4 min read

8 Manager Effectiveness Metrics to Track

Effective vs. Ineffective Leaders

Successful teams are measured by how well they achieve their set goals and metrics.  Effective leaders use the tools available to them to create and set challenging, yet achievable goals. Effective leaders also encourage and enable their teams to be able to reach and even exceed their goals.  Ineffective leaders fail to set achievable goals, in many cases, they are too easy just as frequently as they are too hard.  Ineffective leaders fail to provide support and encouragement and also fail to recognize when adjustments need to be made.

So how do we decipher which leaders are effective and which are ineffective? Well to start, we must first understand that this is not a finger-pointing exercise. This is a tool to uncover both effective and ineffective strategies that can help your management teams perform better. Great management is essential for any business to succeed, and manager effectiveness metrics can be used as a tool to measure success in developing top talent for your organization. These metrics are also crucial in identifying underachieving teams and identifying ineffective leaders who can be educated and uplifted.  By tracking the manager performance metrics below, you can identify great leaders and uncover leadership techniques that can be shared. 


Why are manager performance metrics important?

Organizations need managers who can create a productive working environment, communicate effectively with their team, make well-informed decisions quickly and consistently, and lead their team toward the company’s objectives. By tracking performance metrics in people analytics software, companies can discover effective management techniques and reward their top performers. Not only that, they now have a solid benchmark to compare and see if that new program led to measurable improvements.


How to find your most effective managers with one visual

Wait …  Only ONE visual? I thought there were 8 metrics….

Stick with me, I’m not pulling a fast one on you. I’m about to cover each of these 8 metrics in detail, but first I want to make the point that these insights are more compelling when presented together. How to find your best managers, for example, look at the Team Leader Scorecard Example below. Using a heatmap view - we can quickly see how we gain so much more insight when we arrange and visualize them all together. 

create great leaders with these 8 effectiveness metrics metrics

Now, let’s dive into each metric.

1. Headcount growth rate

Headcount growth rate is the percentage increase in the number of employees that a manager hires. It’s a good measure of manager effectiveness as it can show how well they can find and retain top talent while continuing to build their team. It is also important to understand what are the drivers behind headcount growth.  Increased sales and production or perhaps correcting unbalanced workload distribution. How to calculate headcount.

2. Repeat low performers

Repeat low performers are employees who consistently fail to meet set goals and expectations. Tracking this metric is important as it can show how effective a manager is at developing their people and providing them with the skills needed to succeed in their roles.  It could also be an indication of a manager setting unrealistic goals and may re-evaluate the goal-setting process.


3. High performer termination rate

Effective leaders who view employees as assets can help their company combat resignations by encouraging high-performing employees to stay with the company for longer. By tracking high-performer termination rate, organizations can identify managers who are losing top talent and uncover reasons behind the attrition. They can also seek to understand how effective leaders are succeeding in retaining their top talent and distributing this knowledge among all of their leaders.


4. Termination rate volume

Termination rate volume measures the number of employees who leave an organization within a given period. This metric can identify any patterns in a manager’s employee turnover so that organizations can take steps to address any underlying issues causing high turnover rates.


5. Promotion rate

By looking at promotions actioned across your organization, you can see the managers and work units with more people than average being promoted. This indicates which managers are best at growing talent. Tracking manager promotion rates is an important metric for assessing manager effectiveness and identifying potential areas of improvement. Also, learn about succession planning.


6. Female representation

Female representation is an important metric for assessing manager effectiveness as it shows how well a manager is at promoting diversity and inclusivity within their team. By tracking this metric, organizations can identify any challenges with gender imbalance and take steps to address them.


7. Salary ratio by gender

Salary ratio measures the difference in salaries between men and women within an organization. This metric can be used to identify any discrepancies with wage discrimination so that organizations can take steps to address them. Tracking manager salary ratios is important for assessing manager effectiveness and creating a fair and equitable workplace.


8. Diverse retention gap

Diverse retention gap is the difference in retention rates between diverse and non-diverse employees. This diversity metric can be used to identify any issues with manager diversity and inclusivity so that organizations can take steps to address them.

It took Phil a staggering 51 seconds to pull the chart above together.

Take the People Analytics Challenge and see how long it takes you to answer 90 of the top people analytics questions.

What about employee retention rate?

Employee retention rate measures the percentage of employees who remain with the company after being hired by a manager. This metric is important for assessing manager effectiveness because it shows whether or not they are creating an environment that encourages long-term employment and job satisfaction. This is also a great metric to review and there are lots of ways to talk about it. Reference these articles for more information:


Measuring manager success to stay on top of the game

These manager effectiveness metrics represent the key performance indicators (KPIs) of manager success, and if you track them with people analytics software, then you can find the most effective leaders in your company. Keeping an eye on these measures is a great way to ensure that you are developing, retaining, and promoting the highest-performing talent in your organization. With this knowledge in hand, you can make sure that your company is always staffed with the best and brightest leaders possible.


Good management in business, or should I say good team management, is key in today’s competitive talent market and these KPIs provide essential data points to measure success so that your team can stay on top of the game. 


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