The Deficit of Leadership Training and Its Impact on Businesses

Quality leadership training is in short supply these days. Learn about the effects and how companies can remedy the good-leader gap.

The definition of quality leadership has changed, an evolution that has quickened exponentially in the past few years. The rise of social media, the #MeToo movement, and job review boards have placed an intense focus on having leaders with character, discretion, and sensitivity to the needs of employees. But despite this shift, leaders without these traits were rarely good for an organization—it’s just that more of them could get away with bad behavior.

Excellent or terrible leaders are the difference between long-term success and failure. And while there has been greater recognition of the need for quality leadership, the tools that create great leaders are in short supply. A deficit of formal training means that succeeding or failing as a leader is often a “sink or swim”—“you have the skill or you don’t”—proposition.

The cost of bad leadership

CEB/Gartner research states that “50-70% of executives fail within the first 18 months of promotion into an executive role,” with roughly 3% of those failing “spectacularly.” In a way, these rapid failures are a good thing, as the issues have been recognized and possibly remedied. A bad leader who maintains their position long term can be far more damaging to an organization.

Consider these research observations about poor leadership:

• “Only 49% of full-time workers responded that they had ‘a great deal of trust’ in those working above and alongside them.”
• “Over 75% of the workplace says that their bad boss is the worst part of their workplace.”
• “50% of employees who don’t feel valued by their boss plan to look for another job in the next year.”
• “44% [of employees] say that they’ve been verbally or even physically abused by a superior at some point in their careers.”
• “Being assigned to a good boss increases personal productivity relative to being assigned to a bad boss, and the effects are large.”

Leaders have an immense impact on organizational satisfaction, productivity, and success. But despite this importance, individuals are still routinely placed in positions where they can do tremendous damage to a company. Why?

A lack of formal training and the Peter Principle

The Peter Principle is a common reason for bad leadership, as “the tendency … is for every employee to rise in the hierarchy through promotion until they reach a level of respective incompetence.” A classic example is a salesperson who delivers exceptional sales numbers and gets promoted to manage the sales team. Of course, the problem is that the skills to sell a product or service are vastly different from those required to handle a department and lead people.

The practical result is that individuals who are thrust into management either figure it out, rely on their natural personality traits (bad or good), or model themselves after the leaders they’ve experienced. And given how many weak leaders are out there, that last solution often perpetuates problems.

The real solution to this problem involves teaching people how to manage others. While some individuals are naturally better leaders than others, leadership is a skill that can be learned by most people. Unfortunately, not many organizations invest in dedicated training.

A 10-year study by the organizational and leadership consulting firm Navalent found that:

A survey by Ultimate Software and The Center for Generational Kinetics reported a similar result, with 45% of manager respondents saying “they have never received formal management training.” And a CareerBuilder.com study found that “58 percent of managers said they didn’t receive any management training.”

Fewer companies today have leadership training programs or encourage leaders to seek out educational opportunities. This deficit plays a significant role in poor leadership, which, in turn, significantly harms organizations.

What are the solutions?

The COVID-19 pandemic has thrown the business world into chaos, and many companies are eschewing “unnecessary” expenses and benefits, including training programs. Ironically, however, great leadership is even more critical during a crisis.

The ideal solution to lousy leadership is investing in formal training—internal or offsite—that teaches individuals how to manage people, processes, and greater responsibility.

“The old adage, ‘great managers are born, not made,’ couldn’t be further from the truth,” Summer Salomonsen, Chief Learning Officer at Grovo, told HR Dive. “All new managers need training and development to reach their full potential. Management is a skill like any other, that can be broken down into specific habits and behaviors that lead to exceptional performance.”

The additional benefit of these programs is that they can increase productivity and retention among leaders and those who are being led. Employees who receive training that furthers their career are more engaged and likely to stay with the company that invested in them.

Investing in leadership training is a flexible benefit that can help an organization differentiate itself from competitors and retain employees. It’s also a less expensive proposition than pay increases or many traditional benefits, such as expanded healthcare benefits. Nevertheless, many companies are understandably hesitant to devote resources toward any new program during the economic uncertainty caused by COVID-19. 

Fortunately, there are other concrete steps organizations can take to improve leadership:

• Carefully evaluate and adapt hiring practices to onboard better leaders. Beyond scrutiny of a resume, new tactics can include group interviews that gauge a team-leadership dynamic, and interview questions designed to assess soft skills and previous leadership scenarios.
  
• Assess current leaders. This can be difficult, as leaders will put on a good show, and their subordinates may be unlikely to provide a candid evaluation. But if there are warning signs, such as HR complaints, high department turnover, or a noticeable drop in productivity after a new leader took over, intervene through coaching or replacement.
  
• Mentorship. Of every possible step, this one has the greatest potential to develop quality leaders and mirror the benefits of training programs. Good leaders who mentor other leaders pass on many of their skills. And a formalized mentorship program can create a cycle of good leadership that has exponential, long-lasting benefits for any organization.

Most businesses are grappling with the current recession, and some of them are struggling to survive. But increased scrutiny on leaders’ behavior, the impact of bad managers on a company’s success, and the need for strong stewardship during a crisis make quality leadership more essential than ever.

Investing in leadership is an investment in the success and survival of your business.To learn more about how to improve your company’s sourcing, candidate selection, benefits, and onboarding, contact Karp HR Solutions today for a free consultation.