According to the 2015 Leadership Survey published by Mercer, 81% of organisations fail to calculate the return on investment made in leadership development. Furthermore, the survey also points to a disconnect between the learning and development methods that organisations think are most effective and the ones they actually use.
This news is worrying on a number of fronts. Firstly, if organisations believe there are superior leadership development methods available, but don’t use them, we have to wonder why. If, as the survey suggests, face-to-face learning is ranked as one of the least effective leadership development methods and yet is used by 63% of firms, are L&D professionals ignoring their effectiveness or just heavily wedded to one method?
Secondly, we would question the value of ranking of the development methods in the survey. What is the evidence for online learning being a superior method of leadership development to face-to-face learning? For all employees? In all kinds of organisations?
This kind of message has the potential to influence thinking about L&D methodologies, regardless of the context in which they’re applied. And in taking an evidence-based approach, as endorsed by the Future Work Centre, we have to remember the impact on, and perspectives of, our stakeholders. Online learning won’t suit all employees, any more than hot-desking or flexible working will suit all employees. It’s a top-down, one-size-fits-all mentality that doesn’t reflect the diversity of employees.
Thirdly, the low percentage of organisations whose leadership strategy has an associated business case, points to another disconnect – that between development activities and organisational strategy. If you’re not developing your future leaders in line with your strategy, you’re simply developing them to move elsewhere, where they’ll find a better organisational fit. At best, you’re developing people into the kind of leaders you needed five years ago, not the leaders you’ll need in the next five to ten years.
Finally, it’s extremely worrying that such a high proportion of organisations lack of any kind of ROI calculation. Leadership development represents a significant investment, one that should be evaluated just as any other investment. And while evaluation of these kinds of initiatives can be complex, they’re not impossible.
Introducing an evidence-based approach to evaluation can be made more difficult by the culture of the organisation (e.g. fear of change), an absence of in-house technical skills (e.g. statistical analysis) and the organisational need for quick decisions and even quicker results. These factors don’t necessarily make evidence-based practice impossible, but they do point to the need for planning, stakeholder management, seeking external support where required and a commitment to continual learning and evaluation.
To connect leadership development with business strategy, we recommend:
- Linking leadership development methods to the evidence base and ensuring they are a good fit for the organisational population being developed. This has to go beyond what feels right, or what has always been done.
- Ensuring a robust evaluation process is in place before the leadership development activity even begins. Simply handing out ‘happy sheets’ is just not enough and can’t hope to contribute to an ROI calculation in any meaningful way.
- Working to ensure that leadership development strategy is firmly aligned with the organisational strategy, and reviewing this as frequently as strategy is reviewed. This ensures alignment and a periodic refresh of the leadership development ethos and focus.
We’ve also put together a set of resources and events designed to help you apply an evidence-based approach to evaluating training and development in your organisation: http://futureworkcentre.com/beyond-the-happy-sheet/