I’ve had some great managers in my day, and I’ve had some terrible ones. I’ve been managed and I’ve managed others. Do high performers make good managers? No. High performance is not an adequate indicator of quality management. The skills needed to be an effective leader of people are different from those that make a high performer.
Product / Industry Knowledge ≠ People Knowledge
I joined ABC Lending at a time when they were looking to expand their loan offerings, collateral, and lending terms. Our CEO found a very experienced person to head one of our new divisions; Seth had extensive real estate experience in the specific niche for which we were looking and had run his own investment company.
He knew the players and could talk the lingo. He was energetic and lively and he could understand and talk to customers (people needing to borrow money) as well as investors (people who would give us their money to lend). When asked to work in this division I realized he could teach me a lot about this area of lending.
After about a year our team had almost 80% turnover. Some of that was due to changing dynamics in the way we were funded and structured, but most of it was due to people escaping Seth’s toxicity. We would have customers tell us they’d never do business with us if they had to talk to Seth. This was a bit hard since Seth was also a micro-manager who wanted to be involved in each sales call and servicing issue. He would prioritize his work over everyone else’s. He was condescending and brash with a voice as loud as his ego was big.
I still believe Seth understood the industry as well as anyone I came across in my two years, but eventually, he was asked to focus solely on loan production (his strongest asset) and not on managing people.
Rewards / Power ≠ Leadership
In a previous post, I wrote about a book by Marissa Orr titled Lean Out: The Truth About Women, Power, and the Workplace.
In her book, Orr points out that most managers attain their position by climbing the corporate ladder and not because they necessarily exhibit managerial skills.
“Management is a universal prize given without consideration to whether a person is capable of the task. Given the steep price a company pays for a bad boss, it’s astounding how little attention is paid to the matter. Being a great manager, or even just a moderately good one, requires a specific skill set. Just as you wouldn’t hire an accountant to lead the creative department, placing people without management skills in the role of a manager is almost always a disaster.”
Before taking any job, you ask about the expectations and workload. You also ask about salary, benefits, and time off. That’s because rewards are often the driving factor behind how we work. To make more money or yield more power it is expected that you move into a manager role. Rewards and power are signs that you’ve made it. Unfortunately, the skills that make good managers are not always rewarded. Power is often given to those who have been around the longest or sold the most widgets instead of those people who may be able to coach or lead more effectively.
Job Skills ≠ Managerial Skills
In 2018, the National Bureau of Economic Research wrote a paper titled “Promotions and the Peter Principle.” They concluded job performance is not a positive indicator of managerial performance.
“The best worker is not always the best candidate for manager… firms prioritize current job performance in promotion decisions at the expense of other observable characteristics that better predict managerial performance.”
The sentiment is not new and was introduced in 1969’s Peter Principle. In the book, Peter explains how people tend to rise to the level of their incompetence. He agrees that being a good follower will not make someone a good leader.
“…One reason so many employees are incompetent is that the skills required to get a job often have nothing to do with what is required to do the job itself. The skills required to run a great political campaign have little to do with the skills required to govern.”
This is not to say that great salespeople or analysts cannot also be great managers — oftentimes they are — but high performance is not equivalent to managerial capability. Leadership positions are often “awarded” to high performers and are often compensated higher due to their place of power in the organization. Good managers should be able to recognize that power is earned, not awarded.
My first “real” job while still in college was working part-time as a bank teller. Our branch manager was a 30-year veteran of the business and although she had no children of her own, she was a mother to her employees. Cathy encouraged me to work toward a supervisor position and after two years when she was ready to retire, she convinced me to interview for her job.
Who does that? Who suggests to a girl who hasn’t yet graduated from college that she can do a job for which others have worked for years? A great manager, that’s who.
I didn’t get Cathy’s job but eventually became the manager of a smaller branch at the age of 20. Sure, my branch was the size of a trailer with a staff of 3.5 (including me), but it was mine. I didn’t get the job because I opened the most checking accounts or cross-sold the most credit cards — I was recognized as someone who knew how to work with people and it was those satisfied people who would make our branch successful.
Successful managers will recognize opportunities for their employees, empower them to achieve, and grow a culture of high performers.