The Boss Factor Revisted

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Managers matter.

57% of people have left jobs because of their managers (1), so even if you haven’t, you definitely know someone that has.

Google’s Project Oxygen was wonderfully notorious on this matter. In a genuinely scientific effort they set out to prove that managers don’t matter… and failed spectacularly.

But how much do managers matter? Beyond the intuitive arguments, what is the actual business case for managers needing to be great coaches and to be coached themselves?

And what can senior leadership do to help produce real change that gets measurable results?

‍It’s through this lens that we will revisit the McKinsey & Company article The boss factor: Making the world a better place through workplace relationships by Tera Allas & Bill Schaninger.

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Making the Case

The McKinsey article gives us some compelling reasons why stakeholders should be fully onboard with giving all of their managers the resources they need to be successful.

McKinsey makes the following observations coming from shareholders and other stakeholders:

• "Shareholders are calling for foresight, bold strategies, agility, and resilience, while governments and communities increasingly expect businesses to support broader goals, such as sustainability and social justice."
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• Environmental, Social & Governmental (ESG)(3), and Diversity, Equity & Inclusion (DEI)(4) initiatives are on the rise.
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• Job Satisfaction throughout an organization is seen as a way to "boost profitability and enhance organizational health."

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And here are three extremely important sources of documented benefits:

Countless studies show the empirical link between employee satisfaction, customer loyalty, and profitability.

A large-scale meta-analysis found that business units with top-quartile employee engagement achieved operating-profit margins that were one to four percentage points higher than those in the bottom quartile.(5)

Employee satisfaction has also been shown to contribute directly to shareholder value.(1)

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There are clearly rock-solid logical and practical reasons for senior leaders to step up and embrace the kind of support for their managers that will increase both the  shareholder and social valuation.

What Changes Bring The Most Benefits?

It may seem simple, but after decades of emphasis on "command-and-control", it really does come down to the fact that the link between employee and manager is a relationship, and the factors that make every relationship successful are universal:

• Empathy, Compassion and Vulnerability. These traits have been seen as weaknesses by senior leaders for a long time. These so-called "soft skills" are more and more seen as highly desirable "power skills" in the business community. They are crucial elements for developing the kind of rapport that leads to a loyalty and productivity well above what can be achieved by "barking orders".
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• Gratitude. It should go without saying that people are more effective when they know they are valued and appreciated, but all too often managers believe this will only bring complacency. When genuine gratitude is paired with challenging, attainable goals, you have the ingredients for a high-performance team.
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• Positivity. Constructive feedback has been a go-to tool for every great leader. Criticism and negativity may seem to work in the short run but quickly fails as psychological safety is eroded and communication becomes mechanical.
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• Awareness & Self-care. These new skills can take a lot of energy and be draining to some people. "The recipe for self-care will be different for everyone, but most often includes attention to diet, exercise, rest, and sleep. For many, mindfulness or other meditation practices are also powerful sources of resilience."(1)

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‍How Organizations Can Help Create Better Bosses

Organizations often present their managers with conflicting directives: get higher productivity and efficiency, and... do it "this" way. The last thing an organization should want is managers going "off book" to get results, but years of "this is the way we've always done it" can trigger just that.

Luckily , transitioning your environment to a modern one that reinforces the management behaviors that truly make a difference isn't magic: the principles needed to create change are well established (check out our video Managing Change and Fostering a Culture of Agility with Marion Gamel here!):

• Create a compelling change story. We are creatures of storytelling. A compelling story "connects the dots for everyone in the organization." Celebrate publicly the real-world wins of people within the organization, and share successful transformations that solved specific practical, ethical and relationship problems. (See The Intentional Change Model in the Managing Change webinar.)
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• Role modeling. "Many senior leaders consistently overestimate how much they are part of the solution and not the problem." Nothing destroys trust more than lip service. People sense the difference between reasons and excuses. "The buck stops here," needs to be embraced, not avoided, at the senior leadership levels of the organization or your changes won't hold.
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• Skill and confidence building. While this may seem obvious, this is an area ripe for checking off boxes and growing arrogance instead of building true confidence via real-world results using practical skills. "Research shows that as people gain power, they lose the ability to judge a situation accurately, particularly with regard to how others will perceive their actions." Making sure your training & coaching programs include psychologically safe, yet objectively accurate assessments.
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• Formal mechanisms that reinforce the right behaviors. Results come when the organization's practical values match their states ones. Is the employee's satisfaction with their immediate supervisor and actionable part of performance reviews? Are the best managers actually promoted and rewarded? Is HR screening for high-value leadership traits? Make sure the actual commitment is there!

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BetterManager has coached and trained over 3000 managers and leaders from more than 100 different companies in 10 different languages across the world, and those numbers are growing every quarter. Our leadership team is dedicated to Elevating the Human Experience in the workplace, because employee engagement has been demonstrated over and over to be the biggest driver to increase employee satisfaction, recruiting, retention, and productivity.

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Resources

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(1) Frontline Leadership Project, DDI World

(2) The boss factor: Making the world a better place through workplace relationships, McKinsey & Company

(3) The ESG premium, McKinsey & Company

(4) Diversity wins: How inclusion matters, McKinsey & Company

(5) James K. Harter, Theodore L. Hayes, and Frank L. Schmidt, “Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis,” Journal of Applied Psychology, 2002, Volume 87, Number 2, pp. 268–79.