The US Congress’ Joint Economic Committee reported that companies with a significant bloc of women on their boards of directors tend to outperform those with few women at the helm, boasting 65% higher returns on invested capital.
The 25 Fortune 500 companies with the best records for promoting women to senior positions have 69% higher returns than the Fortune 500 median for their industry.
The results of a McKinsey Global Survey in 2010 found 72% of executives believe there is a direct connection between a company’s gender diversity and its financial success. The study showed that the companies that had the highest levels of gender diversity also had higher returns on equity, operating results and growth in market valuation than the averages in their respective sectors.
Research work from other organizations, such as Catalyst, support these findings.
So what exactly do women bring to the table that makes such a difference? Recent research on collective intelligence sheds some light on the issue.
Social scientists, such as Christopher Chabris at MIT’s Center for Collective Intelligence, and Anita Williams Woolley at Carnegie Mellon University, have recently begun to systematically examine what they call the “collective intelligence” of groups. Collective intelligence is a measure of how smart the group is, as a whole. Chabris and Woolley’s paper,“Evidence for Collective Intelligence Factor in the Performance of Human Groups”, was reported in the journal Science in October 2010.
What they discovered in their research completely surprised them; it was not something they expected or were looking for. They learned that collective intelligence is not tied to either the smartest person on the team nor to the average intelligence of the members of the team.
Rather it is something that is greater than any individual contribution or the sum of contributions. It is an emergent property that results from the interactions among the people in the group. What emerges is almost magical: something greater than the sum of its parts. You can call it evolved thinking.
Complexity science shows us that in complex systems, which groups are, for a positive emergence to occur there must be conditions of mutuality and a level playing field, diversity, and trust. If not, the potential for collective intelligence can easily devolve into group think, where everyone dumbly follows the boss’s lead.
The current research on collective intelligence gives us two key results. The first is that the phenomenon is real, that groups can indeed perform at a higher level of creativity than any single individual. We knew this intuitively, of course.
It is the second result that is the surprise, and this has to do with the one single predictor that a particular group will have high collective intelligence: at least half the chairs around the table should be occupied by women.
What do women bring to the table that catalyzes evolved thinking? According to Chabris and Woolley it is a superior social sensitivity in reading non-verbal cues and other people’s emotions, and a fairness in turn taking.
From my research on women in business, I would characterize their “secret” as the possession and use of what may fairly be called feminine skills. By this I mean relational intelligence, emotional intelligence, holistic perspective, inclusion, empathy and intuition.
All those skills that have been largely marginalized or dismissed as “soft” in the business world are really powerful for facilitating the emergence of collective intelligence. Such skills are not exclusively held by women, of course. But on average they are more developed in women, and women are generally more willing to use them.
The complex problems that companies face today require wisdom coming from many rather than a few. To facilitate the emergence of that wisdom, we need the power of all those “soft” skills. In reality, those soft skills are anything but soft; they are very complex and require a great deal of skill to master.
Soft is the new hard. And women lead the way.
Birute Regine, Ed.D., a developmental psychologist, works as an executive coach, speaker and author. She previously co-authored the critically acclaimed The Soul at Work: Embracing Complexity Science For Business Success. Her new book, Iron Butterflies: Women Transforming Themselves and the World captures a powerful time of transition in our society, led primarily by women.