The Costs of Poor Listening

Poor Listening is Lethal: Avoid the Traps

Ineffective listening caused a fiery death when a power plant worker was told not to use an elevator because a fire had broken out five stories above. The worker didn’t listen, entered the elevator and was burned to death when the elevator shaft exploded.
When an airline pilot misinterpreted instructions to detour around an active runway while taxiing at the Los Angeles International Airport, her crew and passengers were killed. The error led to a two-plane runway crash, causing numerous deaths and permanent injuries.
The number of deaths due to healthcare mistakes are estimated in the hundreds of thousands, with billions of dollars in economic impact each year. How much is due to physician or nurse listening errors is anyone’s guess, but the patient experience improvement may be enough to pay close attention to this critical capability.

Fortunately for all of us, the results of most listening errors are less disastrous than these. Some listening failures only cause embarrassment, such as not remembering the name of a new acquaintance. Other listening errors cause minor inconvenience, such as missing a doctor’s appointment or arriving at a friend’s house for dinner on the wrong night. Whether the errors are life threatening or annoying, ineffective listening damages family relationships, derails business negotiations, and destroys international ventures.

Organizations hire leaders to listen.

Managers and office workers spend at least 40% of their work time listening.
Executives spend up to 80% of their work days listening to assess information, gain new insights and make decisions in meetings.
Yet, these same leaders rank themselves as poor or below average as listeners in self-reports and admit to doing little to improve.

“Most people do not listen with the intent to understand; they listen with the intent to reply.”
Stephen Covey

Comments on Listening – Learning Strategist from Intel

Real Examples of Costs

In 2010, it was estimated that 11 million meetings took place in the United States each day (3 billion a year). Group Vision estimates that Fortune 500 companies waste an estimated $75 million per year in meetings and much of the waste is due to the staggering cost of ineffective listening. When information has to be repeated, the time of all group members is wasted. In a 6-person team, for example, repeating 5 minutes of information wastes 30 minutes of work time. When group members really listen to each other, relationships improve, meetings are more productive, members feel valued, and more people participate.

$37 billion is the total estimated cost of misunderstanding (including or errors of omission by employees who have misunderstood or were misinformed about company policies, business processes, job function or a combination of the three in 100,000-employee companies among 400 surveyed corporations in the US and UK (average cost per company $62.4 million per year).
$26,042 is the cumulative cost per worker per year due to productivity losses resulting from communication barriers.

On a Positive Note

Companies with more effective communicators had 47% higher total returns to shareholder over the last 5 years compared to companies with less effective communicators.
Best Buy found that stores with higher employee engagement scores led to better store performance. For every percentage point it boosted employee engagement, individual stores saw a $100,000 increase in operating income annually.

If you’re concerned about how effectively you, your team or your organization listens, you should be! Ineffective listening is a huge cost and may be one of the highest sources of risk you have. SIS International Research (NY) reports that 70% of small to mid-size businesses are losing money due to ineffective listening and communication. They estimate that a business with 100 employees, for example, spends an average downtime of 17 hours a week clarifying communication which translates to an annual cost of over $500,000 each year.