Women’s career opportunities seem limitless today. Most organizations today profess to be committed to advancing women into leadership positions. However, many systemic barriers continue to hold women back, and they continue to be underrepresented in positions of power. Women continue to be disadvantaged, to varying degrees, in talent management, hiring, performance assessment, compensation, promotions, and employee retention.
Commitment to improving the representation of women at the senior level is rising, and positive results are beginning to be viewed. Compared to a decade ago, the average C-suite now has more women. Even in open roles, the share of women is rising through hiring and promotions.
Increased gender representation at the top spurs more progress – women in senior positions have a more significant impact on encouraging diversity in their organizations. Women in the C-suite also act as role models for other women aspiring to rise up the organizational ladder.
Organizations can level the field for women by identifying hidden and institutional gender biases in their processes and taking appropriate corrective action. This could include simple measures such as anonymizing job applicants’ resumes, setting uniform compensation criteria, etc. Even such seemingly simple measures unlock significant value for organizations by leveraging the full potential of women.
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What is Gender Diversity?
Gender diversity is the non-discriminatory representation of individuals of different genders in an organization. The term, most commonly, is used to refer to equity in the representation of men and women in the workplace. However, in its larger ambit, it includes individuals of non-binary genders.
In a more inclusive sense, gender diversity is used as an umbrella term to include gender identities that represent genders beyond the binary framework. Increasingly, for gender-sensitive individuals, the binary framework for gender – being either male or female – feels constraining. Many individuals also choose to have the option of changing from one gender to the other. Many others prefer not to have any gender identity. Some others want to exercise their choice to defy the accepted notions of gender.
In discussing gender diversity, it is important to understand that, historically, many cultures recognized and accepted gender diversity beyond the binary of male and female. In the spirit of greater gender diversity and inclusivity, the broader terms such as non-binary, X-gender, etc., are acceptable descriptors of gender-diverse individuals.
How is gender diversity different from regular diversity?
Diversity is a measure of the characteristics that make people unique. The Gallup Report of 2018 provides an accurate and succinct definition of diversity. It defines diversity as the ‘full spectrum of human demographic differences.’ These differences could encompass race, religion, education level, veteran status, gender, political beliefs, age, physical disability, sexual orientation, ethnicity, culture, socio-economic class, etc.
Diversity in the workplace means accepting individuals with many or all of these ‘human differences.’ The Gallup report goes on to say that, increasingly, businesses recognize the value of diversity and that fostering organizational diversity is a ‘must do’ rather than a ‘nice to do’ initiative and is critical for both ethical reasons and business success.
Diversity represents the differences between individuals in the organization – their race, gender, age, ethnicity, etc. Diversity ensures that different people are brought together in one workplace. Diversity brings heterogeneity to the workplace by ensuring that there are no biases in the recruitment process.
Accordingly, organizations now include diversity as an essential part of their HR policies. Diversity helps build a work environment where people with all manner of differences between them can work and thrive together.
Gender diversity, on the other hand, refers to only one characteristic that differentiates one individual from the other – gender. Therefore, whereas the term ‘diversity’ deals with the entire spectrum of characteristics that make people unique, gender diversity only describes the differences in their gender.
However, just hiring women, transgender, or non-binary individuals is not adequate. Gender diversity, in the truest sense of the term, requires these individuals to be empowered to perform at and even exceed their full potential.
To be able to achieve this, the other factors that you need to consider include:
- Providing a secure work environment for the women, transgender or binary individuals in the organization.
- Promulgation of robust anti-discrimination and anti-harassment policies.
- Identification and elimination of biases in the organization’s operating processes and policies.
- Ensuring gender diversity at all levels of the hierarchy – working, managerial, executive, and board levels.
