Written submission from Notion Limited (PRO0141)
Notion has had the privilege of working directly with leaders and managers from leading organisations around the world to help them adopt new behaviours repeatedly shown to improve their communication and engagement skills. This has led to measurable increases in employee engagement, productivity, inclusion and collaboration.
Subject: A Strategic Policy Imperative to Address the UK's Persistent Productivity Deficit and Unlock Workforce Potential via the Government-Validated Practice of Operational Coaching®.
The UK stands at a critical juncture where past mistakes in skills policy must not be repeated. Previous government initiatives, particularly those narrowly focused on technical training, have demonstrably failed to resolve the UK's overall productivity deficit.1 This failure is rooted in a fundamental, systemic management problem that has been consistently and continues to be overlooked.2
Despite billions invested and the focus on providing technical and digital upskilling, two undeniable facts define the current landscape:
This history proves that management capability is the missing link.7 Without targeted intervention here, investment in new skills (via the Growth and Skills Levy (GSL) or other means) will continue to yield negligible returns, and the £130 billion prize will remain out of reach.8
This is not merely an economic calculation; it is a national and global responsibility to elevate the standard of working life. While the UK tackles its domestic productivity challenge, it has the singular opportunity to lead the world in solving the foundational crisis of poor management.
Globally, poor management is estimated to cause a loss to global productivity of $8.9 trillion, a crisis that Gallup, in their annual State of the Global Workplace report, repeatedly calls for governments to address. By making a decisive, evidence-based investment in this British-developed and government-validated methodology, the UK will:
The failure to train UK managers is an economic and social drain, costing the economy dearly and actively inhibiting employee potential and life chances.
The opportunity cost of management failure is quantified as a minimum of £130 billion, representing the aggregate of two distinct, significant economic benefits:
● Private Sector Productivity: The Confederation of British Industry (CBI) quantified the prize for improving management performance, estimating that even a modest “7% improvement in the quality of management” could unlock £110 billion for the UK economy.9
● Public Sector Efficiency: The OBR estimated that the savings achievable by addressing the public sector productivity deficit alone amount to £20 billion a year.10
The core problem is structural and decades-old. The Chartered Management Institute (CMI) reports that a staggering 82% of UK managers are "accidental managers"11—individuals promoted for technical competence but who enter their management roles without any formal training or preparation.12
This crisis is compounded by a catastrophic lack of investment:
● Investment Collapse: UK employers cut their total training investment by £6 billion in 2024 compared to 2022, representing a 10% real-terms decline.13 Even more damning, employer spending per trainee decreased by 27% since 2011.14
● Management De-Prioritisation: This decline is exacerbated by the low value placed on management skills. A report found that only 32% of managerial job adverts in the UK specified management as a required skill, indicating a critical skills mismatch.15
● The Ultimate Cost: The CMI suggests that around 50% of the UK's productivity gap with the USA is due to a lack of management capability16
Lacking a proper skill set, these managers default to a directive, command-and-control style, which creates a dysfunctional workplace that stifles productivity.17
The consequences of poor management extend directly into national health and economic inactivity:
● Mental Wellbeing Crisis: Poor management practices—such as unsupportive management and excessive pressure—have a direct correlation with adverse health outcomes for employees.18 Mental ill-health is now the leading cause of long-term sickness absence in many sectors.19 Poor mental health costs UK employers an estimated £42bn–£45bn annually.20
● Direct Management Link: Half (50%) of workers with managers rated in the bottom quartile for management quality reported that their work had “a negative impact on their mental health”.21 Stress, anxiety, and depression are major contributors to workplace absence, with management style cited as the second most significant contributing factor to stress-related absence.22
● Severe Physical Risks: Research published in the British Medical Journal suggests that employees working in a "toxic culture" created by poor management are more likely to develop depression and face higher risks of death from heart disease and stroke.23
● Economic Consequences: These health impacts have driven economic inactivity, with 2.8 million working-age people now out of work due to health conditions.24 Furthermore, over two-thirds (67%) of UK employees have considered leaving or have left a job due to poor management.25
The impact of management failure is acutely felt in public services:
● The Policy Exchange report on the NHS, Just About Managing, highlights that the solution to the NHS's declining productivity lies not in the quantity of managers, but their demonstrable lack of capability.26
● In the NHS, 82% of managers begin as clinical or administrative staff.27 This training gap contributes to environments where frontline clinicians are forced to spend at least 10% of their time performing "workarounds" for operational failures, costing billions in wasted clinical capacity.28
● Management accountability is also broken: 81.1% of NHS hospital trusts and ICBs surveyed had not dismissed a single manager for poor performance in the preceding twelve months.29
The core challenge has been finding an intervention that is scientifically rigorous, practical, and scalable across a complex economy. This solution was identified and validated through the government's own research conducted by LSE.
