McKinsey & Company | 0 Women Matter January 17, 2019
McKinsey & Company | 0
Women Matter January 17, 2019
McKinsey & Company | 1
Why diversitymatters
Where westand today
What we learned at McKinsey
What could this mean for
you?
McKinsey & Company | 2
Our research on diversity
Local perspectivesGlobal proprietary researchand strategic partnerships
McKinsey & Company | 3
Companies in the top quartile for the women
representation in executive committees
Companies with 0 women in executive
committees
15%
22%
+47%
Average return on equity2007-2009
17%
11%+55%
Average EBIT margin2007-2009
Diversity and financial performance
McKinsey & Company | 4
42
67
Quartile 4 Quartile 1
50
53
45
61
43
61
SOURCE: McKinsey; Diversity Matters
Diversity and financial performance
Percentage of companies with EBIT performance above the median
GenderRegion Ethnicity
McKinsey & Company | 5
Direction
+6 pts
Coordination &
control
+5 pts
Innovation
+3 pts
Motivation
+1 pts
Work environ-
ment & values
+7 pts
Capabilities
+1 pts
External
orientation
+5 pts
Accountability
+1pts
Leadership
team
+4 pts
Companies with 3+ women on their boards have better results on organisational performance
McKinsey & Company | 6SOURCE: McKinsey; Diversity Matters
Win the war for talent
Improve the quality of
decision making
Increase customer insight
Motivate employees and
increase satisfaction
reasons why we believe diversity impacts performance
McKinsey & Company | 7
Human capital
Government regulation
Operational excellence
Innovation
Customer relationships
Global expansion
Global political/economic risk
Corporate brand and reputation
Sustainability
0.9
Trust in business
2.4
2.1
2.0
1.7
1.7
1.6
1.3
0.8
0.5
The Conference Board 2013, 2014
CEO Challenge
SOURCE: McKinsey & The Conference Board research, 2012; The Conference Board CEO Challenge 2012, 2013, 2014
Human Capital is the number 1 CEO Challenge globally
Human capital is the Number 1 CEO challenge globally
Ignoring half the pool of human talent just doesn’t make good business sense.”
McKinsey & Company | 8SOURCE: ‘What makes teams smarter,’ Harvard Business Review, June 2011
Little correlation between a group’s collective intelligence and the IQs of its individual members.
But if a group includes more women, its collective intelligence rises.”
Diverse teams are more intelligent
McKinsey & Company | 9
Frequency gap in types of behavior between men and women1
PercentTypes of leadership behavior
Women bring something different to the equation
SOURCE: McKinsey; Women Matter
7
4
4
1
1
4
9
Role model
Control and corrective action
People development
Expectations and rewards
Inspiration
Participative decision making
Efficient communication
Individualistic decision making
Intellectual stimulation Not statistically significant
Not statistically significant
Women apply more
Women apply slightly more
Women and men apply equally
Men apply more
McKinsey & Company | 10
Role of women as customers is growing
SOURCE: McKinsey & Company (2013), Women Matter: Moving Corporate Culture, Moving Boundaries; University of California, The Williams Institute
(2013), The Business Impact of LGBT – Supportiev Workplace Policies; Center of Talent Innovation
80% of consumer purchase
decisions made by
women
60% of all personal wealth is
expected to be women-
owned by 2025
In the UK…
Companies are making changes to reflect their customer base
370%growth of female
executives
Women will control
£400m more expenditure per
week than men
McKinsey & Company | 11SOURCE: The 2013 Digital Marketer Report, McKinsey iConsumer 2013, Universum
Diversity plays a key role in motivating talent
Millennials want to work for diverse organisations
A poll of UK students:
80%felt it was important that the
employer “engages in creating a
diverse workplace.”
McKinsey & Company | 12
Why diversitymatters
Where westand today
What we learned at McKinsey
What could this mean for
you?
