With a large number of women ascending to HRO provider leadership positions in 2006, has gender bias been eliminated from the vocabulary of provider organizations?
If the glass ceiling were a chronic complaint of women in the workplace, they might be tempted to move over to the HRO industry, where the sky seems to be the limit these days. They need only to look to an extraordinary year in 2006, when a number of women ascended to the top of their organizations and one was even named HRO provider executive of the year—all evidence supporting the contention that this is a truly gender-neutral business.
Cynics might dismiss such a notion, but the facts are indisputable: 2006 saw more women leaders coronated at large HRO companies than in previous years.
These leaders argue that the industry’s needs for excellent people are so great that it has grown blind to gender and race when it comes to hiring talent. Furthermore, women are also assuming critical roles in sales and marketing, operations, strategic planning, and many other areas, paving the way for their climb into the C-suite.
But while the HRO industry might have crashed through the glass ceiling, the customers they serve haven’t always made similar strides. Although women make up a significant part of the HR profession, the number of female senior HR leaders remains disproportionately low, some observers point out. However, they also predict that contentious issues such as the ratio of women to men leaders and the pay gap will continue to grow more equitable.
THE YEAR OF WOMEN LEADERS
“I think the workplace has come a long way in the past 10 years. Women are still under-represented in the boardroom but our industry is helping to change that. HRO is enabling organizations to focus more specifically on developing top talent, irrespective of gender,” said Karen Bowman, the president of Convergys’ Employee Care division, which provides HRO services to companies such as DuPont and Whirlpool as well as the states of Texas and Florida. “The war for talent is a good thing for women. It quickly exposes gender bias for what it is and will continue to make gender less of an issue in the workplace.”
Bowman, like some of her counterparts at other HRO providers, said she has focused less on gender differences and more on achieving her own goals on the way up. As a well-recognized leader in HRO—she received the HRO Association’s Provider Executive of the Year Award last April—Bowman said the recent promotions of women executives in the industry reflect what providers are trying to bring to their employer clients: greater staff diversity and awareness as well as setting an example for diversity in the workplace.
Indeed, there were many women executive announcements in 2006. At ExcellerateHRO, Kathryn Kelly was named president in August. Her promotion was one in a string of several before the year’s end. Following a major leadership shakeup at Hewitt, Julie Gordon was named acting president of its HRO business. At Advantec, Dianna Sheppard became president in November in a leadership change. In addition, some women HRO pioneers such as IBM’s Mary Sue Rogers, the global leader of its Human Capital Management practice, have left indelible marks on the business by coining phrases such as “lift and shift” and “my mess for less.”
Top executives such as Kelly say women in HRO as well as in the broader HR industry enjoy vast career opportunities, and this may explain why more female executives are ascending to leadership positions. As a profession that requires working with all departments and broad knowledge of the organization, HR is an attractive career to women seeking diverse challenges in their work, she added. Furthermore, she said, pioneering women who first helped break through the glass ceiling serve as trailblazers as well as mentors to today’s crop of younger and more ambitious female executives.
“I think it’s important for leaders to be role models. One of my personal interests is working hard to cultivate talent in the industry, using whatever tools the leadership platform offers me,” said Kelly, who began her career in public health and served on the President’s Commission for Medical Ethics during the Reagan Administration before joining Towers Perrin, joint owner of ExcellerateHRO with EDS. Admittedly a “poster child” for changing her career a number of times, Kelly acknowledged considering retirement and pursuing an interest in attending chef school before she accepted her current role. But when the opportunity came along, she said it was a new challenge that energized her.
Seeing a considerable number of women in top leadership roles in HRO is encouraging, Kelly and her counterparts at other provider companies say. However, they also acknowledge that women still don’t enjoy complete parity with their male counterparts in the HR profession.
This is evident in both the C-suite and the boardroom. Consider this: according to the Society of Human Resources (SHRM), women account for 75 percent of HR professionals in the U.S., but they only account for a minority of senior VPs of HR.
