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What the Wal-Mart Case Means for Women in Business

June 21, 2011

By Kay S. Hymowitz

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As you’ve probably heard by now, the Supreme Court has ruled in favor of Wal-Mart in Walmart v. Dukes. You may have also heard that the decision is a defeat for the cause of gender equality.

For women in the business world at any rate, I don’t think so.

What most commentary about the case ignores is just how much the dispute is about management policy. Like many companies, Wal-Mart gives its local managers a great deal of discretion in deciding salary and promotion. In fact, the company allows an unusual amount of autonomy to their hourly wage sales people. The strength of the policy is that it allows people to apply what anthropologists call “local knowledge.” Workers who are closer to everyday transactions between customers and workers can use their first-hand experience to make decisions that are responsive to local conditions. It’s an approach that creates more dynamism in the workplace, and more creativity as well. It’s evidently worked – big time. Started as a single store in Rogers, Arkansas, Wal-Mart now has 696 stores and 2,928 Superstores, providing jobs for 1.4 million people in the United States.

But there are also potential problems with giving more autonomy to management and workers, and I don’t just mean for class action lawyers wanting to build a convincing case of corporate malfeasance. If a local knowledge management approach encourages individuals to rely on their initiative and judgment, it also allows them to make mistakes and act on their biases. A decade ago, when Wal-Mart v. Dukes was first filed, 86% of Wal-Mart store managers were male. (The number is over 40% today) Some Wal-Mart women employees have said that their managers promoted men over similarly qualified women (though we have no idea how many of them did, nor do we even know whether they promoted women at lower rates than female managers did, a pertinent question.) Wal-Mart did have specific policies to counter discrimination. It’s pretty obvious they weren’t entirely successful.

The good, the bad, and the unfair of these management approaches leaves us with a question: who should decide how to manage? Do we want the courts to make it harder for companies to delegate responsibilities to managers ? If the Supreme Court decided in favor of the women plaintiffs, Wal-Mart is not the only organization that would have had to change its management policies. All companies would have felt pressure to increase central corporate oversight. Given that women are now 51% of professionals and managers – and, remember, 40% at Wal-Mart – are we so sure that decision would have been good for women? We’d be giving women more power, only to take it some of it away.

Some people will argue that the statistics showing discrimination by Wal-Mart are so overwhelming as to erase any benefits of the company’s management practices. “Women fill 70% of the hourly jobs in the retailer’s stores, but make up only 33% of the management employees…, Justice Ginsburg wrote in her partial dissent. ”The higher one looks in the organization, the lower the percentage of women.“ Like many people, Justice Ginsburg assumes lopsided statistics prove discrimination. As it happens, we at the Fair Sex have been giving a lot of thought to that assumption and will be posting soon on the subject.

Original Source: http://blogs.forbes.com/kayhymowitz/2011/06/21/what-the-wal-mart-case-means-for-women-in-business/

 

 
 
 

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