Your most important investment isn't technology
Why companies need to invest in managers as coaches
The competitive edge a company possesses - through technology, engineering and software development is softening due to rapid adoption of AI. None of this is new information but its stark to see how companies can build faster than they ever have before:
In just the past month, Notion launched an AI-powered email client, AI meeting notes, enterprise search, and research capabilities—essentially becoming the office competitor they always hinted at being. Figma debuted AI-powered tools for creating sites, app prototypes, and marketing assets, taking on Canva, Adobe, WordPress, and even coding tools like Cursor. Loom launched a meeting recorder to compete with Granola. Anthropic added integrations and search. OpenAI acquired Windsurf and launched Deep Research. from
’s The Great AI Rebundling
It’s an exciting time. But, its also an anxiety-inducing time.
Last night, at a happy hour with former Spotify coworkers scattered across the tech industry I heard, “engineers are scared, designers are anxious, product managers are excited.”1
The way we build software is becoming commoditized in ways we haven’t seen before. Companies using the newest, fastest technology aren’t going to differentiate themselves in the market like they used to. What will truly set companies apart in this AI era isn’t their tech—it’s their talent. The people and their interpersonal skills.
I believe it’s the caliber of talent that will set companies apart and drive stronger business results. The companies that stand out will be the ones that invest deeply in their people: boosting employee happiness, retention, and growth. And in the long run, customers will prevail too.
Managers need help.
This week, I was digging into
, How tech workers really feel right now.Takeaway #4 speaks to the massive opportunity companies have to differentiate on talent: Managers need help.
The leadership effectiveness gap represents a major opportunity. With only 26.6% of workers rating their manager as highly effective, improving leadership quality represents one of the highest-leverage investments organizations can make.
So much of an employee’s happiness hinges on their experience with their manager. We don’t need a survey to tell us this. Spend just a few years working and you can easily correlate your work experience to the quality of the relationship you have with your manager.
If this is all the case, why aren't more companies investing in teaching their managers to coach so that they can become better managers?
Why aren’t companies investing in managers?
There is no one size fits all answer here. Anecdotally, here’s what I’ve seen, coaching hundreds of product people over the past two years and operating in tech for over a decade before that:
1. The role of manager is still misunderstood.
One of the biggest errors that leaders make is simply promoting high-performing individual contributors (ICs) to people managers. Just because you’re an incredible salesperson or a killer product manager, doesn’t mean you automatically know how to coach a team to do the same. High individual performance does not automatically unlock your ability to manage a team. Yet, so many companies reward high performing ICs with people management opportunities because they conflate the two.
While so many companies do use people management as a reward, very few explicitly acknowledge this jump. And most high-performers turned people managers are left tackling a completely new skillset, people management, without the tools and resources they need to succeed at an entirely new job.
Everyone suffers in this cycle: direct reports with green managers, new managers struggling to transition from individual work to leadership, and, of course, the business that fails to retain employees when the relationships sour.
It’s a recipe for disaster.
2. Managers are incentivized by business metrics, not people growth.
If managers are judged solely on delivering business results, growing their team's potential or fostering their career development will always take a backseat, even if the long term benefits are clear. People development doesn’t carry an immediate or often obvious ROI. It’s why, when given the choice, most managers focus their conversations with team members on operational work rather than career development conversations. The people development work happens on the outskirts of the day.
Plus, rarely do companies explicitly reward managers for developing their people. Why? Hitting business metrics and chasing quarterly metrics are always paramount.
On the other hand, coaching and people development can’t be neatly measured like business metrics. People development is often measured by qualitative metrics.2 Coaching and people growth takes time, patience, and sustained effort, usually over years. Most organizations don't have the resources or time to do career development right. The long timelines needed for strong people development clash with the short-term incentives baked into corporate culture.
Speaking of culture…
3. Coaching needs to be embedded in company culture.
Coaching can often still carry a stigma: Many still view coaching as a sign that something’s wrong, that you need help because you're failing. Coaching is still seen by many as a reactive tool rather than a proactive one to set someone up for success.
As long as coaching is seen as remedial rather than developmental, the culture of coaching and the importance of it for people managers stays stagnant.
So how do you know what the coaching culture is within an organization? Look at what’s happening:
Is coaching valued internally, or is it outsourced?
Do senior leaders themselves have coaches?
Are leaders modeling and prioritizing ongoing learning?
Without an internal culture of coaching, these skills won’t flourish organically. If you’re coaching curious, check out the post below.
How to make the case for investing in coaching people leaders
So how can you turn this around?
We know that these issues are systematic and often industry wide.
As a sole operator you have limited capacity to create real change.So, what can a sole operator do to change the tide? Below are some ideas:
Invest in people management skills early. If you’re an IC, or managing one that’s an aspiring people manager, find ways to practice people management skills. Before you give people management a real go, try…
Fostering mentoring relationships with more junior team members. Ideally this is at your current company but if not, try other outlets to get mentoring reps in, like ADPlist.org.
Letting ICs hire and manage interns. I did this when there wasn’t budget or leveling for me to become a people manager. Hiring an intern gave me great tactical experience I hadn’t had before.
Fund and/or normalize manager training. Dedicate budgets for ongoing training focused on coaching skills, emotional intelligence, conflict resolution, and effective communication - aka the most important people management skills.
These trainings don’t have to be function specific. In fact, there are so many amazing coaching programs out there, like Co-Active, that teach anyone the fundamentals of coaching. If you’re a new manager, make the case to carve out specific budget for people management training or use your gifted learning and development budget to round out your coaching skills.
Reward people growth. Explicitly recognize and reward managers who invest time and energy in developing their teams.
You can do this by aligning incentives, performance reviews, and career advancement with people growth outcomes. Imagine if a manager was rewarded by how many people they get promoted. How might company incentives change?
Celebrate non-management tracks. Offer clearly defined, respected3 career paths for senior-level ICs who excel in their roles but prefer not to manage people. This is becoming more common. Companies should continue to reward and celebrate this path. Consider highlighting Super ICs at your company and defining what specific career paths look like for these contributors. I love this post from
about his Super IC career.What else have you done to get support as a new people manager?
Investing in manager coaching isn't just beneficial. It's essential.
The companies that prioritize developing their managers into effective coaches are the ones that will attract and retain top talent, foster innovation, and outperform their competitors in the long run.
At the end of the day, our competitive technology edge is waning.
Your people matter more than ever.
What are you doing to support them?
Hi - I’m Jori and I’m a Product Coach. If you’re Product Leader or on a Product team looking for support - drop me a note.
Do you agree or disagree with this take?
But I invite you to challenge me on this!
In seniority, pay and benefits.