-
Fifteen years ago,
-
I thought that the diversity stuff
was not something I had to worry about.
-
It was something an older
generation had to fight for.
-
In my university,
we were 50-50, male-female,
-
and we women often had better grades.
-
So while not everything was perfect,
-
diversity and leadership decisions
-
was something that would happen
naturally over time, right?
-
Well, not quite.
-
While moving up the ladder
working as a management consultant
-
across Europe and the US,
-
I started to realize how often
I was the only woman in the room
-
and how homogenous leadership still is.
-
Many leaders I met
-
saw diversity as something to comply with
out of political correctness,
-
or, best case, the right thing to do,
-
but not as a business priority.
-
They just did not have a reason to believe
-
that diversity would help them achieve
their most immediate, pressing goals:
-
hitting the numbers,
delivering the new product,
-
the real goals they are measured by.
-
My personal experience
working with diverse teams
-
had been that while they require
a little bit more effort at the beginning,
-
they did bring fresher,
more creative ideas.
-
So I wanted to know:
-
Are diverse organizations
really more innovative,
-
and can diversity be more
than something to comply with?
-
Can it be a real competitive advantage?
-
So to find out, we set up a study
with the Technical University of Munich.
-
We surveyed 171 companies
in Germany, Austria and Switzerland,
-
and as we speak, we're expanding the study
-
to 1,600 companies
-
in five additional countries
around the world.
-
We asked those companies
basically two things:
-
how innovative they are
and how diverse they are.
-
To measure the first one,
-
we asked them about innovation revenue.
-
Innovation revenue is the share
of revenues they've made
-
from new products and services
in the last three years,
-
meaning we did not ask them
how many creative ideas they have,
-
but rather if these ideas
translate into products and services
-
that really make the company
more successful today and tomorrow.
-
To measure diversity,
we looked at six different factors:
-
country of origin,
age and gender, amongst others.
-
While preparing to go in the field
with those questions,
-
I sat down with my team
-
and we discussed what
we would expect as a result.
-
To put it mildly, we were not optimistic.
-
The most skeptical person on the team
thought, or saw a real possibility,
-
that we would find nothing at all.
-
Most of the team
was rather on the cautious side,
-
so we landed all together at "only if,"
-
meaning that we might find
some kind of link
-
between innovation and diversity,
-
but not across the board --
-
rather only if certain criteria are met,
-
for example leadership style,
very open leadership style
-
that allowed people to speak up freely
and safely and contribute.
-
A couple of months later,
the data came in,
-
and the results convinced
the most skeptical amongst us.
-
The answer was a clear yes,
-
no ifs, no buts.
-
The data in our sample showed
-
that more diverse companies
are simply more innovative, period.
-
Now, a fair question to ask
is the chicken or the egg question,
-
meaning, are companies
really more innovative
-
because they have
a more diverse leadership,
-
or the other way around?
-
Which way is it?
-
Now, we do not know how much
is correlation versus causation,
-
but what we do know is that clearly,
-
in our sample, companies
that are more diverse
-
are more innovative,
-
and that companies
that are more innovative
-
have more diverse leadership, too.
-
So it's fair to assume
that it works both ways,
-
diversity driving innovation
and innovation driving diversity.
-
Now, once we published the results,
-
we were surprised
about the reactions in the media.
-
We got quite some attention.
-
And it went from quite factual,
-
like "Higher Female Share
Boosts Innovation"
-
to a little bit more sensationalist.
-
(Laughter)
-
As you can see,
-
"Stay-at-home Women Cost Trillions,"
-
and, my personal favorite,
-
"Housewives Kill Innovation."
-
Well, there's no such thing
as bad publicity, right?
-
(Laughter)
-
On the back of that coverage,
-
we started to get calls
from senior executives
-
wanting to understand more,
-
especially -- surprise, surprise --
about gender diversity.
-
I tend to open up
those discussions by asking,
-
"Well, what do you think of the situation
in your organization today?"
-
And a frequent reaction to that is,
-
"Well, we're not yet there,
but we're not that bad."
