getting more women into organizations and key jobs at the start of their careers so they can grow within their companies.
Moving in the Right Direction
Smart organizations realize they will be able to attract the best and brightest if they create an environment to attract and retain women. To be sure, many companies offer diversity training and support initiatives aimed at women, but this is not the same as internalizing the value that women bring to the table and mandating balanced gender representation and parity.
For systemic change to happen, this can no longer be seen as a ‘women’s issue’ but needs to be reframed as a business imperative and strategic priority. Both men and women need to be a part of the change.
I’ve seen much progress in breaking down these challenges over thirty years, as the examples from the companies I’ve worked for will show.
At HP, I actively participated in Women’s’ conferences. As of this writing, HP is one of only two Fortune 500 companies that has had two female CEOs (Xerox is the other).
SAP held a Business Women’s Network (BWN) which was a grassroots effort to facilitate skills building, mentoring, and networking for females. In 2011, the company’s goal was to have 25% of their leaders be female by 2017, 28% by 2020, and 30% by 2022. They hit their 2017 goal six months ahead of schedule, and are on track to meet their other stated goals.
Samsung North American executives sponsored an employee-led program called WISE (Women In Samsung Electronics), with four tenets of Recruiting and Retention, Giving Back, Mentoring & Networking, and Work Environment & Policies. This organization has been hosting panel discussions, scheduling learning and development opportunities, and actively soliciting suggestions to transform the culture.
Many other companies also understand the need to invest in females and are doing so in meaningful ways. But, organizations still have plenty of room for improvement, and individuals within companies must continue to work toward change.
Theoretically, with more diversity at the top of organizations, biases should begin to disappear.
We have to be patient as neither people nor culture can change overnight. At the same time, we need to keep pushing for parity in all aspects of work.
We must speak up when we see an issue, act when we need to, and take responsibility for creating an environment where all of us can contribute and thrive.
And, most importantly, we need to reframe the issue as a whole. For systemic change to happen, this can’t be seen as a women’s issue. It needs to be seen as a business imperative.