To achieve true gender diversity in the organization, the steps that you can take include:
- Break gender stereotypes. Despite all the progress that has been made in improving diversity in general, and gender diversity in particular, many stereotypes regarding acceptable behavior for men and women continue to persist. For example, women often complain that certain personality traits that lead to women being labeled ‘bossy,’ when exhibited by men are seen as being ‘assertive.’ You need to break such discriminatory gender stereotypes. If the organization is to be truly inclusive, even seemingly minor measures such as looking at the language used in the organization that gives rise to and perpetuates such stereotypes need to be corrected. The organizational policies and culture should actively stop such stereotyping and discrimination.
- Give opportunity to a multiplicity of voices. Beyond the stereotyping of personality traits, stereotyping also happens in workplace communication. Often, in meetings, women’s opinions are not sought, and if the women do share an opinion/thought, it is often not given the same consideration as that of a male employee. If this is happening in your organization, you need to reflect, identify the underlying causes and change the organization’s culture. You need to create a gender-neutral work environment where every minority voice finds it safe to articulate its views, and all views are given the same weightage.
- Equitable promotion policies. It is important to ensure that promotion policies are fair and that everyone has equal access to the organization’s leaders. Promotion policies need to be examined to determine that they are fair. The composition of the hiring/promotion committees needs representation from all sections of the workforce to ensure that no gender is unfairly disadvantaged.
How is gender diversity important for organizations?
The importance of gender diversity in a workplace does not merely arise because it is ‘nice to have a goal.’ It is not just a trend that is to be followed, nor some quota that needs to be filled, nor is it merely some social responsibility that needs to be embraced. The importance of gender diversity stems from the fact that it improves the business’s financial performance.
A Gallup study of over 800 business units in the retail and hospitality industries found that the business units with greater gender diversity had better financial outcomes. The study found that in the retail business, in the business units that were more gender diverse, the revenue was, on average, 14% higher than in the less-diverse business units. In the business unit from the hospitality sector, the more gender-diverse business unit had a 19% higher average quarterly net profit.
In addition, the importance of gender diversity in the workplace encompasses other factors that include:
- Greater gender diversity brings in a multiplicity of viewpoints. The different views and ideas enable improved problem-solving, leading to superior business performance.
- It provides opportunities for equal and fair representation of all genders. This helps widen the talent pool and attract the best people to the organization.
- Diversity enhances the workplace quality for the employees. As a result, employees are more engaged and productive at work.
- It ensures the creation of an inclusive and safe work environment.
- It enhances employee engagement and satisfaction, raising the workforce’s motivation levels and productivity.
- A workforce that is gender-diverse enables the business to serve a more diverse customer base. A larger customer base boosts revenue and profits.
How is gender diversity important for teams?
A diverse team comprises individuals with different professional and personal backgrounds and skills, who pool their efforts to work together in order to achieve organizational goals. The individuals in a diverse team are drawn from different age groups, genders, nationalities, races, religious beliefs, personal backgrounds, professional experiences and political leanings. This diversity enables organizations to devise unique and innovative solutions to operational problems.
Building gender-diverse teamsimproves engagement, enhances employee productivity,andreflects the organization’s culture. Gender diversity in teams helps organizations attract and retain talented women. Organizations ought not to ignore 50 percent of the workforce and risk losing out on talent that could provide them with an edge over the competition.
Diverse teams can capitalize on the unique perspectives that women bring to problem-solving. Knowing how a gender-diverse team enhances organizational performance will help you attract individuals with unique capabilities and skills.
The importance of gender-diverse teams arises from:
- Improved innovation capability. A team with members drawn from diverse educational, gender, and racial backgrounds bring different approaches, viewpoints, and fresh perspectives to problem-solving. Such diversity boosts creativity, and the team can develop innovative solutions to problems. A homogenous group with uniformity of thoughts and ideas might be unable to discover similarly innovative solutions.
- Superior problem-solving abilities. The multiplicity of ideas and perspectives in a diverse team equips it to uncover unique solutions to problems. The team can also leverage differing viewpoints to arrive at informed decisions. Multiple views enable the team to analyze data, devise solutions efficiently and solve problems faster.
