So what gives? Gallup has been preaching for two decades that in order to reverse this crisis, great managers (like Google's own) that understand human nature and how to motivate and inspire diverging needs of people, need to be put into management roles at every level of the organization.
When a company raises employee engagement levels across every business unit through great management of people, it leads to higher profitability, productivity, and lower turnover.
And therein lies the problem. To remedy the 70 percent crisis, you first have to find those managers. Gallup reports that companies fail to choose the candidate with the right management talent for the job a staggering 82 percent of the time.
On top of that, managers that actually possess the talent to lead are far and few; about one in 10 have what it takes to make an impact and improve a company's performance. Failing to identify the right talent costs companies billions of dollars annually.
So if you're going to point the finger somewhere, who's at fault? The research is critical of firms that ignore the science behind what makes a great manager, then place the wrong people into those roles. When Gallup asked U.S. managers why they believed they were hired for their current role, the most common response cited was "success in a previous non-managerial role" or their tenure.
In other words, most companies make the huge and costly mistake of promoting people into managerial roles "because they seemingly deserve it, rather than have the talent for it." That's a problem.
While experience and skills are important, it's the innate talent in people -- the naturally recurring patterns in the ways they think, feel, and behave -- that predicts great management performance. As a result, Gallup has observed in their data that exceptional managers possess five key talents:
- They motivate every single employee to take action and engage employees with a compelling mission and vision.
- They have the assertiveness to drive outcomes and the ability to overcome adversity and resistance.
- They create a culture of clear accountability.
- They build relationships that create trust, open dialogue, and full transparency.
- They make decisions based on productivity, not politics.
While finding managers that can pull off all five of these talents is a rarity, when it happens across all levels of an organization, Gallup states that it can "double the rate of engaged employees" and, additionally, they achieve, on average, "147 percent higher earnings per share than their competition."
Potential Management Talent May Be Hiding Inside Your Walls
Regardless of market conditions or the current labor force, Gallup found that, for large companies, "1 in 10 people possess the inherent talent to manage. When you do the math, it's likely that someone on each team has the talent to lead -- but chances are, it's not the manager. More than likely, it's an employee with high managerial potential waiting to be discovered," states their report.
In conclusion, if your organization ever experiences high turnover, consider that the only way to stop the bleeding is to look at whom you have in critical management roles. Gallup CEO Jim Clifton boldly summarized in a succinct sentence the severity of this issue when he stated:
The single biggest decision you make in your job--bigger than all the rest--is who you name manager. When you name the wrong person manager, nothing fixes that bad decision. Not compensation, not benefits--nothing.