A number of well-intentioned corporate executives—with their eyes squarely on the bottom line—are taking action to increase gender diversity at all levels of their organizations. Confident they’ll see a payoff, those top managers are making sure women’s ideas contribute to their organizations’ strategic thinking. Despite strong efforts, though, recent research notes a lack of progress.
In March, global management and consulting firm McKinsey & Company reported in its McKinsey Quarterly that statistics collected from 30,000 employees at 118 North American companies representing nine industries reveals three “common pipeline pain points”: (1) Women often are unable to enter an organization, (2) sometimes they’re stuck in an organization’s middle ranks, and (3) sometimes they’re locked out of top jobs.
The McKinsey information follows a report in January from global consulting giant Mercer, which also presents statistics showing an underrepresentation of women. Mercer’s second annual When Women Thrive report presents evidence that women are under-represented in the workforce globally, and their underrepresentation grows as career levels rise.
The solution lies in more than just numbers, though, according to Patricia A. Milligan, Mercer North America president. “To be clear, we are not arguing for 50/50 math,” she writes in the report’s introduction. “We don’t define success as having numerically exact gender equality in every organization and in every job level and role. Rather, the goal is to establish a pervasive culture across organizations, and geographies, where diversity is embraced as the norm, where women feel they can thrive and actually do so, and where businesses see the winning results.”
Scope of the problem
McKinsey’s report says research shows that women aren’t as likely to advance as men, and women hold fewer roles likely to lead to top management jobs. Those facts mean that women “are a century away from gender parity in the C-suite if progress continues at the pace that prevailed between 2012 and 2015.”
McKinsey’s research shows that several industries—especially automotive and industrial manufacturing, energy and basic materials, and technology—aren’t attracting women into entry-level positions, and that leads to a dearth of women in higher-level jobs. “This problem usually arises from recruiting challenges or pre-pipeline problems, particularly the low graduation rates of women in industry feeder programs such as engineering, where they receive about 20 percent, 24 percent, and 23 percent of bachelor’s, master’s, and doctor’s degrees, respectively,” the McKinsey article states.
The McKinsey report also notes that many employers that focus on gender diversity in recruiting achieve parity or near parity in entry-level positions, but women fall behind in advancing into middle-management jobs. The study found the industries most affected by the “stuck at the middle” problem are logistics and transportation, healthcare and pharmaceuticals, and hospitality.
Another part of the gender gap centers on employers that are successful in both attracting women into entry-level roles and advancing them into middle management but then fall behind in promoting women to top positions. The McKinsey research found that the “locked out of the top” problem is most often found in the retail and consumer goods, media and telecom, and financial and professional services sectors.
What to do
McKinsey’s report says companies in the sectors challenged in their ability to attract entry-level employees can make progress by exploring what they can do to improve pre-pipeline gender diversity, setting targets to improve recruiting, and “empowering hiring managers to spot and interrupt unconscious bias.”
McKinsey’s researchers advise employers with the “stuck at the middle” problem to examine their programs, if any, that are designed to support women’s advancement. Those employers should make sure they are “drawing on the organization’s full range of talent when making promotion decisions at the middle-management level,” the report says.
The McKinsey article suggests that employers afflicted with the “locked out of the top” dilemma should examine how they can keep women from moving away from top roles. The report advises employers to look at how senior, external, and lateral hires might hold back gender parity. In addition, the report urges employers to look at their work-flexibility and mentoring programs as ways to combat a lack of female representation in the top ranks.
Mercer’s researchers also have advice for employers. While acknowledging that different solutions are needed for different organizations, the Mercer research outlines six steps to enhance gender diversity:
- Admit the problem and focus on the opportunity.The report advises employers to ask themselves tough questions and examine what stands in the way of progress.
- Use an evidence-based approach to find the organization’s unique drivers of gender inequality.
- Make sure the diversity strategy is aligned with the organization’s talent strategy. The researchers call on employers—whether they “build” or “buy” their talent—to look at the emphasis they place on talent mobility and the importance of supervisory roles.
- Encourage a culture that is comfortable with different employees contributing in different ways and that enables women to use the employer’s programs and benefits in the context of their overall career development.
- Consider non-typical programs to support all talent. The report says gender-specific programs focused on either health or financial wellness seem to improve gender diversity.
- Collaborate with stakeholders such as schools, governments, public health organizations, industry groups, and nongovernmental organizations to improve the female talent pipeline.