Thinking that a generous, transparent, strategically aligned reward package will "compensate" for the fact that you have lousy managers in key positions that company leadership is unwilling to address?
A recent study by Zenger/Folkman featured in a HBR blog post yesterday, provides some compelling evidence on the impact of bad bosses on employee satisfaction, engagement and commitment. The study centers on the effectiveness of 2,865 leaders (as judged by bosses, subordinates, peers and other colleagues via a 360 degree assessment) in a large financial service company.
As the chart below shows (click to embiggen), the sales, engagement and commitment levels of employees working for the worst bosses (those at or below the 10th percentile) reached only the 4th percentile. As the article states, this suggests that "96% of the company's employees were more committed than these mumbling, grumbling, unhappy souls." The other end of the chart shows that the employees working for the leaders with the highest assessments are more satisfied/engaged/committed than 92% of their peers.
Although it may temporarily salve their pain -- and the tough labor market may prevent them from jumping ship -- not even a world-class reward program will be able to override the impact of a bad boss on employee morale and productivity. Many of us can vouch for this fact based on personal experience.
Are you letting lousy bosses undermine your reward investments?