Managers get higher performing employees by raising their Losada ratio. The Losada ratio is also known as the positivity ratio, Gottman ratio, and Losada line. The Losada ratio is the sum of the positivity in a system divided by the sum of its negativity. A ratio of 3.0 to 6.0 has been found to be highly correlated with high performance. The theory came from the field research of psychologist of Marcial Losada and relationship analysis of John Gottman. The Losada Line of positive to negative interactions which are necessary to make a team successful is set at a minimum of 2.9013. I say the word minimum because teams will function higher the more positive experiences they have. Good environments have always operated highest around a 6 to 1 positive to negative difference.
- Sets objectives. The manager sets goals for the group, and decides what work needs to be done to meet those goals.
- Organizes. The manager divides the work into manageable activities, and selects people to accomplish the tasks that need to be done.
- Motivates and communicates. The manager creates a team out of his people, through decisions on pay, placement, promotion, and through his communications with the team. Drucker also referred to this as the “integrating” function of the manager.
- Measures. The manager establishes appropriate targets and yardsticks, and analyzes, appraises and interprets performance.
- Develops people. With the rise of the knowledge worker, this task has taken on added importance. In a knowledge economy, people are the company’s most important asset, and it is up to the manager to develop that asset.