Do People Leave Managers or Do They Leave Companies?
My last few posts have focused a bit more on culture and leadership (or lack thereof); in today's post, I'll continue the trend with a focus on management sins. I found three separate items that I wanted to share with you, all quite interesting, some with overlap.
The first is a whitepaper I recently came across titled 7 Deadly Sins of Management™. It comes from the Management and Leadership Network (MLN) and the Center for Competitiveness (CforC). They conducted research among executives in Northern Ireland to determine if there was a common understanding or thread as to why businesses in the region fail. Apparently, there is a "management and leadership deficit"in the UK. According to their research, the following leadership behaviors cause a business to under-perform or to fail.
- Lack of vision (No desired future state identified to be working towards)
- Lack of focus (Lack of focus on the areas of the business which add most value)
- Inappropriate role model (not leading by example - actions not matching words, not open to learning, not taking ownership)
- Not close enough to the business (lack of understanding of markets, customers, staff or product evolution)
- Lack of accountability or discipline (no action for non-performance, chaotic/fire-fighting environment, too fluid)
- Lack of constancy of purpose (Not staying the course because of the distractions or opportunities which causes the “eye to be taken off the ball”)
- Too much focus on the numbers (short-termism, lack of patience, mechanistic environment, blame culture)
Without a doubt, these behaviors are 110% detrimental to any business. When there's no clarity for employees, when they see leaders fumble around trying to figure out next steps, and when they feel like leaders don't understand the business itself and what they're supposed to be doing, employees begin to question whether they want to continue to work for these folks. And worse, employees decide to leave.
The next item I found was Dr. W. Edwards Deming seven deadly diseases of western management, which he notes are:
- Lack of constancy of purpose
- Emphasis on short-term profits
- Annual rating of performance: “it is purely a lottery”
- Mobility of management (i.e., job hopping)
- Use of visible figures only, with little or no consideration of figures that are unknown or unknowable
- Excessive medical costs
- Excessive legal damage awards swelled by lawyers working on contingency fees
For any business to be transformed, for businesses to survey, clearly these diseases need to be cured. The first five are his original "diseases," and he added the other two later.
And finally, the third item is a book by Dr. John Collis, The Seven Fatal Management Sins | Understanding and Avoiding Managerial Malpractice, in which he calls out and defines the following sins:
- The character flaw: erosion of trust and integrity
- Blind ambition: focus more on managing your career than managing the organization
- Short-term scare mentality: managing for survival
- Indecisiveness: unclear on when and who decides
- Blurred focus: the fuzzy vision
- Employees perceived as an expense, not as an investment
- Managing unchecked: lack of real accountability
Pundits actually ponder if people really leave managers, not companies. With traits like those listed, why would an employee want to stay. An interesting observation is that none of these three really put a heavy focus on employee development; each one stated only one sin that pertained to the employee, although, ultimately, they all impact employees,
From these lists, some of the deal-breaker behaviors for me - ones that I've witnessed fairly consistently over the years, unfortunately - include:
- Lack of vision
- Lack of focus/constancy of purpose
- No real accountability
- Too much focus on the numbers
- Not leading by example
- Lack of trust and integrity
- Managing for survival
Based on your experience, what else would you add to the sins outlined by the three sources I've noted? What sins have you seen your managers or leadership team commit? What are your deal breakers?
So much of what we call management consists of making it difficult for people to work. -Peter Drucker
Are Your Clients Failing to Plan for the Costs of Long-Term Care?
Written by: Matthew Paine
It’s been a tough few years in my family. My mother has been battling cancer for what feels like forever, and while she’s been managing her health with diet and exercise for some time, a few months ago everything changed. Her cancer had become aggressive, and chemo, which she had dreaded, was suddenly the only real option. My mother is in her late 70s, so the already brutal side effects of chemo resulted in a prolonged hospital stay that is currently at four weeks and counting. The good news is that she’s mentally strong, and she’s battling like a lion.
My dad is another story. Suffering from early-onset dementia, his ability to understand what’s happening and why my mother isn’t at home shifts from day to day. Because he’s unable to drive or care for himself (at least predictably), my siblings and I have been juggling taking care of him ourselves. It’s not an easy task, especially with jobs, children, and lives of our own to manage as well.
