Thursday, March 30, 2006

Where Are the Women Leaders?

In his book The Seven Habits of Highly Successful People, Steven Covey describes the difference between management and leadership. A manager heads up the safari team, hacking away at a jungle path with machetes, proud of the productivity of the group. A leader is the one responsible for ensuring that everyone is headed in the right direction. After climbing to the top of a tall tree for a better view, only a leader has the perspective and courage required to say, “Stop! Wrong jungle!”

We need more women leaders, but we seem to be stuck hacking away at small shrubs, eking out minor, if not dubious, gains; trying to persuade ourselves that “We’re making progress;” when in fact we truly are in the “wrong jungle.”

We seem to be diagnosing the many problems women face -- from the Mommy Wars, the women don’t take risks arguments, women’s aversion to conflict and hierarchies, women’s tendency to be “the helpers”, to all the challenges of work-family balance. There’s certainly a lot of research on the problem, chopping away at the symptoms. Our good “doctors” have done a credible job analyzing what they have observed to be wrong among the patients. Perhaps we need to develop more and different treatments. Instead of the palliative approaches we’ve been trying, perhaps we need to be looking for what it takes for women to take on true leadership roles?

Women and the Mommy Wars

One example of the jungle drama, the focus on symptoms, is the so-called battle between feminists and stay-at-home non-career types depicted in the recent spate of “Mommy Wars” books. It represents a good example of the “power dead even rule” described in detail by Pat Heim and Susan Murphy (with Susan Golant) in their book, In the Company of Women: Indirect Aggression Among Women.

Women on both sides of the “Mommy Wars” debate feel threatened. “One side” sees the prospect that the “other side” might gain sway (or power) in the media, or might attract money for programs, or otherwise might gain advantages that would put them at a disadvantage in this zero-sum game. Those with the lower sense of self-esteem attack and sabotage those whose possible success appears threatening to them -– in an effort to keep the balance of perceived power even.

Unfortunately, both sides suffer from low self-esteem due to a constant barrage of false expectations from the media, the entertainment industry, and advertising sources. Feminists feel their historic progress in accessing higher-paying jobs and professional credibility is threatened. Stay-at-home mothers feel their traditional family values are threatened. Both struggle with low self-esteem, and both strike out at those whom they believe have greater relative external power, whether in fact they do or do not.

Both lose in the long run. We need women leaders to tell the Mommy Wars combatants that the damage they do to each other by their sabotage is far more serious than any threat that outside forces could possibly levy on either side.

If you want to persuade women to buy a product or service, you have to show that a lot of other women think that the product or service is terrific. The key question is “which other women?” Not all women are equal, but women tend to behave as if women should represented one cohesive, coherent group with uniform values, ideals, expectations, and wants or needs. Women need to accept the reality that we cannot “all work together” in some false gender-based happy family. Men accept the reality that men represent a wide spectrum of demands. Women have to learn to accept the difference paths that women take, that they are all valid, and all women will never be united together by some amorphous common denominator that they all share.

Women and Risk

One thing that women do tend to have in common is a greater awareness of risk compared to men. Women believe they can overcome these greater perceived risks if they could find a lot of other women viewing a product or service positively – then it must be a relatively safe choice. If only a few women favor a product or service, then that would tend to reinforce the perceived riskiness of the choice. The media plays to this greater awareness of risk by hyping studies that report on how few women are on boards, how few women are in top management, but how many women follow the escapades of Tom Cruise.

For some women, the areas of greatest perceived risk are their family status, their livelihood, and their children or child-bearing potential, according to Heim/Murphy.

Women have tried to minimize risks in these areas by trying to persuade governments or corporations to underwrite “diversity programs” which have as their goals:

1. insuring against the risks of personal losses or
2. reducing the risks they experience in these areas.

Examples include:

Alternative work schedules (so women won’t have to risk absence from family or children)
Flexible work schedules (providing women more choice in their hours in exchange for lower wages)
On-site day care (keeping transportation costs and day care costs low)
Limit job-related travel (minimizing family absences)
Redefining the job in family-friendly terms (reducing the risks of conflict with family commitments).

Where women have been unable to get government or corporations to subsidize their risk reduction efforts, women themselves have made economic choices that minimize their perceived risks. These take the following form:

Pursuing internal staff and support roles
Accepting lower pay positions.

In both types of circumstances, the women are choosing jobs whose hours have greater predictability and avoiding management or supervisory roles and responsibilities. Women who tell other women that the path to a corporate board of director role is by way of non-profit board roles or public speaking engagements also are offering the promise of a “low risk” solution to a contemporary high-risk leadership challenge. The price women pay for making these choices is a lack of preparation for true leadership roles.

