Gender-based analysis as a turnaround

strategy at McCarthy Uniforms

By Alicia Riolino and Sarah Kaplan*

Introduction

McCarthy Uniforms built their business supplying uniforms to schools, sports teams,
municipalities and businesses. Since 1956, they have sold uniforms directly to customers via a
network of retail outlets, sales professionals and call centres. Despite strong customer service
roots, by the mid-2000s the family-owned business was plateauing in Canada and struggling
to grow internationally. When a private equity firm approached them, they accepted the
investment and managerial expertise, but after ten years McCarthy Uniforms was still
struggling to expand its footprint.

When Vanessa Serra Iarocci stepped in as President in 2017, McCarthy Uniforms was close to
bankruptcy. It was her job to work with the Chairperson and family stakeholders to identify
opportunities for growth that the private equity team had missed. She and her team used
gender-based analysis—a means of identifying how men, women and non-binary people
experience products, services and policies differently—to identify growth opportunities.1 In a

*
This case was prepared by Alicia Riolino (MBA Fellow, Institute for Gender and the Economy) under the
supervision of Sarah Kaplan (Professor of Strategic Management and Director, Institute for Gender and the
Economy) with the cooperation of Vanessa Serra Iarocci (President, McCarthy Uniforms).

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short time, they spotted opportunities to innovate on their service delivery and product
offering, as well as to market McCarthy Uniforms’ existing gender-friendly practices.
Since 2017, the solutions identified through gender-based analysis have supported double-
digit revenue growth at McCarthy Uniforms by identifying opportunities for innovation within
a mature industry and finding ways to grow without compromising service, quality or
sustainability.

About McCarthy Uniforms

McCarthy Uniforms (McCarthy) was founded in 1956 by R.J. McCarthy when he began
designing and creating uniforms for faith-based schools in the Toronto area2. In the years
following, McCarthy’s business expanded to include workplace and athletic uniforms. Initially,
the majority of McCarthy’s customers were in the Greater Toronto Area (GTA), but as the
organization’s reputation for quality and customer service grew, their business footprint
expanded. They opened several retail outlets for school uniform shopping, including in
Calgary, Alberta and in Vancouver, British Columbia. Since opening, over 10 million
Canadians have been outfitted with a McCarthy’s uniform.

McCarthy’s growth has been inconsistent. In the last fifteen years, the organization has
undergone several significant business transitions, including a private equity takeover, a
repurchase by the McCarthy family and a comeback from the brink of bankruptcy.

The turnaround at McCarthy’s defies many of the traditional, cost-cutting approaches used to
increase profitability. In fact, since 2017, McCarthy Uniforms has made significant investments
in technology, products and people. Leaders at McCarthy credits the use of gender-based
analysis and gender-conscious practices with much of their recent success and growth. Most
importantly, gender-based analysis has helped McCarthy Uniforms’ leadership team identify
unmet customer needs and develop a strategic plan that has increased profitability without
compromising on service delivery.

The uniform industry

The uniform industry is highly concentrated and mature. A few significant players, including
Aramark Canada Limited (27.3%), Cintas Corporation (25.4%) and Unifirst Corporation
(16.9%) own approximately 70% of the market, allowing them to capitalize on economies of
scale and compete on price. 3 Local retailers and uniform suppliers like McCarthy’s focus on
building relationships with their customers and offering superior service and product quality.

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Uniform retailers provide a wide variety of uniform materials to their clients, including but not
limited to pants, formal and informal shirts, hats, skirts and jerseys. They can also customize
materials with embroidery or screen printing. Uniform retailers are near the end of the value
chain for workplace clothing. In some cases, they may sell their products as a brand name to
other big-box retailers (i.e., Carhartt or Dickies) but in most cases uniform retailers sell
products directly to end users. The demand for uniforms is highly dependent on workplace
and school regulations as well as broader economic conditions. Population growth and
school enrolments are also important factors for predicting school uniform demand. Growth
in service sector and public sector employment is also an indication of increased demand for
uniforms.