McKinsey & Company |
We’ve made some progress but still enormous opportunity
Share of women, Percent
Executive
committees
2018
Board members
2018
25 241916
4136
1626
15
22
McKinsey & Company | 14
Women are under-represented at all hierarchical levels, not only top management
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data
EMEA industriesNumber of companies= 1301, percent women
Odds of advancement for
men over those for womenXx
SOURCE: McKinsey, Women Matter
CEO Seats on
executive
committee
Senior management
and vice
president
Middle
management
Entry level
2% 9% 14% 22% 52%
5x2x
2x
3x<
McKinsey & Company |
Diverse members of executive teams are more likely to be in staff versus line roles
Women
executives are
under-
represented in
line roles, and
may face a
harder path to
CEO
1 Sample includes 341 companies with 872 female executives
SOURCE: McKinsey Analytics; Company websites; McKinsey Diversity Matters database
Female executive roles by ethnic/cultural minority1
Percent
Asian
Hispanic
Black
White
Other
54%
35%
34%
20%
47%
21%
46%
65%
80%
66%
53%
79%
Ethnic/cultural minority
Line rolesPercent
Staff rolesPercent
Share in women on executive team Percent
70%
12%
8%
7%
2%
McKinsey & Company | 16
Number of companies = 1301
Each sector has its own challenges
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data
SOURCE: McKinsey, Women Matter
11
Consumer goods
18
50
30
9
Financial services
22
13
49
9
17
Media, telecom, technology
34
20
10
Transport, logistics, tourism
27
19
15
Energy and basic materials
11
15
16
25Total company
Middle management
Senior management
and vice president
Seats on executive
committee
McKinsey & Company | 17
Number of companies = 1301
Each sector has its own challenges
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data
SOURCE: McKinsey, Women Matter
11
Consumer goods
18
50
30
9
Financial services
22
13
49
9
17
Media, telecom, technology
34
20
10
Transport, logistics, tourism
27
19
15
Energy and basic materials
11
15
16
25Total company
Middle management
Senior management
and vice president
Seats on executive
committee
McKinsey & Company | 18
What’s going wrong ?
McKinsey & Company | 19
Female managers appear equally ambitious as men but are less confident that they can reach top leadership positions
SOURCE: Women Matter: Time to accelerate, 2017
1 McKinsey Quarterly Global survey of 1,400 executives
Share of female and male managers agreeing or strongly agreeing1, Percent
Senior-level managers Mid-level managers
69867981 6164 5876
I am confident I will succeed in reaching a top management position
Senior and mid-level
managers
I am willing to sacrifice a part of my personal life to reach a top management position
Senior and mid-level
managers
Over the course of my career, I have the desire to reach a top management position (e.g., a role in the C-suite)
McKinsey & Company | 20
22% 24%
26% 28%
Where are companies today?
20%
52% companies48% companies
Percentage of large companies
N=821
1 Companies with >EUR 1bn revenues or >10k FTE headcount.
SOURCE: McKinsey Women matter survey 2016
10 30
70
0 5 2515 3520 40 45 500
Number of measures
Percentage of women CEO or n-1
have implemented
less than 25 measures
have implemented
more than 25 measures
McKinsey & Company | 21
22% 24%
26% 28%
Where are companies today?
Limited
diversity
practices
Investing in
diversity, but no
impact yet
20%
52% companies48% companies
Percentage of large companies
N=821
1 Companies with >EUR 1bn revenues or >10k FTE headcount.
SOURCE: McKinsey Women matter survey 2016
200 5 15 302510 35 40 45 500
70
Percentage of women CEO or n-1
Number of measures
have implemented
less than 25 measures
have implemented
more than 25 measures
McKinsey & Company | 22
22% 24%
26% 28%
Where are companies today?
Operating with
a diversity
advantage
Limited
diversity
practices
Investing in
diversity, but no
impact yet
20%
52% companies48% companies
Making
progress
with diversity
Percentage of large companies
N=821
1 Companies with >EUR 1bn revenues or >10k FTE headcount.
SOURCE: McKinsey Women matter survey 2016
10 25150 5 20 30 35 40 45 500
70
Number of measures
Percentage of women CEO or n-1
have implemented
less than 25 measures
have implemented
more than 25 measures
McKinsey & Company | 23
Looking at Best-in-class companies (i.e., with a woman CEO or 30% of n-1 are women) we identified 3 game changers
Focus next pages
Best-in-class companies have initiated holistic change programs
▪ 68% of best-in-class companies (vs. 49% of other companies) actively support and
nurture a gender diversity culture
▪ 60% have a compelling change story
▪ 48% have role models and change agents embracing diversity
Best-in-class companies started to work
on gender diversity and show passion and
persistence over time
CEOs of best-in-class companies have
gender diversity as a strategic priority and
cascaded it at all levels
1 2
3
Persistence CEO commitment
Holistic change programs
SOURCE: Woman Matter 2016
McKinsey & Company | 24
RECRUITING
PROMOTION
RETENTION
Organization de-biasing
Women’s leadership development
CEO commitment & management cascade
Transparency and indicators tracking
WORK-LIFE BALANCE MEASURES INFRASTRUCTURES
HR processes and policies
Collective enablers
Training and coaching
Sponsorship and
mentorship
Women’s networks
On-the-job de-biasing
Evolution of leadership
styles
Evaluation and recruitment
de-biasing
A holistic programme is required to make change happen
SOURCE: McKinsey Women Matter
McKinsey & Company | 25
It is possible to make rapid improvement on diversity
60%
50%
33%
32%
13%
30%
16%
Increase in women’s representation on executive teams2014 – 2017, %
Increase in ethnic representation on executive teams2014 – 2017, %
47%
14%
22%
46%
21%
29%
26%
SOURCE: McKinsey Diversity Matters Database
McKinsey & Company | 26
Why diversitymatters
Where westand today
What we learned at McKinsey
What could this mean for
you?
