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Women in leadership positions boost chances for sustained, profitable growth by 40 percent: study

Binjal Shah
1st Feb 2018
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Gender-diverse organisations have higher quality leadership, are more agile, grow faster, and are more likely to experiment and embrace failure in pursuit of different and innovative approaches.


Studies may have shown that women make extremely good leaders, but they don't make it to leadership positions as often as they should. But there's reason to ensure that they do.

The global average of women occupying leadership positions is pegged at 29 percent – this number falls to 20 percent when it comes to senior-level management positions. According to a study, companies big on gender diversity at both rungs have clocked a direct impact on the bottom line – they are 40 percent more likely to have sustained, profitable growth, and 70 percent more likely to have greater leadership strength.

These are the findings from the eighth edition of the 2018 Global Leadership Forecast, an expansive research project conducted by DDI, The Conference Board, and EY, that surveyed from 25,812 leaders and 2,547 human resources professionals at 2,488 organisations across 26 industries worldwide.

According to demographic data collected, women currently constitute only 29 percent of all leadership roles, most of which are first-level management positions.

“If you’re deeply concerned about your organisation’s lack of leadership capability, you are in the clear majority,” said Evan Sinar, Chief Scientist and Vice President of DDI, and lead author of the GLF.

“The tremendous amount of data we collected shows that as digital disruption continues to transform the workplace, we’re facing a massive leadership shortage worldwide. The good news, however, is that the research also reveals a clear road map of how organisations can start changing their people strategies today to excel tomorrow.”

Integrating diverse perspectives

These benefits go beyond numbers. “Their leadership strategy relies not on meeting any single demographic target alone, but in integrating diverse perspectives into people, product, and business decision-making companywide,” reads an excerpt from the study.

Maintaining multiple and diverse perspectives is critical to achieving success; the study reiterates this fact. “Their leaders work together to create new solutions and opportunities, and multiple perspectives determine success. They also reported a higher level of collaboration across organisational boundaries. Leaders from more gender-diverse organisations were 1.5 times more likely to work across organisational boundaries and create synergies in their efforts,”

Gender-diverse organisations tend to have organisational practices that emphasise high-quality development planning and more regular conversations on personal development.

Diversity-leading organisations were rated by their leaders as:

  • Having higher quality leadership.
  • Being faster growing and more agile than their more homogenous counterparts.
  • More likely to experiment and embrace failure in pursuit of different and innovative approaches.

The study states that a healthy pipeline of female talent must be created by evaluating the different channels leveraged for recruitment. “You can’t grow diversity if you’re not creating new ways of getting new perspectives into the building,” the report states.

It also asks companies to consciously push for hiring and promoting diversity, and especially identifying under-leveraged talent in order to capitalise on it.

“Encourage leaders to seek different perspectives for new projects and reward teams that harness inclusion of multiple perspectives to generate new ideas and solutions. Provide high-performing women with stretch assignments to continue building their skills and cross-functional knowledge,” it says.

Diversity goes beyond gender – and the study asks hiring managers and decision-makers to incorporate all sorts of different backgrounds and experiences into their leadership. It also advises that sound mentorship is provided to “early leaders”, from outside their own functional areas, to encourage learning and exchange of diverse ideas.

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