Closing The Gap

Top McKinsey exec Joanna Barsh: 4 ways companies prevent women from succeeding

A woman walks by the New York Stock Exchange in New York.
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The proliferation of the #MeToo and Time's Up movements in 2017 helped provide a platform for people of different genders, ages, races and income levels to discuss the inequality that affects women across industries.

This week, nearly 80 leaders took the stage at the annual MAKERS Conference in Los Angeles to discuss issues of women in the workplace, including equal pay, representation and sexual harassment.

Speakers at the three-day conference, titled #RaiseYourVoice, included former U.S. Secretary of State Hillary Clinton, Facebook COO Sheryl Sandberg, Ellevest CEO Sallie Krawcheck and renowned leadership expert Joanna Barsh, who worked at McKinsey & Co. for over 30 years.

Barsh, who's a director emerita and senior advisor for McKinsey, has focused her research on what stunts women's growth at companies.

"The purpose of this research is to have honest conversations about what truly is holding women back in companies and what are the great things that companies are doing that are actually making a real difference," Barsh told CNBC reporter Julia Boorstin.

After a series of interviews with business leaders, HR professionals and diversity experts, Barsh found that the following four factors "create ginormous obstacles that hold women back."

Director Emerita, McKinsey & Company Joanna Barsh speaks onstage during The 2018 MAKERS Conference at NeueHouse Hollywood on February 6, 2018 in Los Angeles, California.
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1. The gap between discussion and action

Barsh argued that "it's actually really hard to move from talk to action," especially when women are not in positions of leadership.

"When you don't have women at the top, the whole pipeline doesn't flow," Barsh said. "It doesn't flow upward."

Philanthropist Melinda Gates recently called out this issue with women in tech at 2017's Grace Hopper Celebration of Women in Computing.

"Right now, a lot of diversity efforts focus on women getting into the so-called pipeline, but that pipeline isn't producing more than a trickle and has a lot of conditionals built in," Gates said.

Barsh said one solution is to actively create more leadership positions for women: "Take every top team member and give that person a chief of staff who happens to be a mid-level, highly talented woman." She's also seen companies take a top role and split it into two co-existing roles, such as CEO and COO.

At this year's annual World Economic Forum held in Davos, Switzerland, Hilton CEO Christopher Nassetta pointed out that in industries where there's no pipeline for women to advance into senior leadership positions, "we have to build it" by actively recruiting, training and developing women.

Nassetta added that Hilton sets three-year goals against increasing all types of diversity and ties executive compensation, including his own, to achieving those goals.

2. Biased evaluations

Another obstacle to women's advancement is the way performance reviews are often conducted. Barsh noted there is "bias embedded in how we evaluate our people, men and women."

Barsh recommended that companies make all of the evaluation criteria as transparent as possible and consider the order of their reviews.

"Evaluate all women first against transparent criteria, and then review all of the men [second]," Barsh said. "That makes a huge difference in how women get perceived in a company and how many women get to the top of the company."

As a result, the entire company gets a "jolt" by being more conscious about equality, she said.

3. Lack of workplace flexibility

Barsh says American workplace culture can be a detriment to workers who require flexibility.

"A lot of women leave in what we call the 'messy middle' — they leave the company because they're having young children and they are turning into managers," Barsh said. "Life gets really, really hard at that point, and it's kind of easier to find a different job that's more a predictable, a more certain job."

As a result, women can be forced off the path to leadership.

"Instead, why doesn't the company bend the rules?" Barsh proposed. "This means you can work whenever you need to work because I'm actually only going to evaluate you on your performance."

4. The competitive nature of the workplace

In many offices, competition among workers is the norm, said Barsh, but it doesn't need to be.

"The competitive man-on-man intellectual combat game is not a game that everybody chooses," she noted. "We can collaborate. We don't have to have all our elbows out."

Transforming the workplace to empower women may require investment, but "it doesn't always have to take time," Barsh said. "It takes resolve and grit."

"Diversity has to be a top priority for this to work. If it's kind of a priority, it just isn't going to work."

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