- Skill set expansion. Individuals with diverse skill sets and competencies, working together, create a mutually enriching work environment wherein each individual adds to his/her skill by learning from teammates by way of osmosis. Some of the skills that team members typically add to their skill set include communication, negotiation, and critical thinking and problem-solving skills. This benefits the organization because the improved skill set raises team productivity, quality of work and overall organizational performance.
- Improved business performance. When a team of skilled individuals works in a collaborative and mutually empowering manner, it provides the organization with a powerful competitive advantage over business rivals. Such teams complete projects efficiently, enabling the organization to seek out and win more projects. All of this boosts revenue and profits, thereby improving business performance.
According to a McKinsey report, higher representation of women increases the chances of business outperformance. Businesses with 30 percent more women executives outperform companies where the percentage of women executives varied between 10 and 30 percent. The report found that the difference in the likelihood of outperformance was a significant 48 percent between the most and the least gender-diverse businesses.
- Enhanced employee engagement. Diversity in teams fosters a healthy exchange of ideas, increasing employee engagement. Engaged employees are more productive and work more diligently for the attainment of set goals. Engaged employees are also more committed to the organization, which boosts retention and reduces employee turnover.
- Improved corporate brand. Diverse teams enhance the business’s brand value and reputation, which helps attract top talent. The most skilled individuals aspire to work in diverse teams for their personal and professional growth. A diverse team can also engage with customers, understand their diverse needs, and better serve their needs, improving customer satisfaction.
- Heightened morale. Engaged, productive, and motivated teams are generally happier and more content in their work and work environment. This feeling is contagious and affects the other team members positively, raising the overall morale of the team. Motivated teams also positively influence other teams in the organization.
However, building gender-diverse teams is not without its challenges. It pays to be mindful of these challenges. The potential difficulties in the process of creating diverse teams include:
- Communication. Members of a team of different genders, races, nationalities, religious beliefs, etc., while having differing viewpoints which benefit the organization, might also be speaking different languages and be unable to understand each other. Such challenges in communications could trip up the building of gender-diverse teams.
- Cultural differences. People of different genders could also be drawn from different cultural backgrounds. In addition to the stress of managing the tensions arising out of gender differences, cultural differences also pose challenges in building a diverse yet cohesive team.
- Delayed decisions. Again, gender diversity and diversity, in general, prove to be a double-edged sword. While diversity improves the quality of decision-making, it has the potential to slow down decision-making. The time taken to resolve the different opinions and varied perspectives reduce team efficiency.
- Bias. It is quite natural for people with different backgrounds to have different preferences. Individuals instinctively tend to push their own opinions. This creates conflicts and stops teams from achieving peak efficiency.
However, careful preparation and planning can help overcome these challenges in building gender-diverse teams. The challenges can be overcome, for example, by establishing boundaries to overcome cultural challenges. Team members can agree not to discuss or disparage other team members’ cultural, religious, or political beliefs to preclude the possibility of conflict.
Excellence and competence are not exclusive to any one gender. Progressive organizations strive to increase diversity in their teams, including diversity in gender. The benefits of gender diversity are many and include:
- Leveraging a broader talent pool. When you have men, women, and transgender people on your team, you gain from the different points of view that these individuals bring to work. These differing perspectives boost creativity and innovation in the team. Although this seems straightforward, many organizations fail to see that by not promoting gender diversity and limiting the size of the talent pool from which they pick their employees. By selecting a diverse workforce of male, female, transgender, and non-binary employees, you widen the talent funnel and maximize the benefit of choosing from the broadest possible talent pool.
