Helping more women reach the top jobs

Citation

Allio, R.J. (2002), "Helping more women reach the top jobs", Strategy & Leadership, Vol. 30 No. 3. https://doi.org/10.1108/sl.2002.26130cab.001

Helping more women reach the top jobs

Helping more women reach the top jobsRobert J. Allio

IntroductionNan Langowitz is the Faculty Director of the Center for Women's Leadership at Babson College, the first academic center at a top-ranked management school dedicated to increasing the visibility and advancement of women in business. The Center sponsors faculty research and case studies to examine issues involving women as entrepreneurs and in corporate and not-for-profit organizational life. The Center also offers educational events that provide a forum for the issues relevant to the advancement of women as leaders. Her e-mail address is langowitz@babson.edu and the Center's Web site is www.babson.edu/wl. The interviewer is Robert J. Allio.

Strategy & Leadership: Despite the great strides women have made in the business world in recent years, why do women continue to be underrepresented in the ranks of top corporate management? A number of women recently have taken the reins of major US corporations, but why isn't the total number of women in top jobs growing faster?

Nan Langowitz: I don't think we know the answer. While women make up 50 percent of the managerial work force in major US corporations, only 12.5 percent of corporate officers and 11.7 percent of corporate board directors are women. But nonetheless, their managerial achievements and their contributions to the US economy are impressive.

According to the Center for Women's Business Research (originally founded as the National Foundation of Women Business Owners), in 1999 there were 9.1 million woman-owned firms in the USA. Women started 38 percent of new businesses that year. Woman-owned businesses contributed $3.6 trillion to the US economy and employed 27.5 million workers. Between 1987 and 1999, the number of woman-owned firms doubled nationwide. The surprising news is that woman-owned firms with greater than 100 employees are growing in number at six times the national average. The surprising news is that woman-owned firms with greater than 100 employees are growing in number at six times the national average.

In a study recently completed by Babson's Center for Women's Leadership, in collaboration with The Commonwealth Institute, we see a strong sector of woman-led businesses here in Massachusetts. We looked at over 200 independent businesses in which the chief executive is a woman. These companies' average revenues were $24 million in 2000 and they are not divisions of other large companies. The women leaders' path for getting to a corner office tends to be via ownership and entrepreneurship – 82 percent of the chief executives have controlling ownership of their companies, and for those owners we studied, 75 percent were also the founders of the firms. These numbers put to rest the myth that women owners are only "wives or daughters."

S&L: Is there a pattern for the types of businesses that women tend to start?

Langowitz: The biggest groups in our study are high tech and professional services. And within professional services it's either marketing or HR. The next largest group is the construction businesses. So I think there's some stereotype breaking – women are doing high tech, women are doing construction.

Another surprising fact is that woman-led businesses in Massachusetts are growing rapidly, with 45 percent reporting greater than 25 percent average annual growth in the last three years and, even with the recession, one-third still anticipate greater than 25 percent average annual growth over the next three years.

S&L: Could we deduce that in time, perhaps in 20 or 30 years, the women who now run the small companies will be directing major US companies?

Langowitz: It could be five years, depending on what size company you consider "major." There are a couple of Massachusetts businesses led by women that are already into the $70-120 million revenue range. Two examples are Lau Technologies and Lightbridge, Inc. For another example, Pam McNamara is now CEO of the Boston consulting company Arthur D. Little, a $600 million firm, and Linda Mason is the founder and chairman of Bright Horizons. Both Bright Horizons and Lightbridge are publicly traded companies.

S&L: A number of observers have pointed out that women excel when running a business that serves women, like Avon and Mary Kay.

Langowitz: I agree, but the examples I would suggest are Xerox and Hewlett-Packard, both now led by women.

Besides, by that logic women would be a good choice for CEO of Procter & Gamble, General Foods, or a large company that provides food or packaged goods. But male chief executives have historically run such companies.

It's noteworthy that when women do make it to the top of a cosmetic firm or lingerie companies like Natori, they aren't credited with having as much talent as if they were running a business in other industries. Why is it that Martha Stewart, head of a $285 million global media company, isn't considered a media mogul? She's thought of as "that nice decorator lady."

S&L: Your hypothesis then is that there are no intrinsic reasons why women can't run successful companies, high tech, manufacturing, whatever?

