When I recently interviewed Maliz Beams, CEO of ING retirement, I was impressed with her intelligent and powerful advice for emerging executive women. One of the most important points she made was that women MUST get profit-and-loss experience in order to position themselves for landing senior roles within a company. Given how crucial this piece of advice is, I thought it would be helpful to examine the issue more thoroughly.
The Pink Ghetto
Nori Gerardo Lietz, founding partner of Areté Capital, senior lecturer at Harvard Business School, and named “one of the most respected pension fund consultants in the world,” recently wrote a Wall Street Journal article accusing private investment firms of consigning women to the “Pink Ghetto” of marketing, HR, and administrative functions.
The “Pink Ghetto” is a loaded term. Many of the business world’s best and brightest women executives have purposefully chosen and excelled at careers in marketing, PR, and human resources. Relegating these influential women to the so-called “Pink Ghetto” runs the risk of minimizing the vital role they play within their organizations. However, statistics show that women are still vastly underrepresented in certain sectors, which is a cause for great concern.
“I compiled detailed employment data on 283 U.S. and European private investment firms, primarily by studying their websites and other public information. I counted up male and female employees, determined the number of men and women in each function, and looked at each person’s title to determine his or her role. The proportion of women firmwide ranged from 17% to 23%, and they were overwhelmingly found in marketing, HR, and other support functions. Almost 60% of the firms I studied had no female senior investment professionals at all.”
Lietz concludes that women’s continual underrepresentation in financial services is due to “a mix of company culture, business school emphasis, investor awareness, and attitudes of women themselves.”
One surefire way that a woman can gain flexibility in her career and position herself for advancing into the senior management level is to get profit-and-loss experience.
The Importance of P&L Experience
Lareina Yee, co-author of a recent McKinsey & Company report on women executives, said, “79% of women who were very successful and reached the upper echelons had line experience as a big part of her portfolio.”
Despite the importance of line experience, women hold less than ten percent of the jobs responsible for profit-and-loss at our largest corporations.
How To Get P&L Experience
Self-Advocate: If you want P&L experience, communicate that to your superiors. Too often women miss out on opportunities because they are don’t ask for what they need to advance their careers. Make sure that everyone – your direct manager, upper management, and your colleagues – understand that you want line experience.
Ask for Advice: Identify the people with line experience within your organization and ask them how they got their own P&L. By engaging in a dynamic discourse with those in positions to which you aspire, you can figure out what your next step should be while also developing potential mentoring relationships.
Go Where The Opportunities Are: If stating your interest in gaining line experience and enlisting the help and counsel of your colleagues doesn’t open doors, it may be best to jump ship. Numerous companies, such as Texas Instruments and General Mills have been recognized for their initiatives to provide women P&L training and experience. If your company doesn’t encourage your development of this essential skill, go to a company that does. Also, be willing to make nonlinear career moves as a way to develop the skills you need to become a business leader.
Do you think there is a “Pink Ghetto” in the financial services industry? If so, how does it impede women’s career advancement?