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29 February 2024

The Cost Of Bad Management

The one thing all organisations have in common is the need for good management. Employees who work under effective managers are 15 times more likely to excel, and 3 times more likely to stay (Gartner, 2023). A great manager can even increase profitability by 48% (Gallup).

But right now, organisations are facing a crisis in management. Not only are managers failing to make an impact, they are sometimes making things worse.

In this article, Sandra Ordel (Business Psychologist) explores bad management, why it happens, and how organisations can overcome it.

The causes of bad management

Very few managers set out to be bad. So, what happens? Why does bad management happen? We believe that there are two factors at play: the current promotion pathway and the lack of people skills training.

1. The current promotion pathway

Too often, individuals are promoted to management because of their technical expertise but with little consideration for their people management capability. At times, taking a management role is the only viable path to advance a career. So, people progress into management whether or not they are suited to the role.

2. Lack of people skills training

The focus on technical capability when promoting managers would not be a problem if targeted management training was in place. But 82% of managers never received proper training or guidance (CMI, 2023). Without this, they struggle to develop the people management skills they need to lead their team.

The signs of bad management

Without essential people skills, managers risk undermining team dynamics. Harmful behaviours start to develop that are detrimental to team performance, engagement, and motivation. Here are some examples:

  • Micromanagement: Dictating every step that team members take, stifling autonomy and creativity.
  • Feedback avoidance: Failing to address performance issues or provide constructive feedback.
  • Poor communication: Avoiding difficult and sensitive conversations.
  • Dismissing wellbeing: Failing to notice and act when pressure and stress build up and take their toll on team members.
  • Setting up-to-fail: Creating conditions that lead to failure – not providing the necessary support, resources, training or clear direction for the team to meet the demands of their role.

Most managers do not set out deliberately to act this way. This behaviour is often a by-product of a lack of development and a lack of role modelling. Unfortunately, these factors create a breeding ground for negative management behaviour.

The impact of bad management

Unfortunately, the impact of bad management doesn’t occur in a vacuum. Here are just some of the ways it can impact a business.

  • Staff turnover: Low-quality management creates an unhealthy work environment. So, it’s no surprise that 50% of employees with poor managers plan to leave their jobs in the coming year (CMI, 2023).
  • Lower productivity: Poor management leads to team disengagement. Studies show that employees with ineffective managers are unproductive for 10-52% of their day (Training Industry, 2020)
  • Absenteeism: Bad management doesn’t just affect performance; it impacts the wellbeing of the team. 50% of people with low-quality managers experience poor mental health (CIPD, 2023). This is unsurprising considering managers account for 22% of a person’s overall wellbeing (The Wraw Report, 2023)

The overall impact on business performance is signficant. In the UK alone, it is estimated that bad managers cost businesses £84 billion annually (OECD).


It’s clear that organisations need to act. The question is how to develop people-centric managers in a sustainable and effective way. In our upcoming article The 3 Pillars of Sustainable Manager Development, we explore just that. Stay tuned for its release.

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