We've all heard the saying, "People don't leave bad companies; they leave bad managers." Unfortunately, it seems there's no shortage of poor management. The impact of bad managers extends far beyond disgruntled employees -- it's bad for business. The cost of bad management is staggering, with estimates putting the financial toll at over $960 billion annually in the U.S. and $8.1 trillion globally, according to Quartz Business News.
Bad managers are a major drag on employee engagement. Gallup's research reveals that 70% of a team's engagement is directly tied to their manager. When engagement drops, the ripple effects can be costly -- lower productivity, higher turnover, and a toxic work environment that's hard to recover from.
Given these statistics, you'd think organizations would be doing everything in their power to eliminate poor management. Yet, incompetent managers remain prevalent. In fact, Gallup finds that companies fail to choose the right candidate 82% of the time.
In many organizations, the path to career advancement is narrow. Ambitious employees who excel in their roles but have no desire to manage others often find themselves with limited options for growth. The only way up is to transition from individual contributor to manager, even if they lack the inclination or skills for leadership. This scenario leads to employees taking on management roles not out of a passion for leading, but for the salary bump, title, and status that comes with it.
Leadership Expert and President of IMS, Charles Good said, "Instead of pushing talented individual contributors into leadership roles, organizations should find ways to leverage their strengths by offering different paths for career development beyond the usual ones. In their internationally best-selling book, Help Them Grow or Watch Them Go, Beverly Kaye and Julie Winkle Guilioni highlight an important point: Some of the best conversations you can have with your employees revolve around what career success means to them. Getting to know their definition of career success is the first step. From there, pursuing that vision can take many forms and go in all sorts of directions!"
Promotion decisions are often based on past performance rather than future potential. Organizations tend to reward high performers with management roles, assuming that success in one area automatically translates to leadership ability. This backward-looking approach overlooks critical factors like emotional intelligence, leadership attributes, and the desire to lead. As a result, promotions become rewards rather than acknowledgments of true leadership potential.
In some companies, internal politics play a bigger role in promotions than merit. Those who excel at networking or have strong political connections within the organization may find themselves in management roles, regardless of their ability to inspire and engage a team. This approach undermines the principle of meritocracy and often places unqualified individuals in positions of power.
Another common mistake is promoting someone to a management position as a means of keeping them, even when leadership isn't what they want or are suited for. This short-sighted approach often backfires, leading to unhappy managers and disengaged teams. To retain top talent, organizations need to understand what truly motivates their employees and find ways to offer growth opportunities that don't necessarily involve managing others.
Once a bad manager is in place, it's hard to remove them. Those who made the promotion decision may be reluctant to admit they were wrong, and sometimes, the extent of a manager's incompetence is only known to their immediate team. In cases where managers are bullies and the corporate culture doesn't reward honest communication, employees may be too intimidated to speak up, allowing the toxic behavior to fester.
Many managers are thrown into leadership roles without the proper training and support. They receive leadership development after the promotion, which sets them up to fail. Despite the billions of dollars spent on leadership development each year, the training often doesn't align with the real-world challenges managers face. This disconnect leaves new managers underprepared to lead effectively. Good added, "Companies should prioritize leadership development as an ongoing journey, recognizing that it starts long before an individual is promoted and continues throughout their career. By investing in this continuous growth, companies can build a strong pipeline of capable leaders ready to drive organizational success."
Leadership development should be customized to maximize impact. Melissa Janis, a leading expert in new manager development cautions, "Even when managers receive training, they often struggle to maximize its value because the program isn't tailored to their specific needs. Covering a wide range of topics like communication, delegation, and business acumen, one-size-fits-all programs overwhelm managers with information they can't immediately use, and they're left to figure out how to apply these concepts on their own. Without development that meets them where they are and the support they need to apply new concepts, training becomes just another box to check, failing to drive real results and leaving both managers and companies frustrated."
Organizations that are willing to change the way they hire, promote, evaluate, and develop their leaders will have a significant advantage over their competitors.
Leadership potential should be assessed and prioritized over past performance. Companies can use 360-degree feedback from colleagues and direct reports to evaluate candidates' leadership qualities before promoting them. This approach ensures that promotions are based on the potential to lead, not just technical expertise.
Rather than waiting until someone is promoted to provide leadership training, organizations should offer management training as soon as they recognize potential. This proactive approach helps employees develop the skills they need to succeed in leadership roles, reducing the likelihood of failure once they're promoted.
Organizations need to create alternative career paths that don't involve managing others. By understanding employees' motivations, companies can offer growth opportunities that align with their interests and strengths, whether that means taking on an international assignment, leading a specialized project, or deepening their expertise in a specific area.
Managers who aren't performing need support to change their behaviors and master new skills. But, if they don't improve, they should be demoted or let go. Taking this tough stance sends a clear message that poor management won't be tolerated and reinforces the importance of leadership integrity and effectiveness.
Not everyone is suited for management, and not everyone aspires to a leadership role. By rethinking how promotions and employee growth are handled, organizations can significantly reduce the prevalence of bad managers. The result? A more engaged workforce, better business outcomes, and a workplace culture where true leadership is recognized and rewarded.
