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    Innovation Village | Technology, Product Reviews, Business
    You are at:Home»Business»How Bad Managers Are Costing the World $8.1 Trillion Every Year

    How Bad Managers Are Costing the World $8.1 Trillion Every Year

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    By Smart Megwai on July 25, 2025 Business, How To, Human Resources, Leadership, Opinion, Remote Work, Tips

    I once worked at a large, well-known organisation that, on paper, had everything you’d expect from a great workplace. Large team. Big mission. Even a daily “morning devotion” meant to inspire us before the day’s work. But none of that mattered. Because three women managers technically held the place hostage.

    In African culture, we have a name for this kind of forces: Principalities. People who move as if power is their birthright, as if compassion is a threat. These women treated every workday like a battlefield. No one felt safe enough to be creative or to relax.

    And I remember this one who kept strict office hours like a drill sergeant. She ruled the attendance sheet like a gatekeeper of destiny. She’d draw a line at 7:00 a.m. sharp. If you arrived at 7:01, no matter the Lagos traffic or your best effort, you signed below the line—public shame in pen.

    Another one harassed me for sitting while sick. I was on duty, still doing my job, just not standing tall enough for her liking. I told her plainly: “I’m not feeling well. If the director wants to know why I’m sitting, I’ll tell him myself.”

    In that environment, empathy was a weakness, and we all paid for it, quietly. That job taught me something the data now confirms: people don’t quit companies, they quit bosses.

    And the cost of that truth is staggering. According to Quartz Business News, poor management now drains over $960 billion annually from the U.S. economy and $8.1 trillion globally. One of the biggest expenses in business today isn’t software, payroll, or even marketing. It’s bad leadership.

    The Real Cost of Bad Management

    A 2019 report by SHRM found that U.S. companies lost $223 billion over five years due to employee turnover driven by toxic workplace cultures. The main cause? Poor management. Nearly 58% of employees said they quit because of their manager. It had nothing to do with the company, nor the pay or the work itself. Just the person they reported to.

    And it’s not just a U.S. problem. A 2024 global survey by DDI showed that 57% of employees worldwide have left a job because of their manager. Another 37% said they’ve seriously considered it.

    The takeaway is hard to ignore: companies aren’t losing people because they’re unmotivated. They’re losing them because their direct supervisors are overwhelmed, untrained, insecure, or simply wrong for the role.

    How Good Employees Turn Into Bad Managers

    It’s a familiar story. A skilled engineer gets promoted to team lead, and suddenly the team is drowning in check-ins, approvals, and control. A top-performing salesperson becomes a manager, and within months, team morale nosedives. Why does this happen?

    It’s something researchers call The Peter Principle. It is an idea that people get promoted based on their performance in their current role, not their potential for the next one. They move up until they hit a level they’re not equipped for. And there they stay: stuck, stressed, and slowly eroding the culture around them. But it’s not always intentional. Sometimes, it is just poor training or no training at all.

    According to Gallup, only 1 in 10 people has the natural ability to manage others. But instead of identifying and training those few, many companies treat management as a promotion, not a skill. If you’re good at the work, they assume you’ll be good at leading others who do it.

    But managing people is not an extension of technical skill. It’s a different job entirely; with its own tools, mindset, and responsibilities. And when we keep handing out promotions without giving people those tools, we don’t just set them up to fail. We put entire teams at risk.

    What Actually Makes a Good Boss?

    Google’s Project Oxygen studied what sets great managers apart—and surprisingly, technical ability came last on the list. What mattered most? Clear communication. Empathy. Trust. Coaching. The things that make people feel seen and supported, not just supervised.

    When those qualities are missing, it’s not just morale that drops. People’s health suffers too. Research shows that working under a bad manager raises the risk of chronic stress, burnout, and even heart problems. The workplace turns into a place of tension and survival. And the toll on wellbeing, productivity, and retention is enormous.

    So What Needs to Change?

    The easy answer would be: “train better managers.” But the deeper answer might be to rethink promotion itself.

    • What if we promoted people sideways before moving them up?
    • What if growth wasn’t only vertical, but lateral—giving people new responsibilities, mentorship, or project ownership without forcing them into people management?
    • What if we stopped acting like “manager” was the only way to move forward?

    Because the truth is, not everyone wants to manage. And not everyone should.

    A Word From Someone Who’s Been There

    I’ve worked in places that drained the life out of me. Where I woke up anxious. Where I drove recklessly just to avoid being late and getting reprimanded for something as trivial as how I signed an attendance register.

    But I’ve also worked in places where I felt trusted. Where I could speak up. Where I could breathe. And in those places, I did my best work. We don’t need more titles in organisations. We need more people who know how to bring out the best in others. That’s leadership. And it doesn’t come from fear but from respect.

    So the next time someone quits their job, don’t ask what happened to the company. Ask who they reported to. 🤣🤣🤣

    Want to make sure you’re not part of the problem? Here are 4 simple ways to improve your management skills starting today. Your team and your company’s bottom line will thank you.

    Related

    Bad Management Bad Managers Business DDI Gallup Google Leadership Peter Principle Poor Management Project Oxygen Quartz SHRM Startups Technology Workplace Culture Workplaces
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    Smart Megwai
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    Smart is a Tech Writer. His passion for educating people is what drives him to provide practical tech solutions which helps solve everyday tech-related issues.

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