Empower Managers, Empower Teams: The Importance of Manager Leadership Training

There’s a direct connection between a company’s leadership and its business performance. Bad managers don’t just make the workplace unpleasant — they cost organizations billions of dollars each year [1]. However, companies with managers who exhibit strong high-performance behaviors and practices see a 43% growth in shareholder returns over five years [2].

Companies that invest in their managers and demonstrate that leadership development is an organizational priority see meaningful benefits. This investment includes actions like outlining clear performance expectations, offering formal strengths assessments, and providing feedback and structured development opportunities to help hone leadership skills.

In today’s working world, investing in the development of strong managers who can lead their employees through change is imperative for an organization’s long-term strategy. We’ll explore the lasting impact leaders can have on a business, and how enterprises can take a distinct approach to leadership development.

A look at the current talent landscape

Over the last several years the talent market has experienced a period of rapid change. The Great Resignation saw a record number of people — one report estimates 50 million people in the US alone — voluntarily quit their jobs for roles that offered better work-life balance, pay, management, or a greater sense of purpose [3]. Then, fears of recession brought layoffs and hiring freezes around the globe. So where does that leave talent management now?

Some are calling the tensions seen currently the Great Talent Stagnation [4]. While employees feel optimistic about their careers, they don’t believe their employers offer advancement and learning opportunities. Employers have fewer roles to fill but are having a hard time finding skilled candidates.

However the macroeconomic winds may blow in the future, leaders — particularly frontline managers — are an organization’s most essential asset for attracting and retaining talent. Strong people managers can act as the polestar for their teams, guiding them through many of these current talent management scenarios:

Employee engagement is a business imperative

Managers are responsible for 70% of their team’s engagement, according to Gallup research [5]. Engaged employees approach their work with enthusiasm, contribute to wider business goals, and are less likely to search for new jobs.

Technological transformation requires deliberate communication

The impact of disruptive technologies like generative AI will bring positive and negative changes to the workforce. Frontline managers and leadership teams play a key role in guiding teams through this change successfully. In a recent Udemy survey, 88% of employees recognized the importance of effective leadership in successfully launching generative AI initiatives at their companies.

Manager behaviors can enhance the flexible work experience

Hybrid work models are now a baseline expectation of many employees. According to an EY survey, 50% of workers said they are willing to go into an office no more than one day per week [6]. Whatever an organization’s workplace policies may be, a manager’s behaviors within hybrid settings can make or break their team’s success. Establishing trust in their employee relationships and providing regular feedback are critical leadership practices to drive engagement.

Specific concerns for hiring and developing managers

In addition to the challenging talent trends described above, there are additional concerns when it comes to hiring and developing leaders. With today’s tight talent market, hiring strong leaders is especially difficult; developing the skills and effectiveness of existing leaders takes on new urgency. The following reflections on the state of leadership development today are relevant for companies of all sizes.

Limited internal pipelines for future leaders

One concern you may face as a leader is how to “build” rather than “buy” the talent an organization will need — in other words, training current employees with the skills required to take on leadership roles in the future. This talent mobility approach requires identifying the skills your organization needs in future leaders and creating a plan to develop these skills in your existing workforce [7].

Solving the issue of a limited internal pipeline involves systemized planning and careful effort. However, consistent effort to create internal mobility programs builds a consistent leadership pipeline, reduces the risk of hiring employees who are poor culture fits, and expedites onboarding times. Fifty percent of younger high-potential workers who receive leadership development opportunities report having a greater sense of purpose at work than their peers who don’t receive these experiences [8].

The skills leaders need to succeed today differ from those of the past

Whether you hire leaders externally or develop them from within your organization, you will want to ensure that they have the right mix of skills needed to succeed. Along with the changing nature of work itself, the most in-demand leadership skills have also evolved. Hugo Sarrazin, CEO of Udemy, says, “businesses increasingly seek candidates who have mastered adaptive skills like navigating ambiguity, communicating effectively, and demonstrating resilience through setbacks.” [9].

SMBs and enterprise companies approach leadership and management development differently

Your company’s size is likely to impact how you approach leadership development. SMBs might offer leadership development opportunities based on open roles and internal needs, while enterprises may opt for structured leadership development pathways that employees can choose to participate in or be nominated for based on performance. But there’s no inherent advantage to being part of a larger or smaller company — you just need to lean into whatever methods are appropriate for your company’s size.

“Some of the most effective ways to accelerate talent is learning through coaching and apprenticeship on the job,” says McKinsey partner Anu Madgavkar [10]. “Smaller companies that may not be able to invest in a lot of more structured learning opportunities can still deliver a lot of hands-on, on-the-job training.” One of the other advantages of the SMB environment is that these organizations tend to be flatter and provide more access to senior leaders, which makes it easier for up-and-coming leaders to learn from them. Larger organizations, on the other hand, can look for ways to combine structured learning with opportunities to work closely with other talented and more experienced individuals.

The specific challenges of leadership development in SMBs

When it comes to leadership development, SMBs face specific challenges. Milton Corsey, Director of Human Capital Solutions at AchieveNEXT, writes in Harvard Business Review that the most common objections to leadership development he hears are [11]:

• Not sure it’s a good fit: “We’re not running Amazon here, and I don’t see how the leadership programs I hear about can address our problems.”
• Perceived lack of time: “We don’t have the staffing to send our leadership teams on offsites.”
• Lack of resources: “We can’t afford to send our emerging leaders to business school.”

But not being a company the size of Amazon doesn’t necessarily mean you can’t provide development opportunities for your employees. Milton recommends taking a few steps to overcome the common challenges SMBs cite when considering whether to invest in leadership development. This could include designing a program to address urgent challenges, focusing on scaling and not just growing, and training leaders in the real world as well as the classroom.

Discover how to empower managers through training

Manager leadership training is one of the most valuable investments a company can make. When done well, it transforms managers into leaders who inspire growth, drive results, and strengthen team performance.

To learn more about how to empower your organization through manager leadership training, download the full report. In the full report you’ll uncover more key insights into setting up a successful training program, plus:

• A distinct approach to leadership development.
• How managers impact business outcomes

Sources:

1. Gallup: “Why Great Managers Are So Rare”
2. McKinsey & Company: “Investing in middle managers  pays off–Literally”
3. CNBC: “2022 was the ‘real year of the Great Resignation,’ says economist”
4. Fortune: “The Great Resignation is effectively over. We’re now in the Great Talent Stagnation, where employers’ biggest concern is the lack of qualified applicants”
5. Gallup: “The State of the Global Workplace”
6. EY: “Pay, well-being, and flexibility prolong workplace tensions as more than a third of employees likely to quit, EY survey”
7. Udemy Business: “Maximizing the Impact of Talent Mobility Through Learning with Paypal”
8. DDI: “Global Leadership Forecast 2023”
9. Fast Company: “The disconnect between skills and readiness in the workforce” 
10. McKinsey & Company: “Learning and earning: The bold moves that change careers”
11. Harvard Business Review: “Leadership Training Can Pay Huge Dividends for Midsize Companies”