Managers are key to employee retention and productivity. But many companies don’t promote into management the people who would do the best job as managers.
The importance of first level managers to employee retention is a conclusion confirmed by many research studies. Motivating and coaching staff members helps employee engagement, which boosts retention and productivity both. But this will be easier if the right people are in the job in the first place.
The most common promotion method is to move your best workers into management. That sometimes works, but not always. Remember the Peter Principle, that people rise to their level of incompetence? People are promoted until they no longer do a good job, and then they stay in that position—doing a poor job.
Now three economists (Alan Benson, Danielle Li and Kelly Shue) have found hard evidence. They looked at sales managers at over 200 companies and found that promoting the best sales people hurt future sales. Dipping into the ranks for the people best-suited to management produces stronger sales.
This is probably true in many other fields. My computer programmer friends tell me the top coders are often not the top managers. A great cop may not be a good supervisor of other police officers.
But there is a risk in NOT promoting your best workers—you’ll discourage them. The possibility of promotion incents people to do their best.
So consider this strategy. First, look at your top-performing people and let them know they may be managers someday. Provide “pre-training” so they understand the person-to-person work needed. It’s not just cracking the whip, as I’m sure you know—but maybe the workers don’t know. The best managers tailor their conversations to the individual employee. Some people thrive on competition, while others freeze. Some are motivated by interesting work, while others enjoy routine. Good managers knows each direct report well enough to encourage in the best possible way.