The digital industry is booming like never before, with new digital business models entering the market on a daily basis, creating lucrative and future-oriented jobs. Within the industry, more and more companies are realizing that heterogeneous teams promote innovation, increase quality and performance, and develop better solutions through their variety of perspectives. As such, organizations with high levels of diversity are not only proven to have higher-than-average financial returns; they also gain a serious edge over their competitors.
But how far have most tech companies come in embedding diversity in their organizations? The answer to this question has been far from uplifting to date, with the branch still being overwhelmingly white and male. All in all, the greatest pool of untapped talent is women – and that’s just the (very large) tip of the iceberg. People from diverse racial backgrounds, older people, and people with disabilities, among others, are also seriously underrepresented in the industry.
While many of us have optimistically expected the branch to become more diverse over the past decade (after all, isn’t it the most future-oriented of all industries?), the opposite is in fact the case. To quote Peter Janze from digital@M: “I have unfortunately had to observe how top female performers with fresh ideas couldn’t prevail against established networks and ways of thinking, and how the proverbial ‘glass ceiling’ is preventing diversity.” And as Agnes Heftberger, a Managing Director of IBM Germany, and this year’s winner of our eco://award in the Ladies in Tech category points out: “The bottom line is that we are making very slow progress. We still have a long way to go.”
Just how long the road ahead of us is can best be understood by viewing statistics. To take two sets alone: when it comes to people from diverse racial backgrounds, in the US, there are half as many African Americans and Hispanics in tech as in the rest of the private sector. And when it comes to women in tech, in both Europe and the US there is now a lower proportion of female experts in the industry than there was a decade ago.
Lack of diversity as a roadblock for the industry
This low level of diversity is presenting the industry with an acute problem, and not only due to the fact that homogenous companies have lower levels of innovation.
A key challenge is the fact that, as digitalization rockets, tech companies are desperately looking for skilled workers – not only in development and programming, but also in fields such as digital marketing, communications, data protection, and controlling. It’s probably no surprise to learn that, last year, the greatest labor shortages across the world were in the tech sector. The call for more colleagues is therefore becoming louder and louder throughout the Internet industry.
Corona times as possible turning point
But it now looks like there might be some light at the end of the tunnel. As we (very) slowly start to emerge from the Corona crisis, we’re learning that the changes it has brought about in terms of New Work could provide an unprecedented turning point when it comes to diversity.
We all experienced it: Going back to spring 2020, from one week to the next, the tried-and-tested work structures were no longer usable. Open-plan offices, presence meetings, and business trips started to become outmoded.
Today, collaboration tools and digital workplaces are building the technological bridge between people working from home. In Germany, for example, almost 75 per cent of employees associate advantages with the increasing digitalization of their everyday working life, in terms of a better work-life balance and increased work efficiency. Many are also more motivated in working from home, a fact highlighted in an eco Association survey of the German workforce. This is likely to have a long-term impact on women in particular, given that – as a Randstad study confirms – work-life balance is one of the most important attributes that women across the globe are seeking from employers. Ultimately, the pandemic has led to the realization of a potential that has been extremely tantalizing for some time, but which until now seemed just out of reach.
Corona times are also sure to have raised men’s awareness of just how much unpaid work most women are doing from home. To take a quick look once more at statistics: the World Economic Forum 2018 Global Gender Gap report informs us that women across the globe work approximately 6 hours more per week more than men, encompassing both paid and unpaid work. The upshot is that around the world, with very few exceptions, women work longer hours, a fact highlighted by Agustina Callegari from the Internet Society in a recent dotmagazine interview, where she notes that: “Decades of research have shown that women do significantly more housework and childcare than men, and the current global context has made it even more challenging.”
Nonetheless, in the longer-term, the Corona crisis could serve to have a more positive impact, given the heightened recognition among men of the level of care work actually undertaken by women – and of their need to level that out. This isn’t just a case of naïve optimism: Recent studies (e.g., Cambridge University’s “Working Paper 26947”) assume that women can profit in the long term from the change in conditions that Corona has brought about in our working world, because men in the home office are also taking on childcare, thus increasing their willingness to do so in the future.
In the meantime, the greater acceptance of mobile working by companies offers more than just work-life balance advantages. Until now, a serious hurdle on the path to closing the diversity gap has been the geographic concentration of many tech companies, which has limited the industry’s ability to connect with, recruit, and retain talent from a widely dispersed pool. Working from home offers a multitude of options for integrating workers from diverse backgrounds. Thanks to digital technologies, it will become easier to attract employees who do not wish to move location for any number of reasons, including family ties.
