Introduction: The Puzzle of Poor Management Practices
In industries worldwide, a troubling management trend has emerged: companies fail to fill roles left vacant by departing employees, instead burdening the remaining workforce with increased responsibilities, often for the same pay or minimal increases. This practice spans tech, IT, and beyond, creating widespread dissatisfaction and burnout.
What’s perplexing is that this approach seems counterintuitive—even detrimental—to the company’s long-term success. Employees, stakeholders, and even middle managers struggle to understand the logic behind these decisions, yet senior leadership and shareholders persist in defending them. Why has this become the norm, and how can we shift toward a healthier, more effective management style?
Why Companies Operate This Way: Short-Term Priorities Over Long-Term Vision
1. Cost-Cutting on Paper
By redistributing responsibilities rather than hiring replacements, companies aim to cut costs in the short term. Unfilled positions are seen as savings, and stretching the existing workforce is rationalized as “operational efficiency.”
2. Shareholder and Leadership Incentives
Leadership is often incentivized to meet short-term financial metrics, such as quarterly profits or share prices. These metrics overshadow the hidden costs of overworked employees, including decreased morale, increased turnover, and lost institutional knowledge.
3. Fear of Risk
Even when companies post record profits, leaders may avoid hiring due to economic uncertainties or the fear of overcommitting resources. This conservative approach is framed as “strategic,” despite its long-term consequences.
4. Normalization of Overwork
Culturally, overworking employees has become an accepted (and often glorified) practice in many industries, particularly tech. This “hustle culture” reinforces the idea that burnout is a badge of honor rather than a systemic failure.
The Hidden Costs Leadership Overlooks
Despite appearing efficient in the short term, this approach often backfires:
- Burnout and Turnover Overworked employees eventually leave, creating a cycle of hiring and retraining that is far more expensive than retaining skilled workers. Research indicates that replacing an employee can cost between 33% and 200% of their annual salary, depending on their role.
- Knowledge Erosion When experienced employees exit, they take institutional knowledge with them. New hires lack mentors, leading to decreased efficiency and mistakes.
- Reduced Productivity Burned-out employees are less creative, less engaged, and more likely to make errors, which harms the company’s overall performance. The American Institute of Stress estimates that workplace stress costs U.S. companies over $300 billion annually in lost productivity and related costs.
- Reputation Damage Poor employee treatment leads to negative employer reviews, making it harder to attract top talent and driving potential clients or customers away.
Why This Behavior Persists Across Industries
The practice of prioritizing short-term gains has become so pervasive that it feels inevitable. But how did this management pandemic take root?
1. Shareholder Capitalism
Since the 1980s, companies have increasingly prioritized shareholder value above all else, often sacrificing long-term stability for immediate returns.
2. Industry Norms
When one company in a sector adopts these practices, others often follow suit, fearing competitive disadvantage. This creates a cycle where harmful practices are normalized across industries.
3. Leadership Detachment
Senior leadership, far removed from day-to-day operations, may not fully understand the impact of their decisions on employees.
4. Economic Crises as Catalysts
Major events like the 2008 financial crisis and the COVID-19 pandemic reinforced cost-cutting measures that, once temporary, became standard practice.
The Irony: Long-Term Thinking is More Profitable
Despite the perceived benefits of short-term strategies, companies that prioritize long-term stability consistently outperform their peers. Research shows that:
- Engaged Employees Drive Profitability Companies with high employee engagement see 21% higher profitability, according to Gallup.
- Lower Turnover Reduces Costs Retaining skilled employees is far cheaper than recruiting and training replacements.
- Innovation Flourishes Teams with manageable workloads and supportive cultures are more creative and productive.
Long-term-focused companies also contribute positively to society, reducing workplace dissatisfaction, financial strain, and the societal costs of burnout and stress.
The Disconnect Between Leadership and the Workforce
For many employees and middle managers, these practices defy logic. As one might ask:
- “If someone left, their salary is still in the budget—why not use it to hire a replacement?”
- “How can leadership celebrate profits in all-hands meetings while claiming there’s no budget to fill roles?”
This dissonance breeds distrust and resentment among employees. While leadership may justify these decisions with financial metrics, the lived experience of employees tells a different story.
The BLUE Method: A Framework Born of Necessity
During my time as a middle manager, I saw the need for a system to balance competing demands while maintaining team well-being and delivering results. The BLUE Method—short for Balance, Logicize, Understand, and Enjoy—is the result of years of reflection, trial, and error. It’s a holistic framework designed to help teams optimize their workflows and find fulfillment in their work, even under challenging circumstances.
1. Balance
At its core, Balance is about creating sustainable workflows. When leadership handed down unreasonable expectations, I used this principle to advocate for my team. By managing task timelines, setting realistic goals, and fostering open communication with stakeholders, we avoided burnout and maintained a steady pace of high-quality output.
2. Logicize
Breaking down complex problems into manageable steps is crucial for overcoming chaos. By applying systematic thinking, we identified inefficiencies and streamlined processes, even when resources were stretched thin. Logicize empowered us to turn challenges into opportunities for creative solutions.
3. Understand
Many managerial conflicts arise from a lack of understanding—of goals, expectations, and constraints. I emphasized deep comprehension of project requirements and clear communication within the team, ensuring alignment and preventing missteps.
4. Enjoy
Amid the pressure of tight deadlines and limited resources, it’s easy to lose sight of what makes work meaningful. Encouraging curiosity, celebrating small wins, and fostering a positive environment helped my team stay motivated and engaged.
Conclusion: A Need for Change
The widespread dissatisfaction with short-term management practices is a clear sign that businesses need a paradigm shift. Companies must recognize that investing in their people and prioritizing long-term stability leads to better financial outcomes and healthier workplace cultures.
By moving away from short-term thinking and adopting strategies that balance profitability with sustainability, organizations can build trust, retain talent, and contribute to a more equitable society.
As leaders, we have the power to break the cycle of short-term thinking and champion practices that benefit everyone. And for those seeking a roadmap, frameworks like the BLUE Method offer a path forward.
Together, we can build a future where businesses thrive, employees flourish, and society prospers.