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THE HIGH COST OF POOR LEADERSHIP

David Witt Program Director

The Ken Blanchard Companies

The High Cost of

Poor Leadership: The three performance

gaps you have to

address

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December 7, 2011 and represent the proprietary intellectual property of The Ken Blanchard Companies. They are

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The Questions

Why is leadership important?

Is leadership capacity the single greatest

contributor to organization success?

If so, how does leadership specifically

contribute to organization success?

What is the cost of poor or ineffective

leadership to organization success?


HELPING PEOPLE WIN AT WORK

High Human Capital Companies vs. S&P 500

Source: McBassi & Company Newsletter, April 2011



• a 14-point

customer

satisfaction gap

• a 16-point

employee

productivity gap

• a 45-point

employee retention

gap



• The cost of

covering the

position while

vacant

• The cost of

finding a

replacement

• The cost of

getting a new

person up to

speed



1. Lack of respect from or

support by supervisor

(13%)

2. Supervisor’s lack of

leadership skills (9%)

3. Poor employee relations

with a supervisor (4%)

4. Lack of recognition (4%)

5. Supervisor

incompetence (2%)



Quit & Stayed

• 15-20%

according to

Gallup

• Probably even

more damaging

as they spread

their bad attitude

among others.



You can win back

those disengaged

people with better

leadership practices.



Best-in-class

service providers

typically achieve

ratings of

approximately

85%, while

average

providers score

closer to 75%



Every 1.3% increase in customer satisfaction

scores corresponded with a

subsequent 0.5% increase

in revenue growth.



Senior executives

have assessed that

their workforce is

operating at only

60% to 65% of their

potential.



Only 59% of work time is

productive. What gets in the

way of higher employee

productivity?

• Insufficient planning and

control (43%)

• Inadequate management

(23%)

• Poor working morale

(12%)



“Although most people are working very hard these days,

we have found that each individual in an organization

can still increase productivity by at least 30%.”

“The culprits are a variety of organizational ‘ills,’ including

lack of clear directions and goals, sub-optimized

processes, excessive paperwork and reporting

requirements, unproductive meetings, inappropriate

systems and tools, etc.”

Tor Dahl, former president of the World Confederation of

Productivity Science and a member of the Board of Directors

for the American Productivity and Quality Center



To help people

perform well,

an effective

performance

management system must be

established.



The 3 Keys to an

Effective Performance

Management System

1. Performance

planning

2. Day-to-day

coaching/execution

3. Performance

evaluation



1.Clear, measureable goals tied to

overall department initiatives

2.Less than five goals, written

down so they can be reviewed

and adjusted if necessary

3.An analysis of employee skill

level for each task

4.Clear agreements on the level of

direction and support needed to

succeed



The biggest

impact on

performance

comes from

day-to-day

coaching



• Schedule weekly

one-on-ones

• 15-30 minutes in

length

• Direct report sets the

agenda

• Remember

development level

to help identify

potential areas to

help



No surprises at

performance review



• Conduct quarterly

mini-reviews

• Check on progress

• Make adjustments

if necessary

• Celebrate

accomplishments



You can win back

those disengaged

people with better

leadership practices.



Better leadership

can generate an

improvement in

customer

satisfaction scores

and a subsequent

increase in revenue

growth.



Most organizations

are operating with a

5% to 10%

productivity loss

that better

leadership practices

could eliminate.



The

importance

of culture in

managing

change



“They have

leaders who know

and do the work.”



“They have a

bias for plain

language and

simple

concepts.”



“They frame the

questions by

asking ‘how’,

not just ‘why’.”



“They have strong

mechanisms for

closing the loop.”



“They believe

that experience

is the best

teacher ever.”



David Witt Program Director The Ken Blanchard Companies

Randy Conley Trust Practice Leader

The Ken Blanchard Companies

Questions and Answers

Request all of the background white papers or participate in upcoming

research by sending a request to [email protected]

Web

www.kenblanchard.com

Blog

www.leaderchat.org

Twitter

@leaderchat

mailto:[email protected]

http://www.kenblanchard.com/

http://www.leaderchat.org/



Thank You

To learn more about how The Ken Blanchard

Companies can help you improve leadership

bench strength in your organization, please visit:

www.kenblanchard.com

Contact us at: 800-728-6000 or

[email protected]

Continue the conversation at www.leaderchat.org

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