My colleagues and I have long called it “the dirty little secret of employee development”. According to the Association for Talent Development, we waste 80% of the money spent in employee development (of all kinds) every year. This is because little if any new participant behavior change occurs. And isn’t that why we invest in development to begin with?
According to their article (link above), McKinsey says $14B is spent annually in the US on leadership development. If so, then then applying ATD’s finding means that more than $11B of that expenditure is wasted! Yikes!
Why leadership development programs fail
In their article, McKinsey offers four ways to make sure your leadership development efforts don’t fail. By way of preview (although I recommend you read the entire article), they are as follows:
- Overlooking context
- De-coupling reflection from real work
- Under-estimating mindsets
- Failing to measure
In my opinion, #4 should be #1. There’s an old adage that says, “You can’t manage what you can’t measure”. If you’re not measuring your leadership development, you should be. The article describes several good ways to do that, including one I almost always use: 360 or other assessment administered before and after development. This best-practice approach also makes it easy to calculate return-on-investment.
Every business wants a return on every investment, or they stop (or should stop) making the investment. Senior leaders live and die by ROI. So why do we tolerate an investment that produces any positive ROI only 20% of the time? And yet we keep making the same investment, year after year? Maybe that’s why we call it “the dirty little secret of employee development”.
Whatever you do, don’t provide development without measuring success, and simply hoping for the best result. You’re wasting your money, your participants’ time, and and benefiting only your leadership developers.
Hope is not a strategy.