Activist company

Your company needs to get rid of bad bosses

Recently, my colleague from Inc., Jeff Haden, wrote about the link between bad bosses and toxic work environments, citing some 57 separate studies that came to the same conclusion: “Destructive leadership dramatically decreases employee job satisfaction. I immediately wondered why otherwise smart CEOs and thought leaders would need just one, let alone 57 studies to prove what should be obvious – that horrible bosses create horrible workplaces. What seemed even more important to understand was how, in the face of such a mountain of literal evidence, do these horrible executives manage to keep their jobs?

Until now, this was a question that most were content to treat as rhetoric. After all, until about a year ago when they were introduced to the century-old take-it-or-leave-it market, most workers felt compelled to accept the “it” – the one that included everything or part of the mistreatment, a toxic workplace and lack of care…until the Great Realization.

Since then, and in the ensuing ‘big quit’, which through January saw some 41 million workers leave their jobs – many of them in search of better conditions – employees have largely decided to quit to take it. They are no longer content to tolerate bad bosses and the toxic environments they propagate. The problem is that the wrong people leave. Bad bosses should go. Unfortunately, for the most part they are not, despite a massive number of resignations because of them. I decided to examine exactly why and what the rest of us can do about it.

For starters, there’s no one reason why bad bosses keep their jobs. A few years ago, business giant Warren Buffet tried to figure out why they were doing it. He postulated that toxic CEOs cling for three main reasons: (1) the lack of written performance standards for many of these leaders; (2) the fact that most CEOs have no immediate supervisor; and (3) that the boards to which these CEOs typically report wish to maintain a collegial boardroom atmosphere and, therefore, almost never directly confront their managers on any performance issues, let alone those having to do with the happiness of his associates. While I buy that these three reasons — put together from the perspective of the highest organizational tops — apply in some cases, they certainly don’t explain why all bad bosses stay employed. To fully understand this problem, one must look at the problem from all altitudes, not just the top. In doing so, a common theme emerges.

Above all, including in the case of the three explanations provided by Buffet, it is a problem of courage, or at the very least a problem of avoiding conflict. Take Warren Buffet’s apology. The reason most CEOs don’t have clear performance standards is that most boards avoid the discomfort that comes with presenting them to him. The same goes for the point on supervision. Among the roles these boards are supposed to play by shareholders, whether they choose to accept it or not, is to oversee and hold CEOs accountable for delivering the results expected of the organization and, ostensibly, for reflecting the values of it. Finally, the desire for collegiality is less about slaps and smiles and more about ensuring that board meetings and other interactions are devoid of difficult conversations about responsibility or CEO behavior. And this avoidance strategy does not stop there.

Remember that any executive hire, especially C-Suite hires like the head of the company, involves many well-placed people – senior human resource managers, board members and firm executives. white shoe recruitment company that conducted the search. So removing these people will force all of these people to admit they made a mistake or missed a gargantuan red flag. People like that rarely admit to making mistakes. Thus, they conspire to live with their error rather than live up to it.

It is also helpful to remember that in many of these organizations, whether private, public, for-profit or non-profit, people at these levels work together. They are friends. They socialize together. Their children are in school together. They sit together on community councils. They belong to the same clubs and frequent the same providers. As a result, for any part of the clique, moving onto another part of it becomes problematic and requires huge amounts of courage.

Many companies cling to bad bosses for fear of upsetting investors, creating bad press, or inviting litigation. Thus, they find nothing more conducive to airing their dirty laundry. Due to this general lack of courage, these artisans of toxic cultures are left free, without remorse. Sensing the organization’s reluctance to deal with them, over time these horrible executives double down on their bad behavior, ultimately making the work environment unbearable.

Finally, over time, a kind of Stockholm syndrome begins to take hold of many of these organizations. I saw it first hand. Without correction, those who are constantly abused by an abuser will, over time, begin to recognize him as a benefactor. Once this happens, finding a collective bloc with the courage to speak out against the aggressor becomes very difficult. But viewing these people as aggressors and tormentors is precisely what it will take to move forward. And the very results of the business demand this to happen.

Here’s why. A recent Talenteck study published by Harvard Business Review found that employee experience is directly correlated to business results. In fact, first-quartile companies when it comes to employee experience significantly outperform bottom-quartile companies—those that provide a poor employee experience and are seemingly run by a bad boss. In numbers, companies in the top quartile generate 53% higher revenues and 44% higher profits than their bottom quartile counterparts. So letting bad bosses think they’re good for business is, in fact, a really bad idea. I can’t stress enough how important and timely it is for those who have made the decision to act on these bad bosses to start mustering the courage to do so. Not only will you begin to stem the loss of good people, which has topped 4 million for five consecutive months, but you’ll also be adding to your business’ digital performance and avoiding the inevitable grassroots action that comes next.

Salesforce founder and co-CEO Marc Benioff was recently quoted as saying, “We have plenty of examples in Silicon Valley where CEOs have been ‘fired’ by their employees because they didn’t listen.” Small and medium-sized businesses that have left horrible bosses in place for far too long now have a decision to make: do the right thing now or risk being called out by a mob of activists. Employees are increasingly losing patience with boards of directors and senior HR managers who fail to act on these bad bosses. Increasingly, they denounce these abusers in the same way that they denounce sexual harassers of both sexes. They are tired of being mistreated or being the ones who have to uproot their lives when things get unbearable. They want to stop leaving; they want their companies to start doing the right thing.

It’s not just about improving leadership, it’s about time.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.