Want to innovate? Hire more women
My meeting recently with one of the top CEOs in America touched on everything from financial education to blockchain to care packages for dogs. What do distributed ledgers and canine luxuries have in common, you ask. One word: innovation.
That term is particularly significant on International Women’s Day, as data shows that companies in finance and other industries continue to miss an opportunity to innovate by failing to attract and retain women in key leadership areas.
I have watched innovation up close since my days in Silicon Valley, in financial services, tech and media. While progress has been slim, smart companies are celebrating — and making real efforts to leverage — the strengths that women bring, particularly in innovation. They have very good reasons to do so.
But a quick look at the numbers shows that large industries as a whole still have a ways to go. In financial services, globally, women account for only 20% of board members and 16% of executive committees, and just eight are CEOs. In technology, women make up just 25% of computing jobs in the U.S.
Yet there are success stories, both of large companies recognizing the need for more female representation in management positions, and of innovative women-led ventures. For example, there is The Skimm, founded by ex-NBC producers Danielle Weisberg and Carly Zakin. Targeting young women, the company sends a daily newsletter providing a quick take of the day’s news. It now has some 4 million readers (including the above-mentioned CEO).
Women understand the customer. After all, they are the customer, by and large.
According to research, companies with more women taking on leadership roles find an increase in “innovation intensity,” resulting in additional $40 million in worth compared with companies without women in top management roles. Another study comparing the strength of work teams found that teams with more women performed better than those with more men. The Peterson Institute found last year that companies with 30% female leaders add up to 6 percentage points to their net margin.
Forward-thinking companies are shaking things up.
Some are devising “returnships” as a way to bring back women who had spent time away. I recently spoke to a woman who returned to the financial industry after 11 years focusing on being a mother. She is working at JPMorgan Chase, and she’s not just shuffling papers. She’s back “on the desk,” making deals happen.
But more needs to happen. Companies should consider putting more women in roles leading innovation initiatives.
In one study, half of the change initiatives at Fortune 500 companies were women-led, with major impact.
The fast pace of innovation presents career opportunities for women who consider getting closer to the digital aspects of the financial services industry. The technological shifts also open the door to women, rather than to return to a large company, to pursue entrepreneurial ideas around what customers want — just like creators of The Skimm did with short, pithy bites of news for busy millennials.
Networks matter, more than ever. They matter because they are driving new innovations and they matter on a personal level because they drive relationships and our own career success.
My own research shows that women fail to leverage their networks to get ahead in business. Though women are great collaborators, they may not take that courageous step to reach out to a CEO and make the ask.
If corporate leaders and women start there — networking and tapping into the power of women as innovators — we will all benefit.