majority of organizations had dysfunctional and unhealthy work climates.39. 40 At any one time the 800,000 employees of the U.S. Postal Service have filed 150,000 grievances against their supervisors.4 Research shows that 50 to 90 percent of all new businesses fail within five years. This finding seems consistent across all business types and countries. Most of the failures can be attributed to managerial incompetence. 42. 43. 44, 45 BP, the energy company responsible for the Gulf of Mexico environmental disaster in 2010, has been cited 760 times and paid fines of $373 million for safety and environmental violations since 2005. The root causes of most major industrial accidents and incidents, such as the Bhopal, India, chemical spill, the Exxon Valdez disaster, the Texas City refinery explosion, or the wildfires of California and Australia can be traced back to poor management oversight or management cost-cutting initiatives. 46. 47. 45. 49 Research shows that 67 percent of all IT projects fail to deliver promised functionality, are not delivered on time, or do not stay within budgeted costs. This IT project failure rate has not improved much over the past 10 years, and U.S. businesses are now spending over $55 billion annually on poorly scoped or executed IT projects.50 Over 70 percent of all mergers and acquisitions fail to yield projected improvements in profitability and synergies. Examples might include HP's acquisition of Autonomy or the Sears merger with Kmart." A majority of large-scale organizational change initiatives fail to achieve their intended results.32 Toxic, destructive, or abusive supervision is prevalent in both the public and private sectors. A U.S. Army study indicated that only 27 percent of officers could accurately identify ineffective leaders and 25 percent of the officer corps were either abusive to others or careerists out only for themselves. Another study indicated that over 60 percent of workers reported to an abusive or destructive leader sometime during their Career $3. 54. 55. 56 The U.S. Navy had four major boat incidents in the Pacific in 2017, including three collisions with other boats and a guided ship cruiser running aground in Tokyo Bay. Despite pleading for assistance from the captain, the U.S. Navy failed to adequately manage the coronavirus outbreak on the aircraft carrier the USS Teddy Roosevelt in March-April of 2020. In 2012, three Italian researchers were awarded the Ig Nobel Prize for demonstrating mathematically that organizations would become more efficient if they promoted people randomly. If the base rate of managerial incompetence ranges between 50 and 75 percent, then random promotions would be the best alternative."? Seventy five percent of employees would take a pay cut if it meant getting their boss replaced. Robert Hogan, American psychologist As unflattering as these statistics are, these examples may seem out of the realm of most readers. So let's make the concept of Page 621 managerial incompetence a little more personal. One easy way to determine the level of incompetence among people in positions of authority is to do the Dr. Gordy test.58. 59. 60. 61 To use this test, begin by counting the total number of people you have been led by or worked for in the past. This total should include past bosses, athletic coaches, team captains, choir directors, camp directors, and so on. In other words, it should include anyone with whom you played a formal followership role. Once you have arrived at a total, count the number of people in this group for whom you would willingly play, sing, or work again. In other words, how many of these people would you play a followership role for again if given a choice? Now calculate the percentage of competent leaders in the total group of leaders. When health care, education, business, military, and community leaders are asked the same question, most need only the digits on a single hand to count the number of leaders for whom they would willingly work again. The percentage of competent leaders people would willingly work for again varies dramatically across individuals, but the percentage seems to hover between 25 and 40 percent. 62. 63. 64. 65. 60 This means that most people would not work for a majority of leaders they have been exposed to. Most of those taking the Dr. Gordy test do not view it as a popularity contest. Those who pass the test are often described as tough but fair leaders who inspired their followers and pushed their teams to achieve more than anyone thought possible. A critical follow-on question to the Dr. Gordy test is whether readers would make their followers' short lists. In other words, would you be in the 25 to 40 percent of leaders who pass the Dr. Gordy test or be with the majority of leaders who fail the exam? Most people fail the test, which implies that being an effective leader is no easy task. Like the Seth MacFarlane movie A Million Ways to Die in the West, there are a million ways for leaders to fail. The common reasons why leaders are unable to engage employees, build teams, or achieve