Women who “opt out” of the career track, leaving the corporate ladder and sacrificing top management aspirations, often enter the entrepreneurial sector with the belief that, at least there, they can control their own time and work parameters. Women-owned businesses are characterized by even lower average earnings than corporate salaries, but “opt out” women also realize a lower outlay for transpiration, childcare and other family support services, clothing and other costs associated with full time corporate work.

Women who are making such short-term risk-averse choices are failing to consider the total benefit-cost stream. In the case of governmental or corporate “diversity programs,” the benefits are high only in times of economic surplus when government and corporate entities can afford to be generous. As budgets tighten, or more conservative financial interests get elected, support of such “entitlement programs” comes into question. Financial support wanes as other demands from different special constituencies increase. And, if women are not in public office in great numbers, their ability to sustain such preferential programs is limited.

Corporations also have supported “diversity programs” when the return on their investment justified tapping this pool of female talent resources. As corporations pursue alternative international markets, they also find alternative supplies of human resources. The cost of labor in the global marketplace is comparatively lower, so corporations are able to reduce their outlay on domestic incentive programs while still reaping the benefits of a diversified workforce. Outsourcing to third world economies – where extended families still contribute a full spectrum of support services to the female worker – means that U.S. corporations have cost-effective alternatives to hiring U.S. female managers. And, if women are not on boards of directors in great numbers, their ability to advance management development programs to ensure diversity programs remain intact is likewise limited.

Women leaders need to help women understand that risk cannot be eliminated, entirely, except at huge investments of resources. Risk can be reduced by farming it out to different people who can manage different portions effectively. Risk can be managed. Risk can be insured against. And sometimes, risk simply needs to be accepted as part of life.

Women and Conflict

According to Heim/Murphy, “women avoid conflict at all costs,” preferring instead to sustain relationships by a delicate balancing act which forces external perceived power (position or rank inside the organization) to be absolutely even with internal perceived power (self-esteem). Women are advised to choose a leadership style which is “appropriate for the follower.” Thus, women are told to drop their leadership style to the lowest common denominator -- to the level of the woman with the lowest self-esteem, the woman most threatened by external power, and to the level of the weakest performer in the organization.

This means women are expected, as adults, to sacrifice the leadership style that is most comfortable for them as an inspirational, independently-minded, creative manager on a leadership track.

In order to “avoid conflict at all costs”, women avoid hierarchies where differential power might exist. Women sacrifice the benefits which diverse thinking could produce, even though women argue that diversity which includes women enhances value and productivity.

Women leaders need to educate those who follow this advice that they are sacrificing the power of specialization and task delegation as well as the benefits of trade and leverage – all of which rely upon effectively recognizing and utilizing differences of productivity, output, and power. These are among the important pre-requisites for leadership.

The tendency to avoid conflict is like the Japanese “salary man,” the preference is “to pound down the nail that sticks out.” It is a forced conformity that ensures that true leaders will not emerge from the herd. Women leaders are those who step out of their comfort zone and reach beyond the safe, but stifling world of the shared economic status of the majority.

Women Helping Others

Research also tells us that women feel more comfortable negotiating on behalf of others, rather than on their own behalf. This is like the woman in the damaged aircraft as it careens toward the earth. She prefers to place the oxygen mask on her children and husband before placing it on herself. This is Harriet Braiker’s The Type E* Woman: Everything to Everybody [Else].

Many women sacrifice their career goals “to be with their children” or their grandchildren or their spouse. Many women believe in a mission of “mentoring other young girls” -– essentially the adult version of baby-sitting or hand-holding. At many major “women’s events”, the keynote speaker can almost always be guaranteed to be some philanthropist, wife of a wealthy male executive, who describes her “passion” dealing with starving children somewhere in the worthy third world. Go thou and do likewise, is the persistent message to all women.

Yet, economists say that “Incentives matter because most people will usually do more for their own benefit than for the benefit of others. Incentives link the two together.” [Thomas Sowell, Basic Economics]

If women are acting on behalf of what they think others want in the marketplace, then they are trying to “get into the heads” of other economic actors. The incentives aimed at motivating women as individual economic decision-makers, therefore, will miss the mark.

Women need to “get back into their own heads” in order to focus on defining clearly their own personal economic priorities and negotiating in the marketplace to maximize their own future benefit stream. Women need to state clearly their own preferred and personal terms and conditions to which incentives might be directed.

