WINNING the RACE for WOMEN in DIGITAL by Frances Brooks Taplett, Matt Krentz, Miki Tsusaka, and Bernd Ziegler

WINNING THE RACE FOR WOMEN IN DIGITAL By Frances Brooks Taplett, Matt Krentz, Miki Tsusaka, and Bernd Ziegler

he demand for digital talent is so pipeline: recruiting, retention, advancement, Thuge—and growing so fast—that and representation of women among senior companies are falling all over themselves in leadership roles. These four stages are inter- a desperate rush for the next hire. Unfortu- linked: companies will be unlikely to recruit nately, they are missing a big opportunity more women into digital roles if they can’t by not targeting women more effectively. retain and promote those already at the or- Women constitute 36% of university ganization. So, companies need a systematic graduates in the science, technology, approach that will address all four, starting engineering, and math (STEM) disciplines with a clear statement from leadership that but only 25% of the STEM workforce and gender diversity is a priority. just 9% of STEM executive leadership. The good news is that digital technology is Adding more women to the digital work- at an inflection point in terms of growth, force will do more than just fill a growing meaning that there is time for companies to need for talent. BCG research has shown catch up. Those that actively seek out the that there are real benefits—both opera- right pools of talent and launch targeted ini- tional and financial—to creating more tiatives to bring in those women candidates gender-balanced workforces and leadership will improve their company’s performance. teams. Companies in which women are And those that manage to keep and pro- equally represented are more innovative mote women to higher positions will truly and resilient, and women working at them win the race for digital talent. have higher levels of engagement and am- bition. A Critical Shortage of Women As part of our research, we developed a in Digital framework for analyzing gender diversity Digitization is transforming businesses in issues that tracks the stages of the career all industries, and companies are investing heavily to put new systems and tools in models ahead, they often feel isolated and place. Yet talent remains a limiting factor end up leaving. For this reason, simply fo- at many organizations. The US Depart- cusing on recruiting isn’t likely to work. ment of Labor estimates that there will be 1.1 million computing-related job openings “A lot of big tech companies focus on diver- in the US by 2024, but more than two- sity in hiring women, but once they’re in thirds of these jobs could go unfilled given place, the culture is still set up in a way that the insufficient pool of college graduates privileges men,” says Ryan Clarke, director with computing-related degrees. of research and evaluation at Girls Who Code, an organization that teaches comput- Women could help meet this demand, yet er science to school-age girls. Cultures are cultural and social influences have pushed difficult to change, she notes, and they have women out of STEM-related jobs in the a disproportionate impact in that they don’t past. Given the smaller pool of women just affect current employees—they also af- with degrees in these fields, it is no sur- fect a company’s reputation to potential prise that they are underrepresented at candidates. Women who hear about these companies. (The exhibit shows the decline cultures simply opt out and look elsewhere. in the number of women in STEM fields as seniority rises.) Some women who do have In sum, most companies have serious work the requisite education often opt to work to do in getting women onto digital teams. outside of traditional companies. As Eliza- Because technology is becoming so perva- beth Bramson-Boudreau, the CEO and pub- sive—in essence, all companies will soon lisher of MIT Technology Review, told us in be tech companies—there is a greater ar- an interview, “Even when women graduate ray of end products and services that incor- with a tech-related degree, they’re more porate digital, meaning that women have a likely to go into academia or apply their critical perspective to offer. Companies skills to a mission-oriented project.” need women coders and designers who think about the different types of offerings, In addition, women who do get hired at from online purchases to websites and mo- companies often don’t stay. Because there bile apps for personalized health care. are so few of them and they cannot see role Companies also need diverse perspectives

Women Are Significantly Underrepresented in STEM Fields

% of women 60 56

38 40 36

26 25

20 14 15 9 9

5 0 University Total Managers Executives CEOs graduates workforce

STEM disciplines Overall

Sources: UNESCO Institute for Statistics; World Bank; ILO; Credit Suisse; Catalyst; Deloitte Global; 2017 Harvey Nash/KPMG global survey; BCG analysis.

