This week's topic: The benefits of women in leadership.
More effective collaboration. A stronger sense of trust in management. A 15 percent boost in overall profitability. What do each of these things have in common? A woman in a leadership position. Despite making up 50 percent of the labor force, women in managerial roles has hovered at around 37 to 40 percent for years, with an even smaller ratio – one woman to every 19 men – at the highest position with an organization.
So, what gives?
This week on CFO Weekly, our host Megan Weis – VP & General Manager, FAO Services at Personiv was joined by Lydia Adams, Personiv's VP of Marketing & Communications to talk about what we miss when women are missing from supervisory roles, and what benefits organizations can look forward to when they actively work to put and keep women in leadership positions.
We've Come a Long Way - And We Still Have a Long Way to Go
Weis began this week's discussion by going back to basics and running the numbers. At the outset of the conversation, she recalled an article she read back when she was beginning to earn her MBA from Duke University's Fuqua School of Business from The New York Times that pointed out how more men named "John" occupied the senior-most role at large businesses than all women in that same role combined. She pointed out that significant ground has been gained since then, but that the number of women in the top spot is still lower than makes rational sense at just one woman per 19 men.
The two pivoted to a discussion of why closing that ratio gap so that it reflects a more accurate breakdown of women in society – and in work, at 50.8 and 47 percent, respectively – is such an important goal, and how it's beneficial for every company's bottom line.
More Than Soft Skills: What Women Leaders Bring to the Table
The first benefit of women in leadership that pops into Weis' head is that, "the more diverse a group, the better the problem-solving abilities within that group" are. "Absolutely," Adams agreed, citing a University of Arizona study that attempted to measure the "innovation intensity" of companies by gender and ethnicity breakdown and found that the organizations with more women in leadership positions were able to secure 20 percent more patents than the ones that didn't.
It's just one of the many data points that show that a more diverse collection of voices within a single organization can create an atmosphere that's more innovative and more adept at solving problems, by simple dint of the fact that a wider collection of experiences naturally leads to a wider collection of approaches – some of which may not have been previously considered. After all, you simply can't speak to something you haven't personally experienced. It's something that Adams has seen firsthand in the organizations she's worked for and had a hand in leading: "The problem-solving, the creativity and the diversity of different minds and different people ... that's one of the biggest benefits [to having women in leadership] – and one of the most overlooked benefits."
Having that wide set of viewpoints is something that Adams has found particular crucial in her role as the VP of Marketing and Communications here at Personiv. "When I think about a group of people," she elaborated, "and especially where I'm coming from in marketing – a lot of what we do is brainstorming different ideas – really harnessing the creativity of a group; and once that process begins, it's amazing to see how it builds. I think when women are left out of that conversation ... you're really not getting that creativity and the ideas that could come from a more diverse group of people."
Then there's the perception among groups that women leaders are more trustworthy. Citing a Pew survey, Weis allows that while most people don't see a significant difference between the trustworthiness of a leader whether they're a man or a woman when there is a perception difference, that is significant: with 34 percent of respondents saying that they saw women leaders as more trustworthy and only 3 percent saying the same about men.
Both of these benefits are couched in the tendency of women to excel at what are generally called "soft skills" – Weis refers to social awareness, conflict resolution and overall adaptability as a few examples, and Adams agrees. Anecdotally, she explains, women tend to be the "cement" that holds groups together, saying that though this is a trait that's frequently a result of how women are socialized, it's one that they've made work increasingly in their favor, especially at work.
How We're Getting Women a Seat at the Table for Generations to Come - The Benefits of Women in Leadership
Weis and Adams moved on to a subject that's particularly important to each of them – the topic of women as mentors. Weis shared her own history in the workplace, where she's experienced women as more likely to step into a mentorship role, which she's personally benefitted from. "If you look at the experience of a lot of women who have made it to those upper-level positions," Adams agreed, "it's been really important for them to have that support of other women in their organizations.
Positing that it's potentially that emphasis on soft skill literacy that makes women less likely to see up-and-coming young professionals as competition, she sees the role as something of an obligation, especially for women who have benefitted from strong mentorship themselves. "I think it's really kind of responsibility or an obligation," she explained, "there are barriers that we face that men don't necessarily have." That's why, she said, "To have women mentors and colleagues and coworkers that are helping each other? That's amazing. That's what we need."
Weis points out that that same need is becoming a matter of course, especially for younger generations of women – namely Generation Z – who are entering the workforce with more education than their male counterparts at a time when Millennials are beginning to assume leadership themselves.
Crucially, Adams agrees, is a concurrent development: "We're also seeing that [women are] wanting to be in management positions and really not taking that old school view of 'men are the ones that lead and women don't'." Potentially, she imagines this can be credited to the fact that "81 percent of [Gen Z graduates] say that the most important factor in getting a job is diversity," whether that's reflected in the breakdown of gender, race or ethnicity. "We're starting to see that shift in how we work."
This is exciting for so many reasons, both women agree, but especially because there is a very big benefit to having women in leadership positions – the increase in profitability. Pointing to companies that "seed women into the C-suite and the board," Weis revealed that organizations that brought the number of women in higher-level positions from zero to 30 percent saw a one percent net margin increase, translating to a full 15 percent increase in overall profitability.
"When you look into this issue from different viewpoints," Adam points out, "it gets really interesting."
In her view, "Morally, it's the right thing to do: to treat people with respect and not disallow women to be in leadership positions – I think most people feel that way. But I think what's really interesting is when you look at the numbers and you see that 15 percent boost in profitability."
"Who doesn't want that?"
To learn more about the benefits of women in leadership positions, and women at the highest level in the workplace – including Weis and Adams' personal experiences – tune in to the entire episode of CFO Weekly over on Apple podcasts or wherever you get your favorite podcasts, where you can also subscribe.
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