Do Women Have Less Managerial “Potential” Than Men?

Whether it is for succession planning or leadership development, many organizations are concerned about a person’s potential.  That it is, in the future, will be this person be performing at their current level (at least relative to peers) or is there something about them that will lead to an acceleration in their performance so that they’ll rise above many others.  This is often reflected in faster promotions as well.

The idea that managers can use their judgment to distinguish between who is a good performer now and who has potential is ridiculous.  What objective information would tell you that an average performer now will blossom in 5 years?  Initiative? Curiosity?  Of course, these things impact current performance, so they really are not related to potential if we assume that the two are not the same thing.

The other example frequently given is whether a person in a given role can perform the next role up.  For instance, can someone in a technical job supervise others or can a current manager be an effective executive.  This has less to do with potential than whether a person has a skill set that they have not been given an opportunity to show in their current role.  Note that there are plenty of valid ways (Assessment Centers being one) to determine whether people have supervisory/management/executive skills which are far more accurate than judgment.

Organizations find potential is sexier than evaluating skills, so potential gets a lot more attention.  And, since objectively measuring potential is time consuming/expensive and no one holds executives accountable for being wrong about potential, we get people sitting around and making up reasons why employee A is a “high po” and employee B is not.  You will not be shocked to find out that this approach is loaded with bias against women.

Whether it is due to unconscious bias or stereotypes that go against women being as self-promoting as men, female employees (at least according to the large study cited above) get the short end of the potential stick.  For example, in that research, women had higher performance ratings, but lower potential ratings.  This leads to fewer relative promotions for woman compared to men.

Now, it could be that the lower potential ratings were justified.  Perhaps men with similar potential ratings were performing better than the women down the road.  In the study the opposite was true.  Women with lower potential ratings outperformed men in the future.

I think we can draw a few conclusions from this study (and common sense):

  1. Organizations that are using potential ratings should look at their impact on women (and minorities).  They may not like what they see.
  2. No matter how much rating systems are dressed up (I’m looking at you, Nine Box), they are subject to huge amounts of biases and stereotyping.  Organizations that use this approach should look at the accuracy of the judgments and only use those who frequently are right.
  3. If you are interested in potential, define it (e.g., promotions, pay increases, etc.) and look at what predicts it over the long term after controlling for sex (since those promotional decisions are likely biased as well).  Then you have a system for understanding potential.

Organizations should plan for succession so that those being considered get the training and development opportunities they need to succeed.  However, using human judgment to identify who has potential and who does not is a fool’s errand.  It is unfair to women, which means it is wrong and negatively impacts your business.  There are ways to predict future performance in your organization.  You just need to put in the work to discover them.

Many thanks to Dennis Adsit for sending me the cited article.

Mentoring For Turnover

This is an interesting time of the year in college football in the U.S., and not just because the final games are about to be played. As head coaches who had a poor year get fired (what should constitute the criteria for firing a college football coach is a topic for another blog), schools have begun looking for their next head coach. In some, but not many, cases an assistant who reported to the fired coach will get the job. In others, a head coach from another school will be head hunted. But, the most common instance is when an assistant from another school is hired. That is as if you wanted to hire a new vice-president of your company and you felt that the best candidates were directors at other firms. Why does this happen?

Part is that the athletic directors (those responsible for hiring the new coach) feel that the failure that led to the coach getting fired belongs to the assistant coaches as well. It is hard for them to go to their stakeholders and say, “We had a really bad season, but we think that one of our assistants is a diamond in the rough.” Note that some schools will groom a successor to the head coach when there is a retirement time frame set.

Picking head coaches from other schools typically involves a bigger school (read: one with a larger budget for salaries, practice facilities, etc.) poaching a successful coach from a smaller one. Think of this as an executive doing well at a competitor with less revenue and a firm with more sales thinking that s/he is ready to move up.

The last option, hiring an assistant from another school, is an interesting one because it reflects on the culture of coaching. Head coaches are thought of well when their assistants go on to getting better jobs. Most of them feel that part of their job is to mentor their assistants so they can get a better job—either at the current university if the head coach leaves or anywhere else. Unlike in corporate America, where losing top lieutenants is seen as a sign of a toxic culture, a head coach who has assistants move on (and be successful) at other schools is perceived as having a great “coaching tree” and attracts even better talent.

This culture comes from the coaching profession being relatively small (130 schools at the top level and 124 at the next). Even with 7 to 10 assistants for each team, everyone eventually gets to know everyone through movement, conferences, etc. Almost every college head coach got his job after being an assistant at another school (most likely, after being an assistant at several schools), so a head coach knows how big of a deal it is when an assistant gets the call to run a program.

In business, it is not a good thing if your high potentials are getting their big opportunity someplace else. However, what are you doing to ensure that they get meaningful promotions internally? Is a VP rewarded when one of her directors becomes VP in another division? Or, is she seen as someone who can’t keep good talent? If it is the former, she will attract more high potentials (internally and externally).

You can create this kind of culture if you encourage and train your executives to mentor talent. Recognize them publicly when their direct reports move on to better positions so they will be encouraged to continue to nurture talent and high potentials will want to work for them.

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