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The management capability gap: what productivity data shows

Written by Anna | Apr 17, 2026 6:16:10 PM

The UK has a management problem. And it knows it. The causes are well documented within research: insufficient investment in capital and technology, infrastructure that constrains how efficiently businesses can operate, and a skills base that hasn't kept pace with a changing economy. And alongside these structural factors, one theme surfaces repeatedly: management capability.

A 2023 Be the Business analysis of G7 SMEs found that while UK businesses rate their management and leadership capabilities highly, they commit far less to developing them. The UK ranked sixth or seventh on all questions regarding investment in management capabilities, with just 33% of UK businesses having improved skills in this area over the previous twelve months, compared to 54% of US businesses.

The mismatch between how seriously organisations take management and how seriously they invest in developing it is striking. But perhaps more striking is that the research behind all this isn't new. The data has been pointing in the same direction for years. The question was never whether management capability matters, as it clearly does... the question rather is why it has proved so stubbornly difficult to address.

The productivity-management link

The World Management Survey has assessed management practices across more than 35 countries for over 18 years. Its findings point to the fact that countries with stronger management practices are more productive. The US consistently scores highest on management quality, with Germany, France and the UK clustered below it. Within that group, the UK typically ranks as the weakest of the major developed economies for management practices.

Research also suggests that differences in management capability account for a large share of the productivity gap between the UK and the US. UK firms are less likely to set clear performance targets, less likely to use data systematically in decision‑making, and less likely to invest in developing their people than their German or US counterparts.

That gap hasn't narrowed; the question is why. The easy answer is budget. But it's not that simple. 

What is management capability and why does it matter?

Management capability is how effectively managers lead, develop, and get results through their people. How they set clear objectives, give feedback, handle underperformance, develop individuals, and translate what the business needs into work their team can act on.

It matters because the quality of management shapes almost everything else. When it is strong, organisations perform. When it's weak, the effects show up across the business: in productivity, in retention, in engagement.

The scale of underinvestment in manager development

Disappointingly UK businesses spend around half the EU average per worker on training and development, and employer investment in training has dropped to its lowest level in more than a decade. When it's clear how managers make or break workplace productivity this is very shortsighted.

The Chartered Management Institute estimates 82% of UK managers are promoted without formal training. Across Europe more broadly, 27% of managers have received no management training at all, with a further 8% waiting on training that's been promised but never materialised. The UK figure of 82% makes us a clear outlier, and for most managers, the honest answer is that they're not.

This points to something more fundamental than spend. Management development has never really been treated as essential. It gets overlooked when promotions are made and cut when budgets tighten. The result: most managers receive no development at all, and for those who do, it rarely arrives at the moment it would make a difference.

What better people management could deliver

Research from the CBI and McKinsey puts a number on what better looks like: a 7% uplift in people management capability across the UK could yield a £110bn improvement in Gross Value Added. The US has shown it's achievable. If UK firms matched US management performance, the productivity of the UK workforce would jump by 12%. But where solutions do exist, they aren't closing that gap. And where they don't, nothing is.

How manager development needs to change

Traditional management development might work for organisations who have individuals motivated enough to seek it out, apply themselves during the training sessions and go on to continue self-development independently. Most don't fit neatly into this category.

When training exists, there remains a knowledge transfer problem. A two-day course doesn't translate into knowing how to handle a difficult conversation with an underperformer on Tuesday morning. The knowledge lands in one context and needs to be applied in a completely different one. That gap is where development dies. Self‑directed learning on the other hand, assumes they have the time, confidence and self‑awareness to know what to look for. Very few do, especially early on in their careers.

Improving management capability could unlock major economic value, but getting there requires a fundamentally different approach, one that treats development as a consistent foundation rather than an occasional event. Something light touch and always available, that grows with each manager as they navigate real situations and fills the gaps that promotion leaves behind.

Developing early-stage managers with Vokser

Early-stage managers are where it starts. They're promoted into the hardest part of the job with the least support, and by the time formal development arrives, the moments that needed it have already passed.

Vokser puts a coach in the flow of their work from day one. One that knows their context, tracks their growth, and shows up when it matters. It's not a course or a programme, but a personalised development experience that builds real capability in real time and, for the first time, makes that possible at scale for every manager, not just the ones at the top.

Interested in seeing a demo? Come and speak to us.