Businesses that invest in management and leadership training and development will find that they are a range of financial and non financial benefits to be gained from it.  For example recent research has demonstrated that:


  • Firms with high levels of HR practices demonstrate up to 200% greater profit per employee (1, 2)
  • Sustained management & leadership development improves organisational performance (3) 

    This arises from the fact that good leaders and managers have the skills to obtain ‘discretionary’ effort from their staff, which means that their staff will go the extra mile for example to win new business, give outstanding service to a customer, or to ensure that costs are properly controlled.


    In addition, there are the real benefits in terms of reducing turnover of staff.  People want to work for a good boss and are less likely to be tempted away by a few extra pounds if they feel that they get what they need from their work and their manager.  The cost of a new hire can be anywhere between 1-3 times their annual salary by the time all of the associated costs are taken into account.  These costs can include:

  • The cost of training the organisation has invested in the leaver.
  • The cost of lost productivity while the position is vacant.
  • The cost of externally advertising the job.
  • Recruitment agency costs. (these can be as high as 20-30% of annual compensation).
  • Costs of internal or external assessments
  • Costs associated with any external medicals, checks and other references.
  • Costs associated with the time taken for a new employee to become ‘fully productive’.There are also real benefits for the individual in terms of improving their own ability to manage conflicting demands on their time, improve performance of their team and as a consequence gain greater satisfaction from their work.


    There is also evidence of less direct business benefits. Regular management training and development is seen as a sign of professionalism and helps to create a positive image for the business in its market place, which is an important selling point when recruiting new employees.


    Whatever the benefits, it is important that an organisation is clear about the objectives of any management or leadership training and development.  Ultimately they should ask themselves, ‘What is it that I want to see differently from this person or group of people?’  In this way it is possible to monitor the impact of training on individual performance and also on the company’s bottom line.




  • Smarter Ways of Working Professor D Guest. Sector Skills Development Agency 2006.
  • Commonalities and Contradictions in HRM and Performance Research. Boselie, Dietz and Boon. Human Research Journal, 15, 3,67-94. 2005
  • Management Development Works: The Evidence.Chartered Management Institute January 2005..