Poor leadership costs average organization over $1 million dollars annually.
The following article is clear and to the point and hopefully a wake up call.
A new white paper from The Ken Blanchard Companies shows that poor leadership is costing the average company an amount equal to 7% of their annual revenue. That’s over a million dollars a year for any organization with $15 million dollars or more in annual sales.
The three big culprits?
- Employee turnover. Poor leadership is responsible for up to 30% of the reasons why people leave their organizations according to exit interviews conducted by The Saratoga Institute.
- Customer turnover. Poor leadership negatively impacts employee satisfaction, which in turn negatively impacts customer satisfaction and retention. Research published in Harvard Business Review calculated that every 5 point change in employee satisfaction scores caused a 1.3 point change in customer satisfaction scores.
- Employee productivity. Poor leadership leads to poor employee productivity. Research from Blanchard shows that direct report productivity can be improved 5-12% through better management practices.
Most senior executives instinctively know that leadership impacts the bottom line, but quantifying that impact has been a challenge in the past. This new white paper (and the free online calculator that the information is drawn from) is a great way for leaders to put some facts behind their suspicions.
Rosanne D’Ausilio, Ph.D.
President – Human Technologies Global Inc
3405 Morgan Drive – Carmel, NY 10512
845/222-2455 fax 928/223-6165
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