Leadership training delivers measurable ROI. When done well, it improves team performance, strengthens engagement, and reduces turnover – making it one of the smartest investments an organisation can make.
In a time when many organisations face skill shortages, hybrid work challenges, and fluctuating engagement levels, leadership development has become one of the most reliable levers for performance and retention.
Why ROI matters in leadership development
Across industries, leadership training is often under-delivered rather than under-valued. Geerts (2024) found that many leadership courses fail to realise their ROI because they lack follow-through, alignment, and measurement. Yet when design and evaluation are done well, the outcomes are substantial: improved behaviours, stronger team culture, and better business performance.
This is where structure matters. Courses that translate learning into on-the-job application produce measurable results, bridging the gap between intention and impact. IML’s Foundations of Intentional Leadership (FOIL) was designed precisely for this reason, equipping leaders with the frameworks and confidence to apply learning directly to real workplace challenges.
For senior leaders, return on investment comes through long-term performance improvement. Leadership training drives engagement, reduces turnover, and develops managers who can adapt to change and sustain results.
The evidence for leadership ROI
Research into the ROI of leadership development has accelerated in recent years. The evidence consistently points to a clear pattern: effective leadership training produces measurable outcomes when the design supports transfer, accountability, and follow-up.
A review by the Chartered Institute of Personnel and Development (CIPD) found that leadership training reliably achieves learning and behavioural outcomes, but that ROI depends on alignment between training design and organisational strategy. In other words, courses need both structure and relevance.
A separate study in Emerald Insight showed that improved leadership capability directly enhances employee engagement and trust, which in turn reduce turnover and lift team performance. These findings align with what IML’s New Manager and Management Essentials courses deliver – practical communication, delegation, and coaching skills that leaders can immediately apply to strengthen team outcomes.
In Australia, the AHRI Turnover and Retention Report (2024) identified leadership development as one of the most effective strategies for improving retention. Among the organisations surveyed, training and leadership capability ranked highest as retention levers, highlighting that leadership training is not a discretionary spend but a strategic one.
How leadership training drives performance and retention
When leadership development focuses on both skill and behaviour, it produces compounding returns. Teams with capable leaders report higher engagement, stronger collaboration, and better resilience in times of change. These are not intangible benefits, they translate directly into lower recruitment costs, improved client outcomes, and greater business stability.
Key drivers of ROI include:
- Improved communication and alignment
Training leaders know how to set clear goals and expectations, ensuring teams work toward shared outcomes. - Higher engagement and morale
Leadership behaviours that build trust, recognition, and autonomy lead to greater discretionary effort. - Reduced turnover
Employees are more likely to stay when they feel supported by leaders who value development and recognise contributions. - Stronger decision making
Leadership training build confidence in evaluating trade-offs, leading to faster, more effective choices.
Courses like IML’s Management Essentials are designed around these outcomes. Participants learn how to lead with influence, manage conflict constructively, and embed accountability, which in turn drives performance improvement across the business.
Effective leaders don’t just manage tasks, they model trust, growth, and accountability, behaviours that directly influence retention. This is supported by Australian studies in early childhood education settings, where leaders who prioritise staff development and relationships achieve higher retention.
Building sustained ROI through continuous leadership growth
ROI in leadership training increases over time when learning is continuous. Studies such as Geerts (2024) and CIPD’s evidence review emphasise that the biggest gap in leadership courses is not content, but consistency. Ongoing reinforcement, peer learning, and coaching ensure that leaders continue to apply what they learn long after the course ends.
This is where IML’s Corporate Membership model delivers sustained value. By providing year-round development pathways, diagnostics, and advisory support, Corporate Membership ensures that leadership capability is built systematically across teams. Organisations benefit from consistent standards, measurable outcomes, and a culture of continuous improvement.
Australian data reinforces this approach. Deloitte’s “Ready, Set, Upskill” (2024) found that every dollar cut from training budgets results in more than triple the loss in skills value. In a market where leadership capability directly impacts performance and retention, the smartest investment is the one that compounds over time.
Aligning ROI with organisational goals
The final step in achieving leadership ROI is alignment. Research shows that courses deliver stronger returns when they begin with a clear understanding of business priorities. The CIPD review found that needs analysis and pre-training assessment significantly increase the likelihood of measurable success.
Through IML’s complimentary Team Analysis Consultation, organisations can identify capability gaps, align training investment with strategic objectives, and benchmark progress over time. This diagnostic approach ensures leadership development isn’t just activity, but a targeted investment that improves both performance and retention outcomes.
The Australian context: leadership under pressure
Leadership capability in Australia remains a critical focus area. The AHRI and Leaders Lab “State of Leadership in Australian Workplaces” Report (2021) found that only 22% of leaders feel they thrive in their roles, with the majority citing lack of time, clarity, or development support. This reinforces the need for structured pathways like FOIL and Management Essentials, which help leaders build the confidence and competence to lead effectively.
Strong leadership is the foundation for retention, engagement, and high performance. In sectors from healthcare to finance, leaders who communicate clearly, support growth, and create psychological safety are the ones whose teams stay longer and perform better.
Frequently Asked Questions
How is ROI from leadership training measured?
ROI is best assessed through both quantitative and qualitative metrics, including engagement scores, retention rates, and productivity data, combined with feedback from leaders and teams.
How soon can ROI be realised?
Behavioural shifts such as improved communication and engagement can appear within weeks. Organisational-level returns typically build over six to twelve months as leadership behaviours take hold.
Why do some leadership courses fail to deliver ROI?
Research shows that many courses underperform when they lack alignment, practical application, and follow-up. Successful courses like IML’s combine design, delivery, and ongoing support to sustain impact.
Can leadership training reduce turnover?
Yes. Studies confirm that leaders who communicate clearly, recognise effort, and support career growth retain their people at higher rates. Leadership development directly contributes to organisational stability.
What is the link between leadership and engagement?
Engaged teams are more productive, creative, and loyal. Leadership training that focuses on trust, inclusion, and motivation strengthens this link, improving both culture and outcomes.
References
Geerts, J. (2024). Maximizing the impact and ROI of leadership development: A theory- and evidence-informed framework. PDF. ResearchGate.
Chartered Institute of Personnel and Development (CIPD). (2024). Leadership development: An evidence review. Retrieved from [https://www.cipd.org/globalassets/media/knowledge/knowledge-hub/evidence-reviews/2023-pdfs/2023-leadership-development-scientific-summary-8431.pdf]
Emerald Insight. (2024). Improving leader effectiveness: Impact on employee engagement and retention. Retrieved from [https://www.emerald.com/jmd/article-abstract/41/7-8/450/238690/Improving-leader-effectiveness-impact-on-employee?redirectedFrom=fulltext&]
Australian HR Institute (AHRI). (2024). Turnover and retention report. Retrieved from [https://www.ahri.com.au/wp-content/uploads/turnover-and-retention-report_final.pdf]
