It’s difficult to argue against the notion that leadership development is critical for an organisation to grow and to meet its strategic objectives. Over the years, numerous studies have highlighted how investment in development can improve bottom-line financial performance, create organisational alignment, increase agility, and help organisations attract and retain top talent.
Companies with strong leadership and talent management practices increase their revenue 2.2 times faster and their profits 1.5 times faster than companies with weak practices, according to a Boston Consulting Group (BCG) report.
Evidently, leadership development is seen not only as a critical imperative but a strategic differentiator helping organisations exploit their competitive strategy. The key question which is not asked often enough is how do we know how effective our leadership programs are? Or, and potentially more critically, are they effective at all?
Well defined leadership effectiveness measurement helps organisations to determine if a leadership development program is achieving its intended impact.
A well-defined leadership effectiveness measurement approach using hard data can:
- Evaluate success of leadership programs across participants’ capability development, their engagement during and post the program and the overall impact on their performance.
- Help identify areas of improvement to better align with organisational strategy and the participants’ developmental needs.
- Act as a key input in formulating leadership development strategies and future action planning.
The effectiveness of formal programs can be captured via feedback – a participant’s reaction to applicability, relevance and usefulness of the experience. However, while measuring the knowledge gained by participants and collecting their feedback is important, these measures often fail to inform whether the broader goals of the programs are being achieved. Furthermore, it can be difficult to measure the effectiveness of leadership development programs that stretch over a longer period of time or use informal learning models.
How to Measure Overall Effectiveness and Impact of Leadership Development Programs
Effective use of workforce analytics can provide useful insights which, in turn, allows evaluation of a holistic organisational impact through leadership development efforts. The strategic use of data and analytics can further position HR as the steward of leadership development practices who drive performance and contribute to business objectives.
Key Workforce Levers to Measure Effectiveness of Leadership Development Programs:
To determine an overall impact on the participants of leadership development programs, some critical elements to review include:
- Participant retention
- Improvements in leadership capability, often reflected in subordinate retention
- Participant career progression / advancement
- Improvements in participant performance, and application of learnings
deliberatepractice and deliberatedge’s approach is to analyse what we refer to as ‘Critical Workforce Levers’ to explore each of these elements and measure the holistic impact of leadership development initiatives.
The key workforce levers our recommended approach explores are – Retention, Progression and Performance.
Our Approach: Leveraging Analytics to Get a Better Read on Leadership Development Effectiveness:
Our methodology applies advanced analytics to ensure that a number of factors including the ‘workforce levers’ are assessed to measure the effectiveness of leadership development initiatives. The analytical model will vary based on the attributes of each development program including – participants’ profile, program duration and developmental approach.
We draw on Comparative Analysis: Participants vs. Non Participants across a set of indices which provides deep insights. Descriptive analytics applied on the cohorts of participants versus the non-participants offers a robust mechanism to determine the direct impact of the leadership development program. A deep-dive into the year-over-year trend analysis on key workforce levers can strengthen the analytics model and present different perspectives on the long term benefits derived.
Comparative analysis over our three indices across participants vs. non participants provides a simple, clear, yet informative health check as the effectiveness of your leadership program. It asks a range of questions including:- are those going through the program actually any better for it or should we re-think our approach? Through this informed, data driven approach, the evidence base behind the business case to invest in leadership development programs is built.
If you are considering assessing the effectiveness of your leadership development program or activities, contact us to discuss how our approach can assist you to build a comparative index and utilise our model to assess your return on investment.