The Economics of Leadership™
The workplace is changing……
Are Your Managers Ready…..?
Pre-1945 1946-1964 1965-1980 1981-1996 1997 -
The Importance of Our Birthyear!
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2019 All Rights Reserved
Pre-1945 1946-1964 1965-1980 1981-1996 1997 -
The Workforce Has Indeed Changed Alot!
Copyright © 2019 Career Potential, LLC All Rights Reserved© Level Up Leadership, Inc.
2019 All Rights Reserved
First Personal Computer - 1981
First Cell Phone 1983
First Commercial Computer - 1951
First Blackberry1999
First iPhone2007
First Android2008
Hidden Figures 1962
ElectricityTelephonesTypewritersAutomobiles
NBC Broadcasts Color TV - 1966
The Future of WorkResponding to the Changing Demands of the Workforce
© Level Up Leadership, Inc. 2018 All Rights Reserved
Past Future
My Paycheck My PurposeMy Satisfaction My Development
My Boss My CoachMy Annual Review My Ongoing Conversations
My Weaknesses My Strengths
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6 Scary Numbers for Any Organization’s C-Suite**
**Gallup – 6 Scary Numbers for Your Organization’s C-Suite, October 20, 2018https://www.gallup.com/workplace/244100/scary-numbers-organization-suite.aspx
1. Only 22% (of employees) agree their leaders have a clear direction for the organization.
2. Only 26% believe their organization always delivers on its promises to customers.
3. Only 12% agree their organization does a great job of onboarding.4. Only 14% agree the performance reviews they receive inspire them
to improve.5. 67% say they are sometimes, very often or always burned out at
work.6. 51% say they are searching for new jobs or watching for new job
opportunities.
© 2013 – 2016 The Ken Blanchard Companies. All Rights Reserved
Only 12% agree their organization does a great job of onboarding.
That means 88% think their organization does a poor job onboarding.
How might this impact your profitability?
Fully Competent and Confident in all
Critical Tasks
Building Competence in all Critical Tasks but
Still Unsure
Still Learning but Becoming Frustrated and
Disillusioned
Excited and Enthusiasticbut not yetCompetent
15% 50% 25% 10%
© 2013 – 2016 The Ken Blanchard Companies. All Rights Reserved
How Might More Effective On-boardingImpact Your Results?
85% of Critical Tasks
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67% say they are sometimes, very often or always burned out at work.
So What are the Primary Sources of Burnout?**
Unfair Treatment at Work
Unmanageable Workloads
Lack of Role Clarity
Lack of Communication or Support from their Manager
Unreasonable Time Pressures
Unreasonable Deadlines and Pressure
**Gallup – 6 Scary Numbers for Your Organization’s C-Suite, October 20, 2018https://www.gallup.com/workplace/244100/scary-numbers-organization-suite.aspx
Burnout and frustrationcomes from:
With better leadership,we can create better:
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Burnout, Frustration, Ambiguity and Uncertainty and their Impact on Productivity
From Tor Dahl, former President of the World Confederation of Productivity and Board Member for the American
Productivity and Quality Center:
From the Microsoft Productivity Challenge (A study of > 38,000 people
in 200 countries)
“Although … people are working very hard … we’ve found that each …. can
increase productivity by 30%.”
“Though people are working an average of 45 hours per week, they consider ~ 17 of these hours to be unproductive.”
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Can Anyone, Anywhere Work at
100% Productivity Everyday?
A Ken Blanchard leadership initiative … 300 managers with 1,200 direct reports … financial
services firm … achieved a 5% to 12% increase in productivity
among direct reports of managers who attended a leadership
development program and began
using the new skills they learned.
Understanding the Connection Between Changing the Status Quo and Increased Profits
Recruit, Select, Hire and Train
Quadrant 1Engaged but
Not Yet Competent
Highly Productive and Effective
Quadrant 2Fully Engaged andFully Competent
Quadrant 3Disengaged and
Still Somewhat Competent
Recruits others to join in.Requires a significant
amount of manager time.
Quadrant 4Disengaged and
No Longer Competent
This too requiresA LOT of manager time and
often required HR input
Requires
manager
time re-
training and
reengaging
the
employee
and moving
them back to
Quadrant 2
Time
and
expense
required
to bring
on new
hires.
