The Cost of Not Developing Leaders

One of the excuses I hear often from organizations is that they can’t afford to invest in leadership training, but I want to challenge that statement.

I read a great quote:

So, what are the consequences of not developing the leaders in your organization?

People will leave poor managers

We’ve all heard the phrase that people don’t leave jobs, they leave managers.

This is so true, and is especially true today. The pandemic has created an employee-driven market, and they have lots of opportunities. They won’t be willing to stick around and work for an inept manager, or on a dysfunctional team.

Figures from Simply Benefits estimate the cost to replace an entry level employee at 30-50% of their annual salary. Mid-level employee replacement costs jump to 150% their annual salary.  

Often these employees are the ones we want to retain and their loss has a huge cultural impact too.

We set people up to fail

Historically, we tend to promote skilled individual contributors to lead teams of those contributors. There is a lack of recognition that the skills required to lead a team is different than they job they were doing. Many of these people are thrust into situations where they are very likely to fail because we have not equipped them.

These new managers often feel like they are failing which impacts their productivity, but also the morale of the team they lead. We have a moral obligation to set people up to succeed, which includes investing in their development and helping them gain the skills they need to grow and lead.

Impact to productivity

Teams that lack clear direction and support are not as productive. Whether they do not have the messaging they need, or there is interpersonal conflict which impacts the team, they often do not get the results required. They spend time dealing with conflict or trying to understand requirements, rather than getting their work done.

Lack of value

Employees who see the lack of leadership investment often have a difficult time believing the organization cares about their growth. Growth potential is critical to many employees, especially Millennials. People want to see a career path and those who don’t will leave an organization.

Don’t have the right people

With the lack of leadership investment, people will leave the organization. What that often leaves is the wrong people. These people are sometimes not aligned with the organization’s values, or they lack the skills necessary to be successful.

Lack of Innovation

Open-minded people embrace innovation and creativity; they are more willing to consider new ideas. Innovation is a critical success factor for organizations today.

Conflict

We do not invest enough time teaching people how to solve interpersonal conflict and as a result, it can fester in organizations. Leaders who do not have the skillset to support people, and employees often lack the skills to solve these issues themselves, leading to energy spent in conflict taking away from achieving results. This conflict can also create animosity and resentment among colleagues which further erodes culture and productivity.

Excuses

In my work with small organizations, I have heard may excuses about why they don’t invest in leadership training:

It costs too much

I have built programs designed for small businesses and non profits. Training doesn’t need to be thousands of dollars and all day. I create sustainable training for reasonable investment. My preference is to do small trainings on a regular basis which increases retention (both knowledge and people).

Don’t know what to do or how to do it

I spoke with a small business leader who believed leadership training was critical, but he didn’t know how to do it; it was way outside his wheelhouse. This is where I can help! It’s firmly within my wheelhouse and I’ve done it with many organizations.

We don’t have time

Training doesn’t need to be an all day or weekend retreat. An hour on a monthly basis gets you an almost two-day retreat at the end of 12 months.

It’s easy to find the excuses about why you can’t invest in leadership training. I’ve built my business around creating training that renders those excuses invalid. Let me help you.

I can help.

When I ask business leaders if they would hire someone without financial knowledge to run their accounting department, they respond with a shocked look and a vehement “no.”

Yet, we do this exact thing with the leaders we promote. We ask them to meet a skill-set that we haven’t ensured they actually have. As a result, we’ve set them up to fail, as well as, created potential issues with those who work for them. These people then often leave the organization, or if they stay, they disengage which affects productivity, effectiveness and culture.

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