Women and Work-Family Balance

Women say they are searching for “work-family balance” – how to have a successful career and, also at the same time, a successfully satisfying and fulfilling family life.

Someone once said that “time was nature’s way of keeping everything from happening at once just as gravity was nature’s way of ensuring that everything did not happen in the same place.” And Ann Landers said, “You can’t have it all. Where would you put it?”

Yet, some women persist in the belief that that imaginary world of perfect balance and teamwork is attainable. When women experience this challenge, they feel guilty that – for some inexplicable reason –- they appear to be the only women unable to attain Nirvana.

To resolve this discord, women seek solutions “out there” -– they sign up for women’s associations, women in management networks, and other relationship settings where they believe they will find the Wise Women whom they are convinced Figured This All Out -– the trick to achieving work-family balance. Or perhaps they can find women will band together to demand governments or corporations provide the programs that women believe will grant them work-family balance. When they fail to find the answer there, they switch back to women’s magazines or women’s conferences or Oprah and Martha. Because the answer must be OUT THERE SOMEWHERE.

The area where women could focus for the solutions to these problems is on “the supply side:”

1. to reassess and renegotiate the terms of the contract on their side of the “work-family balance equation” -– their own view of the balance along with that of their family
2. to create women-based business alternatives within the economic marketplace.

There is a limit to the effectiveness of programs that focus only on “the demand side” of the marketplace -– efforts that try to encourage or embarrass governments or corporations or everyone else to make all the changes required to get more women into management or more women on boards of directors.

There needs to be efforts undertaken to address “the supply side” of the economic equation -– the decisions and actions that women must undertake to either enter into the marketplace or to make affirmative choices as economic actors there.

There are just two places where women can impact the supply side. One entails direct discussions and negotiations with the members of their own families in the economic marketplace: husbands, children and extended families. The other entails direct economic action on the part of women as economic actors or as women-owned businesses. If women cannot build businesses that satisfy their demand for family-oriented support services, then how can women expect that only men and their corporations can somehow build the businesses that will serve their needs?

Where Are the Women Leaders?

Women who are leaders understand the economic marketplace and what is required of their partners, their families – but most important of all, what is realistically required of themselves.
Women leaders take steps which “maximize” their benefits or returns as much as “minimizing” costs or risks.

Women who are outstanding, women who lead, women who excel do not ascribe to the “power dead even rule.” They selectively do what men do, while also retaining their unique sense of themselves as women:

They are goal-oriented, driven to pursue ambitions without apology.
They are content (information) driven, incorporating feedback along the way.
They have high personal self-esteem.
They have a leadership style with which they are very comfortable.
They understand that conflict is an essential and perhaps necessary part of business life.
They are enabled, ennobled, and inspired by the achievements of other successful women, not merely the sacrifices made.
They have high-value, rewarding relationships with women and men, alike.
They have made conscious choices about family and accept all the consequences of their choices without guilt.

Saturday, March 25, 2006

On Risk -- Part 2

Research has shown that women seem to have a greater awareness of the existence of risk compared to men.

Jonathan Baron, in Risk: Thinking and Deciding (2000), reports on a number of studies which indicated that:

“Males were more likely than females to fall into the risk-seeker category. Women consistently gave higher ratings than men [on risk-assessment tests], thus perceiving greater risks.”

Byrnes, Miller & Shaffer likewise reported, in Gender Differences in Risk-Taking: A Meta-Analysis (in the journal Psychological Bulletin, 1999):

“… men are more likely than women to take risks, whether the risks are selected because they seem worth taking …, because they do not seem worth taking…, or because they are neutral.”

In short, we’re not sure why the differences in risk perceptions exist -- but exist, they do.

Because women tend to perceive that more risks exist, women tend to evidence more risk-averse behavior, while men evidence more risk-taking behavior. Women might choose not to pursue risky behavior, perhaps, because women might not yet see the same rewards of risk-taking behavior that men do.

Whatever the cause, men tend more toward the Lone Ranger role while women tend more toward the Tonto role. In general, it is the he who pursues the challenges, while she serves in the supportive, assessing, and scouting role -– evaluating the risks more intently than pursuing the rewards. Thus, we tend to see women more often serving in the helping and supporting roles.

Hannah Riley Bowles, assistant professor of public policy, John F. Kennedy School of Government at Harvard University, and Kathleen L. McGinn, professor and Director of Research at Harvard Business School also concluded from their research that:

“Women struggle to claim the authority to lead.”

To be a leader requires stepping out of the comfort zone, taking on greater risks or managing risk through greater initiative.

