Women Directors: Survey vs. Survey

It has happened again. When I release the results of our quarterly Directors Roster report on new women joining corporate boards — which I did in my blog post of March 8th — I inevitably hear from one or more of the other trackers of board composition. They are puzzled — and, it appears, alarmed.

Their beef is that there is a big disconnect between the Roster numbers and their numbers. The Roster has been documenting for two years now elevated levels of women joining boards — in the fourth quarter of 2010, 38% of new directors were women; for 2010 as a whole, 34% of board appointees we tracked were women. Most if not all other major surveys point to board representation of women still stuck in the mid-teens range, where it has been for years.

"So what's up with your numbers?" I get asked. There is an underlying fear that prompts this question, which is this: the optimistic picture that we present could lull people into thinking that recruiting developments are going along just swimmingly, when in fact all the major surveys of board composition do not seem to bear that out.

I am moved to share my response to the challenge I received after this week's release of the Directors Roster report on women board recruiting:

Dear Colleague,

I do not see the disconnect or discrepancy that you see. Let me explain how I mesh the numbers.

Your data is a snapshot of board composition at a fixed point in time — an annual look at who is sitting on a defined universe of boards.

The Directors Roster data is a snapshot of a quarterly flow of activity at a random universe of boards — companies that happen to have added a new board member.

This is apples and oranges. There is no way to sync these two sets of data to make any sensible matchup.

What we are looking at is velocity — a moving target — and you are measuring an end point.

In looking at the Directors Roster that just hit the street this week, you can see for yourself the flow of activity that we tracked in the fourth quarter of 2010 and the new women directors that came to our attention.

It seems to me that we need both sets of measurements — yours and the Directors Roster — to properly gauge marketplace activity, and I don't really see any conflict in what these two sets of numbers report.

It is understandable that my counterpart is concerned about overly optimistic conclusions that might be drawn from the Roster data. That’s why I feel the urgency to bring other surveys to the attention of the Directors & Boards audience that show how sluggish the progress is of board diversity. Our Roster numbers are useful for adding an important dimension to the discussion of board diversity, but I agree that many questions are left unresolved about the enduring impact of this measure of velocity.

Perhaps it is a matter of time — and it will be a lot of time — before we see the cumulative impact of these elevated velocity levels. But something is going on, and that is where the Roster data plays an important tracking role.

Pictured is Ellen Kullman, chair of the board and CEO of DuPont Co., who has joined the board of United Technologies Corp.

Harry J. Gray: Early Promise, Big Legacy

Both the Wall Street Journal and the New York Times did a good job with their obituaries of Harry J. Gray, tracing his hardscrabble beginnings to rise to the chairmanship of United Technologies Corp. "The Grand Acquisitor," as he was known for his voracious appetite for dealmaking, died last week at the age of 89. Gray was in office in my early years as a journalist, so I well remember him as he built what the Times called "one of the world's broadest and most powerful conglomerates."

Here is one story about this dynamo's leadership that didn't make it into either the WSJ or Times obit. Another Harry J. told this tale — Harry J. Bruce, former CEO of the Illinois Central Railroad and a leadership maven who wrote a cover story for Directors & Boards in 1997 that brilliantly dissected the characteristics that make up a successful CEO. Here is Harry Bruce's reflections in that article on Harry Gray as a leader in the making:

"The corporate world knows and respects this Georgia native and highly decorated World War II veteran as the retired chairman ad CEO of United Technologies Corp. How many people know, however, that Gray first emerged as a business leader in his second job, when he joined Greyvan Lines, the Chicago-based household moving and storage subsidiary of Greyhound Lines?

"On taking his new position in 1951, Gray was puzzled to note that Greyvan was assessing warehouse charges based on how many square feet of floor space a customer's goods occupied. Yet the operative figure, as he saw it, should have been cubic capacity. If Greyvan were to begin costing and charging based on three dimensions instead of two, Gray reasoned, revenues would improve dramatically.

"Pushing firmly but diplomatically for his innovation, Gray was able to overturn a historic, industry-wide practice. The results were as he had hoped: Greyvan's bottom line began improving immediately.

"Gray's approach represented a fresh rethinking — and redoing — of a conventional, unquestioned procedure that had become so endemic to an entire industry that only a confident outsider could grasp its fundamental absurdity. In trusting his viewpoint and influencing his superiors to embrace it, young Gray displayed true leadership without portfolio."

Harry Bruce's concept of "leadership without portfolio" is one that he says he came up with after reviewing the careers of many successful CEOs and realizing that their rise to the top wasn't "as mysterious as might be assumed." Their records, Bruce notes, "showed that very early in their careers, well before they had acquired any substantial measure of formal power or authority, they already were taking initiative, risking their careers and involving not only their subordinates but also their superiors in innovative projects of their own devising for which they had no explicit authority."

Bruce concluded his profile of Gray and a couple of other prominent leaders and how they showed budding promise by asking, "How many of today's CEO candidates have leadership without portfolio in their backgrounds? How many corporate directors hunting for a CEO can identify the candidates who do?" Harry J. Gray certainly fit this prized mold.