Viewpoint: Twitter’s All-Male Board Spells Failure

Organizations can't innovate if they don't have a variety of perspectives

  • Share
  • Read Later
Kacper Pempel / Reuters

It is ironic that Twitter, which has made so many individuals smarter because of the diversity of the social network, isn’t set up to do the same for itself.

Last week, in its preliminary filing for an IPO, Twitter revealed that all seven members of its board of directors will be white and male. (The list includes former Netscape CFO Peter Currie, former Fox executive Peter Chernin, Benchmark Capital’s Peter Fenton, former Google exec David S. Rosenblatt, co-founder and former CEO Evan Williams, and two insiders: co-founder Jack Dorsey and CEO Dick Costolo.)

Most market measures evaluating performance are focused entirely on short-term results: do they have an edge, can they deliver financial profits and so on. Those measures miss one crucial element that determines long-term viability – the ability to innovate. Innovation is a direct result of openness to new ideas. The key is to design for differences of perspective and world views so you can have a better chance at new ideas. If Twitter doesn’t change, it will fail.

Innovation is more important today than ever. The old rules about gaining competitive advantages with economies of scale are gone for good. Today, connected individuals can create value in a way that once only centralized organizations could. This puts more pressure on organizations to innovate. The fact is that sustainable competitive advantages aren’t even sustainable anymore. Rita Mcgrath, of Columbia Business School, has researched and written of this shift. It used to be that a firm could create and hold on to “competitive advantages” for 40-year arcs; today, those advantages are now transient advantages, with your ability to “hold” them for five years in fast-moving industries and 12 in slow ones. What once mattered for profitability was efficiency and size by which to dominate over others. What now count are new ideas, and the speed with which a firm can execute on those with others. So the role of governance and leadership has to shift to became a driver of innovation instead of a steward of competitive advantage.

(MORE: The History of # and Other Symbols That Rule Twitter)

Twitter needs to build a board that can adapt to the marketplace, quickly. Instead, Twitter has chosen to have a so-called classified board, in which elections of its seven directors will be spread out over a three-year period and is designed more for continuity than adaptability. Critics of the practice often point out that this leads to longer terms of service, thereby keeping turnover low. According to a report from the Harvard Law School Forum on Corporate Governance and Financial Regulation, the modern best practice is to moving to 1-year terms. This allows for more independently minded directors, not rubber stamps. After all, if you’ve advised and approved of a strategy that worked 5 years ago, you’re unlikely to design or vote for a new direction. Just as turkeys can’t vote for thanksgiving, directors get deeply invested in keeping those ideas they’ve initiates.

(MORE: Marissa Mayer’s Ambition Problem)

Then there is the issue of yet another all-male board. The problem is, unfortunately, not exclusive to Twitter. The company is, however, still the only tech powerhouse without a female board member. Google, Apple, Microsoft, Amazon, Facebook, Zynga, LinkedIn, and eBay all have at least one female elected to their boards. On Twitter, women out number men by 6%, so on that basis alone a board with no women to shape your strategic direction is troubling. But research shows that companies with mixed boards (with three or more women) outperform those without. Consider the findings of Catalyst’s study of Fortune 500 companies:

  • Return on Equity: On average, companies with the highest percentages of women board directors outperformed those with the least by 53 percent.
  • Return on Sales: On average, companies with the highest percentages of women board directors outperformed those with the least by 42 percent.
  • Return on Invested Capital: On average, companies with the highest percentages of women board directors outperformed those with the least by 66 percent.

When you get a group of people together with similar backgrounds, lots of men, and low turnover, what you get is group think and continuity. And while an all white male board could conceivably have that ability to challenge one another, the likelihood is much higher if the board included a broader range of experiences. That, of course, has to include gender and color. But it should also include other industries.

Twitter has given many female and underserved voices a platform for an ongoing conversation. This openness has been powerful, even catalytic. On a personal level, it not only allows us to share, but to co-create with speed. Openness translates into a strategic advantage when applied to organizations and leadership. It not only allows for more collaboration, it enables a fast, fluid flexible organization ready to leap from opportunity to opportunity. If Twitter wants to prevail in the future, it needs to learn from its own platform.

