We’ve all known and witnessed natural-born leaders. But most leaders are not born; organizations need to develop them. When companies drop inadequately trained managers (especially if they’re new employees) into positions of authority, it can be very costly to the bottom line.

Poor management is a huge hidden cost for U.S. employers. Promoting managers who are not equipped with basic management and leadership skills can have grave repercussions, including low morale, high turnover and unhappy customers.

To help prevent these problems, organizations should strive to develop these five vital leadership competencies in managers:

Clarity on Responsibilities and Priorities

As strategy shifts, there can be increasing confusion about the manager’s main responsibilities. Should they focus on coming up with the big ideas, or should their priority be to support their team? Make sure they understand the answers to these questions.

Effective Delegation

Managers need to learn that their job is not to do all the work themselves but to ensure that others are doing their work correctly. Taking on everything results in isolation, insecurity and ineffectiveness.

Train new managers on knowledge transfer and how to properly match skill sets and strengths to tasks. That means not assigning a detail-heavy project to someone who has shown no aptitude for accuracy or forcing an introvert to give an important presentation.

Respect for Colleagues and Subordinates

Today’s workplace is made up of people with diverse backgrounds, experiences and proficiencies. In order to become effective leaders, managers need to accept that everyone works in different ways. They must respect individual work styles and facilitate collaboration.

All managers should get to know their employees. What do they value? What motivates them? What are their strengths and weaknesses? Answering these questions will enable managers to support each employee individually. Another part of the respect-building process is understanding everyone’s function and where it fits into the organization’s big picture.

Big-Picture Vision

Effective managers understand how their role contributes to implementing strategic company goals. If those goals are not clear, they consult senior managers to provide that clarity. When managers are narrowly focused on their team and don’t look beyond their own department, they are not being leaders.


Being able to lead while knowing that you don’t have all the answers is a sign of an effective manager – and an effective leader.

Training is one way to ensure that managers become successful leaders, but in order for training to be effective, it’s important to follow up to make sure the managers are actually putting their new skills and competencies to use. After six to nine months, using 360-degree feedback is especially effective. This tool allows managers to obtain valuable input from superiors, peers and direct reports – and also to evaluate themselves – to create a well-rounded view of their job performance.

Building effective leaders requires developing new managers from the ground up. A failure to invest in this training and development means that most companies will not see a return on investment, as they continue to place unqualified and unprepared managers into leadership roles.