Moreover, the gender pay gap remains unchanged and has even worsened for some women, according to an article in the December 24, 2006, edition of the New York Times. It cited data from the U.S. Labor Department that showed college-
educated women between 36 and 45 years old earned 74.7 cents for every dollar made by men in the same demographic group. This was lower than the 75.7 cents women made 10 years earlier.
Even among executive pay, women don’t even crack the top 10. According to CNNmoney.com, the top 10 executive compensation packages for men were two to three times that for the top 10 women. The highest-paid woman executive, Safra Catz, president and CFO of Oracle, took home $26.1 million in 2006, but that amount was dwarfed by the $71.4 million scored by Eugene Isenberg, CEO of Nabors Industries, in 2005.
Parity in the HRO industry, however, is more evident than in the general corporate world. The women leaders interviewed for this article all say they believe while gender discrimination may still exist in some workplaces, they felt their own companies have much more aggressively promoted not only diversity of gender but also of race and ethnicity. Glass ceilings, they added, have not been an issue in their career paths.
“I’ve been at Hewitt for a long time. I would say I’ve been fortunate in an organization ahead of the pack promoting diversity,” said Gordon, who began her career at the company in actuarial services and was most recently the company’s Chief Business Excellence Officer. “Throughout our history, we’ve always had women in management.”
But it’s not enough simply to create a corporate culture open to diversity; talent must be nurtured to fill those openings. She said one reason more women are ascending to corporate leadership positions is due to a convergence of qualified talent and openness.
Undoubtedly, companies such as Hewitt and others have helped nurture its women executives to move into the C-suite. By instituting flex time, establishing mentor programs, promoting strictly based on skill and performance, and implementing other ways of encouraging diversity, these companies have effectively shattered the glass ceiling and enabled female executives to climb the career ladder without hindrance.
At the same time, technology has also become an enabler, giving women executives the ability to connect with colleagues around the world and around the clock from their home base. For those with family demands, it eases the burden of juggling family and work life because it reduces the number of days on the road. Such a tool, however, can also act as the proverbial double-edge sword. Being able to hold conference calls anytime with colleagues or clients helps women leaders stay informed with business around the world, but it also means they are working around the clock, even if they are in the comfort of their homes.
“The biggest challenge with women who work for me—those who are high talent and high power—is that they don’t know when to shut down,” said Rogers, who is based in the U.K. but pointed out that she can just as easily reach colleagues anywhere through Internet conferencing, adding that technology has played a “massive” role in transforming jobs.
FACING CHOICE, NOT DISCRIMINATION
Rogers and other women leaders contend that career ceilings women face today are often self-imposed; not that institutional ones don’t exist. But at least in HR, she said, women are more limited by the choices they make than by gender discrimination in the workplace.
“I don’t see nearly as much a glass ceiling as I did 20 years ago. Now it’s more about personal choices. Do we want to give up some
[personal time] to get there?” she said.
Indeed, the Times reported in its article that the number of women staying home to care for children has risen, with the biggest increase among highly educated women, who also have the greatest potential for earnings. Furthermore, it found that the pace with which women are moving into the highest-paying positions has slowed. Rogers’ outlook, then, may very well reflect on what’s happening to women’s pay.
But how does this jibe with more women executives being placed in leadership positions? Dianna Sheppard, recently named president of Advantec, said she believes several factors are at work and that female executives can chose between more time in the office or at home. This is made possible by more flex time for both men and women. Husbands with more flexible schedules can take on a greater share of household responsibilities. In her own case, Sheppard added, her husband benefits from a flexible and virtual work environment as an employee of Xerox, giving her more time in the workplace.
At the same time, a proliferation of mentor programs has empowered women to better prepare for life at the top. They gain a better understanding of executive compensation, learn critical leadership skills, and network with other women leaders. “I think that is very important,” she said. “I have mentored people outside my program, and I certainly make it a personal goal to make it important.”
