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Getting Equality with Men: Capitalize on Your Team’s Differences, with Sallie Krawcheck, CEO and Co-Founder, Ellevest, and Author, Own It: The Power of Women at Work
The Magic of Diversity
There is so much advice for us as women on how to get ahead in business. Books and books and books and articles and articles and articles, and we spend our time on it. And so much of it tells us to be more assertive and tells us to take that seat at the table and tells us to negotiate for that raise and tells us to raise our hand for the promotion, even if we’re not ready. And tells us to and tells us to and tells us to act differently.
Here’s the challenge with that. The power of diversity in corporate America and gender diversity– that power that’s so great that it leads to higher returns on equity for companies, greater employee engagement, greater client and customer engagement, lower risk, greater long term focus, more innovation, that power which is so great that gender diverse teams outperform smarter and more capable teams– the power of diversity is diversity. The power of diversity is not bringing in people of different genders, different skin colors, different nationalities, different orientations, different educational backgrounds, different perspectives, different personalities and telling them to act like the majority.
We, as women, bring a lot of great qualities to work. That power of diversity comes not from our sameness to corporate America, but from our differences. And I have to tell you, for a while I sort of bristled against this idea. Which is, what do you mean women are different from men? We’re all different. Every one of us is different.
Except some magic happens when you have gender diversity in leadership teams. And so I started to dig into what are the things that we as women bring that have that difference. And there are a handful of them that I think are really important.
One, relationship focus– you know, we, as women, you know, right here, right here. How are you? How are you doing today?
We’re intuitive. We’re perceptive. We’ve got high emotional intelligence. Not only is it important in business today, it really becomes more and more important as technology takes over.
Number two, we think holistically. That we as a society sort of love to make fun of women– well, women are slow in making up their minds. You know, what we see is that men tend to make more efficient, faster decisions. And we as women tend to bring in the complexity and think about more aspects of a problem as we’re solving a problem. And so we tend to make more effective decisions.
We as women love to learn. We as women are very risk aware. We tend to look around corners and look for what the downside is. I certainly see this with women in investing, that risk awareness.
We as women tend to have a focus on meaning and purpose, that the number one reason we accept a new job is what impact we can have in the world around us. Money is important, but money’s not the number one reason for us, as it is for gentlemen.
The Danger of Homogenous Groups
There is no doubt in my mind that the financial crisis that the United States and the world suffered would have been less severe if we’d had more diversity on Wall Street. There’s no doubt. We know this intuitively.
If all of us think about those cavernous trading floors where the individuals populating the trading desks looked the same, that if those had been incredibly diverse, sort of the United Nations of every different kind of person you could have, we intuitively know that the crisis would have been less severe. We intuitively know that if there were more women at the senior leadership tables that the crisis would have been less severe. And not only do we know it intuitively, the research tells us this.
The research tells us that homogeneous teams tend to over trust each other. We cognitively finish each other’s sentences. Oh, she’s just like me. Or he’s just like me.
So therefore, since we look and talk and act alike and have a set of shared experiences, I understand what you’re thinking and what you’ll do next. And so homogeneous markets tend to be mispriced by tens of percentage points.
The other thing that the research tells us is that trading risk can be driven by testosterone. And that as gentlemen’s testosterone increases, they take on more trading risk– as it reduces, less trading risk. You know who doesn’t have a lot of testosterone? Women– women– and it’s funny because we women get that rap for being so emotional and so hormone driven. But in fact, what the research tells us is that you can track the risk with testosterone, not estrogen.