Soft leadership pays off in hard cash

Is it possible for supervisors to be soft, supportive and approachable towards their employees and still make money?

Could soft leadership actually pay off in terms of hard cash? Or does a supportive leadership style come at the expense of financial performance?

Associate Professor Anders Dysvik and Professor Baard Kuvaas at BI Norwegian Business School have conducted a study that looks at the connection between perceived supervisor support and organisational performance.

This is supportive leadership

Supportive leadership may be defined as the degree to which employees feel their supervisor is interested in their contribution to the organisation’s success and prosperity, and that the supervisor cares about the staff’s well-being and job satisfaction.

The researchers surveyed nearly 550 employees at 75 petrol stations, all in the same chain.

The researchers employed a recognised measuring tool to survey the employees’ perception of supervisor support.  They were asked to respond to four statements on a scale from 1 to 5 (1= Disagree very much 5= Agree completely):

• My immediate supervisor is really interested in my opinions
• My immediate supervisor shows an interest in my well-being at work
• My immediate supervisor pays attention to my objectives and values
• My immediate supervisor doesn’t really care much about me (the reverse question)

Top score in supervisor support and profits

The results of the study are now being presented in an article in the scientific journal Human Resource Management.

The study shows strong links between a supportive management, perceived investment in employee development and the performance of the petrol stations.

The top 25 percent of petrol stations in terms of  the highest scores for supportive leadership achieved profits on average 38 percent better than profits in the bottom 25 percent.

“This demonstrates clearly that supportive leadership is connected to the performance of an organisation. Supportive leadership yields the most sales and the best customer service,” Dysvik and Kuvaas point out.

The study shows that the perception of supervisor support is linked to the employees’ perception of being invested in.

The results contain clear differences, even though all the petrol stations in the survey have had the same focus on training, development and future opportunities.

What can we learn?

Based on the study, Professor Bård Kuvaas prepared five practical pointers for companies:

1. Leadership does not just affect each employee’s productivity and job satisfaction, but also the organisational outcomes.
    
2. Supportive, soft and approachable leadership leads to happier employees and higher profitability. When this type of leadership results in higher sales and better customer service by petrol station staff, it is natural to think that such leadership will be even more important among so-called knowledge workers.
    
3. Organisations may have good or bad management systems, but the efficiency of a system depends in any case on the individual supervisor.
    
4. Recruit and select leaders who care about people (they must also understand the industry, of course) and who are able to give their staff a sense of being important for the organisation’s performance today and in the future. The employees will enjoy greater job satisfaction, the customers will be happier, and the owners will make more money.
    
5. It is not that difficult to identify supportive supervisors. The measuring tool described above is easy to use. The study shows a great deal of agreement among the employees concerning the supportiveness of each supervisor.

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Read this article in Norwegian at forskning.no

Scientific links

• Dysvik, A. & Kuvaas, B. (2012): Perceived supervisor support climate, perceived investment in employee development climate, and business unit performance. Accepted for publishing in Human Resource Management.