In Turbulent Times Women May Prove to Be Better Leaders Than Men

During turbulent times, organizations spend a great deal of effort on rescue and recovery work. This may include fiscal fitness programs to rein in costs, employee performance is scrutinized to select candidates for terminations, suppliers are squeezed to reduce prices and employee benefits are slashed. However, organizations rarely look at the gender, style and effectiveness of management during these times. Evidence suggests that women may be better than their male counterparts in improving employee morale, motivation and performance – and these are crucial factors that can enhance chances of organizations survival in turbulent times.

Organizations can better deal with turbulent times if leadership shows that it cares and good information is provided without falsely raising hopes. So, too, it helps if clear lines of communication are established and employees are engaged in the recovery plan. Employees know their business intimately, especially those in the front line, and they can generate great ideas to win back customers, reduce costs, improve products or streamline processes. So leaders should adopt a management style that is engaging, inclusive and collaborative, and where individuals and groups can make decisions. This participative or ‘laissez faire’ style works well in an era that makes wide use of the internet, where many people can contribute, even if they are located on the other side of the world.

Who is best at a participative management style? Contemporary research indicates that women may be more suited to this style than men. Female managers think and operate differently. In an interview with CNN Money, Catherine Kaputa, author of The Female Brand: Using the Female Mindset to Succeed in Business, said, “In general, women are most comfortable with a management style that is more collaborative and less concerned with rigid hierarchy and top-down directives. As it happens, that more inclusive, collegial style is what gets results in global companies today.”

According to Dr Bernard Bass who developed the theory of transformational leadership, women are more suited to leadership in the current century. Bass ran a workshop with Bell Labs in the US with 24 participants – twelve men and twelve women. He picked out the participants with the four highest charismatic leadership scores and it turned out all four were women. He later repeated this in New Zealand, and also gathered data from a thousand or so cases in related research. His conclusion was that women were more inspirational. They were also more transformational.

Evidence that points to women’s edge over men in financial dealings is cited by David Weidner, columnist for The Wall Street Journal. He writes, “A new study by Barclays Wealth and Ledbury Research found that women were more likely to make money in the market, mostly because they didn’t take as many risks. They bought and held. Women trade this way because they aren’t as confident – or perhaps as overconfident – as men, the study found.” And this is precisely what is needed in chaotic market conditions that are causing immense problems for people and organizations.

So what makes women better leaders than men? It may partly be simple biology – women have higher levels of the oxytocin hormone than men. Research carried out by Paul Zak (Claremont Graduate University, California), Angela Stanton (Chapman University, Orange, California) and Sheila Ahmadi (University of California, Los Angeles) found that oxytocin is the ‘bonding chemical’. Higher levels of oxytocin lead the individual to greater empathy with others and to a less aggressive stance. Oxytocin stimulates a nurturing characteristic that responds to the emotional needs of others. Warmth and sensitivity are also by-products of high levels of the hormone. Even when the level of oxytocin is similar in women and men, the far higher levels of estrogen found in women act as an accelerator for the effectiveness of oxytocin. This may explain why women develop stronger affections for their children and what makes them good mothers.

A more convincing view is that concepts, rather than hormones, are key controller of behavior. Hormones may create desires, tendencies or inclinations, but its concepts that really control and direct action. This can be clearly seen in reality. Consider Muslims who fast in the Middle East during peak of summer. The body craves for water and food in the extreme heat, yet devout Muslims override these bodily desires and abstain from drinking or eating from sunrise to sunset – for a whole month. Women’s distinctive behavior may be a result of ideas or concepts derived from cultural expectations, religious convictions, and physical differences between men and women.

During turbulent times, a management style that is more characteristic of women leaders really produces positive results. Collaboration becomes vital if the organization is to capture all ideas and opinions to ensure that the best possible course is taken. Women consult more with their peers and teams than men. Showing empathy when people are distraught will provide stability in the workplace. Women are better at expressing empathy than men. Similarly, responding to people’s emotional needs will ensure that they continue to perform under pressure – and women are much better at using emotions in a positive way. Women also tend to reduce or avoid hierarchical layers and to short-circuit communication channels, and this leads to improved trust and better communication. Being less aggressive will ensure that risk is reduced. Women take fewer risks than men so the organization’s chances of survival are higher.

Not everyone agrees that women make better leaders. Gary N. Powell, professor of management in the School of Business at the University of Connecticut in Storrs, carried out research with D. Anthony Butterfield over three decades. It showed that good managers exhibit more traits associated with men, such as autonomy and independence, than traits associated with women, such as warmth and sensitivity to the needs of others.

Evidence may suggest that women tend to lead better than men, but not all women are better leaders. Andrea Jung, who became CEO of Avon Products and Carly Fiorina, who was appointed CEO of HP, both in 1999, are examples of women who did not perform well, were perceived to be arrogant, did not consult much and hence were eventually pushed out.

There is also a strong view that women are not decisive enough. This view is backed by a nationwide survey carried out by Pew Research Center Social and Demographic Trends in 2008, where women scored lower than men in the ‘Decisive’ leadership trait category.

Women face another hurdle. Although it differs from country to country, prejudice against women leaders is still deeply rooted. According to Catalyst, a Canadian non-profit organization expanding opportunities for women and business, women currently hold only 5.6 percent of Financial Post 500 CEO/Head roles. The US fares even worse. Just twelve Fortune 500 companies were run by women in 2011, down from 15 in 2010. However, according to the 2011 Grant Thornton International Business Report, the statistics are slightly better in Asian economies. Thailand leads the way with 30 per cent of companies headed by women, followed by mainland China at 19 per cent, Taiwan at 18 per cent and Vietnam at 16 per cent.

Despite the male dominated leadership space, organizations are beginning to see the value in appointing women to lead, especially since the dot-com bust in 1999–2000. For example, there have been notable appointments in the US corporates – Anne Mulcahy took on the CEO role at Xerox Corporation in 2001 and Indra Nooyi was appointed to PepsiCo in 2007. More recently, Margaret Whitman became CEO of HP in 2011 and Virginia Rometty succeeded Sam Palmisano as CEO of IBM in January 2012. It is also interesting to note that in the midst of economic turbulence the world over, Christine Lagarde has been given the task of leading the IMF.

Organizations stand a better chance of getting through turbulent times if they give women a fair chance at the helm of leadership. Women may not have broken through the ‘glass ceiling’ yet, but there is no doubt that future corporate leadership will have much higher level of the female gender, at least in the capitalist-democratic nations.