- Diverse perspectives. Men, women, and transgender people come with different life experiences. They also react differently to situations at work and approach problem-solving differently. Such diversity in thought enables the organization to arrive at the most optimal solutions to problems. The solutions are arrived at after people with different perspectives have examined the problem. Gender diversity, for example, can be seen at work in the simple act of buying a car. Men are naturally wired to look at the car from the point of view of its performance – speed, engine capacity, fuel efficiency, etc. On the other hand, women would approach car purchases with aesthetics as the prime consideration – color, comfort, etc. Seemingly, this seems to promote gender stereotypes. However, this is illustrative of the differences in the naturally instinctive inclinations of men and women.
- Increased positivity. A diverse team where everyone feels welcome and is provided with equal opportunities to advance promotes positivity. When the organization levels the field for everyone, despite the differences, it promotes a feeling of positivity. When employees are feeling positive, they are positioned to deliver their best on-job performance.
- Increased collaboration. Empirical and anecdotal evidence suggest that mixed groups with men and women are more accommodating and allow participation by everyone during team conversations. This enables greater sharing of knowledge and skills within the team. Increased involvement in discussions also translates into greater ease in working together and collaborating on projects. Collaboration increases productivity and also helps in the most optimal utilization of the organization’s resources. The resulting productivity reduces costs and raises the organization’s margins.
- Greater employee retention. The emphasis on gender diversity signals to the employees that the organization values a culture of inclusion. This boosts morale by enabling the availability of a greater number of opportunities for a diverse set of people. Inclusive and diverse workplaces boost retention. When employee turnover is low, operational costs on hiring and onboarding new hires are reduced. The long-term cost of incentivizing people to stay is far lower than the cost of hiring and onboarding.
- Improved productivity. Gender-neutral workforces are more cohesive and are hence able to be more productive. When top talent drawn from a diverse talent pool works together, they feed off each other’s skills, raising overall productivity. When companies have diverse workforces, they are better poised to foster more adaptive and effective teams. They are also more likely to use diversity as a competitive advantage.
- Improved understanding of customer needs. Your customer base is diverse. Customers are male, female and transgender people. When your workforce diversity mirrors customer diversity, communication between the two is more effective, enabling you to understand your customers’ needs better. An organization’s team comprising a diverse mix of people of different genders, races, nationalities, religions, etc., can reach a larger number of customers, enlarging the buying power that you can tap into. Diverse teams are better equipped to anticipate changing customer preferences and consumption patterns. This makes it possible for the organization to be the first to market new products and services, potentially providing it with a decisive competitive edge.
- Enhanced organizational reputation. Building a reputation as an organization that employs a diverse workforce is beneficial. Customers view you as a progressive organization and are positively inclined toward you. This makes them more likely to buy from you. People aspire to work for progressive and inclusive organizations. A reputation as a diverse workforce attracts the best talent to the organization. This makes recruitment easy, the organization saves on recruitment costs, and benefits from all the best talent coming to the organization.
- Higher profitability. A Forbes report highlighted that firms with greater gender diversity are 21% more likely to be profitable. The report also highlighted that cultural and ethnic diversity further boosted the chances of being profitable. Culturally and ethnically diverse organizations were 33% more likely to experience higher than average profitability. Diversity is good for profitability.
- Direct representation. Organizations strive to increase the representation of a diverse mix of people in their workforce. Additionally, organizations also aim to increase the representation of various diverse individuals year-on-year. Hiring women provides a means of enabling their direct representation. Direct representation furthers the cause of reducing the bias against employing women and simultaneously enriches the teams that the women are a part of.
Representation is often placed at risk during times of crisis, such as the recent COVID pandemic. Although there was an uptick in jobs in healthcare, there were job losses in the private sector, where low-paying jobs in retail, hospitality, leisure, etc., took a substantial hit. Workplace automation is also expected to adversely affect women more than men due to the pervasive attitudes to skill development and access to technology for women. The organization’s leaders need to be cognizant of these risks and take steps to maintain workplace inclusion so that women are provided with the same opportunities as men.