17 comments
SurelyWoo
SurelyWoo

The author makes two assumptions: male and female perspectives differ, and the "female perspective" is in some way advantageous.  That a female presence guarantees the supply some critical insight, one that is beyond the grasp of all the members of the male tribe, is absurd and sexist.  Even if women do contribute something unique, it doesn't follow that these contributions will necessarily increase success.  What if this feminine secret-sauce turned out to be poisonous?  Would the author then argue that women should be excluded from boards?


When did equality of opportunity get twisted into a guarantee of outcome?  If Twitter has rejected more-capable females, then they deserve criticism, but stop trying to make your anatomy a credential.  We've already tried that, remember?

johnmontelione
johnmontelione

We started a contest to select the Qualified Woman for Twitter’s Board. At Nap Time Startups, we crowdfund mom and women entrepreneurs.  So, we have joined the movement against Twitter's lack of diversity on their Board and executive ranks. We launched a campaign today, which should be enlightening and fun, for any women to declare herself or a friend as a "QUALIFIED WOMAN" for Twitter's Board. The candidate with the highest social media votes on Friday, Nov. 15  wins a $1,000.  You can follow the action on twitter.com/naptimestartups. 

lmpicard
lmpicard

The issue is not adding women, it's creating diversity of thought.  Women are usually an easy way to add diversity, but not always.  The point is that Twitter lacks the diversity of thought and the board was established by executive leadership creating a harmonious process to corporate decision making.  Harmonious leadership is the LAST thing one needs in the innovation process.  I would also argue that companies that seek to create a "quota" of women on the board TO purely reinforce diversity policies, without seeking diversity of thought causes more damage that selecting all white males.

Its not always fun to do the HARD work of hiring people that don't think or look like you... But in our high paced, changing society where creativity is THE currency, its a survival tactic.


arsenicspritzer
arsenicspritzer

Seems like Twitter is doing just fine without that all important "female voice" to skyrocket them to success. Funny that. Successful businesses have never required a vagina on staff before. Why would they now?

RaopakBolo
RaopakBolo

Welcome to Cultural Marxism 101, kids!

Today we will discuss CRITICAL THEORY.

It is quite simple, take any example, be it a movie, video game, or in this case a company.
Next, check to see if there is too many whites/males/straights (the enemies) working for the company.
And now see how many women/minorities there are working there as well. If there is not enough women/minorities, you can start your criticism.

We'll take women in this case. Since there is not enough women, and too many men, that is a problem. It must be because of sexism!

That's all for today, kids!

Tune in next time when we discuss how E=MC^2 is actually a rape equation.


Alex12389456973
Alex12389456973

So, out of curiosity,  does the Federal Reserve, with the last 4 chairmen ALL being Jews which make up less than 2% of the population, "suffer" (cause us to suffer more like it) by lacking variety of perspective? 

failureofreality
failureofreality

The Catalyst report referenced by Nilofer Merchant finds a correlation between the number of female board members and financial performance.  Anyone who has taken an introductory statistics class knows that correlation does indicate a causal relationship.  To imply that the number of female board members is a cause of the higher performance is not supported by the analysis.  Merchant seems to be another woman who cannot do the math.

HunsV
HunsV

OK, let me help you figure this out.

This article is an excuse to complain that no one on the board is in the same "tribe" as you. In the old days it was hoplite against hoplite, mountain caveman against forest caveman, etc. Today it's about race and sex and which social status icon you flash. It's in our DNA because it used to help us survive. Unfortunately, this instinct is very good at misfiring, and if you aren't aware of the cognitive bias it causes you can wind up writing stuff like this and then wondering why people are in the comments section calling you silly.

You think you're right, and they think you're wrong, because you're being influenced by this instinct and they know it on some level.

