Leadership: People not process

Another year is all but over. And, on reflection, there haven’t been many examples of outstanding leadership on which to comment or from which to draw inspiration this year, at least not on the home front. Rather the contrary.
Come year’s end, almost, and on my desk are the results of new research study that suggests 52 percent of Australasians are demotivated at work. In other words, every second New Zealander and Australian works in “de-energising” environment created mostly by unresponsive and uncommunicative managers and leaders.
How depressing is that? It’s not as though the world generally is exploding with positive happenings from which we might draw non-work-based enthusiasm and exhilaration.
To winkle out this sad detail, global consultancy Hay Group interviewed more than 3000 managers and 15,000 employees that report to those managers, from across the two nations. The compelling conclusion the researchers came to is simply – the state of “engagement” between employees and team leaders in organisational Australasia is “poor”. Researchers are sometimes masters of the understatement.
Employee perceptions of their organisational climate are influenced by the relationship they have with their bosses. That’s both understandable and long-held truth. That Kiwi and Kangaroo managers don’t talk honestly and openly to their charges has, from my personal experience, been topic for management writers for decades.
Why go on about it, then? Because, this year the New Zealand and Australian governments have been bashing away at the productivity shortcomings of both economies. They even set up joint study programme through their respective Productivity Commissions. The commissions are, of course, focusing on macro-economic policy settings. They’re trying to find the right regulatory impetus to boost each nation’s level of productivity, based mainly and predictably, on more deregulation of perceived business constraints such as the Environmental Management Act.
This study shows, as others have before, that people relationships at work can have profound impact on organisational productivity. Yes, I understand that when the Labour government of the 1980s deregulated New Zealand’s agricultural sector its productivity rebounded spectacularly. And yes, deploying sophisticated new technologies can drive productivity. But for most ongoing and steadily consistent enterprise productivity gains, it’s the people, stupid!
The Hay research proves this yet again. Unless managers lead not the process but the people, productivity languishes. The study suggests that, not only does productivity falter through what are called “low engagement levels” between managers and workers, but so too does the Australasian region’s overall competitiveness. That’s even more reason for organisations to start addressing this particular leadership and management problem.
According to Hay and other researchers I’ve read, employee performance can depress business performance results by anything up to 30 percent. That’s lot of bottom-line potential to sacrifice and leave hostage to poor leadership practices. Looking at manager versus employee relationships through this particular lens suggests healthy payback on any investment made to solve the people engagement problem.
As the Hay researchers suggest: “… creating an energising work environment which encourages employees to put in that little extra can mean the difference between achieving an average or high-performing organisation”.
Some of the other findings of this particular study were, in leadership context, also interesting. For example, 73 percent of the 15,000-plus employees surveyed were happy with the autonomy they had to get on with their work. According to the researchers, this reflected “a degree of trust for employees to take initiative and use their own judgement”. Hopefully that’s correct.
It’s shame, then, that managers don’t feel motivated or sufficiently equipped to take the next step and talk more with people about the outcomes of their endeavours. Being left to get on with things is fine. But it’s also important to know that someone cares enough to chat about what’s being done.
And finally, it seems 62 percent of our employees are “extremely dedicated” to their jobs and to the enterprise for which they work. That looks like fruit ripe for plucking if the boss cares to create the environment in which that potential might flourish.
This study says what we already know. Good managers and leaders who build good relationships with people can accomplish amazing things. You’ll find examples in some of the organisations that made it through as finalists and winners in this issue’s coverage of the 2012 Deloitte/Management magazine Top 200 Awards. They provide evidence that the best leaders, not just the best processes, deliver. Problem is, there are just too few of them out there. M

Reg Birchfield is writer on leadership, governance & management. [email protected]

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