Women are making headlines wherever you turn, from presidential runs to space programs to Super Bowl performances. But the most encouraging news of all in the struggle for gender equality is this: women-owned businesses outperformed the national average and drove economic growth in the United States, according to the latest State of Women-Owned Businesses Report.
As outlined in the report, women-owned businesses represent 42% of all businesses — nearly 13 million — employing 9.4 million workers and generating revenue of $1.9 trillion. In addition, in 2018, the same report ranked Florida No. 1 in the country regarding the fastest growth rate of women-owned businesses.
So, what does this trend mean for the business world and female entrepreneurs?
Julie Kleffel, executive vice president and regional market president for Seacoast Bank, says businesses, especially those that operate in the business-to-business (B2B) space, must find and develop leaders who can relate to and meet the needs of the growing number of women business owners. In other words, they need to hire and develop more women leaders and women CEOs or risk missing out on significant growth opportunities. But, unfortunately, Kleffel feels businesses have been slow to do that.
Kleffel points to McKinsey & Company’s Women in the Workplace Study, indicating the number of women C-suite executives has increased by 6% since 2017, and the number of women managers has only increased by 3% in that same period. Study authors hold the position that fewer women managers limit the pool of talented and experienced women who can be considered for C-suite positions. The study states: “For every 100 men who are promoted from entry-level roles to manager positions, only 87 women are promoted, and 82 women of color are promoted”.
Kleffel shared firsthand insight regarding the problem.
“As a bank executive, when I meet with businesses to discuss their plans, I don’t hear them include gender strategies. They talk about marketing, driving sales, driving revenue, expense management, and other topics. I hear generation strategy more often in the marketplace than gender strategies,” said Kleffel. “If it’s not a written strategy, then it’s not going to happen.”
The McKinsey & Company study points out five steps companies can take to improve their pipeline of women leaders, which Kleffel endorses:
1. Set a goal for getting more women into first-level management
2. Require diverse slates for hiring and promotions
3. Put evaluators through unconscious bias training
4. Establish clear evaluation criteria
5. Put more women in line for the step up to manager
Businesses that successfully recruit and develop more women leaders could find that it’s the difference they need to pull ahead of their competitors. For example, a recent study shared by S&P Global Market Intelligence shows that firms with a female CEO or CFO outperformed those with male CEO or CFO. Likewise, boards with a greater number of women outperformed those with fewer women.
Kellie Landwer, senior vice president and director of residential lending at Seacoast Bank, says companies must implement a gender diversity approach now.
“It takes some time before a gender diversity effort starts to bear fruit,” said Landwer. “It also takes more time in an individual hiring process to find diverse candidates. Companies who don’t already have a process in place are behind.”
She warns hiring managers that it could be tempting to fill open spots and move on if they don’t quickly find suitable female candidates.
When asked how companies can help their leaders maintain a focus on finding and developing women leaders, Landwer points to constant conversations on the topic of gender diversity.
“We must continue to educate people on the overall values and benefits of a gender-diverse culture – in the end, it will help you better serve your clients,” said Landwer. “When we do a good job of communicating the value of a gender-diverse culture to our associates, especially during performance development plan conversations, it becomes the catalyst for getting others to embrace the concept. It helps them incorporate it into their hiring, promoting, and mentoring activities.”
When asked if women differ in their approach to business from men, Kleffel insisted that they do, especially in team building. Half of her direct reports are women allowing her to observe their leadership styles daily.
“I believe women have a broader lens or filter to see and build teams. You need soft skills and intangibles in order to collaborate and achieve the best team chemistry. Women often have those skills along with an innate ability to see how people are wired on the inside,” Kleffel said. “We need women in banking and business to help pull winning teams together.”
When asked how to develop leadership potential in women, Kleffel lists a number of ways she and her team do that.
“How do we help women succeed? Well, you certainly can’t do it with wishful thinking,” said Kleffel. “We ask women to get involved in mentoring. Every woman’s job at Seacoast is to be a mentor and to be mentored. Women need a series of mentors, both female and male. So we point them to mentors and teach them how to ask someone to mentor them. We will even facilitate these introductory conversations.”
In addition to mentoring, Kleffel encourages participation in Seacoast’s Associate Resource Group for women: Women Mean Business.
“Of all the things that our Associate Resource Group for women does, reminding them they are not alone and that leadership at Seacoast, both men and women, see value in them and are eager to help them succeed is perhaps its most important function,” said Kleffel. “Knowing others believe in you gives you the courage to aim a little higher.”
Seacoast supports women in business. Click here for more tips for female entrepreneurs. If you have questions about the financial side of your business or want to know more about the solutions we offer for business banking, contact your local banker today.