Leadership Development Making a Comeback

After several years of employers cutting spending on training, Bersin & Associates reports that half of the companies they surveyed plan to increase leadership development budgets and almost one-quarter plan to increase spending by more than 10%.

What’s behind this change in investment strategy? Many companies fear an exodus or shortage of qualified leaders as the economy picks up and customers re-engage. Their pipelines are weak or non-existent. Executives across most industries are having a hard time finding strong managers to fill vacancies. The result is that leadership training is gaining urgency amid the stronger economy.

Companies have been tested over the past few years as they experienced heightened levels of economic turmoil and unpredictability. Weaknesses in leadership capabilities are showing. As many as one-in-two managers fail. Not just at the top of the house, but for many firms leadership bench strength is proving to be shallow.

Looking for a quick fix, many companies opted for short-term approach to declining revenues by cutting costs during the recession. Companies are now restructuring and changing their models to include leadership development as they are struggling to find managers well-equipped with the leadership capabilities and behaviors needed to handle the kinds of changes we are experiencing at an ever-quickening pace. Engagement, retention, productivity and performance are suffering as a result of poor communication, lack of customer focus, ineffective strategic thinking, and the inability to link one’s workforce with the business strategy.

As your business levels start to pick up, consider the investments in leadership development you need to make to build a pipeline of ready-now leaders at your disposal, regardless of what changes might come your way.