Greg Smith has left the Man Cave.
His now-famous op-ed -- in which he publicly excoriated Goldman Sachs for greed and capitalistic excess -- has been dissected from every possible angle except one: It was a spot-on description of a company that could only have been run by men. And it was a cultural-blast reminder of what happens in male-dominated companies.
What Greg described was an environment of boys gone wild -- of testosterone on a tear. In this environment, the worst male instincts of unbridled competition and tribal bonding -- the "us versus them" push-pull where clients were ridiculed and treated as competitors -- became the rule. Masters of the Universe met Lord of the Flies.
I see the inner workings of Goldman Sachs -- and many other companies -- as nothing less than corporate man caves. At the Daily Beast's "Women In the World" Summit a few weeks ago, the journalist Niall Ferguson asked Christine Lagarde if more women in senior roles could have prevented the financial crisis. She responded, "Unlike Lehman Brothers, Lehman Sisters might have avoided default."
Women run things differently. Female approaches, values, conceptions of victory, and need for validation, do not reflect those of men. And research has shown that women suffer less from over-confidence; meanwhile, arrogance is the cause of many corporate debacles, and was the crux of Smith's message.
A study by Catalyst found that those Fortune 500 companies with the most female directors outperformed those with few, or none. And those with at least three women at the boardroom table dramatically outperformed the rest. And the numbers were huge: 84 percent return on sales; 60 greater percent return on invested capital, and 46 percent greater return on equity.
If a seminar offered these results, it would be sold out for months.
But the problem isn't just Wall Street's. Most companies don't fully appreciate the enormous She-Change we're in. Women control vast amounts of the world's wealth, investible assets, and buying power.
- She's out-learning men -- percentage of female university graduates (Estonia 70 percent, UAE 65 percent, Brazil 60 percent, U.S. 60 percent, China 47 percent)
- 60 percent of all personal wealth in the U.S. is held by women
- 50 percent or more Chinese billionaires are women
- Women are the largest "emerging economy" And growing (at 13 billion, it's bigger than GDP of China and India, combined)
With that unstoppable power and influence, it's clear that women are going to create the future. But men continue to resist, and by pushing back on the tide of history, they are missing out economically, politically, and emotionally.
Indeed, I continue to be stunned by the breadth and depth of this denial.
I once did a project for a major manufacturer of athletic footwear, and their view was that women customers are male customers, with little feet. Just pink it and shrink it and they'll come running. On another occasion, we asked a major car manufacturer for their sales information by gender. Their response: "We don't thread the needle that way."
There are some deeply set reasons for why the profound gender ascendency is being overlooked:
- Companies are talking to a target that no longer exists. As a result, they're talking in a way that is no longer relevant. For example, less than a quarter of HH are what society calls "traditional families." No client believes me that 40 percent of children are born to unwed mothers, many of them college educated.
All this is an unacknowledged national crisis. Women are essential to our global success, because they see things differently and think differently than men do. They are better at synthesizing multiple data points and thinking holistically. The areas of their brains devoted to long-term planning are better developed than the male brain. They are far better at getting teams to work together collaboratively, which is vital to the future of organizational structure.
I'm not castrating the male contribution, just simply saying that it needs the full complement of the distaff half. The most successful companies -- both in terms of their culture and their ability to grow in the marketplace -- will be those that recognize the unprecedented and unstoppable power of women.
Caves are places to hibernate. It's time to wake up.
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