The cost of managers who don’t motivate

No doubt Jack believes he is doing a good job in how he handled Mohan. In his view that’s the way to efficiently breeze through an appraisal: tick all the right boxes to keep HR happy and make sure your people know who’s in charge.  (By the way, if you have not yet read the article about Jack’s appraisal it’s here).

That’s how we do things around here

It is more than likely that Jack has been taught this approach, or picked up the style from his own managers, or was hired for his ability to manage in this way. It’s also quite likely that senior management has no awareness, and possibly little real interest, in how their ‘front line’ troops are being managed and led – and that, rather than ‘managing by walking about’ (MBWA) they manage by data, using reports and spreadsheets to know what is happening.

And we can make a pretty reasonable guess as to the reliability of the data on which they rely from the manner in which Jack ensured Mohan’s appraisal ticked the right boxes and in the right way.

(But the way, you’ll find a lot of words such as ‘possibly’ and ‘likely’ in this article. This is because we are simply doing what any wise communicator does when assessing a situation – we’re gathering clues-to-be-verified.)

What motivates people in organisations?

The Gallup organisation did a world-wide survey of over 1,000,000 employees to discover which factors had most impact on employee productivity and satisfaction. They identified 12 key factors which they said could can be encapsulated in one sentance The factor which most impacts how successfully and thoroughly an employee does her or his job is their relationship with their immediate superior.

The cost of poor management

If we take the Gallup findings as an indicator, we get some clues-to-be-checked on the potential implications of Jack’s style of managing and leading:

• It’s likely that Mohan is already looking for another job – no one except, perhaps, the absolutely desperate, would continue to work for somebody who has little interest in their welfare and who is insensitive enough to publicly humiliate them like Jack did
• Meanwhile he will provide the company with only as much co-operation and buy-in as is absolutely necessary to not get sacked
• If he works in a customer-facing role then, at the very least, he is unlikely to be an enthusiastic ambassador for the company
• If others are being treated in this way Jack has a pretty contaminated team with low morale and a them-and-us culture
• Over a couple of years Jack’s style of leadership will result in a team which is made up of people with such low skill levels and poor self esteem that they only stay there because they can’t get a better job elsewhere.

How can Jack’s company thrive in a challenging economic climate? How can a company like that perform optimally? And do more than just survive? It certainly will have a huge staff turnover, especially if this pattern is replicated in other departments. Think of the cost of advertising, recruiting, and training new staff. What a huge waste. But that’s a relatively minor cost when compared with the overall effect.

Unimportant employees?

Some years ago, as a consultant, I was called in by a retail organisation. The MD and wanted the company to be more customer focussed – just like he was when he founded the company years previously.

So he agreed that, rather than do the usual thing and send a few key managers on the training, we would have everyone attend – managers, restaurant staff, warehouse workers, administration staff, and frontline salespeople. To raise awareness of the importance and value of each employee we did an exercise on each of the resulting workshops in which the groups would calculate the annual cost of lost sales resulting from a disaffected member the retail staff as compared with an efficient and enthusiastic front-line person.

The results, averaged over all of the workshops, suggested that the company lost somewhere between £190,000 and £240,000 per annum in sales.

Ambassadors

Yep, this ‘lowly’ sales person, who may be receiving just above the minimum wage, who may be ignored or overlooked by senior management, who may have received little training other than in how to use the till (cash register), in the eyes of the customer IS the company.

To the customer this person is the ambassador of the company. And how they treat the customer determines the customer’s experience of the organisation. And how theyare treated by their manager or supervisor largely determines how they treat customers. No one is unimportant in an organisation – one weak link can mean unhappy customers. And unhappy customers go elsewhere.

In short…

Earl Sasser, one of the authors of two great books on employee-care and customer-care The Service Profit Chain and The Value Profit Chain, describes this impact quite simply: ‘Organizations are in value exchanges with both their employees and customers.

If the organization does not create superior value for its employees, it is very difficult for the employees to produce superior value for customers’.  (http://hbswk.hbs.edu/item/3405.html)

We could wonder how Mohan, after his public humiliation, feels about his company and its customers…

And how this is currently impacting the company’s profitability.