Good workplace practices and their impacts David Pardey, Senior Manager Research & Policy The Institute of Leadershi

1. Good workplace practices and their impacts David Pardey, Senior Manager Research & Policy The Institute of Leadership & Management

2. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Less 1-5 6-10 11-20 21-30 31 – 40 Over 40 than a years years years years years years year Male Female A brief review of management • 4.5m managers in the UK; estimate 375,000 in Scotland1 • Approx. 2/3 male: 1/3 female, but: • Majority of new managers are women and are likely to have a degree • Majority of established managers are men and are unlikely to have a degree (2, 3)

3. What’s so good about being a manager2? • Being able to make a difference 44% • Making change happen 35% • Developing others’ skills 32% • The variety of challenges 36% • Able to influence people or decisions 29% • Helping my team achieve their goals 32% • Increased financial benefits 31% • The potential for career development 21% • Increased level of responsibility 18% • Status 11%

4. Four good workplace practices • Organisation • Systems • Management • Leadership

5. Good organisation practices Train managers • Better to train all managers a little, than a few managers a lot • Good management practice is strongly associated with better productivity, profitability, Tobin’s Q (asset value ratio), and sales growth. • Poor management practice survives through lack of product market competition; firm age & few new market entrants using better management techniques; and labour market regulation.4 • “UK managers lag their colleagues in the US, France and Germany in terms of competence and experience”5 • “better-managed firms also have a more highly educated workforce, among managers and non-managers alike”6 • General ability and variety of experience used to identify future leaders, & in-house training favoured for their development(7,8,9)

6. Good systems practices Measure what matters • Most improvement methodologies emphasise the value of measurement and analysis (eg PDCA, Ishikawa’s 7 tools & techniques, Six Sigma/DMAIC, etc), and of benchmarking against the best • Effective skills utilisation means: • measuring productivity (efficiency of resource utilisation and product/service quality) • comparing with best practice • using appropriate improvement strategies to raise standards • Far more prevalent in manufacturing than service industries

7. Good management practices From supervision to development • Change focus of management role from supervising performance to improving performance through development(9,10) • Better performance management systems (continuous, people- not system-driven) • Use workplace coaching and mentoring • Culture of everyday learning

8. Good leadership practices Build trust • Trust in co-workers and management is a predictor of: • an employee’s preference for teamwork, • increased engagement, and • lowered employee turnover(11,12) • Trust is positively related to task performance and negatively related to stress13 • Trust can: • reduce transactional costs (by obviating the need for excessive controls and regulation), and • promote positive relationships14 • Trust is the product of three broad personal attributes that all managers need to foster: • Ability (understanding their own role and the role of those they lead) • Integrity (honesty and consistency) • Benevolence (openness and fairness)15

9. References • Office of National Statistics (various) • What makes managers tick? ILM, 2008 (unpublished) • Thomson, A., Mabey, C. Storey, J. Gray, C. & Iles, P Changing Patterns of Management Development Blackwell: 2001 • Bloom N, et al Management Practices Across Firms and Nations Centre for Economic Performance (LSE) & McKinsey & Co: June 2005 • DTI ECONOMICS PAPER NO.17UK Productivity and Competitiveness Indicators March, 2006 • Bloom N, et al Management Practice & Productivity: Why they matterCentre for Economic Performance (LSE) & McKinsey & Co: July 2007 • Future Leaders ILM, due October 2010 • Newell H Who will follow the leader? Managers’ perceptions of management development activities: an international comparison SKOPE Research Paper 51, Autumn 2004 • Tamkin P et al The Comparative Capability of UK Managers Institute for Employment Studies for Skills for Business, April 2006 • Prais, Jarvis & Wagner Productivity and vocational skills in services in Britain and Germany: Hotels National Institute Economic Review, November 1989 • Kiffin-Petersen S., Cordery, J., February 2003, Trust, Individualism and Job Characteristics as Predictors of Employee Preference for Teamwork, International Journal of Human Resource Management, Vol. 14 Issue 1, p.93-116. • Ferres N., Connell J., Travaglione A., June 2004, Co-worker Trust as a Social Catalyst for Constructive Employee Attitudes, Journal of Managerial Psychology, Vol. 19 Issue 6, p.608-622. • Costa A.C., Roe R.A., Taillieu T., September 2001, Trust within Teams: The Relation with Performance Effectiveness, European Journal of Work and Organizational Psychology, Vol. 10, Issue 3, p.225-244. • Kramer R.M., 1999, Trust and Distrust in Organizations: Emerging Perspectives and Enduring Questions, Annual Review of Psychology, 50, p.569-98. • Index of Leadership Trust ’09 ILM September 2009