Frontline managers influence every part of the employee experience, from day-to-day motivation to long-term retention. A now-classic and widely shared Gallup study found that managers account for at least 70% of the variance in employee engagement, which makes them a powerful driver of culture, performance, and turnover.
Yet many managers are overwhelmed because the demands placed on them exceed their skill capacity. The solution is stronger, modern manager development focused on coaching, peer learning, and soft skills. When organizations invest in leadership development that actually works, culture strengthens and retention improves, often dramatically. One company, for example, reduced attrition by more than half through manager development initiatives.
The "manager effect" refers to the impact frontline leaders have on engagement and retention because they control the daily conditions of work: clarity, feedback, quality, recognition, and fairness. When those conditions are consistent, employee experience improves and attrition risk drops. When they break drown, dissatisfaction spreads fast across a team.
Every organization relies on its frontline managers to translate strategy into action, but their influence reaches far beyond operational execution.
A frontline manager is the first level of people leadership: the person who directly supervises employees doing the work day-to-day. They set priorities, run 1:1s, give feedback, resolve friction, and translate company expectations into weekly execution.
The manager–employee relationship is the engine of the employee experience (as evidenced by polling firm Gallup’s widely cited finding that managers account for a roughly 70% of the variance in team engagement levels), and thus retention. When it works well, people feel connected and supported. But when it doesn’t work, it can cause cascading problems for the whole workforce.
To break this dynamic down a little further, think of managerial and leadership skill as a form of capacity. When the responsibilities and demands placed on managers exceed their skill level to execute effectively, they lack the capacity to deal with or absorb those demands. “Managers have a lot of things coming at them,” Jim Harter, Gallup’s chief scientist for workplace management and well-being, told Business Insider. “The new demands coupled with the old demands of the manager’s job have caused kind of an overwhelming feeling for a lot of managers.”
Advisory group Gartner agrees; reporting that three-quarters of managers are overwhelmed by their responsibilities. In turn, that overwhelm has a dis-engaging effect. Gallup’s most recent State of the Global Workplace 2025 report has found that engagement among managers in particular is in an active state of decline.
From there, managerial disengagement can ripple outwards among teams. Or, as HR Daily Advisor puts it, a disengaged manager becomes a “risk multiplier.” But the reverse is true, too. Dr. Natalie Baumgartner, Head of the Achievers Workforce Institute, a workplace recognition and rewards software maker, says that employees who recommend their manager are 64% more likely to be engaged.
Unfortunately, most managers don’t receive adequate training, leaving them without the skills or capacity to deal with the demands on them. Worse, there’s often a disconnect between HR and managers.
“There’s a gap between the support HR leaders think they provide and what managers say they receive,” said Hannah Yardley, chief people and culture officer at employee recognition software provider Achievers, to HR Executive. One report even found that half of HR leaders say they provide quarterly manager training but only one-third of managers agree. One out of five never receive training!
Most managers know what they need to do, but they struggle with execution and need more support, including training and leadership development. “Investing in managerial training is crucial to boosting productivity and navigating the challenges effectively,” Yardley says.
However, old-school manager training is unlikely to work. “Though 75% of organizations have made significant updates to their leadership development programs, and more than half are increasing spending on leader development, they are not seeing results.” Mark Whittle, vice president of advisory in the Gartner HR practice, says.
In fact, Gartner found that traditional leadership development, such as seminars, lectures, and more traditional learning programming, can even have “a negative effect” on development.
So, what does work?
For a more in-depth guide to strengthening your managers, and thus workforce performance and retention, read our 5-part series on “Making Good Managers.”
Does all this actually work? In short, yes.
One organization, for example, reduced attrition by more than half (from 27% to 12%) by focusing on manager–employee relationships and giving frontline leaders ownership over retention. Managers assessed departure risk, created action plans, and strengthened communication. As their leadership development improved, culture and engagement followed. “[B]eing a manager,” their Chief People Officer says, “is not just about driving results—it’s also about needing to understand what’s motivating, engaging employees—and putting an action plan in place.”
Ready to strengthen your managers and improve retention? CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with every aspect of HR administration, benefits, payroll, and compliance. To learn more about our Professional HR Administration Services, contact us today.
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