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More Female MBAs Needed To Feed Employers' Leadership Supply Chains

There is a gap in pay and position between men and women. It's crucial that the leadership supply chain gets an injection of female talent.

Thu Feb 26 2015

By Dr Amanda Goodall.

Females outperform or are equal to men in many subject areas but a gap in pay and position widens as the careers of men and women develop.

This isn’t just bad news for women, it is bad news for the economy as a whole and it appears improvements in the situation may be slowing.   

Vince Cable, the UK’s business secretary, recently warned that leading British companies risk failing to hit a voluntary target for increasing the number of women on boards. He urged them to redouble their efforts this year or face legislation from Brussels.

As a social scientist in a business school, I think in terms of inputs and outputs, demand and supply. So when it comes to women moving into leadership roles, where is the break in the chain?

I can say with certainty that the initial input is there. The flow of women into education is in rude health. Last year 150,000 men graduated from a UK university compared with 200,000 women.

UCAS figures released last month indicate that this trend is set to continue, with 90,000 more women than men applying for places at university this year.

Once in education the output of both genders is equal. Both sexes enter the jobs market with equal fervour, with students surveyed at university reporting near identical ambitions.

So what happens next? Evidence suggests that the problem lies on both sides of the demand and supply relationship. 

On the demand side there’s discrimination; companies claim their diversity teams are working overtime to try and put women into their top slots.

Some women report that only dull or uncompetitive jobs are available for returning mothers, who may want to work flexible hours. 

Homophily also explains a proportion of the imbalance; people tend to hire others who are like themselves. An all-male recruitment panel massively reduces the chances of a woman being hired in most cases. It is remarkable that all-male panels still exist.  

There’s also the old adage that “we really want women to apply but they are just not forthcoming”.

My view is that if females are not responding, someone really isn’t asking the right question. It’s hard to believe that negotiating appropriate incentives and other inducements will not generate potential candidates. 

On the supply side of the equation, evidence from a variety of sources shows that, in general, men like to compete more than women. Men also tend to display more over-confidence in their abilities than women, creating a “confidence gap”. This becomes more pronounced when men undertake tasks that are considered to be masculine – leadership, for example.

The third explanation suggests that women are more likely than men to integrate negative feedback and negative signals about specific performances into their overall perception of self. 

Correspondingly, women are less likely than men to incorporate positive information into their self-perception. In short, men appear more robust to criticism whilst tending to absorb praise. 

Finally, it seems that women are less adept than men at creating networks that facilitate professional advantage. Men may be encouraged to enter competitions through their networks, and receive support whilst in their roles. 

Women are great at developing networks for emotional support but the “old girl” contacts that could help women progress professionally are often weak or completely absent.  

How do we fix the break in the supply chain?

Efficiency occurs at the intersection of the demand and supply curve. Companies claim there is a demand for women managers and leaders that is not being met. In time we will know how sincere they are by the shape and size of the promotion packages on offer.

So, for now, we must ensure a rich supply of women working their way up through the ranks.

Last year, executive search firm Spencer Stuart reported that roughly 40% of CEOs in the S&P 500 index have MBA degrees. Only a third of MBA students globally are female. 

Facebook chief executive Sheryl Sandberg states that women who are ambitious to “lean in” to the C-suite should first get an MBA. She points to the anomalous fact that women equal men at all levels of education except at the MBA level.

We know that doing an MBA helps to raise self-confidence – but it also offers a range of personal development opportunities, which can help with the remaining supply side weaknesses.

These include network development, incorporating positive feedback, learning to negotiate for the contract you want, and competing in promotional tournaments with a view to winning.   

At Cass Business School, we recently interviewed a number of our MBA alumni going back over 10 years. Interestingly, we found that more women than men reported that their MBA experience had given them the confidence to opt out of corporate careers to set up their own businesses. The MBA seemed to unlock women’s entrepreneurial spirits. 

We asked our alumni why they were so motivated towards running their own business and many responded that it put them in the driving seat in terms of how they structured their working lives. 

In order to bend, not break, in the future it’s crucial that the leadership supply chain for women gets an injection of flexibility from both sides.

Dr Amanda Goodall is a senior lecturer in management at Cass Business School

Dr Amanda is holding an event designed for professional women to discuss business and career at Cass Business School on Saturday, February 28. Click here for more information.