Measuring Gender Parity—What Can We Learn from the Largest Environmental Disaster in US History and Accenture’s Research?

Imagine you are driving a company vehicle with its windshield totally blacked out. The only help you have is your rearview mirror. It lets you see if you drove over someone, are still on the street, or if you are still driving without an accident. It’s a different matter altogether though you have no idea if you are about to drive off a cliff or to hit someone the next moment.

To measure your performance and promote safe driving, “your management” has set an incentive system that rewards covering, say, every 10 miles without a fatal accident.

To measure, they have a metric they call the Fatal Accident Rate (FAR). And they have another metric—this one is called the Lost Time Incident Rate (LTIR)—which measures other non-fatal injuries that lead to “lost time”—the time an injured person “loses” working because of their injury.

Because you just drove 70 miles without running over anyone, your management has decided to felicitate you for your “excellent” safe driving record. And the next moment your drive over a cliff.

Scary? Yes. Impossible? Not really.

On April 20, 2010, this was exactly similar to a situation faced by Deep Water Horizon, the offshore drilling rig owned and operated by Transocean, the largest offshore drilling company in the world. It was the day when three senior executives from BP, the company leasing the services of the rig, had flown in from the shore. Their mission was to reward the leadership and crew of the rig for their “excellent” safety record—the rig had had an extraordinary seven years without a single accident serious enough to halt operations.

No one on the rig had an idea they were hours away from the largest environmental disaster in the history of the US that claimed 11 lives and spilled over 200 million barrels of oil into the sea causing severe damage to the flora and fauna in the Gulf of Mexico. The spill was so bad and so difficult to contain that it took BP engineers 87 days to stop.

Drilling offshore for oil is extremely hazardous. It’s almost like walking through a minefield. One wrong step and it could lead to a massive release of energy—what we call an explosion—that would send anything in its vicinity into oblivion. In the military, the soldiers are at least trying to avoid hitting a mine. In the oil and gas industry, the drillers are aiming for one. Their job is to keep poking until you find the source of energy and then try to control its release before it gets out of hand.

Not an easy task.

Lagging Vs. Leading Indicators

Measuring your safety performance based on how many incidents you avoided so far is the worst kind of metric one can use. It’s called a lagging indicator. “Lagging” because it points to things that have happened in the past. It gives no clue on how things are likely to happen in the future. For that, you need something called a leading indicator.

So, what has this all to do with measuring and creating gender parity especially at the workplace?

Many companies still measure the level or success of gender parity efforts by listing the percentage of women in the boardroom or senior leadership (C level) positions or whether they have a female CEO or not. These are all lagging indicators.

They might give you a perspective that’s a snapshot in time, but it fails to indicate if the company has an environment that is conducive to fostering gender parity across the entire company. For having a peek into the future you need better indicators—the leading indicators.

When She Rises, We All Rise!

Accenture--a company with over 460,000 employees—has conducted some interesting research. Their report “When She Rises, We All Rise” says the following:

“Among the 22,000 university-educated employees in its 34-country survey, women are 22% less likely to have advanced to manager than their male peers. Conversely, men are over 40% more likely to have progressed to senior manager/director positions than their female colleagues.”

Using an econometric model that combined survey data with published data on employment and pay, Accenture’s research looked beneath the numbers to reveal the environments in which women actually do thrive today: companies where 95% say they love their job, are satisfied with their career progression and aspire to be in senior leadership; and where women are four times more likely to advance to senior manager. And what sets these organizations apart?

In a word, culture, says Barbara Harvey in her nicely written piece for OECD “Getting to Equal: Three ways companies can achieve gender equality in the workplace”.

Culture Eats Strategy for Breakfast

Accenture’s model analyzed more than 200 factors that experts believe influence the likelihood of a woman advancing. It revealed 40 workplace factors that have a measurable influence on advancement, 14 of which have a stronger, positive impact on advancement. These factors point to three actions business leaders should take right now.