All of this is likely to have a win-win effect: companies can clearly cast their net wider in their bid to find employees, while women, for example, are more likely to not just enter, but also to re-enter the tech workforce. Moreover, taking the need to work in a specific location out of the equation could have a profound effect on integrating colleagues with physical disabilities, and in facilitating older employees to participate in working life on a longer-term and fulfilling basis.
Not the time to turn back
But there is no room for complacency, given that, during Corona times, women and people from diverse backgrounds are those who have borne the greater brunt when it comes to job losses and key areas such as childcare. The International Monetary Fund warns that such factors could see 30 years of gains being erased across industries. As a 2020 study by Trust Radius shows, during these times, almost three-quarters of women in tech have been struggling with childcare (compared with just over half of men); 14% of female workers in the industry have considered quitting their jobs due to family demands; and people from diverse racial backgrounds are those experiencing the highest levels of stress. This highlights the fact that, while working from home can provide a tremendous opportunity for workers, it must also be managed in a way which promotes equality. If not managed carefully, the home office
could end up being a curse rather than a blessing for diversity: leading to a greater permeation of work into home life, or to greater isolation of those working remotely.
In reflecting on this, the eco://award prizewinner Agnes Heftberger believes that it is particularly important for leaders to act as role models when it comes to working from home. In recalling how challenging the Corona lockdown was, she describes her own experiences: “For example, my son was supposed to have started kindergarten at the beginning of the crisis, and for months we were faced with bridging needs. That was anything but easy, but my husband and I managed it well together.” Based on her experiences of the Corona lockdown, she comes to the conclusion: “In general, I tried to take advantage of the opportunity and set an example as a leader that the reconciliation between work and private life can work well.” But all in all, as a woman leader in the tech industry, Heftberger acknowledges that, “We still have a long way to go, and I don’t want to end up simply tagging along, or creating an arduous hiking trail; instead I’d like to be involved in paving the way and turning it into a highway.”
Steering around the corner
The question we must then ask is: How can employers in the Internet industry help to pave that way, and even get ahead of the curve in creating a more diverse workforce – and keeping that diversity intact? In answer to this, we can turn to the multiple contributors of our Women in Tech series to avail of invaluable first-hand experience, as well as borrowing from our recently-published eco Association international study on women in the Internet industry. Here, important levers can be found in the area of recruitment, but there is a distinct need to focus on more than just the hiring funnel: what is also needed is the promotion of diversity and inclusion throughout the company.
Below are just some ideas for how to finally turn that corner in promoting diversity:
Start with Goals
Ultimately, the degree to which companies talk about diversity matters little compared with how they act. But clearly, this should not involve acting on a whim. A key to success for tech companies is to set diversity goals. What is crucial is that diversity is understood as being core to a company’s business success and that it is clearly integrated into the company’s overall business strategy.
To quote Peter Janze of digital@M: “Only with ambitious targets do you start to drive change.” In this respect, when it comes to women in tech, Janze advocates the application of quotas. Such targets are gaining ground once more across the world – in Germany for example, a draft law has recently been presented for a women’s quota on the boards of listed companies with more than 2,000 employees. More food for thought: Caroline Criado Perez, winner of the 2019 Science Book Prize for her groundbreaking book “Invisible Women” found that, contrary to popular misconceptions, quotas have been found to “weed out” men with lower levels of competency, rather than promoting unqualified women.
Designate a Senior Executive Sponsor with Responsibility for Diversity
Studies show that top management are regarded as being the most important drivers for the realization of diversity. Diversity culture should thus be overseen by a designated senior executive sponsor. This does not imply that a manager needs to be assigned exclusively to this role – in fact, this could backfire, insofar as it might compartmentalize the work to be undertaken. In order to ensure that this manager is
not isolated in her/his role, a worthwhile starting point here is “unconscious bias training” for a broader management team. Flowing from this, a shrewd move is to get a company’s supervisory board involved in the diversity movement.
