In the land of women
Lots of companies fret about keeping women in the workforce. Principal Financial has figured out how to do it.
(Fortune Magazine) -- Suzanne Vocal wasn't looking for a job. She was working as an agency planning specialist at State Farm Insurance, which had singled out the ambitious 28-year-old brunette as "high potential." The company helped finance her MBA, placed her in the Austin office near her family, and in 2006 tasked her with one of its thorniest problems - coming up with better HR policies to entice State Farmers to stick around. While looking for "model" companies, Vocal came across a Des Moines insurer called Principal Financial Group. It offered enviable perks, like flexible schedules, two onsite gyms, and a soon-to-open early-childhood-education center. Plus, as Vocal looked more closely at the company's website, she noticed that many of Principal's leaders were women, a big draw in her mind. Vocal certainly didn't see how State Farm could beat Principal's offerings, so she decided a different game plan was in order. She joined them, moving halfway across the country to work as a market intelligence manager.
Vocal had stumbled upon what women in Des Moines have raved about for years: Principal (PFG, Fortune 500) is one of the most female-friendly workplaces in America. Nearly two-thirds of the company's 13,438 employees are women. They hold 50% of the 1,700 most senior positions, and five of 14 directors - that's 35% - are female, vs. the insurance industry average of 16%.
True, at nearly 6-foot-10, Principal's CEO, Barry Griswell, is about as alpha male as they come. But, notes Griswell, who just celebrated his 20th year in the job, "my mother was a single parent who raised my brother and me and worked two jobs. It's been important to me to know that women have equal pay, equal access - all the things that men have." It helps that Principal has a long history of recruiting women: A 1966 Des Moines Sunday Register ad trumpets job openings for "mothers of schoolchildren" with part-time hours and summers off. While those jobs were more secretarial than C-suite, Principal gained a reputation for being a friendly environment where open positions were often filled by word of mouth. The company introduced flexible work schedules in 1974, decades before it became trendy. Says one young mother who left a teaching job to come to Principal: "I had friends who are working moms here, and they told me about it. I didn't even look at positions at another company."
The groundwork for Principal's 2001 IPO, however, proved a critical turning point. The company needed to hire aggressively, and Griswell knew that great benefits would be integral to inspiring employees in an increasingly competitive environment. He brought on HR veteran James DeVries who, after parsing the data, concluded that if employees stay longer than three years, the chance they'll leave decreases. He focused, then, on programs that would support them through the more vulnerable points in what he calls the "whole career life cycle." For example, in addition to 12 weeks off after the birth of a child, women can now return part-time and build back up to full-time. What's more, Principal has invested $8 million in a subsidized early-childhood learning center that will open this fall. Twenty percent of enrollment will be reserved for infants, so new mothers can be within walking distance all day. DeVries says those measures cost the company very little. "It's a virtuous cycle," he says. "Just about every metric you review around employee productivity has increased: Our sales results are higher than they have ever been, our investment performance is great, our stock price has tripled."
Principal's most valuable benefit, however, is one that's much harder to quantify than perks or paid time off. Often unspoken gender stereotypes hold women back more than antiquated policies, notes Lois Joy, a research director at women's think tank Catalyst. But at Principal, employees aren't forced to choose between flexibility and furthering their careers, notes Ellen Lamale, the company's chief actuary, who was promoted to VP while she was working part-time. Or there's the case of Valarie Vest, a regional client service director. Midway through her second maternity leave, her bosses called, offering her a promotion. While some might have assumed that more responsibility - much less a post that involved relocating to another city and more travel - was ill-suited to a new mom, Vest's supervisors simply thought she was the best person for the job. She quickly accepted, and now, two years later, she manages ten people. "I don't ever assume anyone might or might not want an opportunity," she says. No doubt that's exactly what her reports are counting on.