1.  Bold Leadership. Executives should have more than just the general intent to improve gender equality. They must be bolder than that. For starters, publish equality targets and hold leaders accountable for meeting those targets. And appoint women into senior roles: in companies with at least one woman leader, women were three times more likely to advance faster (what Accenture measures as fast-track women) than in companies where there were no women leaders.

Yet, that is just the first step.

Tony Haywards, the then CEO of BP, took over in 2007 and vowed to make safety his top priority and yet ended up presiding over one of the largest industrial disasters in history. It’s important to follow up with actions that are in harmony with your intent.

2.  Comprehensive Action. To achieve true gender balance, develop policies and practices that support both men and women. Solving for women alone does not always work. For example, when women are encouraged to take maternity leave, it is negatively correlated with women’s advancement. When men are included and parental leave is encouraged, that negative impact disappears. This should serve as a reminder to leaders: even the most well-intended actions can have unintended consequences. So, consider using analytics to assess the impact of new programs and be agile enough to adjust them to achieve the desired impact.

Be specifically on the lookout for unintended consequences. It starts from the recruiting cycle and goes through the entire employee life cycle and beyond into alumni management.

3.  Empowering Environments. People should be trusted and allowed to be themselves in the workplace. Give them the training they need to keep their skills relevant and the tools and flexibility to work virtually and remotely—and watch as women (and men) advance. 75% of fast-track women say the workplace environment helps them perform at their best (falling to 62% of women, not on the fast-track). When asked to rank what helps them most to advance in their career, men and women and fast-track women rank “being given trust and responsibility” at the top of the list most often (60%), followed by “freedom to be myself at work” (42%), “freedom to be creative” and “opportunities for training” (both 39%).

A diverse workforce provides opportunities for divergent views. Equity ensures fair and respectful treatment of all. Inclusivity ensures those voices are actually heard. When you combine them with an individual who brings their whole self to work, it becomes an extremely potent combination. It unleashes the power of human potential in an organizational setting.

And when that organization has a deep sense of social responsibility, it creates ripples that transcend far beyond organizational boundaries.

Bloomberg’s Gender Equality-Index

Another company at the forefront of promoting gender equity is Bloomberg. They have a metric they call the Gender-Equality Index (GEI) which tracks the performance of the public companies committed to advancing women globally. Bloomberg built this tool for companies to disclose data across multiple dimensions: company statistics, benefits, gender-conscious product offers, and community support. Their 2019 index includes 230 companies headquartered in 36 countries and regions. The data reported by these companies represents a workforce of over 15 million people, including 7 million women around the world.

This index includes both leading and lagging indicators which I believe is the right approach. In my experience, the biggest insights come not just from looking at some KPIs (Key Performance Indicators) or any other kinds of bars and graphs. They come from learning about the divide between perception (something that’s touchy-feely and, therefore, truly subjective) and reality (something that is based on hard numbers and, therefore, objective). When you add that insight into any report, it creates “A-ha” moments—something all consulting companies aspire to do for their clients.

Perception Vs. Reality

Imagine, a report that says 90% of the men in a company believe the company fosters an inclusive environment for women to be considered equal in growth opportunities, but the numbers indicate only 20% women are in management roles even though their representation is, say, over 40% in the overall employee population. It paints a completely different story altogether.

Presenting that kind of perspective is far more insightful and emotive and creates a stronger motivation for change than merely showing the sterile numbers.

In the end, it's important to remember, it’s easy to do a headcount and put people in different (gender) buckets. But it’s far more tough to measure your organizational culture and your perceptions about the reality.

Unless we have a full picture and, therefore, get to drive our metaphorical company vehicle using both the views—front view through the windshield and the view of the rear through the rearview mirror, we are likely to repeat the mistakes of our past wondering why things are not changing per our aspirations.

There's a popular management adage that says "what get's measured gets done". I'd modify it just a wee bit to say "what gets measured (wrongly) doesn't get done (rightly)". The good news is we are making progress though there is growing awareness a lot still needs to be done.