Why You Should Not Reward Skilled Workers with Management Roles

The skilled labour shortage has been affecting organisations around the globe since the past few years. The recent pandemic has made the situation even worse. According to ManpowerGroup, 54% of companies globally report talent shortages in 2019, which is the highest in over a decade.

Now, business leaders are scrambling to manage the situation. Here are some of their solutions:

heavy recruiting to hire the few candidates that are available,
offering higher wages and benefits to attract and retain them, and
investing in learning and development programs to develop employees' skills.

Do not make management positions a reward for exceptionally skilled labour

There are also corporations that try to offer their top-performing skilled workers the management positions as a reward. Here are the top two reasons why they promote skilled workers to managers:

They have a lot of experience and have stayed with the company for years.
They were promoted because they were successful in their prior, non-managerial position.

When organisations promote a skilled worker to management on the basis of prior performance, they lose a job expert and gain a manager who often times has no talent for people management. That is how moving a single employee can create a double negative, and it hurts their business.

A better solution is to redesign the company's career path and promotion system. Allowing job role experts to advance inside their roles keeps great workers doing their great work. It also keeps management in the hands of those with the ability to manage people well.

Many companies still use the outdated career path system.

Righting wrongs

The current career path system is simple: The only way for top performers to advance in their careers is to take on people management roles.

Even though this system offers employees a clear and defined advancement path, the negative effects are shown in both the skilled labour shortage and the disastrous state of people management around the globe. The worldwide employee engagement rate is only 15%.

There are better alternatives to build career paths: One practice advice is to create additional paths for skill roles that parallel the manager path. These paths reward achievement with advancement inside a role, rather than with a move to a management position.

How does it work?

As people are becoming better at their jobs, their pay and their status, as well as responsibilities increase. This approach allows the talented and skilled workers to develop themselves in one role instead of switching roles for the sole purpose of advancing in the organisation.

Additionally, the pay structure is changed to a broad-banding system, where the entry salary for a higher-level role is less than the top-end salary of a lower-level role. For example, the expert salesman earns more than the new sales manager.

This system shows that the organisation puts financial value on excellent performance and also recognises developmental achievements.

This also changes an organisation's management promotion system. Though it keeps skilled workers in skilled roles, it does force organisations to consider this issue: how to choose managers if prior role success isn't the key criterion?

According to Gallup, there are five innate talents that predict management excellence:

Motivator: They challenge their teams and selves to constantly improve and achieve distinguished performance.
Assertiveness: They overcome challenges, troubles and resistance.
Accountability: They seize ultimate responsibility for their teams' successes and build the structure and processes to help their teams deliver on expectations.
Relationships: They create a positive and engaging work environment where their teams form strong relationships with one another and with clients.
Decision-Making: They solve the many complex problems and obstacles essential to the role by thinking ahead, planning for emergencies, balancing competing interests and taking an analytical approach.

There is no reason that a top-performing individual contributor cannot have these qualities. But there's also no reason to assume they do, only because they have been so successful in their current role.

It's important for skilled workers to be able to keep doing what they're best at.

Organisations cannot survive without skilled labour

Organisations that value performance must value potential, and discover how to develop it on an individual basis. When organisations hire for talent in a position rather than using managerial positions as a reward, everybody wins.

Gallup's research displays that managers are selected because of their great managerial talents realised significantly better business outcomes:

an increase in profit of 48%,
an increase in employee engagement of 17%, and
an increase in productivity of 22%.

People are also more likely to be engaged in their duties and less likely to leave an organisation if they can use their strengths in a role.

The opportunity is obvious: Better career paths and a new manager selection system enable organisations to considerably improve their internal allocation of human resources.

But the need is also clear: Businesses cannot succeed without skilled workers. Competition for them is fierce, and recruiting them is expensive.

Keeping top talents and managers where they shine is a winning strategy for people, organisations, and the economy.

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Source: HR Exchange Network

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