ASTD estimates that U.S. companies spent upwards of $164 billion on training and development in 2012. But leadership development only accounted for 13.5 percent of that figure. Here are five fast facts to illustrate why organizations should be doing more:1. Leaders Play an Integral Role in Employee Satisfaction
One-on-one relationships—between managers and their direct reports—create the backbone for a strong, productive organization. In a recent survey of 1,200 professionals, 88 percent said receiving praise from a manager was either “very” or “extremely” rewarding. Eight-three percent said recognition was more fulfilling than financial rewards.
A larger study, cited by Forbes, indicates that effective leadership is the number two driver of employee satisfaction, just after job-interest alignment. Involved managers can make the difference there, too, by helping individual employees shape their roles to suit their strengths of long-term interests.2. Engaged Teams Are Profitable Teams
In a previous blog, we talked about the profit potential that comes with engaged teams. But engagement isn’t easy. We’ve all read the dismal Gallup poll numbers on employee engagement: 56 percent of U.S. workers are disengaged; 18 percent are actively zoning out at the office…
Even though good leadership starts with individual relationships, we can’t ignore the fact that half of your employees’ coworkers simply aren’t invested in the work. That creates a serious team management challenge. In 2014, cohesive team building has never been so important.3. The Best Leaders Are Hands-On Coaches
There’s a big difference between managing and coaching. Coaches, for example, take the time to know their “players”—their backgrounds, talents, preferences, and personal lives. Some managers aren’t willing to invest the time in employee coaching; others don’t know how. But the payoff is significant.
Coach/managers foster genuine commitment, not just compliance. They promote loyalty. They strengthen employee skills. And they reduce turnover, along with all its associated costs.4. Leadership Influences Innovation Potential
According to an ASTD study, most company leaders rate their “culture of innovation” as moderate or less than that. Yet nearly all can identify leadership development as the difference-maker, when it comes to ideation potential and the capacity for strategic improvements. After all, employees need to know if/when they have the time and permission to think outside the box. And leaders are responsible for setting those guidelines. We recently compiled 5 Strategies to Create an Innovative Culture, which explains how.5. There Probably Aren’t Enough Leaders in Your Pipeline
If none of the above items seems all that surprising, this last one should get your attention. In a survey of 212 North American employers, 54 percent reported not having enough leadership successors in place; another 14 percent didn’t know. That means only about one-third of today’s companies are preparing for smooth leadership transitions. And that spells trouble.
If you’re not already developing your leadership pipeline, and making plans to fill the knowledge/skills gap retiring Boomers will create, you should read our latest resource. Find out How to Help Managers Develop Leadership Skills. Because leadership development is perhaps the one category in your training budget with the longest, widest reach.