BRIDGING THE GAP
Although women face fewer institutional barriers, there is also widespread acknowledgement that gender discrimination has not gone away completely and that pay gaps remain entrenched. As with any equality issue, stakeholders recognize that change comes gradually. And with many women in leadership roles today, they’ll help pave the way for more female executives in the future. But this can only happen if women address their weaknesses while further leveraging their own strengths, some of the executives say.
Hewitt’s Gordon suggested that women focus more on becoming leaders of lines of business. “If we look at where women leaders tend to gravitate, it’s towards staff roles and not line-management roles. Yet leadership in most organizations is fed mostly from the business functions,” she said. “My suggestion is that women look at line management roles and get lots of experience.”
Along those lines, Bowman, the executive sponsor for Convergys’ Global Women’s Network, an initiative focused on the retention and advancement of women, said female leaders can also better ensure parity by becoming more comfortable asserting their value within an organization. She also advocated becoming more assertive about the type of assignments they end up with. “Don’t wait to be tapped. Volunteer for the tough assignments,” she said.
Rogers pointed out that sometimes what makes women leaders strong are also their weaknesses. For instance, she pointed out that a passion for this business has kept her in her current role, despite more lucrative offers. Being emotionally invested in their profession drives their career forward, but it can also have downfalls. “I would say what makes them [women leaders] weak is also their passion and getting things balanced right,” she added. “It’s not tears in the boardroom, but it’s near that.”
On the other hand, there are subtle, if not important, nuances in how women leaders run their businesses compared with how men do it. In a sometimes incestuous industry in which competitors are forced to work together, HRO providers must come to terms with competition—to serve a common client, for example. Some women leaders say they believe this is an inherent quality they must leverage—their ability to seek out mutually beneficial solutions whether the person across the table is a competitor or a client. They say that women leaders are more willing to seek compromises than to wage battles with the opposition.
Furthermore, they add, women-led HRO provider organizations today may indeed serve as a model for what HR organizations will look like in the future. In some instances, vendors with a diverse employee base will be the only ones considered for lucrative contracts.
“I think what makes an HRO company successful is to be a strong company itself. Women embrace that to a certain degree,” said Advantec’s Sheppard. “They understand the strategic importance of HR.”
MEETING FUTURE NEEDS
And it may be these qualities that have made the HRO industry’s women leaders stand out in the past year—why Bowman was selected HROA’s Provider Executive of the Year, why Kelly, Sheppard, and Gordon were asked to head up their organizations, and why Rogers is perennially recognized as a leader in the industry. Moreover, many additional women executives at large HRO companies are also moving up on the corporate ladder, positioning themselves to assume leadership positions in the near future.
As the HRO industry continues to mature and address its own human capital shortcoming, it faces many of the same dilemmas that corporations everywhere grapple with: how to fill not just its talent needs today but also those needs in the future. Key to this is the recruitment of top talent into the executive folds, where having the best leaders—regardless of gender—will determine who gets ahead in the marketplace. With fewer glass ceilings in their way, more women will likely get a chance to lead HRO providers as well as the HR clients they serve. Whether they decide to take on these roles will be a personal choice, but at least the opportunity will be there.
Certainly, the women executives interviewed by HRO Today all say they have not experienced widespread gender discrimination in their careers. Nor do they express concerns that as women leaders they must work harder than male counterparts to validate their skills. However, some of these executives lament that at times they are the only woman in a room full of senior executives. And when they look back at their climb to the top, they had few female role models to look to.
But as they mentor a younger group of career-minded women and help usher in more openness into organizations—at both their own companies and those of their clients— these leaders say they are creating more opportunities for future generations of women HRO leaders.
“From a personal perspective, I’m delighted that my daughter, who will soon enter the workforce, is free to pursue any career she wants,” reflected Kelly.
“Women now have more choices. The more we open up those doors of opportunity, the more young women will feel, ‘I have broader options.’ ”