There is a “crisis in management” across UK businesses that is threatening the country’s global competitiveness, a hard-hitting report has claimed.

The Commission on the Future of Management and Leadership, founded by the All-Party Parliamentary Group on Management and the Chartered Management Institute (CMI), has warned that “myopic management” is a “millstone around the neck” of the UK economy.

In its report, the commission urges employers to focus on their “purpose, people and potential” if the UK economy is to achieve sustained growth.

After speaking to over 60 individuals and organisations, as well as questioning 2,000 business leaders and managers, findings revealed that 57% admitted that their organisation performs poorly or could do better on key measures.

The research also found that, in the key area of ‘purpose’, only 37% of respondents confirmed that their CEO is rewarded for delivering value to all stakeholders.

When it comes to people, the commission warned that it could be a case of “too little, too late”. According to government figures, the UK labour market needs one million new managers by 2020, yet the report showed that 71% admitted that their training of first-time managers needs to be improved or that they didn’t actually train them at all.

In addition, less than a quarter stated that they deliver successful mentoring and coaching programmes.

There is also inadequate investment in the potential of the next generation of managers, the report claimed, with 54% stating that they don’t offer work experience to young people, and 64% admitting they provide little or no information on how their organisation works with schools or universities.

“We’re faced with a ticking time bomb of myopic management in this country, with widespread under-investment in the next generation of leaders,” warned Peter Ayliffe, CMI president and co-chair of the commission.

“Unless all of us responsible for leading businesses, public services and charities acknowledge that we are at a tipping point and commit to being part of a Better Managed Britain, the nation's sustainable long-term growth opportunities will not be fulfilled.

“Without a genuine focus on the three critical areas of purpose, people and potential, we cannot hope to build a sustainable economy – nor a cohesive and prosperous society from which everyone benefits."

The report has outlined key recommendations for government to help address the issue, with particular focus on how schools and employers can work together to help young people develop vital skills.

Barry Sheerman MP, commission co-chair and chair of the All-Party Parliamentary Group on Management, added that employers must do better at developing young people’s potential.

“First, employability needs to be embedded in education, with managers providing more chances to gain real-life experience about the workplace.

“Second, government should work with partners to help build exchange networks, helping employers to set up work placements and share ideas with each other and with schools, colleges and universities.”