Where Are You Throwing Money Away?


Image of dollar bills being thrown into a trash can
Companies waste a LOT of money every day on people-related issues.

Companies waste a LOT of money every day on a range of people issues. And a great deal of it is very avoidable.


According to Harvard Business Review, people problems at work: interpersonal conflict, poor decision-making, bad hiring, etc. waste a huge amount of money, time, energy, and resources to fix. There are cold, hard, costs associated to these issues—to the tune of an astounding $52,757,574 of lost value and potential each year!


It’s not that managers aren’t trying. No, they’re using all the skills they have to find solutions. The thing is, most managers don’t innately have the skills they need, and they’re not getting the training needed to help them. So, instead, companies resort to spending, through money or time, energy, and other resources, to substitute for the real work of leading, managing, and executing on decisions.


Let’s examine one of the line items listed: wasting time in unproductive meetings.


Executives estimate they waste approximately $8000 per day (!) in useless meetings. Staff is called in to spend valuable time sitting around in meetings when their time might be better spent on something else. Companies, then, take a hit on wage dollars spent on those wasted hours as well as lost productivity. Time spent in meetings of this sort can also lead to a lack of time on projects which, in turn, leads to poor results, stress and difficulties meeting deadlines, burnout, disengagement, and absenteeism or quitting.


This can be fixed with a little forethought. Instead of just scheduling a meeting, managers should be asking themselves if this is the best use of the team’s time. Can they achieve the same results by working asynchronously? If so, then utilize the communication and collaboration tools every company seems to have these days to their advantage. Save meetings for when they’re necessary (yes, there are often really sound reasons to hold meetings) and let people get to the work they need to do.


How about another one of those line items: Failure to give underperforming employees feedback.


The amount attributed to lack of feedback was about $7800 daily (or about $2.8 million per year).


Feedback is something I cover in both my book and my manager training courses. Employees want feedback from their managers, even if it’s corrective. They want to have a sense of how well they’re doing as their jobs progress. It’s often the case that employees go into the annual performance review and are blindsided by negative feedback they receive, in that moment, that prevents them from getting a good review and the consummate raise and/or promotion. They leave the review thinking if they’d only known what they were doing was wrong, they would have fixed it at the time. Of course, this also means the company has been putting up with substandard work from the employee for some time, impacting quality, productivity, and customer satisfaction—ultimately revenue. Such a waste…


It’s not fair to let employees go blithely on their way with their work only to tell them it wasn’t up to par much later. Feedback, both good and constructive, should be given close to the moment. It should point out what went wrong and how to fix it. It should also include an offer of support and coaching and/or professional development as needed to increase knowledge and skills to the required level. In giving timely feedback, the manager provides the opportunity for better work to be done quickly, leading to increased output and quality.


Most managers dislike having constructive feedback conversations. They don’t want to make their reports feel bad or maybe even (ack!) cry. So, they avoid them, until they just can’t put it off any longer. By then, it’s often a crisis and a lot of time, money, and energy has been wasted. What I’ve learned is managers don’t like these conversations mainly because they don’t know what to say. I’ve long been an advocate of the one-on-one conversation, which allows for relationships to be built, trust to be established, and communication to flow. When that happens, providing timely feedback becomes much easier. The thing is, few managers have frequent, regular, and consistent one-on-one conversations with their reports. Why? Because they don’t devote the time to them, and they don’t know what to say. Again, it comes down to them not having the innate knowledge of how to do this, and not being given the manager training to equip them.


Were you to go down the list of wasteful activities, you’d likely see even more money-wasting activities that could be eliminated, or at least significantly reduced, with training and support for managers. I've chosen a couple that can be easily implemented in any company and give measurable results. Some of the others will require more work (e.g. conflict resolution) but are achievable with manager training and support.


How about your company? Where are you throwing money away, and how can soft-skills training for your managers help?


 

Laura Sukorokoff is the Owner of C-Change Learning and Development. Her soft skills training courses guide and equip managers to inspire, engage, and retain their employees. Check out her courses at https://www.cchangelearning.com/.

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