Women, like men, who take on the riskier roles implied by leadership might delegate the management of certain risks to others on whom they can rely and depend. This entails building alliances on which the risk-taker can depend – outsourcing, delegating or subcontracting.

Men historically have a long history of such contracting. Women are just beginning to learn about and use these strategies effectively. Women historically have been more comfortable with a networking model -– a peer-oriented model with and among other women. While this sister-sorority model made women feel more comfortable, it did not allow or enable women to take on the greater risks required by leadership. In fact, the networking model tends to keep all women at the same level. Tonto seldom leads.

Once a woman aspires to a leadership role -- facing, confronting, and managing perceived risks in order to attain more or higher rewards -- the question next is how that woman is perceived by other women, her peers who are still more comfortable with the networking model.

At one end of the spectrum, the other women could recognize the pioneering, risk-taking behavior of a leading woman as “path breaking” -– beating down obstacles and barriers so that they too might follow in her footsteps. They would cheer her and acknowledge her achievements because they too perceive the possible rewards, over the long term, might be worthwhile.

Alternatively, at the other end of the spectrum, the other women might say “who the hell does she think she is?” These other women would perceive the hardy woman’s behavior as reaching outside of the acceptable parameters of the expected female role – “uppity”. They would attack her risk-taking behavior as unacceptable to the more comfortable role of the network, the lower common denominator.

The responses of these other women to the female leader’s risk-taking behavior would reflect the benefits or costs which they perceive might result from her actions.

If the other women believe they would be better off as a result of risk-taking behavior of a leading woman, they would encourage her and emulate her. The benefits of leadership would outweigh the costs of giving up the protections of the network.

If the other women believe they would be worse off as a result of her risk-taking behavior, they would not encourage her. Perhaps they would sabotage her for daring to step out of the socially-acceptable role -– “the bitch!” Perhaps they would attack her to try to persuade her to not rock their comfortable boat. The costs of her “abnormal” behavior might set a bad precedent, putting all of them at greater risk.

Those who chose to attack her behavior would be perceiving the risks associated with her actions to be greater and more costly to all of them than the benefits that might accrue from her leadership.

The leaders among women who feel successful in their willingness to challenge and manage risks have peers who support and encourage them. On the other hand, those female leaders who feel the “loneliness at the top” experience the silent desperation of being out there, on the leading edge, alone and unacknowledged by their peers while they also try to face the uncertainty of challenging risks – real and perceived.

The risk-taking female leader who experiences the barbs of her risk-averse peers can either ignore them or attempt to bring the others forward with her. The risk-taking female leader could also just give up and merely return to the comfort of the fold.

If her peers are really afraid of the risks, then the leading woman probably will not be able to persuade them to change their colors and test the waters with her. She will only have the choice of going forward alone or slinking back among the protections of her risk-avert sisters.

Thursday, March 16, 2006

Back to Basics

The most fundamental concept in business formation is that boards of directors are elected by stockholders to represent the interests of shareholder investments in the entity.

The election of directors is a function of who holds a majority of the shares of stock in the entity.

The control over the designation of directors is derived from the investment (the valuation) underlying the company.

At the start-up phase of a business entity, the investment deal (whether venture or angel capital) will allocate a number of seats on the board of directors to investors in proportion to their shareholdings in the entity: whether the shares are preferred or common stock or possibly all shares held in total.

If women are not participating significantly in the shareholding as angel capital investors or venture capital investors or advisors, then we would expect that women would not be represented to any great degree among the shareholders of start-up entities.

Therefore, we would expect that the absence of women shareholders would presage an absence of women on boards of directors of start-up companies.

This tends to be confirmed as we look at the smaller of the top 100 or 200 firms in an urban area -- start-up boards tend to be very small (3-5 directors), and women tend not to be present on these boards of directors.

If women have little or no experience participating in the start-up of new entrepreneurial entities, then we would expect that women would not be present in significant numbers in the advisory roles of the mature companies into which the grow and mature.

This tends to be confirmed by the data showing that the size of the boards are increased in order to accommodate bringing one or more women on board, at maturity, to provide diversity or independence of the board composition.

Many women advocates argue that business "should" allocate a certain percentage of their board seats to women.

