PEOPLE MANAGEMENT is the most serious failing of Australian leadership, with adverse effects on staff engagement, productivity, turnover, customer metrics, workplace safety and ultimately profitability, according to a recent report
PEOPLE MANAGEMENT is the most serious failing of Australian leadership, with adverse effects on staff engagement, productivity, turnover, customer metrics, workplace safety and ultimately profitability, according to a recent report.
It also found that people management skills, which were once considered to be ‘soft’ with an unquantifiable impact on business, are now seen as directly impacting the bottom line.
The Hudson Report, which surveyed more than 7,600 people, found the issue of poor people management on the part of leaders was prevalent across all industries, states and organisation sizes, with the exception of the utilities sector, where change management was considered an equally significant failing of leadership.
While leadership in the workplace means different things to different people, an ability to manage and effectively engage colleagues is a core attribute that continues to be undervalued in a many organizations, said David Reynolds, general manager of Hudson’s Human Capital Solutions division.
“Some managers rely on leading by example to achieve success, and some employees will respond positively to this. But in order to achieve strong leadership across the depth and breadth of the business, managers must be in-sync with their people and have a close understanding of what drives them,” he said.
“That includes understanding their thoughts, feelings and emotional needs if managers are going to be successful in influencing their people to deliver to a common company objective.”
Leadership selection and development should in addition to the more tangible leadership competencies that are traditionally assessed, focus on the ability to identify, understand, use and manage emotions, the report found.
Additionally, while poor people management has been identified as a core weakness of leadership, only 51 per cent of Australian managers have been formally assessed for their leadership/management competencies.
In simple terms, the report concludes that almost half of Australia’s managers are left to infer, assume or guess their own strengths and weaknesses, which Reynolds says is a dangerous state of affairs.
“If Australian business is leaving the development of leadership skills to guess work, then we are dramatically reducing the effectiveness and efficiency of our people and therefore constraining organisational success,” he said.
The most common method used to assess leadership and management competencies (41 per cent of cases) is through the performance review system, the report found.
However it concluded that the problem with this as a method of leadership assessment is that it is entirely retrospective and does not test potential for higher-level roles.
It suggested that more valid assessments of potential, through mechanisms such as assessment/development centres that stretch leaders and allow them to be observed operating at a higher level, are used for only 10 per cent of those assessed – or only about 5 per cent of the Australian management population.