Like many families, none of us—my mother, my father, my siblings or myself—saw our current dilemma coming our way. Clearly we should have. My mother hasn’t been in top health for years. My dad’s condition is sure to get worse. And even if both of them were in perfect health, their age alone should have driven us to communicate better, earlier, and smarter. Despite being in the financial services industry myself, I haven’t been involved in my parents’ finances. I know they saved well for retirement, but I don’t know where they stand financially today. I don’t know what or how much insurance coverage they have. I have no idea how they plan to pay for their long-term care—or if there even is a plan.
The situation is forcing our family to get personal—and fast. Despite being careful about nearly every other aspect of our family’s financial lives, this one slipped through the cracks. We failed to plan.
Just like cancer and dementia, this failure to plan is an epidemic. And it’s only getting worse. To help your clients battle this epidemic, it’s vital that planning for long-term care become an intrinsic part of your retirement planning process. Here’s why:
Retirement planning alone isn’t sufficient.
We’ve all seen it. A client has a great retirement plan in place, and suddenly life throws an unexpected curveball. The later in life your clients get, the more likely that curveball will be the need for long-term care. According to the National Center on Caregiving, the number of people needing long-term care will hit a shocking 27 million by 2050. And according to the AARP, one in four people age 45 and over are not prepared financially if they suddenly required long-term care for an indefinite period of time. That statistic alone tells us that our efforts at planning are failing.
Long-term care costs are escalating rapidly.
According to a 2016 survey from Genworth Financial, a private nursing home room costs just over $92,000—about $7,698 a month—which is 19% more than it cost for the same care in 2011. According to the AARP Public Policy Institute, lost income and benefits over a caregiver's lifetime is estimated to range from a total of $283,716 for men to $324,044 for women, or an average of $303,880—and less than 10% of that care is expected to be covered by private insurance.
Medicaid isn’t the answer.
Many people assume that public programs are the answer to long-term care, but in the case of Medicaid, a program designed to assist the poor, it is a last resort. First, while nearly everyone over age 65 has Medicare coverage, that program doesn’t cover long-term stays. That means that many people who need that coverage are forced to spend down their assets until they qualify for Medicaid. How poor must a patient be to receive benefits? In order to be eligible for Medicaid benefits, a nursing home resident may have no more than $2,000 in "countable" assets, and the patient’s spouse—called the "community spouse"—is limited to one half of the couple's joint assets up to $119,220 (in 2016) in "countable" assets. The result: even a couple who has spent a lifetime saving for a comfortable retirement can be forced to draw down nearly all of their assets before qualifying for Medicaid.
Once on Medicaid, long-term care patients lose the one thing many seniors care about most: choice. As a recipient of public assistance, patients rarely have a say in where they receive care. Whether that means being placed far from family, in a less-than-desirable facility, or even in a facility that lacks certain types of care (such as a dementia unit or other specialized care), the patient is at the whim of the state.
The good news is that even for those who feel there’s no light at the end of the tunnel, there are options that can help seniors who are struggling to pay for their post-retirement care to not only cover those rising expenses, but to do so in a way that gives them the freedom of choice. A Veteran myself, I know that VA Benefits are highly underutilized—including long-term care benefits. You can learn more about these benefits here. As well, the National Association of Insurance Commissioners (NAIC)’s July report Private Market Options for Financing Long-Term Care Services offers a variety of options for helping finance long-term care needs. Included in that list is the use of life insurance policies to help to fund long-term care expenses—an approach that is supported by GWG Life’s LifeCare Xchange Program.
In my own situation, I know there’s a high likelihood that my dad will eventually require skilled nursing care. I hope that as my siblings and I begin to dig into the details of my parents’ estate, we’ll find that they have indeed planned for long-term care. If that’s not the case, I’m comforted to know there are options available to help ensure Dad is not only in a facility that can meet his specialized needs, but that his new home is where our family chooses for him to be. Life may throw its curveballs, but at least Dad’s care will count as a home run.
Matthew Paine is Senior Vice President at GWG Holdings. Mr. Paine started his financial services career with AXA Advisors, developing marketing strategies for the North Central Region and building his personal practice. Since 2008, he has lead sales teams in raising capital in various assets classes ranging from the Life Insurance Secondary Market, Multi-Family Real Estate, Conservation Easements, and MBS Hedge Funds/Fund of Funds. Mr. Paine has a BA in Marketing/Management from the University of St. Thomas in St. Paul, MN and holds FINRA Series 7, 24 and Series 63 licenses through Emerson Equity, LLC. Member FINRA/SIPC.
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