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One of the most important decisions companies make is simply whom they name manager – but what happens if that decision is poorly made?
In fact, according to Gallup’s The State of the American Manager: Analytics and Advice for Leaders report, companies miss the mark on identifying high managerial talent in 82% of their hiring decisions.
Based on over four decades of study, the report polled 2.5 million manager-led teams in 195 countries, and measured the engagement of 27 million employees.
It found only 10% of employees today possess the talent needed to manage others.
“Though many people are endowed with some of the necessary traits, few have the unique combination of talents needed to help a team achieve excellence in a way that significantly improves a company’s performance,” the report stated.
The study attributed the inability of companies to hire good managers to lack of science or research done prior to recruiting them.
Defining talent as the natural capacity for excellence, the report added it was integral for companies to choose managers with the right talent, given the significant impact that talent quality has on managers’ engagement levels.
Managers with high talent were found to be more likely to be engaged than their peers. More than half (54%) of managers with high talent were engaged, compared with 39% of managers with functioning talent and 27% of managers with limited talent.
Interestingly, female managers are more likely to be engaged than male managers (41% to 35%, respectively).
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“Most CEOs I know honestly don’t care about employees or take an interest in human resources,” Jim Clifton, chairman and CEO of Gallup, said.
“Sure, they know who their stars are and love them — but it ends there. Since CEOs don’t care, they put little to no pressure on their HR departments to get their cultures right, which allows HR to unwittingly implement all kinds of development and succession strategies that don’t work.”
The report stressed it was key for organisations to judge managerial engagement levels as managers’ engagement had a direct impact on employees’ engagement.
Employees who were supervised by highly engaged managers were 59% more likely to be engaged than those supervised by actively disengaged managers.
One in two employees had, in fact, left their job to get away from their manager at some point in their careers.
Individuals who worked for a female manager were, however, six percentage points more engaged, on average, than those who worked for a male manager.
“The fact is, real management talent exists in your company right now. Companies that use predictive analytics and intense development techniques will have a profound advantage in the all-out war for the best customers,” Clifton said.
The report added approaches to hire and develop more managers with great talent included creating a holistic, talent-based human capital strategy, and rewarding job performance instead of job title.