Perhaps an additional strategy worth considering might be that talented and competent women "should":

  •     get out into the entrepreneurial business environment

  •     pool their collective discretionary wealth into angel and venture investable funds

  •     identify viable, profitable women-owned business enterpreneurial entities worthy of their investment BECAUSE of their rate of return potential, and therefore

  •     women investors would be qualified to elect THEMSELVES to those boards of directors of women-owned entrepreneurial firms

  •     women directors would be acquiring the experience to grow those companies into profitable, mature entities with growing shareholder value and

  •     women-owned businesses would have greater opportunities to grow and attract additional capital and

  •     women-owned businesses would afford more female investors with satisfactory board of director training experience opportunities.
  • Tuesday, March 7, 2006

    Five Phases of Grief

    Over the years, I have been increasingly inspired by the lessons of Elizabeth Kübler-Ross’ research which resulted in her landmark book, On Death and Dying. She described five phases of grief that people go through in response to a death. These phases also might apply to other instances of extreme emotional stress or distress, including post-natural disaster shock, post-traumatic stress disorder; and post-terrorist attack distress to cite a few examples. The five phases also help explain how women view the shocking truths about “how few” women are on boards or in corporate leadership positions, or “how far” women have not progressed in terms of incomes or other measures of advancement.

    The five phases of grief and some of their indicators are:

    1. Shock, numbness, and disorientation: paralyzed, distant, and removed from one's feelings of grief. Some say such numbing is the body's mechanism for protecting itself from being overwhelmed by the shock of the loss.

    2. Denial and isolation: significant difficulty accepting the reality of the loss, either short term lapses of thinking and behaving or long term denial of the reality.

    3. Anger: rage at the world, fate, God, or people in their lives; search for someone to blame; search for a reason for being impacted or selected; a sense of being a victim; the feeling that there is a conspiracy against one.

    4. Depression and sadness: reality of life after the loss grows; increased awareness of a voice or something missing; a feeling of capitulation in the face of overwhelming odds or events.

    5. Acceptance: increasing ability to come to terms with the loss; experimenting with the ability to move on; willingness to re-invest in the new life that lies ahead; experiencing fewer extremes of emotion; taking increased control over the portions of one’s life which can respond to personal choice.

    The power of Kübler-Ross’ analysis comes from the fact that the five phases constitute “the roadmap out”. One need not merely dwell on the stress. Instead, one can check occasionally with the map to gauge where one now stands on the spectrum leading one out toward “the new life that lies ahead,” whatever that might be. By creative use of the five phases, we might also explain where we are, presently, when faced by a whole host of personal earth-shaking realities.

    Phase One: Shock

    I often hear women my age express shock and disorientation when they look at the reality that women have made so little progress in standard measures of income, salary levels, entrance into top management, shares of seats on top public boards of directors, absence of women from the list of senior partners in law firms or major financial firms, and the lack of women in legislative or governmental positions of power, among a host of other statistics about women’s professional performance or economic progress.

    “I thought we solved these problems in the 70’s” often is the phrase they use to describe the shock they feel, responding at the first and most basic level, as they begin to look at the data, look at the problem, and realize that a significant loss has occurred.

    Phase Two: Denial

    Women in the second phase pretend that no loss has occurred. They dismiss those who point out the loss as “rabid feminists,” separating themselves from having to discuss the loss. Isolation also explains the tendency of some women to “opt out,” to get back into the comfort and safety of home in search of the protection which they hope that will provide them, away from the debate, so they do not have to face the loss.

    Phase Three: Anger

    When the third phase arises, women become zealous in their search for someone to blame: “the old boys’ network” and Laurence Summers or Nick French. In this phase, there is righteous indignation and a search for someone to hold accountable: “there oughta be a law” or “let’s band together and attack.” Conspiracy theories abound as an easier explanation of things they perceive to be out of their control. The pendulum swings from isolation in the earlier phase to the activism in this phase.

    Phase Four: Sadness

    In the fourth phase, ennui sets in, taking the form of “gender fatigue syndrome”. There is a sense of tiredness at the futility of past efforts, a fatigue from apparently working alone. A common comment in this phase is “You are the first woman that I have found that I can talk to about this stuff.”

    Phase Five: Acceptance

    This is the phase of coming to terms, of finding the way forward, of integrating the past with the present in order to begin building, again, for the future.

    What is so incredible is the resilience of the human being -- that she is capable of enduring so much shock, sadness, anger, frustration, isolation and yet somehow she can emerge at the end of the dark tunnel ready to continue with life’s challenges and successes. And the awe is that she can emerge actually stronger for having passed this way on her journey.

    Kübler-Ross also said that the path through these phases might not be sequential or continuous. One might step forward, then jump to another phase, then return back one or two. One might dwell longer in one phase than another. Some might get stuck forever in one phase. What was clear was that the bereavement process required some passage of time in all five phases.

    The happiness and “the new life ahead” would be clearly marked by the landmark of Acceptance. One would know the landmark when one was able to take personal responsibility for the journey through to one’s own goal.