The hidden costs of disengaged managers

Summary

• While employee disengagement is a common problem grappled with by HR, a much more costly problem is managerial disengagement.

• The cost of manager disengagement takes the form of failed initiatives, underperforming company culture, and higher safety violations.

• Address manager disengagement early on with daily feedback initiatives. 

Most of the employee engagement discussions have focused on front-line workers; after all, they are the staff getting the core work done. What often gets forgotten is the engagement of front-line managers, where up to two-thirds are disengaged. In fact, manager disengagement is even more detrimental to the success of hourly workforce businesses.

This probably stems from a few key misconceptions about a front-line manager’s job. Maybe it’s under the guise that they must be bought in because they’re willing to take on more responsibility. Maybe it’s because they’re willing to work overtime without being paid extra, and only someone that really enjoys their job would do that. Or, maybe it’s from the belief that managers are incompetent and only do busy work, so any investment into their engagement wastes resources.

Based on the last belief, Google undertook some of the most comprehensive field research to prove the hypothesis that managers don’t matter. Many of their individual contributors were frustrated with their overpaid and meddling managers, and they probably became even more frustrated when Google released the results.

The managers at Google were shown to significantly increase employee performance and decrease turnover when they were good managers. This distinction is essential because when front-line managers become disengaged, their performance slips, and they can become bad managers, whether they work in software or hospitality.

So what are the most significant costs to companies when front-line managers become disengaged and ineffective?

The hidden costs

Manager turnover immediately comes to mind as a significant cost amid rising disengagement. This is because one day the manager was there, the next they’re not – you can physically see the change. 

What often doesn’t get noticed is the degradation that leads up to the resignation – where the manager is still there, but they’re not present. 

A disengaged manager incurs significant hidden costs long before they even leave a company.

New initiatives fail and don’t roll out

The top reason new initiatives fail isn’t that they’re inherently a bad strategy, it’s because they weren’t executed well and never get adopted. It’s a failure to execute the change. If you reflect on your working experiences, this seems self-evident, but it isn’t the narrative on LinkedIn and other expert circles. 

Once you’re operating across multiple locations or above 100 staff, the complexity of rolling out a new initiative will require some form of basic change management. In fact, this complexity creeps up much sooner than most would expect.

For this to work, front-line managers must be bought in and eager to see this change through. While you can conduct the initial training, roll out the software, and run progress meetings, you won’t have the capacity to ensure all your front-line staff are following it. You need your front-line managers to step up to make sure everyone is doing the right thing every shift.

When front-line managers are disengaged, they’re less likely to go above and beyond. Instead, they will do the minimum work required. In change management terms, this means they become ‘resistors’. 

Ultimately, if your managers are disengaged, they will resist change because they don’t care to make the extra effort, and they won’t make sure their team is doing the right thing. This apathy leads to many well-designed initiatives failing and incurring massive costs.

Firstly, the investment in the initiative itself. This includes the upfront cost of resources such as software, materials, and consultants, as well as the ongoing costs like staff training, progress meetings, and reviews. When the initiative fails to materialize, it means all of these costs were for nothing.

Secondly, the opportunity cost of not being able to do the initiative. Hopefully, the initiative was prompted because rolling it out meant it would resolve a major issue to hit a key business outcome. When you compare the cost of not hitting the business outcome, it’s usually even higher than the initial investment (i.e. it had a positive ROI). This can manifest into serious long-term consequences, such as declining market share, lower customer satisfaction, and reduced profitability.

Quickly infects company culture and lowers performance

Not only can manager disengagement prevent you from tackling new business priorities, but it can even take your organization backward – rapidly.

Gallup research found that disengaged managers had a greater negative impact on their team’s performance than engaged managers had a positive impact. This caused lower worker productivity, higher absenteeism, and more staff turnover, even when the staff members were engaged in their own right. 

What might actually be the most concerning aspect is that a disengaged manager can quickly infect the rest of the organization. Unsurprisingly, managers have a greater presence and influence in the organization based on the nature of their role in interacting with more staff. It means their impact on company culture, good or bad, is heavily amplified within the rest of the organization.

Unengaged managers can also become bottlenecks for other teams, where their lower performance makes it harder for other teams to complete their own work. When executives don’t address these manager bottlenecks, their colleagues become frustrated, and it can create a disengagement loop across teams. 

For example, a Head Chef is disengaged, creating an environment where meals are prepared slowly. This makes it harder for the Head Server and their team to get orders out promptly. Senior Management is reluctant to replace the Head Chef because they’re talented, and it would be difficult to replace them. Now the Head Server sees the problem is unlikely to be resolved, so they become disillusioned, and their team morale and engagement drop off.

Teams that interact with and rely on the Head Chef or Server (e.g. Maintenance, HR, or Payroll) are also likely to fall victim to the inertia of this disengagement. The more it spreads, the harder it is to rein in, and it spreads significantly faster when it’s the front-line managers that are disengaged.

This is why it’s vital that front-line manager disengagement is not only addressed but is fixed as soon as possible. 

Increased safety incidents

When it comes to safety, the bottom line is that disengaged managers and staff lead to 3x the number of safety incidents.

This arises from reduced attention to detail and apathy toward following safety rules. When a front-line manager displays this lax attitude toward safety, it further compounds the lack of care from the rest of the team. This managerial apathy indirectly signals to junior staff members that it’s okay to disregard essential safety measures. 

Any decent person should care about the safety of their team without qualification. Morality hasn’t always been a strong business case regarding safety. If you are trying to put a cost on safety, it’s approximately $1,100 per worker (not per injury).

Outside of direct incident costs, safety issues can cause public relations fires that lower revenue from customer boycotts, make it harder to hire staff, and start OSHA investigations and civil lawsuits. 

How to prevent manager disengagement

The most crucial aspect of avoiding manager disengagement is to find the underlying issues that are actually causing the issues. Applying general employee engagement programs may help, but it won’t be permanently solved unless the root causes are unearthed and addressed. While there may be patterns in the causes of disengagement, any program designed to fix them should be tailored to the individual manager.

You can find the issues first by ensuring you are measuring managers’ engagement. This takes two forms:

1. Running standard satisfaction surveys or eNPS to identify which managers aren’t engaged
2. Getting regular feedback from front-line managers and their teams so you can find issues

Satisfaction surveys will only help you find who is having issues. Collecting regular feedback will actually help you investigate what is causing disengagement. 

Because of the potential of manager disengagement to rapidly infect other managers and staff within the organization, it’s vital that you collect regular feedback. That way, you can identify the issues, investigate further, and resolve them before they snowball across the rest of the company.

Fixing manager disengagement may seem daunting – but the best time to solve it is now. Address it early on with daily feedback to prevent the hidden costs from getting out of control. 

If you are interested in learning more about improving manager engagement, check out our webinar below:

Webinar: How to Increase Manager Engagement & Retention