Defining Glass Cliff

The glass cliff effect is a real-world phenomenon where women are more likely to be appointed to precarious leadership positions during a difficult time for a organization. This phenomenon occurs in the field as diverse as technology, finance, academia and politics.

The term was coined in 2004 by Michelle K. Ryan, Julie S. Ashby, and Alexander Haslam of the University of Exeter. In the study, they examined 100 companies listed on the London Stock Exchange that make up the FTSE 100 index to see what happened to those companies before and after the appointment of new board members.

The study says that a woman or person of color is promoted to a senior position during a difficult time for a company, when the risk of failure is high. While men are more likely to be appointed to stable senior positions in successful firms or times. The glass cliff effect represents a subtle, yet dangerous, form of gender discrimination that may limit women’s ability to become successful leaders.

Overview of Glass Cliff Study

The metaphor of the terminal glass cliff is that women in this position are at risk of falling off a cliff. There are many reasons why such companies place women in precarious leadership roles than men. One of it could be that a struggling company will likely place someone for a shorter tenure knowing that the position itself is risky. Another is, if a woman fails to pull the company out of its downward spiral, then it becomes easy for a woman to blame someone.

Glass cliff positions are risky because it hurts the women's executives' reputations and career prospects. This is obvious because when a company performs badly, people tend to blame its leadership without considering the situation. The phenomenon also points that a female leader finds it harder to get more chances once they have failed due to having fewer mentors and sponsors than male ones.

As per some studies, women CEOs are 45% more likely to be fired than their male counterparts. Some studies also suggest that there isn’t a lot of opportunity for women executives. As of June’21, just 33 of the Fortune 500 companies had female CEO. Therefore, women tend to take such risky positions. Although the term glass cliff is typically applicable to women, it can also refer to minorities or any group marginalized by prejudice.

Glass Cliff Effect Examples

Yahoo hired Carol Bartz in January 2009, who was the first woman CEO of the company. She was immediately put in a tough position. In 2008, Yahoo laid off approximately 1,600 employees. Unable to change the fortunes of the struggling company, Bartz was fired two and a half years later, over the phone. Timothy Morse, then CFO of Yahoo, was named interim CEO.

In 2002, then-unprofitable telecommunications company Lucent Technologies appointed Patricia Russo CEO, and then replaced her with Ben Verwaayen.

It’s not all doom and gloom for women executives, Anne Mulcahy served as CEO of Xerox from 2001 to 2009, and she was promoted at a time when the company was on the edge of Bankruptcy. And, successfully engineered its turnaround.

Ginni Rometty has been Chairman, President, and CEO of IBM since 2012. Under her tenure, the firm underwent a massive transformation, shifting from a focus on computers and operating systems to areas such as blockchain, big data and artificial intelligence. In 2018, IBM received the Catalyst award for Advancing Women and Diversity in Business, the first tech company to win the award in 25 years.

Some study stated that women CEOs excelle in managing complexity and being perceived as inspirational.

How to Prevent a Glass Cliff?

It is important for women and minorities to research and find out much information about the current financial state of the company. Study the company’s stock information and staying up-to-date on company insights and Industry trends. Ensure you have a good network so seeking timely guidance keeps you away from some risks. Always evaluate before accepting any role or position that is risky or unstable.

Glass Cliff and Glass Ceiling

Glass cliff is derived from the term Glass Ceiling, is often used to describe the unseen barriers (glass) through which women and minorities can see elite or higher positions but cannot reach them (ceiling). The glass cliff is a twist of glass ceiling where women are elevated to higher roles/ positions when the company is performing poorly.

It is not just a phenomenon reserved for women; but it happens with minority groups, too.