Gender Diversity in Professional Service Firms: Female Representation Boosts Performance
We are proud that globally PwC is one of the professional services industry’s largest graduate recruiters. Out of the 17,000 new graduate we hire annually, 51% are women. So, when Giulia Tongnini, a 23 year old recent MSc graduate of Bocconi University in Milan contacted us about her MSc thesis research findings on gender diversity in the management consulting industry, we immediately asked her to write a guest blog.
Inspired by extant research findings indicating a positive correlation between female leadership and firm performance, Giulia, as a woman strongly interested in a career in management consulting, decided to explore explicitly if similar findings would present themselves for the consulting industry. Giulia’s guest blog specifically highlights what she feels her research findings mean for professional services firms and female graduates wishing to pursue a management consulting career.
As a woman strongly interested in a career in consulting, I chose to write my master thesis on gender diversity in the consulting industry. That’s me in the photo below at my graduation.
In my sample of 81 consulting firms, I found that female professionals accounted for 39% of the total workforce, yet female partners accounted for only 17% of total partners. Clearly women seem to ‘disappear’ as we move up the ranks. Through interviews with female consultants I discovered that a primary reason for this phenomenon was that, at a certain point in their careers, women chose to willingly exit their firm so as to focus on their families or other priorities. This is largely because they don’t feel the consulting industry will allow them to progress in their careers and simultaneously focus on their families.
The second main finding of my research was that of a positive correlation between firm performance, measured in terms of profitability, and female representation in my sample of consulting firms. Most significant was the relationship between profitability and the percentage of female partners. Based on the research findings of my thesis, consulting firms may be able to improve profitability by increasing female representation at higher levels.
My research results have implications for both consulting firms (and professional service firms in general) and for female graduates like myself, looking towards pursuing a career in professional service firms.
By increasing female representation, professional service firms can achieve a balance of skills that can help firms better solve client problems. Those professionals interviewed through the course of my research, in fact stated that mixed teams allow firms to bring diversity in tackling assignments. Male and female professionals have different strengths and competencies. Having a gender diverse workforce will allow firms to achieve a balance of complementary skills.
As for the effects on firm performance, there are the potential improvements in profitability that my research findings posit. In addition, research by McKinsey has found that gender diversity programmes aimed at increasing female representation can also improve employee motivation, customer satisfaction, and corporate brand name. Gender diversity programmes may also allow firms to achieve cost savings. Keeping female professionals inside the firm decreases employee turnover, which can be extremely costly in terms of recruitment and retention efforts.
So, how can professional service firms increase female representation? At the start of my research project, I perceived the apparent ‘glass ceiling’ in the industry to be caused by a male-dominated workplace environment or by possible discrimination towards women. However, my research findings suggest it is a lack of policies specifically aimed at helping women move to the top ranks in their firms, while allowing them to take care of their families at the same time, that poses an obstacle to women’s career advancement in this industry.
If the main reason behind the ‘disappearance’ of women within management consultancy firms is the difficulty in achieving work-life balance, then firms need to tailor their gender diversity programmes to this effect. Firms have already begun moving in this direction by offering flexible and reduced work schedules, childcare support, and mentoring and training schemes, to name just a few. These policies allow women to achieve their career objectives without having to forego or sacrifice their family life.
This is great news for female graduates like myself! Having always perceived the professional service sector as being heavily male-dominated, the presence of gender diversity policies shows me that this is now changing. As awareness of gender issues in the workplace increases, so will the number of firms implementing specific measures aimed at helping women in their career advancement. I hope that empirical studies showing a positive correlation between gender diversity and firm performance will convince those more sceptical firms that gender diversity programmes can truly make a difference.
Knowing that these programmes are in place demonstrates that firms are actively working towards helping women like myself succeed in their careers while pursuing family objectives at the same time. This is a factor I will definitely take into consideration when choosing the firms to which I will apply.