- Diversity of management styles. It has traditionally been found that women imbue leadership positions with empathy and intuition. This originates from an enhanced instinctive awareness of what motivates other people and what their concerns are. This helps women have a better insight into how decisions percolate into the organization.
On average, women are also better at communication and collaboration than their male peers. Gender-diverse organizations benefit from the varied management styles in play.
How to build a gender-diverse workplace?
We have established thus far that workplace diversity enhances organizational performance. When people with diverse backgrounds and experiences are assembled in a group, their varied perspectives and problem-solving approaches become mutually reinforcing and help the organization thrive.
Despite this, gender diversity in most organizations is poor, and the workplace continues to be dominated by a single gender. For example, typically, in the tech industry, you will find a preponderance of males, and you will find in the nursing profession a preponderance of women. In both instances, there is greater diversity among the customers than in the people serving them. This will result in a sub-optimal understanding of customer needs, leading to sub-optimal organizational performance.
Customer needs can be better served if there is greater gender diversity in the organization. True gender diversity goes beyond the limited attention directed toward ensuring equal representation of men and women in the workplace. Gender diversity should also include transgender people and those who believe in non-binary gender identity.
The measures that you could institute in your organization to build greater gender diversity include:
- Create an inclusive workforce. Before building a gender-diverse workplace, it is important to create an inclusive work environment. The work environment must make it a good place to work for people of all genders. An inclusive workplace that is accepting of people of different genders and who also have other differences can attract the best talent. This increases the reputational value of the firm, and a virtuous cycle is set up, which leads to an overall positive impact on the organization.
Digitalizing the workplaces and the growth of remote working pose a risk to inclusion. These work practices carry the risk of reinforcing existing exclusive attitudes and biases that may undermine efforts to build a diverse and inclusive organization. It is important for the organization’s leaders to be alive to these risks, remain watchful, and discourage and stamp out non-inclusive dynamics as soon they are observed.
- Improve job descriptions. Removing gender bias from the language used in the job description is among the most fundamental steps needed to build a gender-diverse workplace. Instead of writing a job description that merely lists all the qualifications you are looking for in a candidate, build job descriptions that outline the performance-based impact you desire. The emphasis should be on what you need the person to accomplish in the role. The language in the job description should communicate inclusivity.
- Source from a diverse pipeline. For building a diverse workforce, it is important to proactively source a workforce that is gender-diverse. This can be done by accessing sourcing platforms that are meant for underrepresented groups. Also, look for people who, for example, list their membership in LGBTQ organizations in the profile. Such measures add up and help you build a gender-diverse workplace.
- Confronting unconscious biases. It is common for everyone to carry unconscious biases, even if we do not realize them. Identifying and eliminating such biases is another step toward building a diverse workplace. Even a bias created by your first impression may persist through the interview process and negatively impact a candidate. This may also impact the candidate the other way and in both cases, it skews the selection decision, resulting in the selection of a less than appropriate person for the role. To guard against such negative impacts of biases, hiring teams should learn to recognize them and base hiring decisions purely on a set of fair criteria.
- Ensure diversity in the interview panel. Although the interview panel has the greater deciding power in the interview process, it is also a fact that even while the panel is evaluating the candidate, the candidate is also evaluating the interviewers. Through the interview panel, the candidate is also evaluating the organization. The opportunity to work in a diverse workplace is important for many individuals. A diverse interview panel comprising members of all genders signals an inclusive workplace and helps attract superior talent. When faced with a diverse interview panel, underrepresented groups will feel more comfortable and be encouraged to strive to work for the organization.
- Establish fair compensation policies. A US department of labor study found that for every dollar men earned, women earned only 82 cents. After accounting for experience, industry, and job level, the study found that women earn only 98 percent of men with equivalent qualifications. If the aim is to hire the very best talent, it is essential that the terms of compensation are fair and there is no gender gap in salaries. This can be implemented by having a formal employee compensation policy. The policy should use data to determine compensation levels for each position. The factors used to define the compensation levels must include length and quality of experience, skills, education, and record of past performance. The compensation policy should also lay down the performance parameters and development opportunities that inform the candidates about how they can earn promotions and salary raises. Such transparent policies and practices will help eliminate the gender-based pay gap.
