Best Practices, Operations, V8I3

Leadership, Culture, and the Great Resignation

In today’s labor market, people increasingly have a choice of options for employment. We are near historically low unemployment rates (3.6 percent as of March 2022) with an extremely high number of open job positions (11 million job openings and 6 million unemployed) in the United States. That is a lot of opportunity! 

One of the principles taught in business is that people looking for a job tend to give priority to great companies while those quitting jobs most commonly quit a particular manager or supervisor. 

Who you work for matters, and the person to whom you report directly has a greater impact on your work experience than the CEO of the company—unless you report directly to the CEO, of course. 

Why are people quitting their jobs in record numbers? Almost half of all employees are looking for a new job or plan to begin shortly.  Of the current workforce, 44 percent are actively looking for a new job. (Feel free to Google these items and you’ll find many sources!) 

While many quit jobs in search of better pay, the opportunity for advancement, or better benefits such as healthcare and paid time off, a large number are quitting a specific leader in their company (usually their manager or supervisor) or are leaving an unhealthy company culture.

Each of these issues is worthy of our attention, and likely we will address more of them in the upcoming columns. The major point of emphasis here is that a company’s culture is a major factor in both overall company performance and employee satisfaction and tenure. 

In simple terms, companies with a great culture perform better—and employees stay longer. 

Starting at the very top of the organizational chart, the leader is responsible for the culture of the company. Eventually (new leaders need to be given some time to sort these issues out!) the culture that exists in a company exists because it has either been created or permitted. The CEO or president must recognize that he/she owns this responsibility. While division or department leaders can significantly influence the culture of their department, they cannot ultimately override the negative effects of an unhealthy leadership culture at the very top. 

Department leaders can, however, sabotage a healthy culture at the top. This is why executives at the top must be attentive to the continued development of the leaders throughout the organization. 

A recent presentation by Daniel Goleman, one of the world’s leading experts on emotional intelligence, reported that while emotional intelligence represents 66 percent of the competencies required for success in all jobs, it represented 85 percent of the success when it came to leadership. Why? In order to be effective in leadership, leaders must work with people. 

Leaders must be big-picture thinkers and skilled at strategic development themselves, but they can only achieve these outcomes through people. This requires skill in listening, communicating, and inspiring and building strong, diverse teams who realize their individual potentials. 

Goleman lists five primary skill sets common to emotionally intelligent people: 1) emotional balance, 2) quick recovery when there has been an emotionally intense interaction, 3) emotional maturity demonstrated by a growing gap between an emotionally charged impulse to act and the actual action that follows, 4) adaptability and openness to change, and 5) a positive “growth” mindset.

The way this plays out in leadership styles is significant. While every leader must be skilled in using multiple styles of leadership and decision-making, maturity in leadership coupled with emotional intelligence ensures that he/she will use the most effective style for the situation at hand. Goleman notes six different leadership styles:

  1. Visionary: provides long-term direction and vision.
  2. Coaching: develops employees for the long-term.
  3. Affiliative: creates harmony in the work relationships.
  4. Democratic: builds commitment through collaboration.
  5. Pacesetting: pushes to accomplish tasks.
  6. Commanding: demands compliance.

Each of these styles has an impact on the culture of the organization, and every leader at every level of the organization employs these methods in some priority or mixture. 

Goleman noted that the visionary and coaching styles build very positive, high-performance cultures. The affiliative and democratic styles have a moderately positive impact, and the pacesetting and commanding styles create unhealthy cultures. 

There are situations where the pacesetting and commanding styles are essential to the survival of a company, such as in situations requiring a rapid response to a crisis.  Yet when these are the primary style of ongoing leadership, the health of the culture will decline, performance eventually begins to lag, and people will quit—especially in a labor market like our current one with numerous job opportunities to be found in most areas. 

Healthy companies with thriving cultures where people love to come to work are companies where the leaders make sure that long-term direction and vision are allowing each individual to live out his/her personal purpose inside the mission and vision of the company. When the leadership also embraces a coaching model of leadership, individuals continue to grow personally/as people, opening up their potential for personal advancement. 

Companies or departments led by pace-setting and commanding leaders may produce outstanding results in the short-term, as metrics are tracked and accountability for delivering on those metrics is doggedly pursued. However, leaders for whom this is the default style of leadership (marking the majority of their interactions with their direct reports) lack the empathy to inspire and influence. 

Leaders who default to the affiliative and democratic styles may build a strong sense of team but will often lack the results essential to achieving a high-performance culture. They can quickly devolve into a network of “buddies” who have a great time together at work but job performance is weak, and eventually the team will tend to lose its sense of purpose.

The first four styles of leadership—visionary, coaching, affiliative, and democratic—require significant emotional intelligence. In people for whom the final two styles are the default—pacesetting and commanding—emotional intelligence is usually absent. The financial cost to a company will eventually be enormous as culture disintegrates, performance declines, and the best people walk away.

No matter where you are in the organizational hierarchy, invest in your personal growth as a leader. Every human has a circle of influence (the reach of his/her leadership), and the quality of that leadership shapes the culture and impacts the quality of life for those they influence.

You owe continual growth and improvement as a leader to those inside your circle of care; you will see them flourish under it. You also owe it to yourself to become a better leader, for the sake of polishing and using the gifts God has given you and fulfilling the purpose for which you exist.

Leave a Comment

Your email address will not be published. Required fields are marked *


Current Issue

April/May 2024