-
One executive told me, for example,
-
"Oh, we're not that bad.
-
We have one member
in our board who is a woman."
-
(Laughter)
-
And you laugh --
-
(Applause)
-
Now, you laugh, but he had a point
in being proud about it,
-
because in Germany,
-
if you have a company
-
and it has one member
on the board who is a woman,
-
you are part of a select group of 30
-
out of the 100 largest
publicly listed companies.
-
The other 70 companies
have an all-male board,
-
and not even one of these hundred
largest publicly listed companies
-
have, as of today, a female CEO.
-
But here's the critically
important insight.
-
Those few female board members alone,
-
they won't make a difference.
-
Our data shows that for gender diversity
to have an impact on innovation,
-
you need to have more
than 20 percent women in leadership.
-
Let's have a look at the numbers.
-
As you can see, we divided
the sample into three groups,
-
and the results are quite dramatic.
-
Only in the group where you have
more than 20 percent women in leadership,
-
only then you see a clear jump
in innovation revenue
-
to above-average levels.
-
So experience and data
shows that you do need critical mass
-
to move the needle,
-
and companies like Alibaba,
JP Morgan or Apple
-
have as of today
already achieved that threshold.
-
Another reaction I got quite a lot was,
-
"Well, it will get solved over time."
-
And I have all the sympathy in the world
for that point of view,
-
because I used to think like that, too.
-
Now, let's have a look here again
and look at the numbers,
-
taking Germany as an example.
-
Let me first give you the good news.
-
So the share of women
who are college graduates
-
and have at least 10 years
of professional experience
-
has grown nicely over the last 20 years,
-
which means the pool
in which to fish for female leaders
-
has increased over time,
-
and that's great.
-
Now, according to my old theory,
-
the share of women in leadership
-
would have grown
more or less in parallel, right?
-
Now, let's have a look
at what happened in reality.
-
It's not even close,
-
which means I was so wrong
-
and which means that my generation,
-
your generation,
-
the best-educated
female generation in history,
-
we have just not made it.
-
We have failed to achieve leadership
in significant numbers.
-
Education just did not
translate into leadership.
-
Now, that was a painful realization for me
-
and made me realize,
-
if we want to change this,
-
we need to engage,
and we need to do better.
-
Now, what to do?
-
Achieving more than 20 percent
women in leadership
-
seems like a daunting task to many,
-
understandably, given the track record.
-
But it's doable,
-
and there are many companies today
that are making progress there
-
and doing it successfully.
-
Let's take SAP, the software
company, as an example.
-
They had, in 2011,
19 percent women in leadership,
-
yet they decided to do better,
-
and they did what you do
in any other area of business
-
where you want to improve.
-
They set themselves a measurable target.
-
So they set themselves a target
of 25 percent for 2017,
-
which they have just achieved.
-
The goals made them think more creatively
about developing leaders
-
and tapping new recruiting pools.
-
They now even set a target of 30 percent
women in leadership for 2022.
-
So experience shows it's doable,
-
and at the end of the day,
-
it all boils down to two decisions
that are taken every day
-
in every organization by many of us:
-
who to hire and who
to develop and promote.
-
Now, nothing against women's programs,
-
networks, mentoring, trainings.
-
All is good.
-
But it is these two decisions
-
that at the end of the day
send the most powerful change signal
-
in any organization.
-
Now, I never set out
to be a diversity advocate.
-
I am a business advisor.
-
But now my goal is
to change the face of leadership,
-
to make it more diverse --
-
and not so that leaders can check a box
-
and feel like they have
complied with something
-
or they have been politically correct.
-
But because they understand,
-
they understand that diversity
is making their organization
-
more innovative, better.
-
And by embracing diversity,
by embracing diverse talent,
-
we are providing
true opportunity for everyone.
-
Thank you. Thank you so much.
-
(Applause)
Aviva Nassimi
Hello,
Please note that the, at the request of the speaker, we've changed the headline of this talk from
Want a more innovative company? Hire more women
to
"How diversity makes teams more innovative"
Thank you!