McKinsey & Company | 27
Our women’s initiative
McKinsey & Company | 28
We were falling short of our fair share in recruiting and retention was a MAJOR issue
Maternity and flexibility were key challenges
The external environment played a major role
We saw the power of a great mentor and sponsor but also that fewer women had them
Many things were no surprise
McKinsey & Company | 29
Maternity – whenever that happened
Mid-tenure – looking up at Partner and trying to decide whether to go for it
Mid-tenure partners –looking up at Senior Partner and deciding whether to go for it…
There were a few surprises…3 critical moments of truth
McKinsey & Company | 30
There were a few surprises… our senior women weren’t leaving for the lifestyle – UK example
Jane FraserCEO of Citi, LatAm
Margo GeorgiadesPresident Google
America
Elane StockGroup President
Kimberley Clark
Charlotte HoggCOO, Bank of
England
Helen WeirCFO Marks & Spencer
Diana LayfieldCEO Standard
Chartered – Africa; VP
– Next Billion Users
(Google)
Wendy BeckerCEO Jack Wills
Sue WhalleyCOO Royal Mail
Gioia GhezziChair – RGI Group
Dido HardingCEO of TalkTalk, Chair
– NHS Improvement
Natalie CeeneyCEO HM Courts
Jenna LittlerSVP Marketing,
Burberry
McKinsey & Company | 31
Outside of the UK… a few of the women who left
Sheryl SandbergCOO, Facebook
Susan RiceNational Security
Advisor, White House
Claudia NematManagement Board,
Deutsche Telekom
Keiko HondaEVP and CEO – MIGA
at the World Bank
Sandy PetersonGroup Chairman,
Johnson & Johnson
Katrin SuderSecretary of State,
Ministry of Defense,
Germany
Alison WatkinsCEO Coca-Cola
Amatil
Chelsea ClintonVice Chair, The
Clinton Foundation
Kathleen McLaughlin
President, Walmart
Foundation
Christiana ShiPresident, Direct to
Consumer, Nike, U.S
Melanie KreisPersonnel & Labor
Director, Deutsche
Post DHL, Germany
Rebecca WeiPresident, Asia,
Christie’s
International, China
McKinsey & Company | 32
Community Maternity/
flexibility
Skill
building
Mentorship
and
sponsorship
Role
models
2. Progression and retention
1. CEO agenda
So what did we do?
SOURCE: McKinsey; Women Matter
5. Engaging the men (unconscious bias training, external research)
4. Foundations (metrics, HR policies, performance dialogues)
3. Recruiting
McKinsey & Company | 33
We have also started to change our model
▪ Functions or industries
▪ Special initiatives
▪ McKinsey Global Institute
▪ Secondment programs with world-
renowned organizations
▪ Mobility options across our 105 global
offices
▪ Including different paths (expert, RTS,
McKinsey Implementation)
▪ Also different roles knowledge, people &
operational roles
▪ ‘Take Time’
▪ Various flexible part-time programs
▪ PACE program
▪ Leaves of absence
More diversity in expertise
More options on career paths
Greateroptions for mobility
More flexibility on timing and “Up or Out”
McKinsey & Company | 34
Overall, we have made significant progress –increase in women in EMEA since 2007
Directors
+400%Partners
+56%Associate
Partners
+70%
Engagement
managers
+50%Associates
+28%Business
analysts
+19%
Overall
+38%
McKinsey & Company | 35
…with pockets of excellence…
Women in global Organization practice – 2019
40% global leadership team
60% new partners 2017 & 2018
52% project managers
>50% practice consultants
McKinsey & Company | 36
Leadership - from both the most senior men and the most senior women
A truly inclusive culture that celebrates and champions diversity in all its forms
A holistic program including a ‘segment of one’ approach and tackling the key ‘moments of truth’
Constant focus, passion and persistence over time
What makes the difference?
McKinsey & Company | 37
Why diversitymatters
Where westand today
What we learned at McKinsey
What could this mean for
you?