- Shared parental leave. Globally, women are expected to bear a significantly larger proportion of childcare responsibilities. This compels women to take more time off from work, adversely affecting their careers. Even in firms where shared parental leave is available, data shows that only about 2% of couples exercise this option. Many men find it difficult to take time off for financial and cultural reasons. To correct this skew and to improve gender diversity, you should actively promote shared parental leave. By talking about parental leave and fostering an inclusive environment, make it is culturally acceptable for men to assume childcare responsibilities. This will enable men and women to take leave for childcare responsibilities without adversely affecting either career. Another means of promoting shared parenting is to have identical increased rates of compensation for maternity and paternity leave so that no one parent is financially disadvantaged unfairly when they take a break for childcare.
- Promote workplace well-being. Although compensation is probably the factor that impacts gender equality the most, a workplace that is sensitive to the need to provide employees with opportunities for good work-life balance is also important. This is essential to keep employee turnover low.
Typically, work-life balance issues are loaded against women. Almost all men and women agree that progression to the top of the career pyramid implies a 24×7 availability for work. This is particularly difficult for women managers. A McKinsey study found that 62 percent of women thought having children did not stop them from reaching the top. However, a higher percentage of women – 80 percent – thought that it was truer for men.
Workplace well-being can be provided by ensuring that employees are assessed, based on performance outcomes and not the number of hours worked. Well-being can also be improved by sensitizing all managers on gender equality, which facilitates the creation of a workplace culture that enables women to progress up the ranks of the organization at the same rate as their male counterparts.
- Use feedback from exit interviews. Exit interviews are powerful means to identify the specific reasons that are causing employees to leave the organization. This information can be extremely useful in helping eliminate those causes and increasing employee retention. Exit interviews also provide information that will reveal the reasons that men and women are leaving the organization. Many of these insights will be unique to the organization and provide you with the basis to evaluate your progress over time. For example, suppose you find from an analysis of the data from exit interviews that women are leaving the organization from a real or perceived gender-based pay gap. In that case, you can correct your compensation policy and then observe its impact on the turnover of women employees over the duration of the future year.
The data from exit interviews will also help organizations retain their top talent by tracking and monitoring the demographic profile of people leaving to ensure that diverse talent is not lost. Here, remote working might help despite the other risks that arise that we have discussed above. Remote working increases flexibility and can help in the long-term retention of women employees. Women traditionally shoulder a greater proportion of family and childcare responsibilities. Remote working opens up the possibility of women continuing to work while still being able to take of their family responsibilities.
What has been discussed and outlined above are broadly the things that need to be considered to foster gender diversity in the workplace. However, it is important to also remember that diversity does not automatically guarantee inclusion. Organizations need to make a conscious effort to foster equality, fairness, and openness in their workplaces to derive the full benefits of diversity. Successful diversity initiatives also co-opt the ideas and the active participation of every employee in the organization, since they can provide invaluable insights on what the organization is doing right on diversity and where it is failing. Building a world-class team requires everyone to participate across genders, races, professional backgrounds, and seniority in the hierarchy.
Diversity winners employ a planned approach to inclusion and diversity. They do not hesitate in taking bold actions to foster diversity and are best positioned to gain from the upsides of diversity.
Promoting gender diversity comes with a compelling business case. There is a similarly strong business case for promoting gender diversity in senior, decision-making positions and positions on the board. Although considerable progress has been made in improving gender representation in senior positions, overall progress is still slow. However, there are several lessons to be drawn from organizations that have made gender diversity work to their advantage. Creating and sustaining a diversity initiative is neither a small nor a one-time effort. It requires the strong and sustained support of the organization’s leaders.
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