Labor Law: Bad bosses, big losses

My speech was on Bad Bosses/Big Losses. There is no doubt that bad bosses can cost your organization more than just a lawsuit. A bad boss can cost your company turnover, lost productivity, harm to your organization’s reputation and lower morale.

Some estimates show that bad bosses cost the economy $360 billion annually in lost productivity. In fact, in one survey, 65 percent of respondents said they would take a new boss over a pay raise, and 75 percent said their boss was the most stressful part of their day. Many employees report that their bosses do not appreciate them, and just less than half report that they have been verbally, emotionally or physically abused by a manager or supervisor at some point in their careers.

The ironic thing about a bad boss is that we’ve all had them, and they are everywhere, but I can guarantee you are reading this article thinking not about whether YOU are a bad boss, but thinking about that other person who was a bad boss. The key to success is realizing that being a boss gives you a substantial responsibility not just to make your numbers and do your own job, but to develop others and ensure their experience is equally positive in the organization.

A significant example of where this equates to a bottom line impact is demonstrated in a study done by Xerox. In this case, Xerox was experiencing high turnover in its customer service department. As a result, it hired a workplace data analysis company to study the reason for the high turnover. The study showed that a number of factors contributed to the trend, but supervisors were the strongest predictor of whether employees were going to quit. In fact, it showed that supervisors who were better at supervising employees and engaging their teams could keep employees up to five and six times longer than the “drill sergeant” type supervisor. As a result, turnover dropped 20 percent in just six months and, by fixing the boss, Xerox saw higher productivity.

The study is critical for a lot of reasons, but namely how impressive it was that Xerox made the effort to figure out the problem. So many times organizations blame lazy employees or incompetent staff. The reality is that many times organizations have great workers on board, but they simply aren’t motivated to perform and see no loyalty to management in giving their best effort. This also plays out in a study that showed that about one-third of employees admitted to intentionally slowing down or purposefully making errors due a bad boss, and about the same number admitted to not putting in maximum effort due to their boss.

The key to uncovering bad bosses is to give employees a safe forum to express concern. Many companies conduct workplace surveys, and while I also do these for employers, in my experience merely sending out a survey asking employees to complete it and return it does not uncover serious workplace issues. The best way to uncover issues is to create a true, sincere, retaliation-free workplace where dissent and concerns are welcome. The other way is to talk to employees privately, creating a safe environment. Employees are usually suspicious about whether the discussions are genuine and for a proper motive, but if this type of conversation is frequent and commonplace, employees will accept it as a positive part of the culture. I also find that 360-degree evaluations sometimes have the ability to uncover issues, but again, this must be a safe, retaliation-free environment, which I think rarely exists in most organizations.

In closing, I would ask you think for just a minute – am I a good boss? In virtually every workplace investigation I’ve done where I’ve uncovered a horrible boss, the person is completely unaware of his or her own failures. Being a great boss involves being selfless, considerate and patient while also setting high expectations and holding people accountable. It involves excellent communication. Being a great boss takes a lot of work, but the rewards pay back in more than dividends.