From a distance, it can seem like success in business is 70% hard work, 20% clever tactics, and 10% pure bravado. On the inside, however, things are a little different. As every current and former business owner knows all too well, it is the health of the workforce that really matters. The workers are the beating heart of any company and, if they are not used to their full potential, performance can quickly go downhill.

This is why leadership skills are an essential part of running a company, whether it be as big as Google or as small as the tiny startups that are changing the world right now. You could have the largest workforce on the planet, but if you don’t know how to lead it, you won’t succeed. Over the last twenty years, the popularity of leadership coaching experts has soared, because managers are finally starting to realise the value of being a great mentor.

Capable business leader

This guide to the most severe ramifications of poor leadership will make it clear why all business owners need to learn how to trailblaze.

1. Decreasing Profit Margins

One of the clearest signs of poor leadership is a company that underperforms financially. This means that it is failing to meet recommended and required targets. So, the problem here is that the workers aren’t committed enough to getting things done; they don’t care enough to give it that extra bit of effort.

If motivation levels are dropping, give employees something to fight for. Introduce a reward system, praise high performers, and foster stronger relationships between team members.

2. Poor Communication

It is absolutely vital that clear and logical connections exist between department heads and their workers. There must be an easy way for employees to get help, seek advice, ask questions, and raise concerns. If this access isn’t provided, not only will the workforce feel like management doesn’t care enough, there will be no leader in place to drive performance and push the team in the right direction. Make sure that your employees always know where to find you and how you can help them.

3. Reduced Morale and Team Spirit

Poor leadership very quickly results in decreased morale, because employees start to feel lost and cast adrift from the objectives of the company. A good leader is always on hand to reinforce positive behaviours and offer constructive criticism on the ones that aren’t so valuable. Also, a strong leader isn’t afraid of mistakes; they know that errors and slip ups don’t necessarily mean that an employee isn’t useful. They see it as their job to mould and teach, to prevent future mistakes with learning, rather than cold penalties and punishments.

Bad leadership
photo credit: Crash Symbols / Flickr

4. An Unhealthy Turnover

If poor leadership becomes a persistent problem, it is likely to lead to an increased turnover. Employees who don’t feel motivated and are not happy with their positions usually start searching for new ones. When they jump ship, this further intensifies financial issues for the company and, sometimes, it starts a downward spiral that pulls the company under. Therefore, it is not an overstatement to say that good leadership is something that can save a business from future ruin and financial devastation.

Takeaway: Why Professional Leadership Courses Are the Right Choice

Even very experienced managers can learn a lot from professional leadership programs and teaching courses. These carefully crafted resources are based on sound psychological and behavioural knowledge, so they offer an insight into the mind of your workers. This is essential, because keeping employees happy is only possible if you know what drives them.

To be a great leader, you need empathy and understanding as much as you do ambition. Be one yourself.