In Canada, the private and Catholic school systems have mandated uniform policies.
Approximately one-third of elementary and secondary school students in Ontario are
enrolled in a Catholic school and are required to purchase a uniform.4 Companies like
McCarthy’s work with School Boards to establish uniform guidelines and drive students to
purchase their products. For example, the Dufferin Peel Catholic District School Board uses
McCarthy Uniforms as their main supplier. Students can purchase directly from McCarthy
online, attend one of the prearranged uniform days that McCarthy offers on site at their
school, or make purchases at school from a McCarthy supplied retail outlet. In contrast, the
Niagara Catholic District School Board has mandated a uniform guideline to students in
elementary school, which allows parents to purchase generic navy-blue bottoms and a logo-
free white top from anywhere. These may be purchased from McCarthy Uniforms, but
students may choose to buy uniform-appropriate clothes elsewhere.

Winning new clients is a relatively straightforward and consistent process across industries.
The uniform retailer submits a proposal outlining their product offering and prices to a
central administrator or team of administrators. The administrator(s) decide who is awarded
the uniform contract based on a combination of criteria. Word of mouth and reputation are
important factors to winning new business, but since products are fairly standardized, it is
common for retailers to compete on price.

McCarthy Uniform’s business challenge

Despite a strong reputation and history as a school uniform retailer, McCarthy Uniforms
struggled to grow internationally and remain profitable throughout the mid-2000s. As the
market for uniforms became more competitive, McCarthy found it challenging to maintain
their profit margins and had little in-house expertise to expand outside of Canada. Larger
uniform suppliers were entering the Canadian market and were able to undercut McCarthy’s
prices due to the size and scale of their operations. McCarthy had always prided itself on

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offering superior, personalised service to its customers, but their leadership team had
difficulty translating high quality service into a meaningful value proposition to clients.

In an attempt to reignite growth, McCarthy was taken over by a private equity fund in 2007.
Members of the McCarthy family stayed on the corporate Board of Directors, but operations
were run by a team from the private equity firm. The private equity firm focused on cutting
costs, including closing down McCarthy Uniform’s corporate division. They felt that the
margins in corporate uniforms were too low and that there was little room for service or
product improvement to differentiate McCarthy from competitors. Unfortunately, the
traditional cost-cutting measures implemented by the private equity team were unsuccessful,
and after almost 60-years in business, McCarthy’s Board and Executive team were
considering the possibility of bankruptcy.

In 2017, the McCarthy family repurchased the company from their private equity partners and
began trying to rebuild. During the transition, the Chairman of the Board, Martin McCarthy
asked family friend and long-time business advisor, Vanessa Serra Iarocci to take a look at
their business and see what could be done to restore growth and profitability.

Gender-based analysis at McCarthy Uniforms

As a first step, Iarocci looked at what McCarthy Uniforms did well. She quickly realized that
the organization’s orientation to customer service could help it stand out from low-cost
competitors. But, extracting value would mean making a few important changes internally
and externally, starting with customers instead of traditional retail statistics. Many of the
decisions made previously by the private equity partners were based on standard key
performance indicator (KPI) and spreadsheet analysis. Investments and divestitures were
made using historical data but lacked any connection to the people making purchasing
decisions.

Before joining McCarthy as the President, Iarocci had spent time in accounting, finance and
marketing roles. She had a successful track record in capital markets and had led the Women
Investor Strategy at TD Wealth. Through her role at TD, Iarocci saw the value in user-centred
design and recognized how gender difference could impact decision-making for end users.
Specifically, Vanessa recognized the value of segregating data by gender and engaging with
end-users to better understand their needs. So, the first thing Iarocci did was reach out to the
sales leaders at McCarthy Uniforms to ask what they were seeing from customers on the
ground. What the private equity partners had missed, and Iarocci saw, were the implicit ties
between gender and customer needs. Using gender-based analysis, Iarocci was able to
identify gaps in the uniform market and opportunities for McCarthy to grow their business.

