Why Do Relatively Few Women Make a Big Name in Business?

Quick: Name the five most famous books written by women on the subject of management. Tick. Tick. Tick. Tick. Tick.  Bzzzzz. You lost out. Sorry.

Let’s try an easier question. Aside from Marrisa Mayer, Ursula Burns, and Carol Bartz (to take out the easy ones) name five leading women in tech.  Tick. Tick. Tick. Oh, forget it.

Where are all the women in this age of gender diversity in the workplace, especially in tech?

Women supposedly account for more new businesses than men do. According to the Kaufman Foundation which studies such matters, between 1997 and 2002 U.S. women-owned firms grew in number by 19.8 percent, compared with a 10.3 percent growth rate firms overall.

During the same period, however, women-owned firms recorded lower survival numbers, as well as lower numbers for size, growth, earnings and profits. The data suggest that women-owned firms are smaller and less growth-oriented than men-owned firms.

What’s behind these disappointing numbers?

First, let me answer why I’m writing about gender and the workplace. I started looking at the topic in connection with a new book I’m doing. It’s hard to find women’s names that resonate in the business community like those of Peter Drucker, Gary Hamel, Tom Peters, Michael, Porter, Jim Collins, John Kotter, and Warren Bennis and so on and so on.

Then, a Fast Company article appeared in my email today on “The Most Influential Women in Technology.” The number of influential women in tech is shockingly small. Women as a founder or co-founder account for less than 10 percent of all tech startups.

I’ve read that women have greater challenges getting credit, that they still must learn to play by rules laid down by men, that they have to face social stigmas associated with women who abandon family  for career, and other reasons why fewer women make it really big in the business world.

Alicia Robb, Kauffman Foundation senior research fellow said, "The interesting thing about women entrepreneurs is that many of them may be purposely starting businesses as a lifestyle choice. The number of women-owned businesses growing faster may reflect that women are going into business as a viable way to move out of the traditional employment market and gain flexibility. It's hard to know if those kinds of businesses are where they want to be or if they would like to grow faster."

In other words it is not fair to women (or men, for that matter) to compare them on equal terms. Women often start businesses for different reasons than men do. And probably by virtue of lower testosterone levels they generally pursue business less competitively.

Do we see women who are as competitive as any man? Of course – but not as often because women are indeed different. Their brains work differently and they have characteristic values that weigh in heavier in their decisions than they do in men’s decisions. For example, research shows that women tend to be more collaboratively-minded than men are. Men are more likely to make a go of it on their own.

One thing I’m seeing is that while women’s influence in tech may be what some would call appallingly low, women’s influence on the business ethos in general is growing and men’s is ebbing. Perhaps from the standpoint of what’s good for society, maybe women’s influence on corporate behavior is more important than on corporate growth. I’ll get into more detail in my next post on this topic because it affects every aspect of business from employee relations and product design to marketing and customer servicing.

Comments

[Vee Sweeney]

First, thank you for posting this! Women do start businesses for different reasons than men do. For example, I work for myself because it allows me more flexibility with the kids and other responsibilities. I also started working for myself because when the economy crashed, I was pushed out of my management position with a financial company and I decided to take control of my own destiny. Power to me is not about making a ton of money, it's about feeling good about what I think women and men differ a lot in that regard.

[Lahle Wolfe]

The National Center for Business Women's Research (October 2009) reported that 20.9% of all women-owned businesses (WOBs) were in the professional, scientific and tech industries. The next leading sector for WOBs was wholesale (13.4%.) These high numbers seem to indicate women are very interested in tech careers - they just hit more obstacles in men in the "real world." And so, they launch their own businesses. Trouble is, women have a significantly more difficult time in two important areas: access to venture capital and less they are awarded less then 3% of government contracts each year (despite federal law requiring a 5% "quota" be met.)

WOBs are now contributing nearly $3 trillion to the U.S. economy. In addition, WOBs create or maintain over 23 million jobs annually -- a job pool that makes up about 16 percent of the workforce. And, we also hold half of all jobs in the United State now. We are not lacking in numbers, so, why are we lacking in presence?

Let's look to the mainstream world of business. By year-end 2009 there were only 15 women CEOs running FORTUNE 500 companies including Ursula Burns, CEO of Xerox, the first African American female CEO in the United States. (In 2000, there were only three women CEOs running Fortune 500 Companies, so at least we have made some improvement.) So it is a little hard to name five top women in any field.

You make excellent points about women vs. men when it comes to starting and building businesses. Could it have to do with education and credentials?

Not likely. The truth is more women hold higher degrees than men -- they just are not rewarded in status or compensation for holding those higher degrees they way men are. And, more women are graduating from business school than men so again, it is not about women lacking in numbers (or MBAs.)

According to an article in the Washington Post, Weekly Edition, July 20-26, 2009 by Katty Kay and Claire Shipman, companies that employ more women in upper level management are more profitable than those that rely heavily on male "talent" to run their businesses.

"...And it's not only one study, but at least half a dozen, from a broad spectrum of organizations such as Columbia University, McKinsey & Co., Goldman Sachs and Pepperdine University, that document a clear relationship between women in senior management and corporate financial success. By all measures, more women in your company means better performance."

As for books, putting management books aside, the industry as a whole favors male writers.

Publisher's Weekly's "Ten Best Books of 2009" was a list of who's who in male authors - not one female writer made the list (again.) There is tremendous gender discrimination that lives on in the publisher's realm.

In fact, when J.K. Rowling first began publishing the Harry Potter series, her publishers advised her to use her initials or a male pen name because "they didn’t think little boys would read her series."

The disparity in gender equality starts at a very young age (the cradle) and simply extends itself into adulthood.

[James]

Womens rocks in every field whether it is her professional or personal life!!