Consider this advice from Simone Menne, member of multiple supervisory boards and former CFO of Lufthansa: “Supervisory boards must do everything possible to ensure that boards are staffed with members who advocate for diversity and who have clearly shown in their careers that they are capable of doing excellent work with diverse teams. In one of the supervisory boards I’m on, we are currently working on an evaluation of diversity. We’re taking a good hard look at: How old are the members of the supervisory and management boards? What cultural backgrounds do the members have? How international are the boards? These factors are very clearly evaluated by investors, and a homogenous 50-year-old all-male board all with the same cultural background definitely results in a poor evaluation.”
Convey a Core Message
A company should impart a core corporate message, such as: “As a tech company, we not only benefit from strengthening pathways for women and people from diverse backgrounds, but we are also uniquely situated to do so.”
Identify Priority Policies
The following represents a logical set of policy pillars and associated actions for promoting diversity:
- Recruitment & On-Ramping. Actions worth considering here include championing colleagues from diverse backgrounds as role models and in testimonials, integrating women into employer branding programs, formulating job ads using gender-neutral phrasing, separating “essential” from “nice to have” skills, redesigning job profiles to focus on skills matching, and – last but not least – availing of AI-based recruiting to help overcome unconscious bias. On this latter topic, you can avail of some interesting insights from Yuliia Diachuk from MoBerries, a HR-Tech start-up in Berlin.
- Retention through New Work Culture. Here, actions should include not just the remote working models already mentioned, but also establishing flexible working models as a norm, promoting relationship building programs (with a strong online dimension), fostering collaborative online engagement, and building confidence in employees’ abilities through an environment of constructive feedback. An insightful tip is also offered by Ursula Vranken, Managing Director of IPA Consulting: “Instead of thinking in terms of roles, think in terms of skills and assign suitable employees to each individual project”. As Detlev Artelt, eco topic expert for remote working describes in the dotmagazine article, “Bricks, Bytes, and Behavior”, working culture and rules of conduct simply must be adapted to the new age.
- Supporting Diversity in Leadership. A crucial action here is the assignment of sponsors, but other actions which can also make a core difference include transparency when it comes to promotion, and corporate development programs. In addition, companies should put their specialists and managers from diverse backgrounds at the forefront in terms of communication and public image. After all, role models attract more applicants from diverse backgrounds, act as mentors for their colleagues in companies, and have a positive effect on the company’s image. As Peter Janze states: “I am firmly convinced that, with a relevant proportion of women in management, the general proportion of women in the company increases.”
Ultimately, the focus should not only be on women and other underrepresented groups – rather, it needs to be on the entire work culture. At the end of the day, it’s important to avoid approaches that focus on “helping” or “fixing” individual colleagues from diverse backgrounds; instead, companies should focus on fixing the environment. Allies – managers, board members, co-founders – need to encourage colleagues from diverse backgrounds in their talents, consider them for promotions, and create framework conditions that contribute to making the Internet industry even more colorful and diverse.
As we emerge out of the Corona pandemic to a changed world, we can look at this as a defining moment in our history. Now is the time for tech companies to seize the day by seriously embedding diversity through New Work into their roadmap for the future. This isn’t just a matter of societal responsibility; it’s also a simple matter of economics.
Lucia Falkenberg is Chief People Officer with eco – Association of the Internet Industry and DE-CIX Management GmbH. Having joined eco in 2012, Lucia became Head of the eco Competence Group New Work in 2014. Prior to her role at eco, the Business Studies graduate managed her own human resources firm, where she successfully supported numerous clients in finding and retaining talented personnel. Lucia also previously worked as an international HR representative for an American IT company. Her extensive experience and know-how across the entire human resources spectrum is of particular benefit when it comes to advising executives and developing and implementing targeted personnel marketing and recruitment strategies. As a professional mother and woman working in the digital sector, Lucia benefits directly from the opportunities offered by the digital world of work.
Further information on the topic of diversity can be found on eco's Diversity focus page and in the eco Association 2020 study on Women in Tech Across the Globe: A Good Practice Guide for Companies.
eco’s German-based #LiT Ladies in Tech offers a platform for exchange – on both a digital and analogue basis. The initiative is as vibrant and diverse as the Internet industry itself. Men are therefore also more than welcome to get involved, because promoting the industry’s female heroes can only succeed if male managers and colleagues also serve as allies for women. In solidarity with them, eco is campaigning for the topic of women in the tech sector and diversity. It is achieving this by bringing women onto the stage of important panels and events, promoting their digital visibility, politically advocating their interests, and inspiring even more women to join this great industry.
If you’d like to get involved in our German network, we’d be happy to have you contact us at: hanna.vonderau(at)eco.de