Women Leaders Do Hard Things in a Human Way

This time last year, S&P Market Intelligence published a report indicating that an important gender parity metric – women’s representation among all senior leadership positions in the U.S. – dropped to its lowest rate in more than a decade. Across C-Suite positions, women lost seats for the first time since S&P started collecting data twenty years ago.

In the intervening months, many programs designed to address inequities and lack of parity have faced mounting scrutiny, if not virulent backlash. According to a study by McKinsey & Company and LeanIn.org, employers are scaling back programs intended to advance women’s careers. Some of the sharpest declines are in programs designed to boost the careers of women of color.

Many experts are regrouping and strategizing on where to go next and how to best advance against the headwinds. Some point to the persistent need to continually measure and report on outcomes. According to DEI strategist and consultant Lily Zheng, “data-driven efforts are everything.”

In this spirit of letting data speak, we revisit a multi-year study that Potential Project conducted of leaders and employees from approximately 5,000 companies in close to 100 countries. We assessed how well the leaders are able do the hard things that come with their top jobs (we call this trait wisdom) while still remaining good human beings (we call this trait compassion). We then looked at employee impacts and discovered that when leaders had high levels of both wisdom and compassion – they are able to do hard things in a human way – there is an exponentially higher impact on important business metrics. For example, employee job satisfaction increases by 86%, job performance increases by 20%, and commitment to the company increases by 61%.  

When we parse the data by gender, the differences are pretty stark. 55% of the women in our study were ranked by their followers as being wise and compassionate compared to only 27% of the men. Conversely, 56% of the men in our study ranked poorly on wisdom and compassion, landing in a quadrant we call Ineffective Indifference. By a 2:1 margin, followers said that women leaders versus male leaders are able to do hard things in a human way.

We also looked at survey respondents who are actively disengaged from their jobs; in other words, those who have miserable work experiences and spread their unhappiness to their colleagues. With male leaders in our survey population, 18% of their followers are actively disengaged compared to 11% of the followers of female leaders. Based on Gallup research, a disengaged employee costs their organization $3400 for every $10,000 of salary in lost productivity. By driving more engaged/less disengaged employees, women leaders save their organizations $1.43 million for every 1,000 employees (assumes an average salary of $60,000).

There is so much need for more wisdom and compassion today, in the corporate setting and beyond. Moreover, the ability to do hard things in a human way can save money and drive better performance. Women leaders are the steady source of this competitive advantage.

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