Jane Drain - women leaving your workforce

According to a recent survey conducted in the US for the Center for Work-Life Policy, just over a third of highly qualified professional women (37%) step out of the workforce. That rate is nearly 1.5 times that of men (24%). But those numbers don’t tell the whole story.

While these statistics point to an incremental loss of talent by gender, they don’t account for the departures that deposit that talent in another firm rather than out of the workforce altogether. The incremental departure of women professionals from organisations constitutes what some are calling a “Jane Drain.” It doesn’t matter where they go; it could be to a competitor firm, to another avocation, to start their own businesses, etc. If women leave your firm at a faster rate than men do, you’ve got a “Jane Drain” and a loss of talent your company can ill afford.

Corporations have done a dismal job of retaining female talent. Indeed, they make it very easy for women to depart. When women take a temporary leave of absence to have children or deal with other personal matters, they find it difficult to return to work and contribute as they previously did. In essence, corporations provide women with many career off-ramps, but provide them with few on-ramps. This problem bodes badly for CEOs and top managers who view human resources as a critical asset.

Why should you care? Isn’t there a big enough labour pool out there? Of course there are plenty of men available, but the demographics of the future demand that organisations begin focusing on the retention of an inclusive talent pool. First, there’s the revenue side of the equation. Companies are discovering that a diverse talent pool allows them to capitalise on the innovation that comes from a broad array of perspectives, be it for product development, client or customer affinity, opportunity insights or problem-solving. Second, comes the cost side of the equation. It’s expensive to continually need to replace talent the firm has already invested in. As the demographics of the labour pool changes, companies will find themselves in a continuous and costly replacement cycle, unless they can gain an advantage in reducing their Jane Drain.

Diagnosing Your Jane Drain

So, does your company have a “Jane Drain?” How would you know? What does it cost? What can you do? As we’ve researched the dynamics of women in business, we’ve begun to uncover some of the key things to consider as you evaluate your company’s situation.

First, is the question of assessing the extent to which your organisation faces a Jane Drain. It’s important to have data to assess the relative departure of women versus men in your organisation. Are you tracking the managers in your organisation? If you did an autopsy of your entering hires each year over time, would you find the same proportion of men and women in your organisation 5 or 10 years later? If you look at each managerial level in the organisation, would you find that women are under-represented at the senior levels?

Look back at the promotion decisions your organisation has made in the past few years. Were there women in the promotion pool? If they didn’t get the nod, did they stay with the organisation? Were they promoted later? Did they get any feedback? Did they have a champion? Is the pattern you uncover in this investigation different for women versus men? If you find the pattern is consistently different for women versus men, you’ve got a Jane Drain.

What Does the Jane Drain Cost?

Second, suppose you find your company has a Jane Drain. Can you account for its cost to the firm? One approach might be to think about it from a cost trade-off standpoint. You might look at the cost of Jane Drain departure (remember this is incremental over men) versus the investment expended for retaining and advancing women. The cost of Jane Drain departure may have several components, both internal and external.

Internally, there is the firm’s investment in recruitment, training and development for the individual as well as the replacement cost of hiring someone new. Beyond this there are perhaps more intangible costs related to the individual’s value as a role model for other women employees, and the diversity of perspective she brought to the firm’s problem-solving and decision-making processes.

Externally, there is lost value for business development, as many clients increasingly look to their business partners and vendors to represent the diversity of their own firm or of what their customers expect to see. The loss of gender diversity may also surface as an external opportunity cost related to not seeing a business opportunity or developing products and services designed to meet segmented customer needs. At IBM, their women’s initiative is linked directly to business goals and they have a track record of positive incremental business and revenues as a result.

Investing in Prevention

A focus on prevention is a focus on advancement. Preventing the Jane Drain requires investment of both money and managerial attention. Let’s talk about money first.

Everyone knows that in business, money talks; it signals how serious the organisation is about an initiative. Oddly enough, many companies endorse women’s initiatives in the company, yet put little budget behind them. Essentially, they rely on the passion of a few dedicated women to help transform the firm. In the best case, these women leaders get visibility and kudos for their work (on top of their regular full time jobs); at worst, victims are tasked with solving their own problem, ultimately increasing the flow of the Jane Drain.

Beyond money, companies need to invest managerial attention. Someone needs to take the issue seriously and be a champion for retaining and advancing women within the firm. It’s critical to measure progress and look for root causes in your company culture, formal and informal organisation policies, compensation formulas, job structures and expectations, and opportunity assignments.

Again, here’s where paying attention matters. Is anyone watching Jane to see how she’s progressing? Are Jane’s supervisors held accountable for retaining, developing and advancing Jane? Does the firm know what her real needs are or is it just imagining them? Is it really true that Jane “wouldn’t want” to travel or “couldn’t be effective” with the client on a reduced schedule? How do you know? Have you talked to Jane lately?

Advancement is the Bottom Line

Of course investing in prevention has to go beyond signals, paying attention, and inclusion. If women don’t advance in your company, these other investments won’t matter. The women in your organisation, and those you seek to attract, are watching to see if you walk the talk. More often than not, clients and customers are watching too. So whether it’s on the cost or the revenue side of the equation, stemming the Jane Drain by retaining and advancing women has the power to improve your bottom line.