Some businesses may think that their leadership development programs are unnecessary. However, a new, wide-ranging study is claiming that leadership training is essential—and it’s hard to argue with the 42 years’ worth of data it presents.
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Criticism of leadership development programs often stems from the lack of hard data measuring how the programs affected leaders’ behavior and the company’s bottom line business metrics. In fact, less than 8% of chief executive officers (CEOs) ever see the business impact of their leadership development programs or the return on investment (ROI), according to a recent LinkedIn survey.
Development Dimensions International (DDI) released PROOF, the world’s largest and most comprehensive report on the effectiveness and ROI of a leadership development program. Based on 42 years of data, 186 unique studies, and surveys of more than 18,000 participants, the study focuses on Interaction Management®, a behavioral change program that is the longest running and most widely used program in the leadership development industry.
“DDI is a pioneer in leadership development, and we have more than four decades of data and research spanning nearly the entire history of the modern leadership development industry,” said William C. Byham, PhD, cofounder and executive chairman of DDI, in a press release. “This report pulls together a significant body of work that shows the measurable impact of leadership development on the behavior of leaders and on the behavior of those they lead. For example, the report showed that 81% of people were more engaged in their jobs after their leaders applied IM [Interactive Metronome] training.”
Overall, the study showed that the organizations in which leaders employed IM reported ROI ranging from 147% to 633%. Most notably, critical business success metrics improved after leaders applied IM. For example, individual companies found:
- Sales increased 114%.
- Accidents decreased 60%.
- Productivity increased 36%.
- Grievances dropped 105%.
- Work quality improved 48%.
- Turnover dropped 77%.
- Absenteeism dropped 90%.
- Customer satisfaction increased 71%.
“Businesses only see these types of positive results if the leadership development program they use permanently changes the way that leaders behave and interact with their direct reports, colleagues, and managers,” said Byham.
We’ll present more of the study’s findings in tomorrow’s Advisor.