Economic Professor on toxic bosses: “Bad management costs money”

Interview

Economics Professor
Study of toxic leaders: “Bad management costs money”

How widespread harmful of leadership, and what are the consequences? The has studied business administration Professor Christina Hoon. In this Interview, she reports of toxic effects that damage companies.

Woman Hoon, you have examined about 40,000 entries on the employer rating platform Kununu to find out how common toxic leadership. How much workers are suffering under the poison of their heads?

In General, we have found in the data, especially a lot of good leadership behavior. Only one out of every five Employees rated the leadership behaviour of its leaders negatively. However, many companies are affected: We have examined reviews for 148 employer, with 85 percent of them there was negative leadership behavior.

What is it behavior in this context at all bad leadership?

Negative leadership behavior we are talking about, when someone referred to his superiors as a destructive, abusive or grip. This has mostly to do with Yelling or other types of pressure. The scientific term is “abusive supervision”, in German we say a behavior is often simply a bad or destructive leadership.

What are the consequences of destructive leadership behaviour?

We can very clearly indicate that poor leadership has negative effects. Even if only a single bad managers are in an organization, there is the satisfaction level with a statistically significant probability of lower. Our data also show that the companies in which the satisfaction of the climate drops, are also less powerful as a company with good leadership. From this we can deduce: Bad leadership costs money.

What have you observed?

That bad leadership is toxic. If Employees rate the leadership performance of the Top Management is bad, then you will also appreciate a high probability that the leadership behaviour of their direct supervisor as poor. The negative effect that poor leadership has been at the forefront of a company is very much stronger than previously believed. Because not only the direct employees of the business leaders are affected, but this toxic effect is down to the simple employees is seeping through.

The fish stinks from the head.

Exactly. So, you could call it that.

Poor leadership leads so often to poor company Performance. However, the same is not always true. They are also encountered spectacular exceptions.

It’s really exciting. As we have seen: If the lead is too soft, does the company no good. A cozy can also lead to low satisfaction and poor Performance.

And then there’s the other Extreme, the one they call “Hell’s Kitchen”. What’s up with that?

The were about 16 percent of the company. There was a toxic leadership climate and nevertheless the staff were happy and ensured a good Performance of the company. This shows that There are certainly companies can do a rougher style of leadership well.

What is the for companies that are typical for certain industries?

Whether this is typical for certain industries, shows our study unfortunately. But you can imagine there is perhaps a star kitchen, where the sound is a little rough, and the results are still very good. Therefore, we have this type also in “Hell’s Kitchen” is called. Also out of the hospital context, we know from other research that there is often a rougher handling is maintained and Teams nevertheless work together very successfully.

They also looked at whether family businesses have a better leadership culture than other companies. What came out of it?

Over a family business, it is said often that there is a special take care of factor. Our study shows that the extent of “abusive supervision” is pronounced in a similar way. In a family business, a better management, the climate is, therefore, not per se. But, Interestingly, is bad management less damage behavior in these companies. The employee satisfaction decreases, despite the lousy bosses not so strong.

Why is this so?

Since we can only speculate. Perhaps the long-term, family-like working relationships, a higher sense of responsibility for the Deal or value the ideas of the entrepreneurs family. In any case, there seems to be a certain buffer to give effect, to ensure that bad governance in family enterprises by proposing less heavily on employee satisfaction and company performance.

What should takeaway business from your study?

That bad management costs money and you therefore need to do something about it. Often I hear from companies things like, “Yes, so be it” or “we have to”. But to ignore or endure is wrong. Companies should also respond to individual cases of toxic leadership, otherwise, this put the whole cabin on fire.

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