results that beat the competition are described in more detail later in this chapter. Knowing what people do that causes them to be perceived as incompetent managers can help readers avoid making the same mistakes. (See [ Highlights 17.2 and ) 17.3.)Managerial Incompetence For every person who's a manager and wants to know how to manage people, there are 10 people who are being managed and would like to figure out how to make it stop. Scott Adams, creator of "Dilbert" Whereas destructive leadership is associated with individuals who engage followers and build teams to achieve corrupt, selfish, or evil ends, incompetent management is associated with individuals who cannot engage followers, build teams, or get results through others. In other words, incompetent managers have difficulties building loyal followings or getting anything done. Research shows that there may be more incompetent than competent managers; the base rate of managerial incompetence may be 50 to 75 percent. 17. 18. 19. 20. 21. 22. 25 You might think the base rate of managerial incompetence could not be this high-too many countries, businesses, government and other nonprofit organizations, or volunteer organizations would simply fail if riddled with such a high percentage of incompetent leaders. But consider the following facts: Most countries are run by some form of dictatorship. Most ordinary citizens in Saudi Arabia, Syria, Belarus, Bahrain, Sudan, Jordan, Page 620 Chad, Iran, Turkmenistan, China, and Russia do not have much say over who is in charge, what laws are made, and so on. Although the leaders of these countries have a following among a minority of people, the majority has little input into who leads them and often realizes few benefits. Many leaders of democratic countries are perceived as being unable to build teams or get results. U.S. president George W. Bush saw his approval ratings drop from 85 to 30 percent over his eight-year term, and Barack Obama experienced a 25-point approval rating drop during his first 18 months in office. With only a 43 percent approval rating, Donald Trump's ratings have been among the lowest for any U.S. president, and the U.S. Congress has less than a 15 percent approval rating among likely voters. 24. 25. 26. 27, 25 CEO departures averaged 114 per month in 2019. Some departures were due to retirements or taking jobs with other companies, but many were the result of unacceptable behavior and poor performance. High visibility examples include John Schnatter from Papa Johns, Adam Neumann from WeWork, Harvey Weinstein from the Weinstein Company, and leaders of Nike, Barnes & Noble, Texas Instruments, Amnesty International, and Boeing. If these trends continue, then approximately 50 percent of CEOs will be replaced every three years. 29. 30. 31. 32, 33. 34 In employee satisfaction surveys, more than 75 percent of all respondents indicate that the most stressful part of their job is their immediate boss.35. 36 This finding holds true across countries and industries. Two-thirds of all U.S. workers are either not fully engaged or actively disengaged at work, and at any one time 51 percent are looking for other jobs. 37 Sixty percent of the participants in a high-performing division of a Fortune 100 company indicated that that their organization was successful despite their leaders. Thirty-five percent of the participants in a broader research study of high-performing companies said the same thing. Clueless bosses in high-performing companies attribute success to their own efforts, but it may be highly engaged employees working in high- performing teams that make the difference between winning and losing. 38 A study published in Harvard Business Review reported that only 30 percent of businesses had "healthy and respectful" work climates. A majority of organizations had dysfunctional and unhealthy work climates. 39. 40 At any one time the $00,000 employees of the U.S. Postal Service have filed 150,000 grievances against their supervisors.41 Research shows that 50 to 90 percent of all new businesses fail within five years. This finding seems consistent across all business types and countries. Most of the failures can be attributed to managerial incompetence. 42. 43. 44. 45 BP, the energy company responsible for the Gulf of Mexico environmental disaster in 2010, has been cited 760 times and paid fines of $373 million for safety and environmental violations since 2005. The root causes of most major industrial accidents and incidents, such as the Bhopal, India, chemical spill, the Exxon Valdez disaster, the Texas City refinery explosion, or the wildfires of California and Australia can be traced back to poor management oversight of management cost-cutting initiatives. 46. 47. 45. 49 Research shows that 67 percent of all IT projects fail to deliver promised functionality, are not delivered on time, or do not stay within budgeted costs. This IT project failure rate has not improved much over the past 10 years, and U.S. businesses are now spending over $55 billion annually on poorly scoped or executed IT projects.30