Boston Consulting Group | Winning the Race for Women in Digital 2 on how to channel and use AI and large On a broader scale, they can become advo- masses of data in a way that is fair and eq- cates to bring more school-age girls into uitable, rather than simply perpetuating STEM programs, and potentially even existing biases. sponsor or fund such programs.

Rethink candidate events. In addition to How to Win: Addressing the Full staging traditional job forums, companies Employee Lifecycle should hold women-focused recruiting For companies to win the competition for events. These can be low-key, informal women in digital, they must not only re- events, where participants are encouraged cruit more effectively but also address the to bring a friend along. (The research full employee lifecycle, including retention shows that because there are so few and advancement. women in science and technology fields, many feel isolated and do not have strong Sourcing Talent professional networks in place.) Some First, companies need to make sure they companies, like Accenture, use digital are looking at the largest possible pipeline technology to hold virtual events for job of talented women. candidates. (See “Digitally Driven Gender Diversity,” BCG article, August 2017.) Identify every possible candidate. As discussed, there simply aren’t enough Consider candidates from non-STEM and women studying STEM-related subjects, STEM-related fields. Tapping into the but at a minimum, companies should aim alumni networks of top engineering and to reach every possible woman in that computer science programs is critical. But category. companies should also consider women in adjacent fields at the collegiate level who To that end, companies should create target- have similar skills and the aptitude to learn ed marketing and ad campaigns with the the harder digital and analytical skills. message that they are actively seeking When recruiting women already in the women candidates. LinkedIn, Facebook, workforce, don’t ignore those who may and other social media platforms are all have a technical foundation in place yet valuable tools in launching more targeted are currently working in adjacent fields. outreach. There is a strong network effect For example, women entrepreneurs who in place among millennial women in tech- founded technology startups may not have nology. “When you find one, you find many, done any actual software coding, but they because they all follow each other on social know how to manage projects and talent in media,” says Bramson-Boudreau of MIT that realm, making them attractive hires. Technology Review. Companies can also target women-only colleges or organiza- Make job offers fair. A central challenge in tions. When using headhunters for open gender diversity is that many women still positions, require that shortlists of candi- don’t receive the same pay as men in an dates include equal proportions of men and equivalent role, and the data and analytics women. field is no different. A 2017 study of 120,000 job offers by Hired, a technology job market- Companies that can’t find enough skilled place, indicates that two-thirds of job offers women candidates can expand the pool for women are at lower salary levels than by offering training programs on the skills offers for men, for the same position at the they need. For example, the craft site Etsy same company. Another study found that could not find enough programming candi- women in technology positions receive dates through traditional channels, so it salaries 18% to 22% lower than those of men. launched a 12-week program with free This is a deep-rooted problem, but it also courses on open-source software and cod- creates an opportunity: by ensuring that pay ing. The company ended up hiring more levels are fair—for existing positions and than a third of the first wave of attendees. particularly for new hires—companies can

Boston Consulting Group | Winning the Race for Women in Digital 3 differentiate themselves and become more executives already at Intel could meet with attractive to women candidates. recruits of their own gender or race and hire them on the spot. The company Use technology to eliminate biases. Most achieved its goal within one year; 43% of managers who make hiring decisions for new candidates in 2016 were women or digital and analytics jobs are men. The minorities. Female role models are even research shows that virtually everyone falls more critical in leadership roles, says prey to unconscious biases that cause them Bramson-Boudreau of MIT Technology to favor job applicants who share their Review. “At this point in time, it’s a little background—meaning that qualified embarrassing to have an all-male leader- women may get overlooked. ship team.”

