Leadership Development Does Not Have to Cost an Arm and a Leg
We had a previous post about the excellent summary management consultant McKinsey recently posted online about the four key reasons leadership development initiatives fail. Read our summary of the points here.
We were also a bit shocked to read in their introduction that a top business school will charge $150,000 per person to develop leaders, probably annually. Wow. We are not charging enough for our services!!!
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All kidding aside, we don’t charge that much because you shouldn’t have to pay that much to effectively develop great leadership talent within your organization. Given the right mix of internal and external support, the employees will develop themselves.
Partly because organizations think leadership development is costly, too many new managers are given their first leadership roles with no development support, which automatically sub-optimizes them. Organizations tend to wait for “the cream to rise to the top” and reserve development investments to these self-identified rising stars. We would argue that this Darwinian sorting method throws up a limited set of people as your “future leaders,” ones that understand how to act like a leader upwardly, but who may lack the fundamental mindsets and behaviors that make people want to follow them sustainably. This kind of sorting also eliminates diversity, because only a few sets of behaviors and motivations will survive such a corporate jungle (our bet is on “dominant” behavior and “individualistic” motivations.)
You don’t want to invest $150,000 to launch a middle manager on his or her new career, but you do want to invest $15,000 or so in that person to accelerate their growth as a leader.
Here’s a rule of thumb to use: If substantive leadership development support for a new manager raises his or her contribution rate from 60% of their potential to 75%, you have gained 15% more “employee.” So, take 15% of that person’s salary and invest it in their professional leadership development. This investment will pay off in having the new manager transfer their new skills to their team, raising everyone’s productivity on one $15,000 investment. That’s great HR ROI!
This is a growing part of our business, as more enterprises recognize that home-grown leaders must be more actively nurtured. It should be a growing part of your organization’s development budget, too. Future leaders will rise to the top without it, but the mix of future leaders you get may be more diverse and creative if you support their development more actively!
Does your organization invest in developing the leadership skills of front line and middle managers? How does it structure it? What do they offer as training programs and resources to develop these leaders? Is it considered useful by the people going through it?