Comment on – Leadership

Election fever is waning but change is still in the air… along with faint hint of financial trepidation.
As voters, we’ve spent time debating the merits of change and revision of political leadership. As business colleagues we must also debate the merits of change and revision of corporate leadership.
Why leadership? Why now? Twenty-five years ago Kouzes and Posner, authors of NY Times best-seller, The Leadership Challenge, started on their quest to find answers to these questions, ultimately hearing from more than one million leaders from all walks of life. If you haven’t yet read the book, do so. Their findings have developed generation of leadership thinking.
Recently Jim Kouzes pointed out in blog posting that “the economy is in foul mood, and it’s not being nice to anyone”.
It’s tough out there. As Kouzes went on to say, “leaders are no strangers to challenges. In fact, exemplary leaders thrive on them.”

Rising to the challenge…
To the questions of Why leadership? Why now?, I’d add: Leadership: why not?
Last month in this column Gill Hopkins pointed out that the best CEOs see every downturn as an opportunity to strengthen their organisations.
I agree. Now, more than ever, companies need to get back to basics and assess what qualities and competencies in their workforce are required to succeed. To fight and survive, much less thrive. They need to determine what’s needed to galvanise employees.
Leadership surely must be at the top of this list of requirements.
So I pose this further question: in time of financial stress, is it worth the cost to develop our leaders?
And I present this finding from Nexus Partners’ own research: that ROI on leadership training costs is measurable, is tangible – and the results are irrefutable.

A ROI Case Study
Between 2005 and 2007 leadership consultancy Nexus Partners worked with the Truck Investments Group, one of New Zealand’s leading suppliers of new medium and heavy vehicles and major service provider to the motor industry. The company invested in the development of younger, high-performing staff who showed leadership potential by establishing two-year leadership development programme. At the programme’s conclusion ROI assessment was undertaken.
The ROI measurement project showed the programme delivered spectacular financial result – massive 98 percent return on the cost of the programme. Measurable, tangible dollar benefits included personal productivity gains, significantly improved staff retention rates, reduction in personal grievances and impressive sales growth.
There were also major intangible benefits. Feedback showed improved self-confidence and an ability to manage relationships, new skills developed in conflict management, increased personal development and job satisfaction.
The case study was calculated within two months of the leadership programme’s conclusion. Future financial benefits will continue to mount. And as the economic downturn continues to bite, this company will benefit from its investment in developing resilient highly engaged young leaders.
Global market pressures and New Zealand’s skills shortage make it vital for organisations to focus on internal talent.

Take measure on the cost… and the return of leadership training
Talent management and leadership programmes allow employers to identify and develop key staff – if you lose critical people when times are hard, you’ve got nothing to move forward on when things improve.
The Truck Investments case study reinforces two key principles: leadership skills can be learned and the impact of those skills can be measured.
However, as with all wise investments, it is essential to consider what returns you are expecting.
Therefore the starting point in planning any leadership development is to start with your business objectives and clarify what business outcomes are desired. Then explore the performance and behaviours needed within the organisation to support those outcomes. This preliminary planning will give clear picture of the factors that can be used in any ROI exercise and will ensure any learning objectives are appropriate, realistic and achievable.
Effective leadership development is an essential investment.

Annie McLaughlin is performance consultant with Nexus Partners. For copy of her ROI case study go to

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