The data are quite clear: employee engagement is the “g” factor in organizational life. Engagement, which is easy to measure, predicts every important organizational outcome at both the individual and the group level. Higher levels of engagement bring better financial results in terms of lower turnover, lower absenteeism, higher productivity, and higher customer satisfaction. When organizations pay attention to engagement, they make more money.
Nonetheless, the base rate of bad management in corporate American remains pretty steady at about 65%. Why do managers destroy employee engagement and corporate profitability? The answer, I fear, is that many managers in most organizations are focused on doing what it takes to advance their own careers with little regard for the welfare of the overall organization. Developing engagement is a long term, strategic undertaking; promoting one’s career is often a short term, tactical activity based on “targets of opportunity.”
Research shows that the principle factor driving employees’ decisions to quit an organization is their immediate boss, and the most important factor affecting employees’ relationships with their boss is integrity. Thus, managerial integrity is at the core of employee engagement. With regard to the archetypal dimensions underlying managerial behavior, structure and consideration, integrity is most highly correlated with consideration and essentially unrelated to structure. This means that integrity is associated with being considerate. How can we measure managerial integrity?
Virtually every competency model used to evaluate managerial performance contains an entry for integrity; that is to say, virtually every organization claims to believe that managers should have integrity. Asking people to rate the integrity of managers turns out not to work. On the one hand, research shows that in most competency reviews the managerial cohort gets its highest ratings for integrity; individual managers rarely get low ratings for integrity. Rob Kaiser reports a study in which all 340 managers in an organization got high ratings for integrity but that 10% of them were subsequently indicted for fraud. On the other hand, bad people are good at disguising their naughtiness; actually observing someone seriously misbehaving is a very low base rate phenomenon. Thus, behavioral ratings for integrity lack integrity.
Kaiser suggests an alternative method for evaluating integrity. He begins with Walter Mischel’s distinction between strong and weak situations. Strong situations provide clear cues for behavior, which then suppress individual personality. Weak situations provide ambiguous cues for behavior, which then potentiates individual personality. Dealing with one’s boss is a strong situation, but dealing with one’s subordinates is a weak situation. Subordinates are, therefore, better able to observe bad managerial behavior than are the bosses of the managers.
Kaiser suggests asking subordinates to estimate the likelihood that their manager will lie, bully, betray, deceive, demean, procrastinate, shout, grope, or dehumanize them. Subordinates are able to do this quite easily and subsequently give many managers poor ratings for integrity, and these estimate-based ratings predict a variety of leadership outcomes including employee engagement. Kaiser notes (correctly) that this process amounts to evaluating a manager’s reputation, which I believe is the best personality data we can possibly gather. Kaiser also notes that the politics of many organizations make it difficult to use these kinds of ratings, but politics aside, the data clearly indicate that: (1) employees know which managers do and do not have integrity; (2) employee ratings of managerial integrity predict employee engagement; and (3) organizations would be well advised to pay attention to this kind of data—if they care about overall profitability.