The Evolution of Employee Engagement and Productivity
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Calculating the Cost of the Status Quo
Total Number of Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
x Percentage of Employees in Quad. 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x 66%*
Estimated Number of Employees in Quad. 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
x Average Monthly Compensation of Emp. In Quad.3. . . . . . . . . . . . . . . . . . . . . . . . . . . $2,500
Estimated Average Monthly Payroll for Emp. In Quad. 3 . . . . . . . . . . . . . . . . . . . . . . .$247,500
X Percentage of Lost Effectiveness (100% - 70%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34%**
Estimated Monthly Cost of the Individuals in Quad. 3 . . . . . . . . . . . . . . . . . . . . . . . . . $84,150
Estimated Annual Cost of the lost productivity of theIndividuals in Quad. 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$1,009,800
* Based on Gallup’s most recent findings on employee engagement in the US, June 20, 2018. **Based on the average percentage of employee productivity from Tor Dahl’s work with lost productivity % from Tor Dah’s work with the World Confederation of Productivity and the American Productivity and Quality Center (30%) and the findings from the Microsoft Productivity Challenge (38%)
Amy Cuddy, author of Presence:Bringing your Boldest Self to your Biggest Challenges
© Level Up Leadership, Inc. 2018 All Rights Reserved
51% say they are searching for new jobs orwatching for new job opportunities
© Level Up Leadership, Inc. 2019 All Rights Reserved
The Top 5 Reasons EmployeesLeave Companies*
Limited career/promotion opportunities
Lack of respect/support from their
manager or supervisor
Compensation
Lack of challenges or boring job duties
Ineffective leadership skills
* 82% of departing employees leave their manager not the company!
Why WouldYou Leave?
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So, What are the All-in Costs of Turnover?
Conservative estimates suggest the total cost is ~ 1/5 of the worker’s annual salary.
At $8/hour - $16,640 per year - $3,328
At $16/hour - $33,280 per year - $6,656
At $75,000 per year - $15,000
At $100,000 per year - $20,000
What do these costs include?
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Direct Costs such as:Separations Costs – Exit interviews, severance pay and higher unemployment taxes
Cost Temporarily Cover Essential Duties
Replacement Costs – advertising, drug testing, background checks, time screening, interviewing, etc.
On-boarding Expenses
Indirect Costs such as:
Lost Productivity
Reduce Morale
Team Member Frustration
On-boarding Expenses
Lost Institutional Knowledge
Potential Lost Clients or Lost Client Opportunities
Taking a Look into the Cost of Turnover
The Future of WorkResponding to the Changing Demands of the Workforce
© Level Up Leadership, Inc. 2018 All Rights Reserved
Past Future
My Paycheck My PurposeMy Satisfaction My Development
My Boss My CoachMy Annual Review My Ongoing Conversations
My Weaknesses My Strengths
© Level Up Leadership, Inc. 2019 All Rights Reserved
What CanYou Do?
Train your leaders, managers & supervisors to Set motivating and relevant goals. Effectively diagnose where people are on their competency and commitment to achieve those goals. Coach people to higher levels of motivation, confidence and capacity.
Create a clear vision and mission for your organization, engaging as many of your employees in the development of both as you can.
Coaching skills are trainable skills. Make the investment to train your managers to conduct on-going coaching conversations and minimize your emphasis on annual performance reviews.
Commit to developing your employees hard and soft skills and providing opportunities for growth for those who want it.
© Level Up Leadership, Inc. 2019 All Rights Reserved
Improve Your Hiring Analytics
Motivation: What’s their drive for achievement?
Workstyle: How do they approach their work and does that fit with what you need?
Initiation: Do they initiate action and inspire others to succeed?
Collaboration: Do they build and nurture quality partnerships?
Thought Process: How do they assimilate new information and solve problems?
In Summary, Looking at the
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Efforts made to improve
The management and leadership skills of your supervisor, manager and leader skills andImprove your success in screening and hiring the best possible talent for your team
Should be viewed as an investment, not an expense, and when implemented effectively should be recovered within 12 – 24 months.