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Alberto Venturini

Inefficiency lies in labour relations

L’inefficienza risiede nei rapporti di lavoro

Scritto da

Alberto Venturini

in

Work · 5-minute read

1. Introduction

Business productivity is often interpreted as the result of technical skills, operational tools or organisational models that are more or less advanced. However, a significant body of scientific literature suggests that the main source of inefficiency within organisations lies in working relationships. Professional relationships, the quality of leadership and the internal working environment have a direct impact on staff turnover, engagement and individual and collective performance.

SMEs, due to their informal structure and the concentration of decision-making in a small number of individuals, are particularly vulnerable to the effects of unmanaged interpersonal conflicts. The evidence presented confirms the centrality of the human factor as a critical lever in organisational functioning.

2. Evidence on the relational nature of inefficiency

2.1 Conflicts, complaints and hidden costs

According to the Chartered Institute of Personnel and Development (CIPD, 2017), an employee spends an average of 12 days a year complaining about processes, colleagues or management. This time, often invisible in the financial accounts, erodes productivity and fuels a negative organisational climate.

At the same time, employers spend over 13 days a year managing internal conflicts. The opportunity cost of this effort impacts the company’s ability to devote time to strategic development and innovation.

2.2 Engagement and the quality of relationships

Only 30 per cent of workers say they are actively engaged (Gallup, 2023). This figure is not merely a cultural indicator, but a measure of the quality of professional relationships, the clarity of objectives and the level of perceived support.

The Saratoga Institute highlights that 80 per cent of resignations are caused by relationship issues, particularly conflicts with the line manager. This evidence confirms the systemic impact of day-to-day leadership on organisational well-being.

2.3 Managerial time wastage and lack of trust

Managers spend between 25 and 30 per cent of their day dealing with unproductive discussions, misinterpretations, personal conflicts and procedural misunderstandings. Trust in managers is significantly low. Only 30 per cent of employees say they trust their manager, a figure that directly affects commitment and collaboration.

Finally, two-thirds of workers feel undervalued, and when they are assessed, they believe the process does not accurately reflect their contribution.

These phenomena paint a clear picture: the loss of efficiency does not lie in skills, processes or the labour market, but in the fragility of the relational system and the leadership models adopted.

3. Theoretical interpretation: why do working relationships generate inefficiency?

The theory of organisational relations (Schein, 2010) highlights that every corporate system operates on the basis of implicit norms, expectations and communication models. When these elements lack consistency or clarity, tensions emerge that manifest themselves in the form of:

  • interpersonal conflicts

  • declining engagement

  • increasing staff turnover

  • poor collaboration

  • operational inefficiency

The literature on the Psychological Contract (Rousseau, 1995) confirms that the perception of fairness, recognition and support is a key determinant of performance. A breached psychological contract leads to defensive behaviour, demotivation and disengagement from the organisation.

4. The new approach required of businesses

If the main cause of inefficiency lies in working relationships, companies must adopt a model that goes beyond mere information provision to transform behaviour, relationships and culture. The evidence suggests a number of priority levers.

4.1 Transform, do not merely inform

Traditional training, focused on the transmission of content, has limited impact if it is not integrated with development programmes, coaching, feedback and growth-oriented performance systems.

4.2 Promoting self-management

Self-management reduces conflicts, increases autonomy and enables employees to resolve problems more quickly. Research by Hackman and Oldham (1976) on job design confirms that autonomy and meaningful work improve performance and satisfaction.

4.3 Allowing operational autonomy

Self-determination theory (Deci & Ryan, 2000) shows that people are more productive when they feel autonomy and trust. Excessive control generates resistance and defensive behaviour.

4.4 Focusing on the future

Developing concrete career development paths reduces staff turnover and fosters engagement. The learning organisation model (Senge, 1990) highlights that the ability to learn continuously is a prerequisite for competitiveness.

4.5 Building lasting collaborative relationships

Positive relationships reduce stress, enhance the quality of work and improve the ability to tackle complex problems. World Class Manufacturing and the Toyota Way (Liker & Meier, 2007) demonstrate that structured cooperation leads to superior performance and operational stability.

5. Conclusions

The data clearly show that the main source of organisational inefficiency does not stem from people, but from the way they interact. A weak relationship system generates high costs, delayed decisions, staff turnover, conflicts and inefficiencies that no software or technical reorganisation can compensate for.

Companies that invest in the quality of relationships, leadership, clarity of roles and people development see a clear and stable improvement in performance.

To identify the areas where an organisation is losing efficiency, a targeted preliminary assessment can be useful, capable of quickly analysing relational issues and management systems.

Bibliography

  • CIPD. (2017). Managing conflict at work. Chartered Institute of Personnel and Development.

  • Deci, E., & Ryan, R. (2000). Self-Determination Theory. Psychological Inquiry.

  • Gallup. (2023). State of the Global Workplace Report. Gallup Press.

  • Hackman, J. R., & Oldham, G. R. (1976). Motivation through the design of work. Organizational Behavior and Human Performance.

  • Liker, J. K., & Meier, D. (2007). Toyota Talent. McGraw-Hill.

  • Rousseau, D. (1995). Psychological Contracts in Organizations. Sage Publications.

  • Schein, E. H. (2010). Organisational Culture and Leadership. Jossey-Bass.

  • Saratoga Institute. (2004). Employee Retention Survey. Saratoga Institute Research.

  • Senge, P. (1990). The Fifth Discipline. Doubleday.

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