The current business outlook may be positive but according to a leading think tank, the quality – or lack of it – of UK management skills is fundamentally compromising long term recovery. Less than one third of UK companies offer any form of management training – in direct contrast to our overseas competitors.  The result is compromised productivity, lost working hours and, critically in an era of high employment, poor employee perception.  Every business knows the additional cost, disruption and lost productivity associated with staff turnover – so why are businesses failing to put in place the right skills and processes required to improve management, build careers and retain good employees?

It is not just management training that is missing – what has happened to mentoring programmes? Where is the hierarchy of experience that prepares individuals for management roles? Businesses, for some reason, appear to think that managers are born not made.  They are not. As Roger Moore, Managing Director, Bond HR & Payroll Software, insists, unless UK businesses start putting in place coherent, long term strategies for building strong management skills and supporting managers with good employee career planning, training and communication, the positive economic and business climate  may well be short lived.

Poor Management

Just as the mood of the country begins to improve, with higher levels of economic confidence and continually improving employment levels, a report by The Commission on the Future of Management and Leadership¹, has raised a huge red flag for the future of British business.  According to ‘Management 2020 – Leadership to unlock long-term growth’, management in UK companies is in a perilous state and risks fundamentally undermining the country’s long term economic strength.

According to statistics cited in the report, the UK lags significantly behind its competitors in terms of productivity and management practice, with output per hour 21% lower than the average across the rest of the G7 and poor management could be costing UK businesses over £19.3bn a year in lost working hours. A key issue is the relationship between managers and staff – forty-three per cent of UK line managers rate their own managers as ineffective and four-fifths of workers don’t think their manager sets a good moral example.

Yet look beyond employee gripes towards the core of the problem and this lack of productivity and good management should not be a surprise: UK managers are under qualified and undertrained. Over two-thirds (71%) of employers give either no training or inadequate training to new managers. In contrast, managers in other countries, most notably the US, Japan, Germany and Canada, have management qualifications and training to back their skills up.

Short Term Focus

Of course many companies have had an understandably short term attitude over the past decade. With low economic confidence and a perception of job fragility, all efforts were focused on keeping the company going. Good business practice, including staff training, regular appraisals and clear career development plans have hit the back burner.  At the same time, many companies have avoided the costs and risk associated with adding full time employees by using the growing band of freelancers and consultants. While this has added flexibility to the workforce, these skilled and experienced individuals are no longer embedded within companies and are not sharing their knowledge and expertise with the next generation.

Times have changed, however. The economy has been improving for the past couple of years. Employment is on the up and the concern today is not job security but the challenge of recruiting the necessary staff with the right skills to support business growth.

New Generation

At the same time business practices have changed radically over the past decade. New technology has influenced the way employees interact, creating demands for better communication, collaboration and networking skills; while growing numbers of employees work flexibly and remotely, creating new management challenges in areas of both control and encouragement.  The problem is that good management practices have simply not been reintroduced at the same time and the short term attitude still prevails.

The challenge of retaining staff is something that many managers simply have not had to deal with before. And it is getting tougher. Not only are 38%² of staff planning to move jobs this year but the expectations of the generation now entering the workforce are very different. They want regular appraisals and feedback – and they expect rapid promotion. In a job rich economy, these individuals will not think twice about moving on to another company if those expectations are not met.

So what should UK businesses do? The starting point has to be the establishment of a training programme that takes individuals through from junior right through to senior management.  Anyone in a management role needs to have the basic skills of time management, appraisals, target setting; and, in today’s working environment, they need to understand collaboration and effective communication.

A company also needs to ensure there is good communication between employees and managers, as well as the HR department. This is now an economic environment that requires a shift in HR focus towards proactively retaining staff – clear career development paths combined with timely training and productive feedback are essential tools in minimising expensive and disruptive employee turnover.

Supporting Management

Of course there are tools that can be deployed to support this process. A learning and development system that provides self-service access to information on training courses, plus the ability to book courses – even request courses that are not offered as standard- is a great start. In addition, the self-service model can support online appraisals, a particularly effective approach for those organisations with high numbers of flexible and remote workers.

The HR team also needs to find a way of identifying those employees that could be deemed a flight risk and proactively share that information with managers to minimise staff turnover. The problem is that unhappy employees often don’t want to rock the boat – and in this market of full employment they are more likely to move job than actually complain about a manager.

However, disgruntled or even slightly unhappy employees leave a trail of clues – from attitude and demeanour to sickness absence. Therefore in addition to training managers to pick up on these clues, it is important to provide HR with the necessary tools to identify those demonstrating ‘at risk’ behaviour. Combining business intelligence with HR information, such as Bradford Factor reports, can deliver a highly visual view of these trends. Using dashboards to flag up key areas of concern, HR can prioritise activity and quickly look an individual’s employment history, such as training activity – including training requests accepted or denied. It is this combination of improving employee career engagement with proactively addressing potential problems that should be an essential aspect of end to end good business management.

Conclusion

Government data shows that the UK labour market will need one million new managers by 2020 – but with the current lack of training, that potentially leaves 150,000 employees a year taking on management roles without adequate preparation. The truth is that good managers cannot be created overnight – in addition to relevant training, managers require mentoring and experience.

UK companies are sitting on a time bomb – and if long term strategies are not put in place now, by 2020 the lack of management skills will be a severe constraint on global competitiveness. There is no time for complacency; organisations need to step away from the cost cutting and short term targets of the past decade and recognise the long term value of strong management and productive, engaged and committed employees.

ENDS

¹ http://www.managers.org.uk/~/media/Files/PDF/M2020/Management%202020%20-%20Leadership%20to%20unlock%20long-term%20growth.pdf

² http://www.managers.org.uk/~/media/Files/PDF/M2020/Management%202020%20-%20Leadership%20to%20unlock%20long-term%20growth.pdf

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