Following the CBI's call to action30 and the government’s 2019 Business Productivity Review, our methodology, Operational Coaching®, which was grounded in over fifteen years of continuous work with managers, was selected from 189 proposals for a full-scale, double-blinded Randomised Controlled Trial (RCT).31
The research was designed and independently evaluated by LSE.32 This specific trial was a major undertaking, wherein managers and leaders drawn from 62 organisations across 14 sectors would undertake a self-paced, experiential learning programme called STAR® Manager designed to build confidence and encourage learners to hold specific conversations with team members utilising newly learned techniques, before reflecting on the impact. The results of the research were published in the peer-reviewed Journal of Work-Applied Management.33
The LSE RCT’s results were deemed "conclusive"34 and "a first in the field of coaching research".35 The solution lay not in teaching managers how to conduct episodic coaching, but in establishing a simple, repeatable behavioural framework for application in a variety of day-to-day interactions, an essential and new distinction affecting the managers’ mindset.
● Behavioural Transformation: Managers who pursued the STAR® Manager programme successfully adopted an Operational Coaching® style of management, increasing the time they spent coaching and enabling their teams in the flow of work by a statistically significant 70%.36 This was achieved without the need for external coaches, trainers or training support.37
● Exceptional Financial Returns: LSE calculated that as a consequence of their behavioural change, each manager on the programme generated an average commercial return on investment (ROI) of 74 times the built-up cost of the learning programme.38 Even at the standard commercial rate for the programme, this was 65x the investment.39
● Organisational Impact: LSE observed strong, positive trends in underlying organisational metrics, including higher Gross Asset Value (GAV), an increased FTE count and a 6-fold improvement in employee retention in intervention firms compared to the control group.40
Operational Coaching® is powerful because it addresses the "how" of management, replacing the default directive mindset (tell) with an altogether more engaging "enquiry-led approach" (ask).41
● Capitalising on Training: The shift from directive task management and problem-solving to ‘enabling the skills and talents of team members’ creates upward pressure. Employees feel motivated and engaged (77% satisfaction with effective managers)42 and are more likely to seek further development. Research confirms that businesses that develop their staff’s strengths reduce staff turnover by up to 72%, thereby improving employee retention rates.43
● Improving Culture and Reducing Absence: The coaching mindset builds trust and psychological safety.44 By improving workplace cultures, organisations can reduce staff stress and mental health issues, contributing to lower sickness and absence.45
● Fosters Accountability: The coaching mindset empowers employees to take accountability for problem-solving.46 This shift alone creates a bottom-up culture of innovation,47 which is directly needed to boost national productivity.
To seize the £130 billion economic opportunity and elevate management capability, the government must leverage its own research and the flexibility of the new skills funding system.
We urge the Business and Trade Select Committee to recommend the following decisive actions:
As a proven British innovation that advances the discipline of management, we have the opportunity to provide decisive global leadership in tackling an internationally recognised problem that not only impairs global productivity but also negatively impacts outcomes for the newest generation entering the global workforce.