There’s no denying it: women have made massive progress in the last decades. In the United States alone, women statistically get more college and graduate degrees than men, and represent nearly half of the workforce. And yet, although women represent a substantial force in today’s economy, the business world remains unprepared.
For years, women have played by the rules, under the impression that if they work hard, are diligent and committed, their skills and abilities would be recognized and rewarded. One study found that female employees enter the workforce with confidence, as 43% are determined to climb the corporate ladder and get a top management position. But, after a couple of years, morale drops by 60%, with just 16% of women still believing they can make it to the top.
In spite all of these efforts, men still seem to get ahead, getting better jobs, better positions, and better salaries. The fact of the matter is, when observing trends in top management positions, women are virtually absent. According to one 2015 study, only 23 women were at the helm of Fortune 500 companies. And only 7% of tech companies have women on their boards.
There’s a growing body of evidence that reveals companies who employ more women in executive positions far outperform their competitors on every level of profitability.
What follows is a discussion of how women in leadership positions could benefit today’s business environment and why companies should take action.
Female Leaders Identify and Pursue Growth Opportunities
A study conducted over two years found that women are better at identifying and pursuing growth opportunities within the company than male leaders. Not only that, but women also outperform men in tasks that require initiative taking or driving change. The authors of the study concluded that women have the advantage of being able to widen their perspective and see beyond any impediments. They focus on innovation when finding solutions to achieve the company’s goals.
Women Have Excellent Problem-Solving Capabilities
Study after study has made it clear that diversity in the workforce improves problem-solving and brings enormous business benefits. When we work with people that have different genders, sexual orientations and come from a variety of cultural and social backgrounds, we increase our ability to see the world in a new light and develop solutions never thought possible.
Another study found that female leaders collect and analyze more variables in the decision-making process, enabling them to see a wider spectrum of possible solutions. Because women tend to ask for and listen to different, often conflicting options, they also get a better scope of the problem at hand.
Women Strengthen Businesses through Strategic Partnerships
The ability to build a collaborative environment produces a catalyst that develops strategic partnerships that might otherwise remain untapped. As a result, companies run by women are strategically connected and more cohesive, ultimately leading to an increase in profitability.
Women Are Oriented towards Collaboration
A 2015 Harvard study found that women are better deal-makers than men. After analyzing women in the Senate and the number of legislation they passed as a result of team effort, the researchers found that women are better at collaborating and working with opposition to get the best deals for their electorate.
The same stays true in business.
Human behavior researcher, Helen Fisher theorizes that because women have a social brain, they are better at picking up nonverbal and preverbal cues. This trait allows them to build stronger and more meaningful relationships with their peers. As a result, female leaders tend to outperform men when it comes to network building and employee development.
Women Leaders Achieve Improved Financial Performance
According to Catalyst research, there is a strong link between profitability and workplace diversity. The study found that Fortune 500 companies with women CEOs had a higher financial performance than those with low female representation. The research made it clear that including more female leadership on company boards can lead to increased financial results.
New evidence emerges almost daily highlighting the ways female leaders impact and advance business environments for the better. Companies that continue to ignore these facts will find themselves at a great disadvantage in the years to come.