THE GREAT BRITISH PRODUCTIVITY SWINDLE – 3 Painful Truths No 2. The Manager

In the first Painful Truth of this series, we highlighted the need for business owners to implement robust Management Control Systems and Key Performance Indicators, critical to measuring and optimising productivity.

The Bank of England’s “Lessons on a Plate” gave us some insight as to why businesses are woefully unproductive, and the impact on profits. This article explores the second Painful Truth: The Manager.

The Government is pouring money into Leadership and Management development, possibly fuelled by scathing claims by Andy Haldane, the Bank of England’s chief economist, that,

“Bad managers stand accused of holding back economic growth in the UK by undermining productivity, and preventing pay and living standards from rising”. Mr. Haldane continued “Just as most people believe they are better than average drivers, so most firms believe they are highly productive…A lack of management quality is a plausible explanation for the UK’s long tail of [unproductive] companies” and “there is a statistically significant link between the quality of firms’ management processes and practices, and their productivity.”

Training is a necessity not a luxury

I’ve spent thousands of hours observing managers in the field, and there are two fundamental problems I’ve witnessed, which business owners need to address:

1. Managers are not trained in setting expectations or communicating standards of work required to meet business goals.
2. Managers lack the people skills to communicate, delegate and constructively challenge poor performance or, conversely, reward and perpetuate good performance.

Both these issues have a domino effect impact on the managers’ teams’ performance, as the staff will basically just get on with doing what they think is right, but potentially completely mis-aligned with the company’s objectives.

I’ve often heard managers suggest their teams know what they have to do and they just need to let them get on with it. This then begs the question as to why companies pay managers and supervisors at all. And little wonder we’re now witnessing the Great British Productivity Swindle, with the biggest downturn in UK productivity since 2008.

A case of ‘a bad workman blames the tools’?

In my experience of working with team leaders and management in industries around the globe, it’s unfair to blame the managers themselves. Managers can only be as good as we make them, and the onus should be on the business owner, or executive team, to ensure their managers are equipped with the tools and people skills to carry out their jobs effectively.

How often have you promoted a high performing team member to a supervisory or management role, only to find overall performance drops sharply? A good worker doesn’t necessarily make a great manager. They have the advantage of a strong technical knowledge of the work to be done, but may have no management or people skills whatsoever.

The good news is that leaders can be shaped, and managers can be made.

For your managers to have a positive impact on productivity, you may need to invest in training to ensure they have the right tools, techniques and skills to guide their teams towards becoming more productive and effective, and achieving those all-important KPIs.

I’ll end this article with more words from our Chief Economist, which sums up the solution perfectly.

“If we’re to turn the tide on this slippery slope towards diluted profits, business owners have to invest time and money into their Managers. This suggests potentially high returns to policies which improve the quality of management within companies.”