A great study was carried out by Jack Zenger and Joe Folkman that showed the quality of leaders determines the quality of ultimate profits a company may produce.
Many others have insinuated that there is a link between leadership and the bottom line but never has a detailed study been carried out to confirm this.
We often look at our competitors or other companies and wonder what they are doing differently that is making them perform better than we may be performing.
We may even invest considerable money in researching or trying to identify the reasons, when all we really need to do is look closer at the leaders within and the impact they are having on the people in the company.
It is largely the leaders within the company that impact on the company’s bottom line and the effectiveness and efficiencies of the company and their people.
Where people in leadership positions focus heavily on the bottom line and not how to get a great result, the impact on the results is negative and slowly declines over time.
Great leaders need to focus on the people as it is the people that ultimately make the profits. Helping the people see the big picture, the impact they have in the company and the contribution they all make towards profitability.
There is a proven fact that when people understand their worth to the company and are appreciated for their efforts by their leaders, productivity, efficiency and profits rise whilst absenteeism, staff turnover and poor performance decrease.
Don’t get me wrong, without a focus on financial returns a company will fail, but when the only focus is on profits then the long term impact will be a decrease in profitability and an increase in people issues.
There is no such thing as a bad team, just a poor leader.
