The Importance of Good Managers and Sales Results


This past Sunday, the professional football season got underway and my Philadelphia Eagles played the Cleveland Browns. The Cleveland Browns were once a winning franchise, but have had hard times in recent years. This last year, they brought in a new coach and added 17 new players to their team. However, even with the reorganization and drafting highly valued college stars such as Johnny Manziel, the Browns have not been able to turn things around. Clearly, this is not happenstance, but a result of poor decisions made by owners and their staff starting with managers of draft talent evaluation.  The cost of bad managers is high, not just for football teams but in every industry. Businesses lose untold millions of dollars each year as a result.

Granted, managing is not easy today. Mortgage banking managers are tasked with being recruiters, motivators, administrators, reporters, controllers and for many sales organizations, they are also the top producer in their branch. In an industry that measures success on loans closed, companies only judge managers on personal volume and don’t worry about whether they can effectively manage the rest of their staff.

When a company is in a competitive marketplace, poor management decisions can have a negative impact that lasts for years. Losing begets more losing and then losing becomes part of their culture. The reality is that a losing culture is difficult to turn around and eventually precipitates a company’s rapid decline.

Selecting the right individual to be a manager is the most important decision a company can make. According to Gallup’s research on employee engagement, 70 percent of performance variances are attributed to the quality of the direct manager. The manager drives customer metrics, profitability, productivity, employee turnover and retention.

Gallup further states that 10 percent of the people possess the talent to manage. These 10 percent are what help a company achieve excellence. They estimate that another 20 percent of individuals have some of the characteristics to be an effective manager but need the company to invest in coaching and developmental programs to help them achieve their fullest potential. The sad part is that Gallup estimates that companies miss the mark on making the right decision on who should be the manager 82 percent of the time! Gallup notes that this is an alarming problem with negative consequences “for employee engagement and the development of high performing cultures in the U.S.” Gallup also observes that being successful in individual contributor positions (such as origination) does not mean that the employee will be matched to managing others.

According to Gallup, when companies increase their number of talented managers, they achieve on average 147% higher earnings per share than their competitors. The challenge for every company is to identify individuals who have the talent to manage. The Cleveland Browns are a prime example of what happens when poor managers are in place. Nothing can fix the wrong selection. Not sure if you have the right managers in place to achieve long-term success? Contact me at 800-875-0222 to discuss.