How Strategic Leadership Development Creates RoI

Developing effective leaders is a critical component of any successful organization. But simply training individuals in leadership skills doesn’t cut it. For maximum impact – and return on investment – development programs must be integrated with an organization’s business strategy.

15% Improvement in Organizational Performance

Organizations that link leadership development to their business goals see an average of 15% improvement in organizational performance, according to a study by the Corporate Executive Board (CEB). When leaders understand and support the business strategy, they effectively guide their teams in the right direction.

21% Engagement Increase

Employees who see a clear connection between their work and the organization’s goals are more engaged and motivated. And when leaders are trained to communicate the strategic direction of the organization, employees are more likely to understand and align their own work with that direction.

In fact, a study by Gallup found that organizations with high levels of employee engagement have 21% higher productivity than those with low levels of engagement. By linking leadership development to business strategy, organizations can drive employee engagement and ultimately increase revenue and profit.

50% Higher Chance to Fill Positions with Internal Talent

When leaders understand the business strategy they are better equipped to develop talent that supports those objectives. This includes identifying high-potential individuals and developing succession plans to ensure leadership continuity.

Relevant studies show that organizations with strong leadership development programs were 50% more likely to be able to fill leadership positions from within. By aligning leadership development with business strategy, organizations can build a pipeline of future leaders who are aligned with the organization’s goals.

How Organizations Link Leadership Development to Strategy

Ensure the business strategy is clearly defined and communicated. Leaders of all levels need to understand the business needs and the performance outcomes required.

Performance outcomes are results of certain behaviors, performed in moments-that-matter. As these moments occur, leaders must possess the necessary skills, or they wont be able to cease these opportunities.

Once you identify the strategically relevant skills, design leadership development programs that train and build these skills, combined with a support system for ongoing learning application.

Eventually, you should measure learning application and analyze impacts, for example sales growth, increase in customer satisfaction, and other relevant metrics.

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(Main Image by This Is Engineering)