How effective are your managers?

Gallup recently highlighted one of the most critical decisions any organisation makes: who it appoints as a manager. Yet, their research shows companies choose the wrong person 82% of the time.

The consequences are costly. Poor management drains productivity, damages culture and can ultimately impact business performance. Conversely, when organisations get the decision right, the return is significant — stronger engagement, higher retention, better customer experience, and improved profitability.

Why managers matter more than ever

Managers are responsible for at least 70% of the variance in employee engagement across UK organisations. Yet engagement levels have barely shifted in more than a decade: just 30% of employees feel engaged at work.

This stagnation suggests a systemic issue — we’re not consistently selecting or developing the people who can truly empower teams to perform at their best.

What great managers do differently

Gallup’s research shows that only 1 in 10 people naturally possess the full set of talents needed to be an exceptional manager. These individuals tend to:

• Inspire action by connecting people to a clear mission and vision
• Drive outcomes with confidence and resilience
• Build a culture of accountability
• Foster trust through strong, transparent relationships
• Make decisions based on performance, not politics

When placed in the right roles, these managers achieve remarkable results — contributing up to 48% higher profit than the average manager.

A further 2 in 10 people show strong managerial potential and can succeed with the right development, coaching and support.

Why organisations get it wrong

Many selection processes inadvertently reward performance in previous roles rather than assessing potential to lead. According to CIPD research, most managers believe they were promoted because they excelled in a non-managerial role — not because they were evaluated for managerial talent.

Being a brilliant engineer, carer or salesperson doesn’t automatically translate into managing others effectively. The result? Teams led by individuals who may be committed, but lack the capabilities to engage, motivate, or support their people.

The hidden talent already inside your business

The encouraging news is that management potential does exist within every organisation — often in unexpected places. With roughly one manager for every 10 employees, and one in 10 people naturally suited to leadership, the talent is already there. It may simply not be in the manager’s chair… yet.

Forward-thinking organisations are now using predictive analytics, talent assessments, and performance insights to identify potential managers early — enabling them to be nurtured, supported and positioned to succeed.

Why this matters now

With high turnover rates and ongoing recruitment challenges, developing the right leaders internally is no longer optional — it’s essential. The CIPD reports that 75% of employees leave their manager, not the business. Strengthening management capability is one of the most reliable ways to improve retention, culture, and overall organisational performance.