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When the McCarthy family repurchased the company, there was also a significant shift in the
composition of the internal leadership team. When the private equity firm had been directing
operations, the majority of the leadership team were men. The composition of the leadership
team was largely a by-product of the demographics in finance and private equity, but also
closely mirrored the leadership teams at other uniform supply companies. In contrast,
McCarthy Uniform’s employed a high percentage of women in their client-facing and internal
service delivery teams, so, when the male leadership team members left, there was room for
a greater number of women to join the formal leadership ranks. Iarocci said, “It immediately
became apparent that our [diversity] was a source of competitive advantage. Male leaders
apply a male lens to their business.” In McCarthy’s case, the previous male-only lens meant
they had missed a growing fraction of the corporate uniform market: women. The new
leadership team was in a unique position to address the needs of underserved clients in a
largely ignored segment.

Together, McCarthy’s new leadership team examined their education client portfolio to see
where they had been most successful. They noted that their tailored girl’s clothing options
were extremely popular with customers. Martin McCarthy, the Chairperson of McCarthy
Uniforms Board of Directors, noted that their “female fit” options for schools had come from
client consultations and customer feedback. As early as the 1970s, when McCarthy had
worked with school boards to pilot new uniform options for boys, McCarthy Uniforms had
asked the students what new items they would like to see offered. Within a very short time of
the boys’ uniform pilot, female students demanded that they should have similar options.
Through this process, McCarthy’s found that it was essential to have multiple options readily
available to their male and female customers.

Inclusive design also found its way into McCarthy’s on-site fitting days. When McCarthy’s sets
up fitting appointments, sales representatives bring at least one of every item in every size.
They also have male and female fitters on hand to help customers feel more comfortable with
their purchases and identify opportunities for tailoring. This service was extremely valuable to
their education client—particularly for young people starting high school who might be
wearing a uniform for the first time. For customers, knowing what they would look like on the
first day of school could help ease anxiety and led to a better overall customer experience. In
fact, customers and school board representatives had commented that the fitting days, size
and girl’s clothing options were a pleasant unexpected benefit of their partnership with
McCarthy Uniforms.

Product diversity: Showcasing female fit clothing

As the team identified McCarthy’s differentiating factors in the education portfolio, they also
looked at other potential markets for uniforms. Leadership from the ‘private equity days’ had
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eliminated McCarthy’s corporate portfolio, because they felt it was impossible to innovate on
service or compete on price. Despite having moved out of the business line, Vanessa and her
team scanned the market to see what opportunities might exist.

They noted a significant fraction of request for proposals (RFPs) had women listed as the
point of contact—regardless of the industry the RFP originated from. They also noted that
many of the uniforms they saw in the field were one standard type. Male and female
employees were often dressed in the same outfits, just different sizes. This was shocking to
the McCarthy team, since male and female product specifications and measurements are
materially different. Clothing made with female fit size data has substantially different
proportions in the shoulders, chest, hips, arms, legs and torso than clothing made with male
fit data. It appeared that women were cobbling together uniform options that fit their body
proportions. For example, someone might have to order a larger size in pants to
accommodate hip measurements or a larger size shirt to accommodate breasts. The result
was often a slouchy, ill proportioned uniforms for female employees. This didn’t make sense
to the McCarthy sales team, since women’s options exist, and McCarthy had the capacity and
capability to offer them to customers (see Exhibit 1 for examples of female fit uniform
options).

It appeared that other uniform distributors had used similar metrics as McCarthy Uniforms
former private equity partners. They chose to offer a limited breadth of uniform options as a
way to reduce costs and keep inventory turnover rates high. Historically, male fits and sizes
would have had the highest demand, so those were the options uniform suppliers stayed
with. They failed to recognize that the demographics in many traditionally male industries
and workplaces were changing and more women were entering occupations like
construction or transportation. Relying on historical KPIs meant that female fit options were
not considered profitable or fast moving. As a result, they were rarely made available to
clients. When female fit options were provided, additional costs were often passed on to the
customer. This includes female fit, maternity wear, adaptable clothing for persons with
disabilities or plus sizes.

In many cases, organizations did not demand female fit clothing because it had not occurred
to them to ask. Since few uniform companies advertised the products a vicious cycle
continued. Women were not aware the products existed, so they made do with what was on
hand (male or unisex uniform options).

