It is a truth, sadly under-acknowledged, that an organisation in possession of an under-performing business must be in want of leadership and management development. Part of our mission is to shine a light on the value of this development in the hope that one day this will be universally acknowledged. ILM believes it is essential for people to understand both leadership and management right from the start of their working life, first of all as someone who is managed and then as you progress to managing and leading others.
On 10 July, the All Party Parliamentary Group on Management hosted an event to launch a newly published report from the Department for Business, Innovation & Skills (BIS), Leadership & Management in the UK – The Key to Sustainable Growth. The report shows the clear link between business success and leadership and management capability. ILM was part of the group which authored the report and our own research is referenced.
John Hayes MP, Minister of State for Further Education, Skills and Lifelong Learning, made a speech to open the proceedings, making it clear that the Government is not about to step in and direct underperforming businesses, but aims instead to help create a framework in which employers could access education and training opportunities that met their needs.
On the panel responding to the report were CEOs of three professional institutes, Charles Elvin (ILM), Ann Francke (CMI) and Peter Cheese (CIPD) along with the Institute of Employment Studies and ACAS. Not only was it rare for all three CEOs to share a panel like this, but there was clear consensus about the need to invest in leadership and management development to help organisations improve their capability.
The UK’s poor productivity record compared to its major international competitor nations is attributable principally to the long tail of under-performing companies suffering from poor leadership and management. The evidence in the report is unequivocal – UK managers are less well educated, less well trained and less well equipped with the tools and techniques needed to enable their organisations to achieve what they are capable of. Most of the gap between the UK and the USA (at the top of the productivity and performance table) would be overcome by UK if managers were equipped with the right skills.
Charles Elvin made the case for investing in leadership early in people’s careers, to prepare them for the lower levels of management, and this certainly caught the mood, with several people in the audience reinforcing that message through their questions and comments.
So what is the business case for investing in leadership and management?
Fact 1 Organisations with better qualified managers and a dedicated programme of leadership and management development perform better.
Fact 2 Better trained managers ensure a more engaged workforce and enhance employee well-being, leading to better performance, lower absenteeism and lower staff turnover.
Fact 3 Under-performing managers cost organisations money and are directly linked to business failure.
Fact 4 UK managers under-perform compared to leading competitor nations, as does UK business due to poor leadership and management.
Fact 5 If the bottom half of performers were brought up to the standard of the average, then UK plc would be a world-beater.
This report makes the case for leadership and management development very robustly, and shows quite clearly how poor management holds firms back. And now we need to ensure that those messages reach decision-makers.