The Cost of a Poor Promotion

An article from Forbes.com called “Promoting Wrong People Hurts Employee Retention and Productivity” opens by stating, “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.”

A separate article from human resources consulting firm Insperity called “You Promoted The Wrong Person, Now What?” shared this list of potential consequences a business can face from a poor promotion:

• Negative impacts to the employee’s team, including lower morale, productivity and damaged trust
• Loss of clients, especially if they’re in a client-facing role
• Exposure to legal liabilities
• Time and financial resources lost for a role that you then must spend more time and money on to recruit, replace and train
• Safety issues (in some cases, depending on the job)

And Job Monkey’s article called “Why You Don’t Want to Promote the Wrong Person” cited Jim Corter as saying, “companies put the wrong people into management positions a whopping 82% of the time.”

To this point, we’ve outlined a host of things that can kill profitability in our organizations. It borders on terrifying to see how many of those things can become exponentially more costly just by working to fill an open leadership role!

Here’s what I’ve seen throughout my career: Since formally entering the workforce right after I turned fifteen, every company I worked for had some process for internal promotions. For what it’s worth, I’ve always felt this is an outstanding approach to reward our best team members for their hard work and loyalty. The challenge, however, generally comes from forcing the ole square peg into a round hole. For one reason or another, even the best intentions in growing our team from within can rapidly become no good deed going unpunished.

A harsh reality that every business owner, executive, and high-level manager needs to face is that the best doers don’t always end up being the best leaders. As we address this profitability killer, we’ll look at several reasons that can happen—without placing blame—and we’ll work through some concrete steps we can take to build a succession plan in our organization that can keep each of the pitfalls listed in those articles I just referenced at bay. But first, we should probably consider the price tag that comes from imposing our will on someone who’s perfectly happy right where they are…

For more on this, you're welcome to reach out to us directly at [email protected] to get a 45 Day Trial Access to our COMPLETE Leading At The Next Level program or you can check out Wes's recently released book, What's KILLING Your Profitability? (It ALL Boils Down to Leadership!) that was a #1 Best Seller on Amazon!