The £84 Billion Mistake: Why Companies Can't Afford to Ignore Leadership Training in 2025 Anymore

Imagine you're about to undergo a complex surgical procedure. Your surgeon is highly skilled, no doubt—but there's a catch: They've never attended medical school, never been formally trained in the art of surgery, and have only "learned" by observing others. Would you still trust them with your life?

Of course not. The thought of being under the knife of an untrained professional is terrifying—and for good reason. Now, take this scenario and apply it to your business. Every day, untrained leaders—often referred to as 'Accidental Managers'—are in charge of entire teams, departments, and even organisations. And just like an untrained surgeon, the consequences are far-reaching and potentially devastating.

In the UK alone, poor leadership costs businesses a staggering £84 billion annually, according to the Organisation for Economic Co-operation and Development (OECD, 2023). That's the financial equivalent of letting an unskilled surgeon operate on your company's most vital assets: your people.

Let's dive into the causes, consequences, and solutions to the leadership crisis that threatens businesses worldwide.

The Hidden Cost of Poor Leadership

Leadership may not always be top of mind when discussing business challenges, but it should be. Without proper training, 82% of managers are thrown into their roles without any formal guidance or development, leading to a massive £84 billion loss in the UK alone every year (OECD, 2023). If leadership were a system, poor management would be its Achilles' heel.

So, what does poor leadership look like? Much like a bad surgeon making a series of missteps during surgery, a bad manager erodes the fabric of a business, one bad decision at a time. Here are just some of the key issues caused by poor management:

1. Micromanagement

Micromanagers hover over their teams, dictating every move and stifling creativity. This is the management equivalent of a surgeon who insists on guiding every single incision rather than allowing their team of nurses and surgical assistants to take charge where needed. Studies show that 35% of managers spend too much time micromanaging, leading to a 30% increase in employee stress levels (CIPD, 2023). Not only does this undermine productivity, but it also creates a culture of fear and anxiety within the team.

2. Feedback Avoidance

A surgeon who avoids addressing complications during surgery would jeopardize the patient's well-being. Similarly, a manager who avoids giving constructive feedback or addressing underperformance leaves problems to fester. Without feedback, employees cannot improve or grow. In fact, 10-52% of an employee's workday is unproductive when they lack direction or feedback from their managers (Training Industry, 2020).

3. Poor Communication

Imagine if the surgical team wasn't on the same page during an operation, with no clear instructions or updates. The procedure would likely end in disaster. The same holds true in business: 70% of employees claim that poor communication within their team leads to frustration and disengagement (The Wellbeing Project, 2023). Communication is the lifeblood of any team, and without it, the entire organisation can falter.

4. Neglecting Wellbeing

A surgeon who overlooks signs of a patient's discomfort or neglects to ensure proper aftercare is risking the patient's life. Poor leadership similarly fails to support employee well-being, leading to burnout, stress, and absenteeism. Research reveals that employees with ineffective managers are 50% more likely to suffer from mental health issues (CIPD, 2023). The costs of poor wellbeing are huge, including lost productivity and higher turnover rates.

5. Setting Up to Fail

A manager who gives their team inadequate resources, unclear expectations, or no training essentially sets them up to fail. It's like giving a surgeon the wrong instruments or no access to the necessary tools for surgery. 33% of employees report that they often face unmanageable workloads, which leads to burnout and disengagement (CIPD, 2023).

The Ripple Effect: How Bad Management Creates a Domino Effect

The consequences of poor leadership are not isolated to just one department or one manager. It's a domino effect that spreads across an organisation. Disengaged employees, lower productivity, and poor performance trickle down from ineffective leaders, creating a toxic environment.

Turnover Costs

Bad management increases employee turnover—50% of employees with poor managers plan to leave their jobs within a year (CMI, 2023). Replacing an employee can cost a company £30,000 per person, including recruitment, training, and lost productivity (The Wellbeing Project, 2023). So, poor management doesn't just cost money in the short term—it accelerates attrition and leaves businesses scrambling to fill critical roles.

Declining Performance

Teams under poor management report up to a 52% decrease in productivity (Training Industry, 2020). When employees are disengaged or feel unsupported, their performance inevitably suffers. The loss of morale and motivation, combined with constant stress, results in lower-quality work, missed deadlines, and dwindling business results.

The Fear Factor

Fearful leadership is another critical issue. 23% of UK leaders unconsciously foster a fear-based environment, which leads to higher anxiety, disengagement, and lower performance among teams (Leadership Institute, 2023). Just like a surgeon's trembling hands can affect their precision, a leader's fearfulness can hinder team morale and creativity.

The Solution: Investing in Leadership Training

So, what's the solution? Just as we wouldn't entrust our health to an untrained surgeon, we shouldn't allow businesses to be led by untrained managers. In today's world, leadership isn't just about directing a team—it's about fostering a culture of empowerment, clear communication, and growth. This is why leadership training is no longer an optional perk; it's a necessity.

The Return on Investment

Effective leadership can have a profound impact on your bottom line. Research shows that employees under effective leadership are 15 times more likely to excel in their roles (Gartner, 2023). Moreover, businesses with great leadership can increase profitability by 48% (Gallup, 2023). Investing in leadership development isn't just about improving your team's day-to-day functioning—it's about creating long-term, sustainable business growth.

Unlocking the Potential

Investing in leadership training enables managers to develop key people skills: communication, emotional intelligence, and the ability to motivate and empower others. It's no longer enough to simply be technically proficient. Leaders need to understand how to guide their teams through change, keep morale high, and drive innovation.

Conclusion: Don't Wait Until It's Too Late

The data is clear: The cost of bad management is steep, and the consequences are far-reaching. The UK economy loses £84 billion each year due to poor leadership (OECD, 2023), and businesses continue to hemorrhage money because they're unwilling to invest in leadership training.

Just as you wouldn't let an untrained surgeon operate on you, you shouldn't let untrained managers lead your teams. The cost of inaction is too high, and the benefits of investing in leadership development are undeniable. In 2025, good leadership isn't a luxury—it's a strategic imperative for business success.

Are you ready to stop the bleeding and invest in leadership training? The future of your business depends on it.

At Perlman Pierson, we transform 'Accidental Managers' into intentional leaders by providing core leadership training, skill gap analysis, and ongoing coaching for lasting impact, as well as impactful and highly engaging day workshops.

Leadership training has proven to deliver 8x ROI, boosting performance by 80% and reducing attrition by 30%.

Download our Confident Leadership Guide and schedule your discovery call now so we can come up with a tailored program to elevate your leadership and help you prevent these losses and save your business hundreds of thousands annually.

Warmest regards,

Maria Perlman

Co-Founder of Perlman Pierson