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Study Shows Importance of Diversity at the Top

By Melissa J. Anderson

A new working paper suggests that women have a better chance of promotion when more people at the top “look like them.”

The study, by Kathleen L. McGinn, Harvard Business School, and Katherine L. Milkman, Wharton School, looked at the effects of having demographic similarity of senior and peer colleagues on whether someone advances or leaves their career. Paradoxically, having more senior colleagues of the same gender or race helps individuals advance, while having more peer colleagues of the same gender or race increases the likelihood that they will leave their employer.

“Social comparisons may be especially influential in professional service organizations, where careers depend upon a challenging up-or-out promotion hurdle to the highest ranks,” they write. “For professionals in such organizations, the benefits accruing to demographic similarity between subordinates and supervisors— looking up to others like one’s self—may differ substantially from those accruing to similarity among peers—having to look out for others like one’s self.”

The study has implications for the importance of sponsorship, as well as how companies can structure work groups so as to increase trust amongst same-level employees.

Sponsorship and Competition

The two researchers tracked the careers of 511 US-based lawyers at a top-20 international law firm for five years. They explain that the necessity of gaining support from senior individuals at the firm in order to make partner increases the importance of sponsorship at the lower levels, and at the same time that the up-or-out pyramidal structure of most professional services firms heightens competition between junior employees. They continue:

“Taken together, the human capital features of professional service organizations have the potential to heighten the value of demographic similarity between junior and senior professionals on juniors’ career mobility, while simultaneously diminishing the value of demographic similarity among junior peers.”

The impact of senior-level demographic similarity was much more pronounced for women than it was for men (the researchers attempted to study the impact of racial similarity, but because of the sample size, were unable to come to a significant conclusion, although they expect the effects are the same).

Based on qualitative interviews, the McGinn and Milkman found that both men and women were relatively happy with their ability to closely work with senior individuals at the firm, because there were so few women at the top already, the chances for women to work with female role models were rare, but impactful. They write, “Women sought relevant, within-workgroup social comparisons to assess the chances of success for “someone like me” and appeared to be making career decisions based, in part, on this assessment.

They add, “Higher proportions of same-sex seniors were more important for women than for men because the presence of female partners in the workgroup provided information to junior women that they could succeed, while junior men took the possibility of success for granted.”

On the other hand, when work groups contained an increased number of demographically similar peers, both men and women were more likely to leave the firm, and less likely to be promoted. The researchers suggest that individuals are seeing those similar to them as a threat to their own success.

Solutions

According to the study, the more senior individuals at the top of the firm, the more likely junior lawyers in the pipeline were to stay around. The findings on peer competition also suggest that “flooding the pipeline” with diverse individuals at the junior level isn’t the key to solving the lack of diversity in the professional services. They researchers also hypothesize that the isolating nature of junior legal work may be isolating to individuals, increasing the level of competition between them

They continue, explaining that companies need to get past a “diversity by numbers” approach to talent management and move toward real inclusion in order to retain women and minority individuals through the ranks. They write:

“Furthermore, our results call for organizations to attend to the ways in which policies and practices invoke competition and comparison within demographic categories. Attempts to design employment practices that are blind to the demographics of candidates are likely to succeed only if all candidates perceive and receive equal mentoring, sponsorship, and peer support regardless of their race and gender.”

The results show that even junior individuals still make judgments on the gender or race of their peers, seeing competition based on superficial similarities. And this can only be exacerbated by the actions of their superiors in choosing to sponsor those who look like themselves as well. If firms can make everyone aware of these biases, they can begin to move toward a more inclusive workforce that acknowledges these latent issues that can derail the careers of women and minority individuals.

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