Langowitz: No reason why they're not capable of doing it, but there are plenty of intrinsic factors why they don't get to. The women that I know in the top levels of corporations are every bit as good decision makers for their businesses, every bit as capable of handling tough situations as male counterparts might be.

S&L: So in your mind there's no gender difference in behavior?

Langowitz: Exhibited behavior, the way they implement decisions, or go about their decision making may be different but I don't see a biological connection to their ability to cope with a difficult situation or with a business problem.

S&L: Are women more sensitive, compassionate, and nurturing than men?

Langowitz: Overall, I think they're more willing to exhibit that behaviorally. I don't know if that means that men aren't also as sensitive and compassionate.

S&L: What about the cultural barriers to women?

Langowitz: I think a lot of those barriers are just as real, but more subtle than they used to be, because of the change in our legal environment and our social environment. Nonetheless there are still plenty of organizations where people unthinkingly take out cigars at a sales meeting. That is a hostile environment for anyone who cares about his or her health to be in, but it's definitely an environment that will push women away. Has the company done anything illegal? No. Is stogie smoking a cultural cue that the organization will tend to under appreciate women? Definitely. Should they get rid of all cigars at sales meetings? Absolutely.

S&L: One of the advantages of having women in an organization is that you get the benefit of diversity. Is this a legitimate argument to have women in managerial roles in the organization?

Langowitz: Women have an experience as members of society that is different from male members of society. If you want to consider that in view of the larger diversity picture, the experience is different for blacks than whites, different for Hispanics than Asians. So to be effective in managing a large organization with diverse workers, it's important to have people in the senior level who understand their experience and who can be seen by people lower in the organization as role models and leaders for the organization. It also improves corporate effectiveness to have senior managers who share experience with their diverse customer base. And by this logic, it's crucial for senior managers to keep in mind that the majority of purchase decisions in the US market are made by women.

S&L: What's the strategy for addressing these issues?

Langowitz: We still don't have enough information about what the differences are. We still don't have enough good measurement about where women are in the workforce and how they are succeeding as managers and executives. When women do make it to the top of a cosmetic firm or lingerie companies like Natori, they aren't credited with having as much talent as if they were running a business in other industries.

It may be that there are no real differences for women in the business world versus men. But when you look at traditional business curricula most of the cases are about male managers. Most of the research is based on corporations that are dominated by male managers. We need to change the mix. Think about your answers to any of these questions: Whom can we get for a speaker? Whom could we get for our board? Whom could we promote into this position? There is a tendency, I think, for people's shortlist typically to be similar to models like the ones they studied in cases or read about in the business press – the male managers. Even for me, often the first people I used to think of would be men. So, it's really a matter of training yourself to say, "OK they might be good candidates but who are the next three people who aren't like that?" There are now plenty of women business leaders to use as examples.

S&L: Describe a paradigm for women who want to assume leadership positions in large organizations – what skills do they need to develop, what qualities, what behavioral patterns? What can be said to the woman who asks, What do I need to do or learn in order to succeed in the corporate world?

Langowitz: I think we can recommend that they target an organization that already has women in the senior managerial ranks, such as the CFO, the COO or general managers of a division. You want to try to start in a relatively friendly environment. Then I think you want to put yourself into a line job rather than a staff job so that you can really learn the business. You want to get to know other managers in the business, to be as visible to senior managers in the business as you can.

S&L: Does the Center develop leadership skills?

Langowitz: We are working with a select group of high potential undergraduate and graduate women students to provide them with added leadership training – from time management to communication style to coaching and feedback. Many of things that we're doing with this group are enhancements of what's already going on in our curriculum. For example, although all of our students learn communication skills, we've done some acting workshops to help our women's leadership students to further develop a sense of presence and voice that they may not be able to work on in the main classroom offering. We spend a lot of time connecting them to our women alumni who are out in the business world, who can be mentors to them

S&L: What are your measures of success? What achievements do you hope to point to if I ask you in a year, five years, ten years, "Have you been effective in running the Center for Women's Leadership at Babson?"

Langowitz: The jobs that our students take and their career paths will be one measure. Another measure will be the number of organizations that contact us for information or for assistance either in conducting research in their own organizations or for providing executive training. The results of our research will be a harder thing to measure, but we believe that our work will help corporations better benefit from the talented women in their management ranks and help women entrepreneurs build effective organizations.