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3 Reasons to Invest in A Leadership Development Program

Harnessing the potential of company growth takes having well-equipped leaders. Every successful leader needs the right tools and useful skills. When companies look for a competitive advantage, there is often talk about making leadership development investments. It also tends to come up when budgets get tight or during mid-year reviews when there is a realization that half the year is gone. But during these conversations, leadership development programs are typically questioned. The truth is that leadership is more than a position, and event-driven development often fails to create lasting change. But, while narrowly focused programs don't work, leadership development does. Surprised?

Why is leadership development important?

We know technology needs frequent updates to perform well. In a fast-paced and turbulent workplace, leaders must also continually add to and enhance their skills or risk falling behind.

Here are a few ways that well-equipped leadership makes a difference in the workplace:

Team Performance

Several research studies have investigated the connection between the leader and business performance. Studies have demonstrated that effective leadership improves follower performance and promotes higher business results, follower job satisfaction, and follower organizational commitment.

Innovation and Creativity

Evidence suggests that leadership is essential for driving innovation in a company. A study involving over 400 executives from 48 companies connected strategy and innovation performance directly with good leadership habits.

Trust and Change

Studies have demonstrated that the level of trust in leadership directly correlates to employee retention, organizational commitment, and support for organizational change. Furthermore, when executives build trust, evidence suggests that organizational change readiness increases.

Internal Communication & Relationships

Words shape worlds. Studies have revealed that influential leaders enhance two-way communication, creativity, collaboration, job attitudes, and organizational commitment.

Leadership Transitions

Leadership transitions, whether successful or not, are costly. Evidence suggests that, on average, 35% of internally promoted executives fail, and direct reports spend 10-20% of their time helping a new leader transition. Successful leadership transitions increase company revenue, have 13% lower attrition rates, and are 90% more likely to achieve long-term performance goals. Leadership development is a leadership transition acceleration tool.

"If you think education is expensive, try ignorance." Derek Bok

Who is leadership development for?

A common barrier to leadership development comes from companies and individuals failing to recognize leadership as something more than a job title.

A company avoiding this mistake is Amazon. They offer a month-long training and leadership development program prior to hire. They believe that all employees should be owners one day, so they train them to take ownership over their products, services, and careers.

"At Amazon, we believe that everyone is a leader. And leaders know that they always have things to learn." Amazon Jobs

As companies have flattened organizational structures or moved to self-directed work team structures, the need for leadership development has expanded. However, not all leadership development programs are effective. The development needs of a project manager, frontline leader, or executive are similar but different. Leaders learn best when development is bite-sized and personalized.

What does leadership development mean?

Leadership is one of the most researched and least understood topics in the social sciences field. Just as there is no one definition for leadership, there are often many different perspectives on what is and is not considered leadership development.

Leader vs. Leadership Development:

There is a common debate over whether leader development differs from leadership development. Leader development typically focuses on the individual, including self-awareness and leadership identity.

Management Development vs. Leadership Development:

Another common area of confusion is between management and leadership. Adding to this confusion is that different global cultures have different preferences for using leadership or management development. Management development is typically company-specific task knowledge and skills for managerial roles.

Leadership development includes formal and informal activities and practices that enhance leaders' qualities, traits, and behaviors that improve results and relationships.

What are the elements of an effective leadership development program?

While skills and tools are often emphasized in leadership development programs, there is much more to consider. The effects of the leader's character, company culture, the quality of leader-follower relationships, and leader and follower traits are elements that directly impact program outcomes.

Leaders make decisions based on their character every day, consciously or unconsciously. The impacts of these decisions reinforce desired or undesired behaviors, thinking, and employee feelings. In a study of executive leaders and their organizations over two years, CEOs who scored high on aspects of character had an average return on assets (ROA) of 9.35%, in contrast to CEOs with low ratings who had a ROA of 1.93%.

Gaps in leadership performance are frequently tied to a lack of support rather than an individual's lack of desire to perform well. To maximize development investment returns, programs need to account for environmental performance influences such as leadership feedback, resources, and incentives.

"A bad system will beat a good person every time." Edwards Demining

How to get the most out of your leadership development investment?

Many leadership development programs are missing the mark because they are event-driven. Leadership development is best viewed as a system and not an event.

Aligning development readiness with high-quality coaching improves development outcomes. Development readiness refers to the leader's and organization's ability, orientation, and motivation to develop. Leaders who want to learn and can focus on learning tend to view obstacles and challenges to their learning as the path to improvement.