I have the same instinct, which is the first thing that responded to the title, as I am a white male; and on a more cognitive level, I recognize the same instinct in you, and therefore I know how it works and that the article is just what happens when that instinct weasels its way into the driver's seat. If you require further proof, just look at the order it's in: First, the title (which is what you really mean); then some unrelated stuff to make it look like it isn't just about the gender/race (tribe) of the board members; then after you get done making it look like it isn't all about race and gender, you finally get onto the main point, which is that the board needs a woman's perspective. (Or maybe, let's say, a woman OR a nonwhite male. That way it doesn't look so much like sexism. It's couched in racial tolerance, which makes it look "better.") Please understand that a part of your mind picked this because it was the path of least resistance. You did it to satisfy an emotional need. Emotions are not rational and are happy to make you believe utter hogwash, as long as the hogwash feels good.

The board members are serious heavy hitters with proven track records of making business work in this sector. Every one of them is not just qualified, but EXTREMELY qualified. So, there is no question that they have picked a good team. These people know what they're doing, and the proof is readily available; just read their resumes.

Finally, try reformulating it with the players reversed and admit how it sounds: "There are just too many women on the management team. What these women need is a man to balance their perspective." Making a statement that conveniently aligns with your position and vested interests, but which turns into horse manure if you say it the other way around, is a sure sign that your opinion is heavily influenced by emotions - which cannot think, and have no place in what is presented as an informed, rational opinion.

....
....

"It is ironic that Twitter, which has made so many individuals smarter because of the diversity of the social network, isn’t set up to do the same for itself."

1- having a woman on your "board" does not in ANY WAY make the board smarter or dumber. To imply it does means you don't believe men and women are equal

2- diversity in social network does not in anyway contribute to an increase in IQ or intelligence. At all. Ever. It simply cannot.

3- what's actually ironic is you are a woman, advocating for equality between the sexes when you clearly view women as superior. 


Lady, you are what's wrong with this country!

outerwings
outerwings

What a sexist article! So now you are supposed to have 'token' female board members even when they don't make the cut? And do all female board members necessarily have different view points from their male colleagues? Or is an all white male board inherently incapable of creativity? Unbelievable :/

NonTechieTalk
NonTechieTalk

Twitter hasn't even gone public yet, and already we're talking about it failing? 

Yet, somehow, it managed to get to where it is just fine.

I'm not saying diversity wouldn't be better (why stop with just gender, though? Diversity is about a whole lot more than just white males accommodating a few white females).

However, this world is not ideal, and Twitter is likely to keep doing what it's doing, and achieving success, even if it remains an old boys' club.


DeweySayenoff
DeweySayenoff

"...which has made so many individuals smarter because of the diversity of the social network..."

SMARTER???  

I, for one, would like to see the author prove that.  Based on the things I've seen in social networking, people get dumber the longer they are exposed to it.

Azrimgiab
Azrimgiab

Getting women on the board just to check a box is sexist and short sighted. No one is stopping women from competing at Twitter. Stop forcing companies to coddle and be PC. Come to think of it, how come there are no afrrican americans on the board? Or Indians? Or Chinese Americans? Or Vietnamese? This is not a UCB ad, its a company.

BobDevaughn
BobDevaughn

How sexist and racist to base your assessment of the board members' qualifications on their sex and race...

SarahConfran
SarahConfran

@BobDevaughn twitter isn't just used by white males. if the only input is from white males other groups will not be as satisfied with twitter bc it doesn't meet their needs. 

arsenicspritzer
arsenicspritzer

@SarahConfran @BobDevaughn Tell me what exactly about Twitter is alienating to women right now? Please, I'd love to hear it, because the millions of women who use it regularly should be told that they are nothing more than tools of the patriarchy and that Twitter is oppressing them. I think that would come as a shock to all of them -- except perhaps to those with a political axe to grind like the author of this article.

JustDon
JustDon

@SarahConfran @BobDevaughn And now the sexist and racist article has a sexist and racist comment to defend it.

It's unfortunate that you would assume that "other groups" will not be satisfied with Twitter, and that it will not "meet their needs,"  simply because of the gender and skin color of their leadership.  There are (at least) two separate prejudicial views stated in just your short comment.  First, you assume that "other groups" needs are defined by *their* gender and color, and then you follow that by assuming that those needs can't be understood by somebody who doesn't look like them.