Effective leadership is critical in virtually any type of for-profit or service-based organization. When company managers lack the ability to provide direction, coaching and training and motivation for staff, the organizational culture and morale often suffer. Poor leadership can have several negative effects on the company and staff.

Poor Financial Results

A tangible result of poor leadership is often poor financial results and goal achievement. To optimize production, sales and efficiency, a company needs employees committed to their jobs, the company and its vision. Poor leaders don't inspire workers to deliver their best performance and to look for training and development opportunities. In the long run, a culture of poor leadership perpetuates across a company at all levels.

No Synergy

Poor company and departmental leadership also inhibits the development of synergy. Effective managers coordinate tasks within their departments and promote an atmosphere that encourages idea sharing and discussion. They get employees aligned in the pursuit of shared goals. Poor management may result in more fragmented departments and work roles. This means that each employee neglects the importance his work plays in achieving company and departmental objectives.

Low Morale

Low morale is another possible consequence of poor leadership. This can result from employees feeling misdirected or uncertain about the company and their jobs. Poor communication contributes to this issue. Overly critical managers may demean or demoralize employees who make mistakes but want to succeed. In some cases, failure to address negative employees or poor performers leads to low morale, because good employees often have to pick up the slack.

High Turnover

A culmination of ongoing poor leadership is high employee turnover. Workers who aren't motivated and are burned out from a poor culture begin looking for other jobs. This further escalates profitability concerns for the business. This downward spiral is often difficult to get out of since companies struggle when they lose top performers and experienced employees and must replace them with new hires. Even those employees who stay get frustrated at the loss of familiar coworkers and friends.