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Your Actions Matter: The Effect of Good and Bad Leadership


Leadership development isn’t just a nice to have – it’s essential to have. Leadership behaviours can have a profound effect, not only on the direct reports, but also the wider organization. Effective, well trained leaders motivate employees do their best work, while ineffective leaders can pass on their bad habits to their direct reports. Here we outline three major ways a leader can effect the workplace.

1) Employee engagement and performance

A leader’s behaviours can have a profound effect on employee’s engagement. A study by Harvard Business Review found that the direct reports of the worst-performing high-level managers were also below-average performers. Conversely, high-level managers who were rated as very effective had direct reports who were also rated far above average.

A leader does not just have an effect on their direct reports, but also the direct reports of the leader’s direct reports. High level managers whose overall leadership effectiveness was in the bottom 10% had direct reports (DR) whose engagement scores were in the 15th percentile, and the direct reports of those DR managers had engagement scores in the 24th percentile. In contrast, high-level managers whose overall leadership effectiveness was in the top 10% had direct reports (DR) whose engagement scores were in the 81st percentile, and the subordinates of these DR managers had engagement scores in the 74th percentile. Bottom line: the behaviours of a manager will ripple through the organization: good puts out good and bad puts out bad.

“Managers account for 70% of the variance in employee engagement scores.”Gallup

2) Professional development

Not only will employee engagement and performance be affected by bad leadership, but according to social learning theory, leaders’ behaviors are easily learned and imitated by followers. Ineffective leaders pass on bad habits on to their direct reports. This can subsequently impact the quality of the leadership pipeline and over time, this cycle can erode the employee performance throughout the organization. Simply put, managers are role models of appropriate behavior and their actions have consequences for the future success of their company.

3) Employee well-being

Poor leadership can be linked to greater employee stress, reduced job satisfaction, and significantly lower levels of personal well-being. Employee stress can significantly affect workplace productivity – in fact, the American Psychological Association has estimated that 550 million days of work are lost every year because of job-related stress. Not only will employee productivity suffer under poor leadership, but the employees will be more likely to look for other jobs. Research shows that up to 50% of respondents have quit a job because of a bad manager. So how can organizations ensure that their leaders are providing GOOD leadership?

3 Actions to Promote Good Leadership in the Workplace

1) Address ineffective leadership behavior

An organization has to be able to spot ineffective leadership. High turnover rates and low employee morale and performance can be signs of an ineffective leader. Having a performance management system that is able to track employee feedback and performance of employees is essential for this purpose. In addition, ineffective leadership should be addressed. Explain the consequences if the leadership behavior ends up violating company policy and address specific skills that the leader needs to improve (see point #2 below).

Pro-tip: Upward feedback can be considered as it can help improve the performance of the manager. However, if there is little trust between the employee and manager, the feedback may not be completely accurate (because the employee could fear retribution, for example). We would recommend to establish a healthy culture of feedback – this will make employees feel more comfortable sharing feedback with their managers.

2) Invest in leadership assessment and development

Place your employees and managers in business leadership training workshops and courses annually. Provide educational webinars and custom leadership training courses. This should be done even if you believe that all your leaders are great. Continuous training and professional development should be done at all levels of the company.

3) Feedback, feedback, feedback

360-degree feedback can help a leader understand how they are perceived by those around them. However, having the courage to give feedback to the boss can be frightening; hence, it is ideal to have a feedback system that can be done anonymously (Pavestep has this option!). Remember that feedback has to meet certain criteria in order to be effective. Check out our guide to effective feedback for more details.

What are your thoughts? Have you had to deal with addressing ineffective leadership?

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