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Quality Digest

Management

Forty Years of Data Say Women Are Stalling Out at the Top

Since 1980, nowhere to go but up

Published: Wednesday, September 21, 2022 - 10:58

(MIT Sloan: Cambridge, MA) -- According to recent research in MIT Sloan Management Review, despite gains made in gender diversity overall, the distribution of women remains uneven across types of leadership roles; most of the women have been relegated to support functions.

To gauge progress toward gender diversity in leadership, Monika Hamori and Rocio Bonet, of IE Business School, and Peter Cappelli and Samidha Sambare of Wharton, analyzed 4,000 Fortune 100 executives’ career histories and demographics from the past 40 years, focusing on the 10 highest-ranking roles in each company.

“Gender representation certainly improved because there was nowhere to go but up: Not one woman held any of the top 1,000 jobs in 1980,” said the authors. “Since then, women have actually advanced more quickly than their male counterparts into executive positions. But they remain largely stuck in support functions rather than moving into more key operating roles. At the oldest companies, women’s numbers are backsliding even in those functional roles.”

Despite accounting for 47 percent of the U.S. labor force, women held just 27 percent of the Fortune 100s top leadership positions in 2021. (A huge advance since 1981, but still far from equal). Some of this can be attributed to a change in the Fortune 100 shift from industries that tend to employ fewer females (e.g., manufacturing and steel in 1980) to those that employ more (financial services, healthcare, insurance, and retail in 2021).

In these traditional companies, the percentage of women actually dropped a few points in 2021. (In 2011 women accounted for 50 percent of top executives at PepsiCo and Lockheed Martin, and 40 percent at Coca-Cola, GE, and IBM, but by 2021 those percentages dropped by half at some).

The distribution of women is uneven across types of roles, and that hasn’t changed much in 20 years. Among all leadership positions held by women in 2021, just 6 percent were in the highest tier (CEOs, presidents, and COOs), hardly any change from 5 percent in 2011 and 7 percent in 2001.

Women in this sample advanced faster than male counterparts—typically two to four years faster. Partly as a result, women in high-ranking jobs were, on average, younger that the men by almost two years.

A higher percentage of women (33 percent) came to their leadership roles as outside hires, compared to 23 percent of men.

What can companies do better?

What can be done to increase numbers of executive women where they’ve gained the least traction—in top-tier and general management roles?

Don’t count or count on board diversity. Authors found fewer women in top-tier positions and in feeder roles at companies with a higher percentage of female board members.

Boost external hiring. Many companies examined were more likely to bring in female executives from outside the organization, hiring 47 percent externally in 2021.

Promote more women to “feeder” roles. While promoting women in general helps, it helps more when they advance to general management and operating roles that feed the highest tier.

Double down on development. Make internal pathways for career advancement clearer for all employees interested in general management roles. Remove barriers, such as requiring permission from a current manager to move.

The MIT Sloan Management Review (MIT SMR) article, “Women Are Stalling Out on the Way to the Top: Here’s what we’ve learned from 40 years of data on executives in the largest U.S. corporations,” was published on Aug. 31, 2022.

 

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For 40 years Quality Digest has been the go-to source for all things quality. Our newsletter, Quality Digest, shares expert commentary and relevant industry resources to assist our readers in their quest for continuous improvement. Our website includes every column and article from the newsletter since May 2009 as well as back issues of Quality Digest magazine to August 1995. We are committed to promoting a view wherein quality is not a niche, but an integral part of every phase of manufacturing and services.