To fight this tendency, use software pro- Sponsor talent. Sponsorship by senior men grams to eliminate biases in job postings. and women is effective in giving junior and (Textio is one option.) Screen candidates midlevel women support to build a career by looking at resumes in which names and in which they rise through the ranks at a other identifying details have been re- company—rather than just accepting a job moved so that all candidates can be evalu- there. Sponsors typically offer career advice ated based on their merits alone. Conduct to help high-potential women navigate first-round interviews using AI software. inflection points in their careers and lobby And use gamification, asking candidates to for them to receive promotions, training, play a series of neuroscience-related games and key assignments. Notably, this sponsor- and applying the results through machine- ship should be seen as an opportunity for learning algorithms to better match candi- both men and women. dates to positions free of bias. (One caveat: some AI applications “learn” based on pre- Offer flexible work arrangements. One vious hiring data, so they can often simply clear measure for creating an inclusive replicate, or even exacerbate, hiring biases culture is flexible working arrangements. from the past. Like all technology, AI-based In research conducted by BCG and other hiring programs require human supervi- organizations, women consistently rate flex sion, and recruiters themselves will need work among the most effective measures to be trained on how to use these tools to in terms of boosting gender diversity and eliminate biases.) increasing retention. In a recent BCG study, 58% of female employees cited flexibility as Retention and Advancement the most effective intervention for increas- All the recruiting initiatives in the world ing gender diversity across all industries won’t help if companies can’t keep women worldwide. (See Getting the Most from Your once they’re hired. Accordingly, once wom- Diversity Dollars, BCG report, June 2017.) en are on board, leaders need to put the Moreover, flexible work aligns with the right measures in place to retain them and ethos of tech functions, whose employees give them the same fair shot at advance- are generally young people who keep ment as men. Those measures should be nonstandard hours and don’t worry about based on data, rather than hunches. Specif- outdated concepts like “face time.” ically, companies should focus on the fol- lowing initiatives. Take bias out of advancement. As in recruiting, bias is present in key decisions Make role models prominent. Showcase and promotion points. Affinity bias in a women leaders from the company at every predominantly male culture will naturally opportunity. Intel has used this approach favor men at key moments—decisions successfully. The company set a goal in about who should be promoted, who 2015: that 40% of all new hires would be should attend key meetings, who should women or minorities. To support this get opportunities to lead high-demand program, the company held red-carpet projects. Companies should ensure that events where women or racially diverse metrics are used at each decision point and

Boston Consulting Group | Winning the Race for Women in Digital 4 that decision-making panels are diverse tive for companies to recruit more women themselves. into digital roles and to create the kind of equitable corporate culture that allows women to thrive and advance. The mea- e are at a point where the challeng- sures discussed above are a starting point Wes that women face at work are more on a long journey. However, we believe the openly discussed—and, ideally, addressed— destination—a balanced workforce in which than in the past. At the same time, technolo- opportunities are based on talent rather gy is becoming prevalent in all industries. than gender—warrants the effort. Those two strands are creating an impera-

About the Authors Frances Brooks Taplett is the senior director of the global people team at Boston Consulting Group. Based in the Boston office, she oversees the firm’s global diversity agenda and Women@BCG efforts. You may contact her by email at [email protected].

Matt Krentz is a senior partner and managing director in the firm’s Chicago office. He is a member of BCG’s executive committee and serves as the global people chair, leading the firm’s diversity agenda. You may contact him by email at [email protected].

Miki Tsusaka is a senior partner and managing director in BCG’s Tokyo office, a member of the firm’s executive committee, and the chief marketing officer. You may contact her by email at tsusaka.miki@bcg. com.

Bernd Ziegler is a senior partner and managing director in the firm’s Munich office, where he leads the people agenda across BCG’s digital functions and businesses. You may contact him by email at [email protected].

Boston Consulting Group (BCG) is a global management consulting firm and the world’s leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all re- gions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with offices in more than 90 cities in 50 countries. For more information, please visit bcg.com.

For information or permission to reprint, please contact BCG at [email protected]. To find the latest BCG content and register to receive e-alerts on this topic or others, please visit bcg.com. Follow Boston Consulting Group on Facebook and Twitter.

11/18 Rev 12/18

Boston Consulting Group | Winning the Race for Women in Digital 5