Despite the increased costs of carrying slower moving SKUs [stock keeping units] and
speciality items, McCarthy Uniforms did not pass on these costs to customers. Iarocci noted
“from a business-case point of view, a higher number of SKUs translates to higher costs. [High
SKU volume] means more square footage… Slow moving SKUs are less profitable. By looking
solely at the numbers, these slow-moving SKUs might seem dispensable. We quickly found

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that they could be central to our business and our competitive advantage.” For Iarocci and
her team, McCarthy’s winning formula in school uniforms was the variety of their product
offering and the quality of their service. The sales team began putting together proposals for
corporate clients and unions that highlighted their female fit and cost neutral uniform
options. The options from McCarthy’s included customized cresting and embroidery to
ensure that men’s and women’s uniforms looked the same. These details were often not
covered by competitors and meant that employers had to pay additional fees for
customization. For many organizations the McCarthy proposal was the first time tailored
female clothing had been explicitly offered at no extra charge. Shortly after starting to
showcase female clothing options, McCarthy Uniforms started winning corporate contracts.
In fact, they have been so successful with corporate clients since adding their female-friendly
options that, as 2019, McCarthy Uniforms relaunched their corporate business division.
Within one year, their growth has exceeded the size of the former division, and they
anticipate that all of their material growth will come from gains in corporate uniform sales.

Uniform customization: Building relationships and more inclusive workplaces

From the early years of the business McCarthy’s recognized the value of incorporating
comfort into their uniform offerings. They extended this belief to their uniform fitting offering.
For every client, McCarthy Uniforms brings two trained fitting specialists, one male and one
female, to their client site. The fitting specialists are on hand to help customers select
garments, address fit needs and tailoring options. McCarthy Uniforms also offers tailoring to
customers at no extra charge. While this service is valuable to people of all genders, it offers
female and nonbinary employees with more options for style and comfort.

The sales team has found these interactions provide valuable opportunities to learn from
their customers and gather feedback on their product offering. For example, the sales team
learned that many female employees found uniform options with stretch fabric valuable to
their workplace productivity. Women’s weight fluctuates more than men. Natural weight
fluctuations can mean that the same pair of pants might go from fitting perfectly, to being
loose or tight on a daily basis. Stretch fabric allows for give and fexlibility in fit, leading to an
overall more comfortable and adaptable piece of clothing. By incorporating female fit
products with stretch fabrics, McCarthy was able to increase customer statisfaction while
maintaining uniform standards.

Fitting sessions also proved to be important relationship building opportunities. At one of the
first new corporate client fittings, a female employee broke down in tears and hugged the
McCarthy’s fitting staff. In her 20-year career, she never had a uniform that fit her properly.
Another customer said that she felt like ‘a kid in a candy store’. She was shocked to find so
many female sizes, and even more surprised that they were all available to try on. For these

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customers, the opportunity to wear clothes that were made-to-fit resulted in a substantial
boost to their confidence and thier overall workplace satisfaction. The McCarthy Uniform’s
fitting specialists had many more interactions like this, with clients echoing how surprised and
pleased they were to have uniform options that fit their proportions.

Before McCarthy Uniforms, many female employees were finding “uniform hacks” and
making do with what their employers offered to them. Many employers failed to recognize
the intrinsic value that exists in an individual’s sense of belonging and how a uniform can help
employees achieve that feeling.5 In extreme cases, lack of appropriate options can actually
impede an employee’s ability to do their job. Consider the cancellation of the all women
spacewalk by NASA, due to a shortage of female size space suits.6 While spacewalks aren’t an
everyday occurrence, the broader lesson is the same. Designing for one type of person (in
this case, men) limits an organization’s ability to engage with a deeper talent pool. By
expanding the definition of uniform and providing a multitude of options to their customers,
McCarthy Uniforms is also helping their clients design more inclusive workplaces.

The focus on relationships rather than transactions has proven to be valuable since many of
the municipal clients are connected by employee union networks. The positive word of
mouth about McCarthy Uniforms customer services experience has spread through
departments and organizations. As a result, McCarthy has been asked to bid on more
corporate proposals.

