What Are Ineffective Leaders Costing Your Company?

"Some bosses are like clouds: the minute they disappear, the day suddenly gets brighter!" Attributable to every disgruntled employee ever...


Have you ever had a boss who either dismissed your ideas or took credit for them? Failed to realize, or to care, that you couldn't handle yet one more task? Who said his or her door was always open only to close it when you actually needed something? Who never acknowledged your successes or supported you in your challenges?

Sure! Everyone has. Including your employees? Asking your people these questions could well be a humbling experience - but perhaps a necessary one. The bottom line is that ineffective leaders are a liability organizations cannot afford. We all have weaknesses, but the strong leader works to identify, acknowledge, and overcome them.

The Cost of Bad Bosses


Ineffective leaders can - and do - work in any organization, and they are far more prevalant than most of us would like to admit. Three of four employees, for example, say their bosses are the "worst and most stressful" parts of their job. There's an old adage that people don't quit their jobs, they quit their leaders. And it's true: half of employees who do not feel valued by their leaders plan to look for another job in the next year.

Bad bosses erode morale, tank engagement, and hinder productivity. All of this results in a measurable impact on the bottom line. Gallup found that poor leaders cost the US economy $319-$398 billion annually, and companies spend $360 billion each year in extra health care costs. Employees who do not have a positive relationship with their leader, for example, are 30 percent more likely to suffer from coronary heat disease.

The old "bad boss" trope gets a laugh in movies and television, but there is nothing funny about ineffective leaders in your organization. What lies at the root of the problem - and how can you fix it?

What We Have Here Is a Failure to Communicate


It always comes back to communication. According to an Interact/Harris poll, the vast majority of employees (91 percent) say that communication issues "drag executives down." Top complaints include:
  • Not recognizing employee achievements.
  • Not giving clear directions.
  • Not having time to meet with employees.
  • Refusing to talk to subordinates.
  • Taking credit for others ideas.
  • Not offering constructive criticism.
  • Not knowing employees' names.
  • Refusing to talk to people on the phone/in person.
  • Not asking about employees' lives outside of work.

Lou Solomon, CEO of Interact, writes:
What it all boils down to is that business is about people - it always has been, and always will be. Too often, businesses fall short not because leaders don't understand the business, but because they don't understand what the people who work for them need in order to bring their best effort to work.

Productivity, engagement, satisfaction, performance - all the metrics that you're shooting at are directly connected to communication. If you're falling short in this area, you are not going to achieve the results you want. Is all lost? If it were, you wouldn't be here. You can improve. As YP CEO David Krantz reminds us, "Effective communication with employees takes effort, repetition, thoughtfulness and most importantly needs to come from the heart."

Solomon recommends taking several steps that, when combined with that effort, repetition, thoughtfulness, and sincerity, will help you overcome communication challenges that are bring your people down.

  • Know - and Use - Their Names. You know the expression, "It's the least I could do." Well, knowing your employees' names is the very least you can do for them. People want to feel valued and important. "Hey, you" doesn't cut it. Not by a long shot. If you run a large company, start with your immediate team, and then start working out from there.

  • Thank Employees for Their Efforts. Nearly 80 percent of employees do not feel valued at work, and 55 percent leave their current jobs for organizations that recognize their employees' contributions and efforts. While money, perks, and reward programs are great, they never take the place of a simple and heartfelt "Thank you."

  • Be specific when thanking your people: "Thank you for taking the initiative on this project and getting it done early." Or "Thank you for keeping a cool head during this crisis. You kept it together, and you kept everyone on track." This highlights their value, and as employee engagement expert Laura Troyani says, "Reinforcing behavior creates a norm within your workplace community that these are the types of behaviors you want."

  • Provide Feedback. This is an area where many leaders fall down. But research shows that employees (particularly younger ones) want continual and ongoing feedback. Even if it is negative or corrective.
    As leadership experts and researchers Jack Zenger and Joseph Folkman discovered, 43 percent of employees prefer praise and recognition. Fifty-seven say they want corrective feedback. According to their study, 72 percent said their performance would improve if managers gave corrective feedback, and nearly all - 92 percent - agreed that when "delivered appropriately," corrective feedback is "effective at improving performance.
    The takeaway: provide feedback in "real time." That is, make it a regular part of your interactions with your people. This way, they expect it, and one corrective comment isn't going to send them into a downward spiral - which often happens when they're delivered during a once a year performance review.

  • Ask for Feedback. Ask your people for ideas and suggestions that could improve the team and the organization as a whole. Ask them about what's working, and what's not. As Solomon writes, you need to "establish a safe environment" in which employees feel comfortable sharing their views.
    The value is twofold: employees feel heard and valued - and they can come up with some great suggestions. If you love your Prime two-day shipping, you can thank Amazon software engineer Charlie Ward. He suggested the idea of a free shipping program, and another employee came up with the name "Prime." This helped turn one-time shoppers into Prime-obsessed loyalists. This is just one example of the payoff that comes from listening to your people.

These five ideas are just a starting point - do not let them be your ending point. Make every effort to strengthen communication with your employees, and the results will speak eloquently and powerfully for themselves.

Written By

Larry Hart


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