The best bosses have one particular skill that elevates them above the rest, according to University of Chicago economist Virginia Minni.
Standout managers can spot their workers’ hidden talents and know how to best put them to use, making them more productive and helping them advance their careers, Minni wrote in a study published in September. “Gaining a good manager results in an improvement in worker performance,” she wrote, and those workers were more likely to be promoted and earn higher salaries in the long-run — 13% more than other workers, on average — according to the study.
Minni, an assistant professor of economics at the University of Chicago Booth School of Business, studied 10 years of data from a single “large multinational firm” with 200,000 workers and 30,000 managers across offices in 100 countries. The study does not identify the name of the company.
The study identified the company’s most successful managers by looking at those who were promoted faster than their peers and received high marks in internal performance ratings, Minni wrote.
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Among that group of top managers, she looked for common factors that might explain their success. She found that their employees more likely to show improved performance under their management — and 40% more likely than others to make a lateral move within the company and see their performance continue to improve in the new roles.
Those employees’ continued improvement in other parts of the company suggests that the top managers aren’t just strong motivators. They excel at identifying individual employees’ specific skillsets and matching them to new roles within the company where they can potentially have a greater impact, Minni wrote in The Wall Street Journal on Friday.
“If a top manager were just a good coach or motivator, employees would show big gains while serving under the top manager, and the gains would fade once the high-performing leader left the scene,” wrote Minni. “But worker mobility and pay rose steadily even after the manager departed.”
How the best managers nurture talent and encourage autonomy
It’s no secret that managers who identify and nurture talent can be highly valuable to their employers. Businesses that prioritize employees’ development tend to see higher productivity and retention rates, plus 11% higher profitability, according to a 2019 Gallup study. Workers are happier and more productive at work when they are performing roles that make the most of their specific skills, research shows.
The top managers in Minni’s study had “strengths in strategy and talent management skills” that helped them identify underutilized workers and steer them toward roles where they could truly shine, she wrote.
Other measurable differences made the managers Minni nicknamed “high-flyers” stand out from their peers, she added in the study: “Workers describe good managers as mentors who guide career development, offer structured feedback, foster autonomy, and create opportunities aligned with employees’ individual skills and aspirations.”
Those high-performing managers spent “19% more time in one-on-one meetings with subordinates, and engage more in communication and multitasking — suggesting a more involved, coordination-intensive management style,” she wrote in the study, citing the unnamed company’s time-use data.
Talent development can indeed be aided by managers who dedicate time to individual mentorship, research shows: Bosses can learn more about their employees’ specific strengths and skillsets while offering relevant feedback to help advance their careers.
The best managers also gave their employees the freedom to discover their own strengths and experiment with new tasks and roles, Minni added. As such, those workers were more likely to participate in “flexible, short-term projects outside their core teams, which offer a low-risk way to experiment.”
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