Effective leadership development programs leverage a continuum of leadership development approaches, such as:

3 Reasons to Invest in leadership development

Reason #1: Reinforcing Company Culture

Financially successful businesses, according to Forbes, have identified organizational culture as the critical factor in their success. Evidence from a study involving 1435 companies over 40 years revealed that great sustained results depend on an overarching corporate culture. Company culture impacts everything in business and plays a role at the individual, team, and organizational level.

A company's culture exists within the shared experiences and learnings of its employees. A simplified working definition of organizational culture is how things get done within the organization when no one is watching.

What leaders reinforce, either intentionally or unintentionally, influences what does and doesn't get done. Leaders at all levels play a vital role in creating the organizational culture.

Ultimately every organizational result is the direct contribution of an employee. Evidence from numerous studies repeatedly confirms the vital importance of company culture on business results. Also, research links company culture to employee morale, commitment, health, productivity, and well-being.

Leadership development programs equip leaders with the knowledge, skills, and abilities to effectively reinforce the desired company culture and d the company's vision, mission, and values.

Reason #2: Attracting and Retaining Your Best Leaders

The best leaders in your company place a high value on continuous growth and development opportunities. The 2018 LinkedIn Workplace Learning Report involving 400 people managers and 200 executive leaders revealed that 94% would stay at a company longer if they received development opportunities. According to an IBM study from 2014, employees who do not feel they are being developed to achieve their career goals are 12 times more likely to leave.

Great companies are the outcome of having great employees. Gallup's 2013 State of the American Workplace report declared that the single biggest decision executives make is selecting the leader.

"When you name the wrong person manager, nothing fixes that bad decision . Not compensation, not benefits—nothing." Jim Clifton

Multiple studies reveal that leadership style can enhance organizational commitment. More committed leaders and employees are less likely to leave, are more productive, and are more likely to give discretionary effort toward their goals.

Reason #3: Creating a Robust Leadership Pipeline

A lot of businesses are experiencing a leadership shortage. Alarming data from a new global study reveals that only 14% of leaders are confident with hiring decisions. Also, only 11% of CEOs rate their organization as having a solid bench of ready-now leaders.

Having the right leadership in the right place at the right time is vital to harnessing the potential of company growth and navigating the volatility in the marketplace. Good leadership can make a success out of a weak plan, and ineffective leadership can destroy a business with a great strategic plan.

What could be more vital to company growth and sustained business performance than a pipeline of well-equipped, ready-now, and future-ready leaders?

Leadership development programs build current capability and future capacity. Our suite of leadership development programs are:

  • personalized

  • packaged into bite-sized formats

  • supported with tips and tools to create good daily leadership habits

Let's talk about how we can help you achieve your goals with transformational executive coaching and organizational consulting solutions that work.


Avolio, B. J., & Hannah, S. T. (2008). Developmental readiness: Accelerating leader development. Consulting Psychology Journal, 60(4), 331-347.

Bambacas, M. (2010). Organizational handling of careers influences managers' organizational commitment Journal of Management Development.

Cameron, K. S., & Quinn, R. E. (2011) Diagnosing and changing organizational culture: Based on the competing values framework (Third ed.). San Francisco, CA: Jossey-Bass.

Conger, J. & Fulmer, R. (2003) Developing your leadership pipeline Harvard Business Review.

Gartner (2019) Gartner says 45% of managers lack confidence to help employees develop the skills they need today.

Goler, L., Gale, J., Harrington, B., & Grant, A. (2018) Why people really quit their jobs Harvard Business Review.

Gurdjan, P., Haibeisen, T., & Lane, K. (2022). Why leadership development programs fail McKinsey & Co.

IBM (2014) The value of training IBM Corporation

Jan, J. & Kandampully, J. (2017) Reducing employee turnover intention through servant leadership in the restaurant context: A mediation study of affective organizational commitment International Journal of Hospitality & Tourism Administration 19(2),125-141.

Kleinman, C. (2004) Leadership: A key strategy in staff nurse retention The Journal of Continuing Education in Nursing 35(3).

Korn Ferry (2022) The leadership shortage.

LinkedIn (2018) 2018 Workplace learning report LinkedIn

Rhyne, R. & Neal, S. (2021) Top CEO challenges 2021: 4 key trends in leadership.


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About Dr. Jeff Doolittle

He is the founder of Organizational Talent Consulting in Grand Rapids, MI, and Program Director of online graduate and continuing business education at Olivet Nazarene University in Bourbonnais, IL. Executive leaders who work with Jeff describe him as thoughtful, decisive, intelligent, and collaborative. Jeff is a business executive with over twenty years of talent development and organizational strategy experience working with C-suite leaders in Fortune 100, Forbes top 25 private, for-profit, non-profit, and global companies in many industries.

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