To Break the Glass Ceiling, Women Need MBAs and More
In September 2011, Yahoo Inc. fired its CEO, Carol Bartz, placing a spotlight on the small number of women who sit at the top of the nation's mega-companies. Before Bartz's dismissal, there were just 12 female CEOs at the top of the nation's Fortune 500 companies, according to the Nelson Institute for Environmental Studies, and while this number meant at least a dozen women were in executive roles, it was down by three from the year before.
Although the Wall Street Journal recently reported that a record number of women entered the prestigious Harvard Business School and University of Pennsylvania's Wharton School in the fall of 2011, those women started their MBA path under the shadow of pay and position discrepancies that appear to be improving only slightly with time. A new study by the nonprofit Catalyst found that women with their MBAs earned $4,600 per year less, on average, than male counterparts.
In addition, a study of University of Chicago MBA graduates found that the salary discrepancy between men and women in comparable positions often starts with the first job and grows wider over the years. Researchers have long suggested this is due to a woman's need to take time away from work for children and other family issues, thus sabotaging her climb up the business ladder. However, the Catalyst survey found evidence to the contrary.
How to shatter the glass ceiling? Take control
The discrepancy in pay exists regardless of whether women have children, the Catalyst study found, and it often begins with a woman's first job after business school. In the 2003 book "Women Don't Ask" by Linda Babcock and Sara Laschever, the researchers found that only 7 percent of female Carnegie Mellon business graduates negotiated for a higher starting salary in their first position, as opposed to 57 percent of male graduates. Since many promotions are given as a percentage of pay, this means that over time, the pay gap widens even further.
However, this initial pay gap might be lessened by the ability and willingness to negotiate. Babcock and Laschever point out that women often don't know the true market value of their work; therefore, women should arm themselves with compensation information for comparable positions in other firms and use this to help set realistic salary expectations. Also, women should have a clear grasp of what they can bring to the table and be ready and willing to convey those strengths throughout the negotiation for pay. Many MBA programs offer courses that focus on business negotiations, and those principles can be applied internally when discussing pay and benefits.
A strong professional support system is also important. A 2011 study from the Center for Work-Life Policy found that women could benefit greatly from a sponsor--someone who is helpful in establishing connections and promoting visibility--during their climb up the business ladder. This sponsorship can result in as much as a 30 percent increase in more stretch assignments, promotions and pay raises.
Other advantages of MBA programs for women
Though an MBA can help women break into business and land high-level jobs that might not have been possible without the degree, it can also help them to step away from the pack and form their own companies. Carol O'Brien worked for several years in high-powered positions with PricewaterhouseCoopers, Fidelity Investments and Digitas. Two years ago she launched her own company, Cleanicity.
"As a marketer without an MBA I could have continued on my career path to become a very successful marketing executive," O'Brien said.
But earning her MBA led to even more possibility for success.
"My education gave me an in-depth understanding of the functions within the organization and how they operate together and separately," she said. "That knowledge allowed me to move into more strategic roles both in marketing and operations. Most recently, that knowledge and experience gave me the confidence to launch and run my own company."
O'Brien pointed out that there are other advantages to climbing the corporate ladder with an MBA, as higher positions can result in more flexible hours, more vacation time and other perks that come along with a lucrative executive package.
Going beyond the glass ceiling
Betty Shotton was among the first class of women admitted to the University of Virginia in 1974. Four years later, she was one of the trail-blazing women who pushed her way into a male-dominated business world by enrolling in the MBA program at The College of William and Mary; she finished up the degree through night classes at Virginia Commonwealth University while working full-time for Philip Morris USA.
"The MBA gave me the ticket into the established norms," Shotton said. "It gave me the practical tools to be able to understand and move comfortably in a business environment."
But after so many years of experience in the male-dominated business world, Shotton developed a new perspective about having her MBA.
"Every woman has the intuitive gift for collaboration, listening, respecting, and supporting others in achieving their potential," Shotton said. "The MBA teaches you the science and structure of the business, which is important. But it is the combination of the meaningful things, along with the scientific side of business, that makes for true success."