Avoid The Hidden Costs of Poor Leadership

Posted on October 22, 2015 by Steve Smith, One of Thousands of Business Coaches on Noomii.

We have a leadership crisis in this country. Not only from a talent standpoint but from the hidden costs associated with poor performance in various leadership positions at present.

Studies by such notable national recruiting firms like Challenger, Grey & Christmas chronicle the costs associated with executive turn over and the costs to companies leading up to and after the executive is gone. And while companies tend to resist the decision to remove an executive (unless laws are broken or financial impropriety takes place) many wait way too long to address early signs of poor performance or destructive behavior.

Very few business professional that I have known took on their leadership roles with the idea of failing. The successful ones did their homework about the assignment they accepted and made sure to get help when they found themselves in uncharted territory. The others tended to try and force fit their approach or solution into the situation and assess the damage later. With these leadership practices, the damage usually showed up in the form of costly outcomes from poor decisions, loss of key personnel, lawsuits, promotion of unqualified friends or miscalculated strategies that cost the company market share.

Much of this dilemma can be avoided by paying attention to early warning signs that current leaders maybe struggling. Here are 4 early warning signs that an executive may be having difficulty in their current leadership role:

1. Unproductive Communications:

Truly excellent leadership relies heavily on frequent and open communications. From encouraging feedback at meetings to talking regularly with subordinates about the company’s direction, the confident leader understands that people want to be included in conversations that will help them stay focused. These conversations could address professional development, problem solving, or new business opportunities. In all cases, eliciting feedback encourages colleagues and subordinates to play a proactive role and enables the leader to extend authority for the purpose of upgrading performance and insuring mission success. When leaders are not confident or struggle to initiate productive conversations, communications tend to be less frequent and less collaborative. Short, one way, communications start taking over with the intent to deliver messages and reduce discussion that could lead to more successful outcomes. The fact is, lack of frequent, clear communications is at the root of so many costly outcomes in organizations with many management levels or departments that need to work together.

2. Less Engagement:

Like communications, effective leaders recognize that engaging the troops is vital to establishing trust. The more people have a chance to interact with the top person and understand what they are all about, the more people will devote maximum energy to achieving what the leader has identified as important. Leaders who resist engaging with their teams (either because they are uncomfortable or see little benefit) forgo the opportunity to build loyal, high performing teams. They also tend to alienate others whose influence could pave the way for more successful outcomes. No amount of intelligence will compensate for lack of engagement when it comes to leadership effectiveness.

3. Lack of Fairness:

Fairness in the workplace can be a challenge under normal conditions. When not promoted and practiced, the perception that work loads, performance reviews or promotions are not based on merit can undermine a leader’s intentions. Some leaders are simply unaware of the subtle ways that people perceive unfair conditions. Others devalue the effects of unfairness in favor of developing things their way. In either case, a workplace or team that suffers from blatant unfair decision making, delegation or compensation practices is destine to lose synergy and eventually, star players. Lack of fair and equitable leadership undermines trust and a desire to put organizational goals above individual ones.

4. Questionable Decisions:

Good decision making is the back bone of every effective leader in an executive role. When decisions are untimely or demonstrate questionable judgment, this is an indication that the executive may be in over their head. At an early stage, the leader in question may just need more exposure to the organization they are overseeing and perhaps some mentoring from above. As time goes on, the effects of poor decision making (long meetings, second guessing, and stressful interactions) set in and the executive is now making decisions from a point of survival. Left unaddressed, the organization will suffer morale-wise, financially and possibly publicly.

Dealing with these early warning signs is not easy. Many executives come hard wired with type A personalities and may have learned during their ascension that being tough and driven will overcome any of the soft skills that a truly effective leader needs in today’s workplace. Addressing concerns early make the solution more palatable and less costly. Ask any seasoned HR executive what happens when poor leaders stay too long.

Your relationship with the individual involved will have a great deal to do with how successful you are at broaching the subject. The best approach will prompt the executive to reflect on his/her own values and how their handling of their role is getting in the way of them accomplishing what is important to them. Some successful possibilities include coaching, executive retreats and CEO roundtable memberships. Sometimes, reading the right book can do the trick. Years ago, I read a book by Marshall Goldsmith- ‘What Got You Here Won’t Get You There’. What a fascinating book about the very behaviors that hold executives back. If the executive in question is sincere about improving, invite them to look at alternatives for improving themselves professionally. For executives who are completely unaware of their behavior or demonstrate little interest in performing at a much more successful level, leave a copy of Marshall’s book for them to read, unanimously of course!