Online ordering: Reducing administrative time for better customer service

As noted above, many of the contact names on corporate RFPs were women. McCarthy’s
found that in many corporate and municipal organizations, the advertising and ordering of
uniforms are considered to be highly administrative. As a result, uniform related tasks were
often delegated to a female member of the office or the union regardless of the gender
distribution in that field or workplace. In the education sector, the majority of uniform
administration is also done by women. However, the gendered distribution of work wasn’t
immediately obvious since their primary market in education tends to be a more female
dominated field.7

McCarthy recognized that many of these women were completing uniform orders in addition
to their other duties. Furthermore, the additional administrative work was often expected, but
not rewarded. Through consultations with uniform administrators, the McCarthy team
identified an opportunity to streamline their ordering processes. Many of the administrators
expressed frustration with the paper-based ordering process. The low-tech system was
cumbersome and inefficient. Completing orders often required replicating steps, keeping
separate spreadsheets or tracking documents and following up one-on-one with employees

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to ensure their orders were made and received. Ordering processes were standard across
the industry, with little innovation in the last two decades. Iarocci commented, “Again, this is
an example of using a female lens to understand customer needs.” The female leadership
team at McCarthy could empathize with the female administrators at their client sites; many
had similar tasks delegated or downloaded to them during their careers. Consequently, they
understood the value of administration, but also that it can also be cumbersome and time
consuming. Their male counterparts, including McCarthy Uniforms’ competition, had less
experience working in administration and therefore didn’t understand the innovation
opportunity that was available to them.

The team decided to focus on redesigning the uniform ordering process. They worked
closely with existing clients to identify pain points, streamline ordering requirements and
reduce the need for paper ordering systems. The system was designed to make it simple for
administrators to manage their list of eligible employees, track their orders and budget
allowances as well as finalized approvals for uniform orders. See Exhibit 2 for examples of
McCarthy Uniforms intuitive ordering platform. Using Agile methodology, they were able to
migrate ordering online in two months.

began marketing an intuitive ordering system in proposals. The new ordering system led to a
reduction in the time needed to input, track and process orders for their clients. Most
importantly, the new system also freed up time for uniform administrators and allowed them
to do their jobs better. McCarthy Uniforms found that their clients were more engaged with
the new system and more satisfied with the service they received. Administrators from other
organizations and departments began talking to one another and praising McCarthy
Uniforms’ ordering system, leading to more RFPs and more wins for McCarthy.

Pay equity analysis and corporate social responsibility: Modelling the value of a
feminist business canvas

When Iarocci first took on the role of President, she and her leadership team worked through
a feminist business model canvas analysis (Exhibit 3). A feminist business model canvas
expands on the traditional business planning tool by asking users to consider the expressive
and social needs of its customers and corresponding solutions their business can offer. The
McCarthy Uniform team felt strongly that they needed to look beyond revenue values and
consider the dynamic economic, social and environmental impacts of their work. The uniform
industry is directly tied to the textile and garment manufacturing industries. In recent history,
garment manufacturers have come under the microscope for unethical and unsustainable
practices. The community focus and connectedness of many of McCarthy’s school board and
athletic team clients encouraged Iarocci that it was important to have a deeper social
connection in their work. The Toronto District School Board has begun requesting that
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uniform suppliers disclose where their uniform materials were made and to guarantee that
their supply chain was free of child labour and McCarthy’s was already well-positioned to
comply.

They began by reviewing their internal policies to ensure that they were meeting, or
exceeding, standards set by their consumers or industry peers. As an organization with a high
proportion of female employees, McCarthy’s leadership team felt it was important to
understand the status of pay equity within the company. The audit confirmed there were no
gaps in pay between male and female employees. The audit results were positive but
maintaining pay equity remains an ongoing goal for Iarocci. They continue to track pay equity
and work to ensure that pay for male and female employees stays equitable. They recognized
that this was not a “one and done” action, but rather, it required ongoing monitoring and
evaluation. To emphasize their continuous commitment to equity within their organization,
McCarthy Uniforms began including their pay equity statistics in proposals. To their
knowledge, none of their competitors has chosen to disclose this information.

McCarthy Uniforms has conducted audits of other processes, as well as community

engagements and their supply chain practices. They highlight their record online and in
proposals, making it clear to prospective customers that their business has 100% gender pay
equity, zero corporate social responsibility violations and follows sustainable business
practices (see Exhibit 4).8 They have also formed partnerships in the community. They offer
hundreds of youth summer employment in their uniform retail locations and warehouses.
McCarthy Uniforms is also earmarking over $500,000 annually for community donations and
uniform scholarships to youth in need. Combined, their commitment to nurturing a
sustainable community and their willingness to disclose their actions have bolstered
customer engagement. Their partnerships have also helped pave new paths for future clients.

