What Is The Business Equivalent Of Designing & Building A Sports Car & Then Shoving A VW Beetle Engine In It?

Have you ever worked for a bad leader? One who is clueless about managing a team and fails to motivate or inspire? Unfortunately, too many of us have. The root cause of this situation is that too many businesses assume that leadership skills can be absorbed through osmosis. This assumption is as far from the truth as assuming that no one really cares about the outcome of the Ashes.

Companies do understand that they need to train their staff in skills such as finance, project management, engineering, and so on, but they rarely prioritise and fully invest in the need to develop essential management and leadership skills. It really is the business equivalent of spending a fortune on a sports car but saving money by putting a 20kW original VW Beetle engine in it.  It may look good, and it may feel nice to sit in it, but you aren’t going anywhere fast! This lack of investment is a massive oversight and can lead to serious problems for any organisation.  

Skilled leaders, even junior team leaders, play a vital role in encouraging innovation, maintaining safety, ensuring a respectful workplace, and improving retention. They can have a significant impact on the productivity and profitability of a business. The cost of not getting leadership training right is enormous. Poor retention, workers’ compensation claims, low productivity, and other issues can cost organisations dearly.

So how about a few facts?

  • According to a report by Gallup, organisations with high employee engagement have 21% higher profitability than those with low engagement. Trained leaders who maintain a respectful workplace, encourage innovation, and improve retention can lead to higher employee engagement, positively impacting profitability.
  • A Leadership IQ study found that employees with bad bosses are more likely to quit their job (not sure that really needs a study to work out…..). Turnover can be costly for businesses, with the Society for Human Resource Management estimating the cost of replacing an employee to be between 50% to 200% of their salary
  • Good leaders encourage diversity and inclusion, leading to more innovative and productive teams, positively impacting a business’s profitability. Research by McKinsey & Company found that diverse teams are more innovative and better able to solve complex problems than homogeneous teams. 
  • Good leaders will maintain a safe workplace and reduce workers’ compensation claims, which can positively impact the bottom line. 

So, what are the foundational skills that leaders can be taught that will make all the difference?  

  • Leaders must be able to delegate and supervise.  Some great and easy-to-teach frameworks will enable leaders to delegate well, manage appropriately and have impactful conversations with their teams.
  • Leaders must be able to bring out the best in their team members.  Establishing psychological safety, building trust, and ensuring a supportive environment may seem complex, but again, some simple processes and models can help your leaders achieve this.
  • Leaders must demonstrate the standards and behaviours the organisation wants to follow.  Exposing the leaders to an understanding of how their behaviour impacts others, how they can establish their brand and how they analyse their team’s part in business outcomes can immediately improve the leader’s impact.

So, skilled leaders can significantly impact a business’s productivity and profitability by maintaining a respectful workplace, improving retention, maintaining safety, and encouraging innovation.  The cost of not getting leadership development right can include poor retention, workers’ compensation claims, and low productivity, which can cost businesses dearly. 

Act and invest in leadership development today. Your business, your team, and your bottom line will thank you for it.

At nXus People, we can help.  We understand the importance of strong leadership and can design and deliver programs to suit your organisation’s needs. Our partners have over 100 years of practical leadership experience and can help your organisation to develop strong leaders at every level.