The bottom line

Guest editorial
Doug Cartland, President, Doug Cartland Inc.

This article was published in the February 2020 edition of NTEA News.

Let me begin this little article with a disclaimer: Profitability is important, as it keeps us in business.

However, a new study out of Baylor University shows leaders who emphasize profits typically get less of them.

The study (get ready, it’s a long title) — The Influence of Supervisor Bottom-Line Mentality and Employee Bottom-Line Mentality on Leader-Member Exchange and Subsequent Employee Performance (whew!) — was published last summer in the journal Human Relations. 

It reveals leaders who drive the bottom line, first and foremost, cause a response in employees that undermines that very objective.

What’s the response? As summarized in the study’s opening line: “Supervisors driven by profits could actually be hurting their coveted bottom lines by losing the respect of their employees, who counter by withholding performance.”

Well, there you go.

The more you let profit be the main driver, the less your employees are apt to respond to you. If employees respect and trust you less, they won’t work as hard for you. The less effort they apply, the more your profits disappear.

This begs the next question: Why does focusing on profits lower the respect level of employees toward their leader?

As you might expect, Baylor has an answer for that, too. Lead researcher Mathew Quade, Ph.D., assistant professor of management at Baylor University’s Hankamer School of Business, says, “Supervisors who focus only on profits to the exclusion of caring about other important outcomes like employee well-being or environmental or ethical concerns, turn out to be detrimental to employees. This results in relationships that are marked by distrust, dissatisfaction and lack of affection for the supervisors. 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.”

One really interesting finding was even employees who have a strong bottom-line mindset prefer managers who do not. So, even though they may be driven by the same philosophy, they still look askance at their leaders if they do.

(I suggest you read that short paragraph again. It’s an astonishing finding.)

Here’s the bottom line to this article. The way to profits comes not by emphasizing them, but rather, prioritizing your care for the employee’s well-being, inside and outside of work. Be an example in word and deed, and commit yourself and your company to the betterment of the world and, more specifically, to your community. And, it goes without saying (though I will say it), be honest and ethical. 

These traits will inspire and motivate your people to work hard for you. It’s a simple formula, really — but knowing it and doing it are two different things.

Indeed, winning is the byproduct and shouldn’t be the emphasis in a sporting event. Doing all the little things correctly should be the focus.

In the same way, profits are the byproduct and shouldn’t be the emphasis in business. Doing all the little things correctly as a leader should be.

Ahem, I’ve been saying this very thing for over 20 years.

Believe me now?

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