Conclusion

Revenue growth at McCarthy Uniform’s is an ongoing process, but the early work of Iarocci
and her team has ensured that the business made a significant turnaround in two years’ time
(two years ahead of schedule). Bleak financial statements are now include double-digit
growth forecasts.

Gender-based analysis provided the McCarthy Uniform’s team with unique insights. In
combination with the leadership team’s empathetic response, McCarthy was able to make
significant and meaningful changes to the way they do business and how they communicate
their value to clients. At the beginning stages of the turnaround, Iarocci and her team felt like
gender-based analysis was the obvious choice. Looking back, they can clearly see how
innovative this approach was in their industry and how it supported their growth objectives.

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As of August 2019, none of McCarthy Uniforms competitors has moved to copy their product
offering or service delivery models. Iarocci suspects that many of McCarthy Uniforms’
competitors are failing to see the dynamic impacts of female-focused investments. Rather,
they believe increased costs will erode their profits. McCarthy Uniforms has identified the
needs of an underserviced market and leveraged their existing skills and internal capabilities
to meet these needs. While increasing costs in the middle of a turnaround might appear
counterintuitive on paper, the increases in revenue have far outweighed the costs.
Furthermore, the insights gained from gender-based analysis has created deep customer
loyalty and a reputational boost for McCarthy Uniforms.

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Exhibit 1: Female Fit Clothing Options

Exhibit 2: Mock Up of McCarthy Uniform’s Online Ordering System for Workplaces

a) Monitoring Active Users: Tracking, adding and removing users (employees) in the workplace can be done with
a few clicks. (fictitious names used for demonstration)

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b) Tracking Uniform Budgets: Managing and tracking uniform budgets is readily accessible and easy to assess via
a dashboard view.

c) Uniform Order Approval: Approving orders or making changes to orders can be done quickly, again in only a
few clicks. (fictitious names used for demonstration)

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d) Order Details: Administrators can access specific order detail with one click. (fictitious names used for
demonstration)

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Exhibit 3: Feminist Business Canvas Example

This is an example of a Feminist Business Canvas, provided by Feminists at Work. This template is
available through http://www.feministsatwork.com/tools-ebooks/fbmc-free-download/.

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Exhibit 4: McCarthy Uniform’s history page

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References

1
The Government of Canada: The Status of Women in Canada. 2018. “What is GBA+?” Retrieved July 14, 2019.
(https://cfc-swc.gc.ca/gba-acs/index-en.html)
2
McCarthy Uniforms. 2019. “Our History.” Retrieved July 26, 2019.
(https://www.mccarthyuniforms.ca/page/ourhistory)
3
IBIS World. 2019. “Industrial Laundry & Linen Supply in Canada.” Retrieved July 14, 2019. (https://clients1-
ibisworld-com.myaccess.library.utoronto.ca/reports/ca/industry/default.aspx?entid=1731)
4
Ontario Ministry of Education. 2018. “Quick Facts: Ontario Schools, 2016-2017.” Retrieved July 30, 2019.
(http://www.edu.gov.on.ca/eng/general/elemsec/quickfacts/2016_2017.html)
5
Sabharwal, Meghna. 2014. “Is Diversity Management Sufficient? Organizational Inclusion to Further
Performance.” Public Personnel Management 43(2): 197-217.
6
Fortin, Jacey and Karen Zraick. 2019. “First All-Female Spacewalk Cancelled Because NASA Doesn’t Have Two
Suits That Fit.” The New York Times March 25 2019.
7
Ontario Ministry of Education. 2018. “Quick Facts: Ontario Schools, 2016-2017.” Retrieved July 30, 2019.
(http://www.edu.gov.on.ca/eng/general/elemsec/quickfacts/2016_2017.html)
8
Harquail, CV. 2019. “FBMC Free Download.” Retrieved August 11, 2019. (http://www.feministsatwork.com/tools-
ebooks/fbmc-free-download/)

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