How much does a promotion to management cost in your company?

I was talking the other day to a friend of mine, Tom, who was promoted into management last year. Tom’s story is not unusual. In fact it’s quite common.

Tom was the top technical contributor in his group– he had the deepest knowledge, best skills, and got the work done.

He’s struggling in his new job. He’s not doing a great job as a manager and he knows it. He wants to do a good job, but he doesn’t know how. He asked to attend management training, but the training budget has been cut.

His boss gives advice when he can, but he’s not great coach, and doesn’t really have much time to devote to developing Tom’s management skills. He’s more or less of the “sink or swim” school. He figures he promoted Tom because he was capable, so he should figure it out.

It’s just not that easy.

And Tom is miserable. He so miserable he’s thinking of quitting. He’s got some money saved and his wife makes a good income, so he can quit and take his time finding another job.

This company may have saved a little money on training, but at what cost?

  • The organization doesn’t have Tom’s technical contribution any more because he’s trying to focus on management. (At least he hasn’t fallen into the trap of retreating to technical work and ignoring his management work.) They’ve lost a great technical person.
  • The organization is paying Tom a management salary — roughly $150K at the fully burdened cost. But their not getting their money’s worth for his salary — and it’s not Tom’s fault.
  • The team Tom is managing isn’t a productive as it used to be. Tom is trying hard, but he’s making mistakes. And those mistakes are costing his team time, focus and productivity.
  • It looks like the organization might lose Tom. Even though he’s not effective in his management job yet, he had tons of knowledge about the business, the organization, the systems and the people.

    Training, coaching, and support to help Tom make the transition to management would be much less expensive.

    But the company probably doesn’t realize what their promotion practices are really costing them.