Gender Diversity at US Health Care Companies: A Prescription for Progress
Three out of every four employees at US health care companies are women, far more than in most other industries, yet women are still scarce in the industry’s leadership ranks, according to a new report by Boston Consulting Group (BCG). The report, titled Women Dominate Health Care—Just Not in the Executive Suite, is being released today.
Health care companies clearly have a large pipeline of talented women to groom for leadership positions, yet those women don’t make it to the top. In large organizations, the numbers are even worse. Among the 50 biggest payers, medtech manufacturers, pharmaceutical companies, and providers (200 companies in all), just 19 CEOs are women, including just one in medtech.
“Those numbers are abysmal,” says Michelle Russell, a senior partner at BCG and coauthor of the report. “Health care companies should be better positioned to create gender-balanced leadership teams. They already have the talent in-house—the challenge is for them to capitalize on it.”
The report points to two root causes. First, women in health care tend to work in administrative functions such as HR, marketing, risk, and legal (along with nursing). By contrast, men are more likely to run operational units that give them profit-and-loss responsibilities—and put them on a faster track to the executive suite. Second, the bulk of child care responsibilities still falls to women. Until companies reliably offer flexible work options and other arrangements to help new parents, women are more likely than men to step off the career path when they have kids.
Diversity Yields Dividends
Clearing a path for more women to advance into leadership roles is more than just a fairness issue; it can yield real benefits. Previous BCG research has found that diverse leadership teams perform better. Their organizations are more innovative and generate higher financial returns. In a volatile health care environment, that kind of fresh thinking can give companies an edge.
“Health care is facing major disruptions from new payment models, digital and e-health, and greater patient involvement in their own care,” says Matt Krentz, a senior partner at BCG and coauthor of the report. “Companies need innovative solutions to compete, but they won’t be able to come up with those ideas if everyone on the leadership team looks the same.”
The report identified six ways to put women on an equal footing with men:
- Highlight senior women as role models.
- Offer sponsorship programs for high-potential women.
- Standardize performance reviews and promotion decisions on the basis of hard metrics.
- Hire and promote talent from unconventional sources.
- Provide flexible work arrangements.
- Measure what matters.
The report also includes insights from senior women at top health care organizations, including NewYork-Presbyterian, Health Care Service Corporation, the Henry Ford Health System, CVS Health, the Mayo Clinic, and Northwestern Memorial HealthCare.
A copy of the report can be downloaded here.