You might imagine that having a manager that is aware of the profitability of their organization would be a good thing, but a recent study from Baylor University suggests this might not actually be true. Indeed, profit-driven managers may so lose the respect of their team that the bottom line is actually hurt rather than helped.
“Supervisors who focus only on profits to the exclusion of caring about other important outcomes, such as employee well-being or environmental or ethical concerns, turn out to be detrimental to employees,” the authors explain. “This results in relationships that are marked by distrust, dissatisfaction and lack of affection for the supervisor. And ultimately, that leads to employees who are less likely to complete tasks at a high level and less likely to go above and beyond the call of duty.”
The wrong focus
The findings emerged after a survey of nearly 1,000 people, half of which were supervisors, with the remaining half their employees. The survey examined the bottom line focus (BLM) of both manager and employee, together with task performance levels and leader-member exchange, which is the rating employees give the relationship they have with their boss.
The analysis found that managers with a high focus on profitability seemed to have low relationships with their employees, with employees often then withholding performance in return. This is especially so when employees aren’t focused on profitability, but the negative impact persists even when employees are also focused on profitability.
The authors believe this latter point is particularly pertinent as it undermines any notion that as long as manager and team are unified, then everything is okay. This doesn’t appear to be the case if both are focused purely on profits.
“When supervisor and employee BLM is similarly high, our research demonstrates the negative effect on performance is only buffered, not mitigated – indicating no degree of supervisor BLM seems to be particularly beneficial,” the authors explain. “It seems even if employees maintain a BLM, they would prefer for their managers to focus on interpersonal aspects of the job that foster healthier social exchange relationships with their employees in addition to the bottom line.”
It perhaps goes without saying that organizations do ultimately want to be profitable, so what can they do? The authors advocate caution in emphasizing bottom-line outcomes in communication with staff, especially if this forces managers to neglect other concerns, such as ethics and wellbeing.
It’s also important for managers to be aware of the messages they’re passing on to employees when they talk about the profitability of the business. If such bottom-line related messages are to be communicated, then the authors recommend accompanying them with emphasis on things such as ethics and wellbeing to balance them out.
“Supervisors undoubtedly face heavy scrutiny for the performance levels of their employees, and as such they may tend to emphasize the need for employees to pursue bottom-line outcomes at the exclusion of other competing priorities, such as ethical practices, personal development or building social connections in the workplace,” the researchers conclude. “However, in doing so they may have to suffer the consequence of reduced employee respect, loyalty and even liking.”
