Poor managers can lead to insolvencies

Mon, 10 Jan 2011

Poor managers can lead to insolvencies

Poor management can be detrimental to a company’s success in many ways, and in the very worst cases, can lead to a company failing.

A new poll of insolvency practitioners, carried out by industry body R3, suggests that 56 per cent of insolvencies are caused by poor management on behalf of company directors.

Incompetence or bad management is a problem that most businesses will find extremely damaging, claims R3’s president Steven Law. He explained, “Regardless of the economic circumstance, no business will survive with poor management in place. I have seen a good workforce let down and sometimes laid off due to management who do not admit and correct their mistakes.”

However, even in cases where substandard management techniques are not poor enough to ruin a company, they can cause numerous other problems. Research suggests that staff can become disengaged with their job, stressed and demoralised if they think they are receiving poor management.

The issue of bad management can easily become a damaging vicious circle, particularly if a boss mismanages unhappy staff.

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