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Bad leadership is costing you more than you think

In companies, culture is key. A positive workplace culture attracts and retains top talent, and allows individuals and teams to thrive and perform, in a healthy, sustainable way. Conversely, bad leadership has many negative knock-on effects.

Recent research by the Chartered Management Institute (CMI) shows that almost one-third of UK workers have quit a job due to a negative workplace culture. It is clear that many organisations have some way to go in developing a culture that works for both their results and their people.

In order to fix this issue, companies have to look to their leaders; ultimately, culture is created by those in charge. They are the ones who set the tone, role model the behaviour and signal to those around them what is acceptable, and what is not.

However, the research shows that a staggering 82% of new managers in the UK are ‘accidental managers’ – a term that has been given to those who have had no leadership training, yet have been given a leadership position.

82% of new managers have had no leadership training.”

Chartered Management Institute research

Anthony Painter from CMI argues that improving the performance of UK managers is not only crucial in preventing toxic workplace cultures from developing (25% of trained managers say they have called out bad behaviour versus only 15% of untrained managers), but it is also an economic necessity. In fact, economists believe that a third of the difference between us and the most productive countries is down to the quality of management and leadership.

Painter says “You want your plumbers to be trained, you want your cyber security people to be trained – well the same is true of managers. The fact that 82% haven’t received training when they’ve become managers, that tells us really how seriously we’re taking management and its importance collectively.”

The cost of bad leadership

Mark Allen, from Pepperdine Graziadio Business School, says that when he asks the question “Do you have bad managers in your organisation?” to executive audiences, 100% of them say that yes, they do have bad managers.

So why are organisations knowingly hiring and retaining leaders who are not able to perform a vital function of their role: people management? Well, it mostly comes down to a flaw in the system. Top contributors in a company are often given more power and responsibility, even if they do not have the skill set to perform the job well.

But what is this costing companies? Well, if your goal is to have an organisation full of productive talent who drive turnover, then you need to ensure that your employees are engaged – with the company and with their own work. And here is the kicker – of the 20 factors that determine an employee’s engagement level, 15 of them relate to their direct supervisor. In fact, research shows that 79% of people who quit their jobs do so due to bad leadership.

But high employee turnover isn’t the only consequence of bad management. Low morale, waste of resources, legal issues and toxic cultures are just some of the many reasons why companies need to stop being complicit in the repeated pattern of bad management.

The bottom line is, if you want high performance and high turnover, you need more than good managers and leaders to get you there – you need to actively stop bad management.

Leadership development for managers

Sadly, extraordinary leaders – ones who are able to create a positive, high-performance working cultures and lead an organisation to economic growth – do not grow on trees (although if they did, we might be out of business).

If you genuinely want to stop losing your talent due to bad management or company culture, and if you are ready to make a difference in your organisation, then start with your leaders. The fact that so many leaders lack essential training, and that the impact of this is so large, shows us that development truly is essential. But this can’t simply be some tick-box exercise. The best leadership development programmes will start with finding out exactly what type of leader your people were born to be. It will uncover their core strengths and teach them how to use their most powerful tool – their mind. It will then empower them to step into their strengths and take ownership for their role, from a place of authentic leadership. This level of skill is available to everyone, but it has to be actively sought after and developed.

And at Ivy House, that is exactly what we do. We believe that everyone is able to thrive in leadership – when they are given the tools to do so. Our expertise is teaching people these tools, and by doing so, creating organisational and cultural change that directly impacts the bottom line.

If you want to get deeper into the tried and tested ways that leaders can go from being average to extraordinary, download our whitepaper, which goes into detail about the specific challenges leaders face today and how to overcome them, and outlines the three pillars of extraordinary modern leadership.





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