Leadership Development Programs: Effectiveness and Outcomes

Introduction and Research Context

Research and studies on the effectiveness of leadership development programs are sparse. The most widely cited foundational research, conducted by Burke and Day (1986), is considerably dated given the changes that have emerged both in the definition of leadership and its ever-widening scope. The results of studies available on a variety of leadership development programs do not offer a clear view of the effectiveness of these programs.

Organizations are increasingly investing in their managers and other key employees to develop leadership skills, suggesting genuine concern about a shortage of leadership qualities and capabilities. Gibler, Carter, and Goldsmith (2000) maintain that investment in leadership development will continue to increase as organizations "recognize the shortage of talented managers, the importance of developing bench strength, and the need to widen perspectives in order to compete globally" (p. xii). It has also been found that leadership programs are "no longer focused on the individual learner but increasingly on shaping the worldviews and behaviors of cohorts of managers and, … transforming even entire organizations" (Conger & Benjamin, 1999, p. xii).

Organizational Investment and the Measurement Gap

What has emerged from a close study of the literature is that while companies are investing in leadership programs, they are not seriously assessing the effectiveness of those programs in terms of performance outcomes. Sogunro (1997) indicates that the reason for the sparseness of literature on this subject stems from the belief that such programs will definitively lead to improvement — an assumption so ingrained that concrete assessment is taken for granted and rarely conducted. Effectiveness in terms of outcomes is not measured in most cases, even though doing so has become increasingly important in the global age with its dual economic structures (Friedman, 2000).

While research on the subject suggests that leadership skills are considered important (Bass, 1990; Burke & Day, 1986), there is very little information available on the impact of leadership programs, since the concept of outcome measurement is not properly understood. Improvement in performance is not considered an indicator of effectiveness and does not form part of the assessment tool in any major research on leadership development programs (Lynham, 2000). Despite heavy investment in leadership programs, there is no substantial evidence in the literature indicating a link between these programs and better leadership skills (McCauley, Moxley, & Van Velsor, 1998). Klenke (1993) maintains that leadership programs are still lagging behind demand.

There is more than one explanation for organizations' lack of measurement and assessment of leadership program impact. Collins, Lowe, and Arnett (2000) attribute this to the complex and overlapping nature of leadership competencies. In the global age, organizations have become very complex, and leaders need a broad variety of skills to tackle diverse problems (Sogunro, 1997). Peter Vaill (1990) uses the phrase "permanent white water" to highlight the highly chaotic and uncertain nature of corporate leadership today.

Leadership programs — including education and training — can be costly and must be justified in terms of goals and outcomes. This means that every leadership program must be backed by organizational objectives. As Swanson and Holton (1999) suggest, "every (leadership development) intervention should lead to a system outcome at some point" (p. 69). The investment being made in leadership programs attests to the fact that organizations understand the significance of effective leadership. It is pointed out "that people are the only assets with the creativity and adaptive power to sustain an organization's success in today's dynamic business world" (Krohn, 2000, p. 63). Torraco and Swanson (1995) further argue that investment in "employee education and training increasingly funds the development of an infrastructure to support the sustainable competitive advantage that a highly trained workforce provides" (p. 13). For this reason, "it is the development of workplace expertise that is becoming vital for organizations to adapt to change and maintain optimal organizational performance" (Herling, 2000, p. 9).

Defining Outcomes and Leadership Development

For the purpose of analysis and research, an outcome is defined as "a measurement of effectiveness or efficiency (of the organization) relative to core outputs of the system, subsystem, process, or individual" (Holton, 1999, p. 33). Leadership development is defined as "every form of growth or stage of development in the life-cycle that promotes, encourages and assists the expansion of knowledge and expertise required to optimize one's leadership potential and performance" (Brungardt, 1996, p. 83).

Leadership programs are no longer what they used to be. New concepts have introduced new content into leadership training: "At the same time, the world of executive and management education has been undergoing an equally radical shift in learning approaches and program design" (Conger & Benjamin, 1999, p. xiv), and "there has been greater emphasis placed on groups of managers" (p. 20).

Conclusion: Toward Systematic Assessment

Literature review reveals that leadership development programs and their impact are usually taken for granted. It is widely assumed that if a program is implemented, it would produce certain benefits. The assessment of impact has also suffered due to the lack of adequate evaluative models or the presence of defective ones. Each year, billions of dollars are spent on leadership development programs in both the government and private sectors (Gibler, Carter, & Goldsmith, 2000). Organizations are usually seeking results in the form of cost reduction and performance enhancement (Dionne, 1996). Firms are typically concerned about the impact of the program on the "bottom line" of the organization (Holton, 1995).

Despite all this, there is a clear dearth of systematic evaluation of leadership programs in organizations, especially in terms of impact on performance (Collins, 2001; Sogunro, 1997). The effectiveness of these programs in terms of financial outcomes has also been hampered by certain organizational assumptions. Most organizations do not hold individuals responsible for financial growth in exchange for training, because they feel that one person cannot meaningfully affect the financial health of the entire company. Organizations are, however, beginning to expect changes in behavior as an indicator of program effectiveness. Shipper and Neck (1990) suggest that subordinates are well positioned to identify areas that need improvement, which can help organizations develop leadership programs targeting those specific areas. In final evaluation, subordinates can determine whether the program has been successful based on their direct observations.

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