Women and Leadership

Women and Leadership: The Changing Role of Women –from a historical perspective

As the capital markets explosion and corresponding implosion reached its peak in 2008, a group of seasoned women mortgage professionals began to gather in a telephonic group to support each other and discuss topics of interest within the industry.  It was not unexpected then that one of the topics that popped up was “If women had been in charge, would we be in the same place we are today?’  Surprisingly there was no consensus within the group; thoughts ranged from “we all were involved” to ‘leadership was to blame” to “who knows”.  While recognizing that finding an answer to the question was probably not going to be something anyone could easily find, the group set out to examine how roles in this industry and business in general have changed over the past three decades and determine if, collectively a group of individuals with an average of over 20 years experience could develop some guidance as to what leadership attributes are best for handling current and future problems in our industry. 

We ended up with the idea of creating a “white paper’ on the subject of Women and Leadership: The Changing Role of Women. Because the topic is so broad, it was broken into four distinct discussions. This is the first of those discussions and Progress In-Lending will continue to publish the other three in its up-coming issues.  The topics involve an historic view of leadership; the cultural, generational and gender roles of leadership; what leadership will be needed in the future and finally an application of these conclusions to a current problem facing the industry today.  We begin this series of articles by discussing the changing roles of leadership for men and women over the last three decades.  

The Beginning of Change

From the start of the industrial age through the “revolutionary” times of the 1960s and 70s, the common leadership profile for any company was a man at the top of the hierarchy with various male managers reporting to him.  His decisions were carried out by this next level of management by communicating the necessary information to the staff. The staff then performed the functions necessary to meet the requirements set out by the president or CEO.  Women who worked in these businesses typically made up the clerical staff with the occasional woman acting as the supervisor of such a group.  This division of roles was so pronounced that in the 1960s it was common to see two separate sections of the help wanted ads; jobs for men and jobs for women. 

The 1980’s was the beginning of numerous changes within industry in general and the mortgage business specifically. At that point in time, the influence of several legislative initiatives regarding equal treatment and opportunity for minorities and women were beginning to be implemented.  Companies held sessions on accepting diversity and creating policies that retarded the advancement of women were either changed voluntarily or forcefully through the courts. Not only were companies lead by men, but senior positions within government, the legal system and state and local agencies were male dominated. 

It was also during this time that the S&L crisis resulted in realigning the primary source of mortgage products from the savings and loan business to independent mortgage lending operations.  With this change, the dynamics of the leadership structure and personnel responsibilities changed as well. Loan officers whom had previously been employed by S&Ls as mortgage originators and that were now out of business, set up shop as mortgage brokers.  The emergence of this entrepreneurial opportunity allowed women, as well as men, the chance to run their own companies, make their own decisions and realize the resulting survival or failure of the company was in their own hands. 

Larger mortgage lenders also began to recognize that by limiting women to clerical positions they were losing two opportunities; one was meeting the legislative demands for equal opportunities and one for taking advantage of women’s knowledge and experience by advancing male managers to higher levels of leadership and placing women in these vacated positions.  However the movement of women into these management functions was slow in coming and when achieved, resulted in only minimal acceptance of their role in management circles.  The history of one of today’s prominent female CEO demonstrates this elongated path to senior management.  Her biography shows that in the early 1980s she was promoted to branch manager, a position she held for nine years before moving into a regional management job.

The 1990’s

The emergence of information technology, begun in the 1980s, really began to make its impact felt and its potential recognized during the 1990s.  Technology programs began to replace or significantly reduce many of the clerical functions and many jobs were restructured or eliminated. Companies began to redesign processes to maximize the use of technology.

Also during this decade, companies that had previously been local or regional organizations began to expand into other regions of the country and even into other countries.  The idea that through the use of technology, management located in one city or region of the country could effectively oversee multiple production centers swept through all types of businesses at lightning speed.  And while it was true that higher levels of management could handle much of their responsibility from elsewhere, on-site management was still critical.  At this point, women with technical experience or with management experience at any level began to emerge as a natural choice for these positions.  With years of experience working through the details of organization, they understood better than their male counterparts what drove a successful organization and were ready, willing and able to help lead the organization in whatever role necessary.  Once given the opportunity, they easily migrated from a simple management role to providing real leadership. Despite this advancement in leadership functions, the roles assigned to these women were in areas of the company that were most frequently associated with females such as Human Resources or Accounting. 

The mortgage industry followed a similar pattern.  Lenders used this technology to support expanded operations and “point of sale” operations.  This allowed them to move into previously unreachable areas of the country without the expenses associated with building a supporting infrastructure.  This expansion in operational sites also required the expansion of personnel in the area to support the processing, underwriting, closing and back room operations.  While the division of these functions was different for various lenders, the result was the same; more of the personnel with the knowledge of how these functions were performed moved into management positions. Since these were mostly clerical jobs that had been largely female, the management promotions brought a large number of women into the mid-level management ranks.  At the same time, this expansion of business caused senior management to rethink the existing structure and as a result elevate some previous mid-level functions to the executive level.  Many of these mid-level positions were filled with women.  Although these positions were created at the senior level, creating the positions and promoting the personnel does not automatically create the underlying respect and recognition of authority.  Many times these women found themselves struggling to have their decisions respected by other senior managers, particularly when these decisions conflicted with others.  An example of this is the expansion of the underwriting function to a Chief Credit Risk position.  While it is not uncommon to have conflicts between this function and production, women seemed to find the implementation of their decisions to be much more difficult. 

These initiatives came about as it became obvious that the pool of men available to fill all these positions was inadequate and opportunities for women began to expand.  These expansions also opened up various management and leadership roles for women, although the overall senior management structure remained male dominated.  Whether it was lenders, mortgage insurance companies, trade associations or industry related vendors, women’s roles were expanding. 

Women however were able to utilize these opportunities to learn and grow into the responsibilities associated with higher level of responsibility.  Many successful women today were mentored throughout their careers.  These mentors, who provided guidance, encouragement and previously unheard of opportunities, were many times the male leadership in the organization.  Women, once promoted also were there as mentors for some of their subordinates.

There was another aspect of this unparalleled advancement in technology. Since it was a relatively new profession the management role models developed as it grew. As a result many of the senior management level positions were filled with the individuals who could best fulfill the role; and many times this was a woman.  As a result many of these technology companies not only had a large number of female senior management, but were in fact lead by a woman CEO.  In order to make effective decisions about technology, senior executives who were used to dealing only with men, found that they now had to work with women.  This experience helped to eliminate any unfounded prejudices that may have existed at the senior management level regarding women’s ability to lead and deliver results.  

The New Century

At the turn of the century “C suite” executives frequently were women. It was not uncommon to find women at the helm of a variety of organizations.  Today we see women at the head of major technology companies, entertainment giants, banking and finance companies and other businesses.  They also fill positions as heads of major universities, cabinet positions, as members of the Supreme Court, government agencies and generals in the armed services. It would undoubtedly be premature to say that women in general have achieved equality in executive level positions.  The reality is that during the first 10 years of this century, women have experienced executive management opportunities more frequently than in the past.  This does not mean that they have the same opportunity as a man, just that the probability is higher that these offers can occur. 

An overview of mortgage lending seems to send mixed messages to women.  At least three large lenders have promoted women to executive leadership positions while others have retreated back into the more traditional roles of men and women in business.  One of the most promising actions that have occurred is the growing number of women who are now starting up companies outside the entrepreneurial initiatives seen previously.  Several women have capital market firms that are experiencing steady growth and on-going success.  In addition, many women who have held executive level positions are leaving there traditional firms to venture into new opportunities involving consulting, human resources and operational support functions. 

Despite these advancements, the CEO position in most mortgage operations, as in other industries, continues to be men.  While the business norm continues to see men at these top leadership positions, those women who have assumed executive spots or created their own will be watched to see if they, in fact, are a leading indicator of the future or are a reflection of an industry that is experimenting with all options to resurrect dwindling profits and confidence in their business. 

In the next article in the series we will explore the attributes of leadership and explore what impact cultural, generational and gender elements have on the traditional leadership role and attempt to identify what attributes leaders of the future will need to have to be successful.

Authors:  Barbara Perino, CPCC, ACC – Executive Coach and Rebecca Walzak, President,rjbWalzak Consulting, Inc.  Contributors to the article are Zoe Goss, Consultant and Susan King, EVP-National Sales Director at e-TEC Appraisal.