Why Leadership Development Lets Managers Off the Hook

Imagine spending $366 billion globally on a fire suppression system because you never fix the faulty wiring. That is what leadership development has become. An entire industry built to compensate for a role design failure that nobody addresses.

Jackson Lynch and Scott Morris (former CHRO, founder of Propulsion AI) unpack why 60% of new managers get no training when promoted, 60% fail within two years, and employee engagement has barely moved since the year 2000. The problem is not the programs. The problem is we designed the manager job with functional delivery first and people development as an afterthought, then built a function to do what managers should have owned from the start. This episode names the 10-step loop that keeps the system stable but ineffective, and lays out a practical playbook for CHROs willing to stop optimizing the workaround.

What You'll Learn

The solutions order problem:

• We defined the managerial role with functional delivery as the primary output and development as secondary. That ordering is a signal to every manager about what actually matters.
• Gallup found only 10% of people have the natural talent to manage, yet we promote based on functional excellence, which has almost no correlation with people development ability.

Why the system does not self-correct:

• Every program built to close the capability gap tells managers that development is someone else's job. Each one is a permission slip.
• L&D teams create their own constituency. Activity feels like progress. The system is stable, just not effective.

The 10-step loop:

• From hiring on functional expertise to nominating for programs to measuring vanity metrics, the loop ends where it starts: nobody accountable for whether anyone actually got better.

The playbook for this week:

• Audit your largest multi-incumbent manager job description. Find the word "develop" and see how far down the list it sits.
• Ask your L&D leader what percentage of participants apply what they learned, and how they know.
• Run a time study on five managers to expose the gap between what the organization says matters and what the system reinforces.
• Kill your lowest-impact program and fund a pilot where five managers get held accountable for developing their people with measurements and consequences.

Key Quotes

"If you had a manufacturing line with a 60% defect rate, you would not buy more inspection equipment. You would redesign the line."

"Every program we develop, even with the best of intentions, is a permission slip for the manager not to do their job."

"The leadership development function is a confession. It is an admission that we built the manager role wrong and compensated with a function instead of fixing the design."

Diagnostic Questions

• Where does "develop people"

Transcript

The question for every CHRO or senior leader who is listening is whether you want to keep running programs that insulate everyone from accountability, or whether you are willing to name the structural problem and then redesign around it.

Hey there, senior leader, and welcome to the Talent Sherpa Podcast, where senior leaders come to rethink how human capital really works. I'm your host, Jackson Lynch, and today I am joined by my co-host, Scott Morris. He's a former CHRO with the scar tissue to prove it, a genuine believer in the best of people, and the founder of Propulsion AI.

Now, Scott, I want you to imagine spending $366 billion globally on a fire suppression system because you never fix the faulty wiring. That's what leadership development is today. We have built an entire discipline, nay I say an entire industry, to compensate for a role design failure that we never address. And I'm going to be honest on this. I have sat in those programs, I have nominated people for those programs, and I have never once asked whether the programs existed because we designed the manager job incorrectly.

Scott: I love how you just set that up. I've not only sat in those programs, I've not only sent people to them, I've actually designed and delivered them. I came out of the learning and development space and I join you in this. There's something really wrong with the way we do leadership development. I'm glad we're going to pull it apart today in this episode. But before we dive in, do us a favor. If you are listening, hit the subscribe button right now. Leave us a comment, drop us a quick review on your preferred platform. Those mechanisms are how we grow the pod, how we manage the algorithm, and how we keep this pod sharp for senior leaders.

Jackson: Yeah, we'd be very grateful if you do that. Okay, now, Scott, let's dive in. Because every CHRO has heard the pitch. Invest in leadership development, build your bench, close capability gaps. And that sounds like smart capital allocation. It sounds like we're investing in the future. And we do invest. The numbers are staggering. According to Exec 2025 research, organizations spend $366 billion, with a B, dollars globally on leadership development. In the U.S., that's $166 billion. That's still a lot of money. And the market is growing. 88% of companies plan to upgrade their programs. The industry reports a $7 return for every $1 invested. So why does it feel like nothing's working the way it's designed?

Scott: Yeah, $7 of ROI for every dollar is from the industry itself. But here's the thing: the spend is going to the wrong place. Gallup's research tells us that 70%, 70% of the variance in employee engagement is determined by the manager themselves. 70%. Not the programs, not perks, not the mission statement on the wall. The manager. And yet, according to the Center for Creative Leadership, 60% of new managers report that they never received any training when they transitioned into their first leadership role. So think about that. We spend, quoting your number from a second ago, $366 billion globally on development. And 60% of the managers get nothing when it actually matters. What happens to all of those untrained managers?

Jackson: Probably exactly what you'd expect. Gartner confirms it. So we have this massive gap between the investment and the outcome. And Gallup estimates that poor management costs the U.S. economy somewhere between $960 billion and $1.2 trillion annually. That is not a typo. Trillion with a T, which rhymes with P, that stands for pool. Okay, that's enough Music Man references.

Scott: You and the musical theater references, man. Well, here is something that is arguably worse. The trust numbers are pretty devastating. Trust in managers dropped from 46% in 2022 to just 29% in 2024. That's a 17-point collapse in just two years. And that's during a period where companies have been pouring money into leadership programs. Explain that disconnect to us.

Jackson: You can't explain it unless you accept that the spend isn't solving the problem. So I want to make sure this is really painfully obvious. We have a $366 billion industry that is supposed to build better leaders, while 60% of managers get no training when promoted, 60% fail within two years, and trust in management has cratered. Outside of that, Mrs. Lincoln, how did you like the show?

Think about it this way: if you had a manufacturing line with a 60% defect rate, you would not buy more inspection equipment. You would redesign the line.

Scott: You and I have both worked in manufacturing. You and I have both sat in those conversations, and that is exactly what happens. But here's the thing, I think, Jackson. Investors are already there. They see the spend. They know that the engagement numbers aren't moving. In fact, if you look back, Gallup has tracked engagement for 20 years. And I know you and I sort of jointly love Gallup's work and especially Q12 in their survey. But here's the overall result. Engagement's barely budged. A third of employees were engaged roughly in the year 2000, and about that same now. And that's after billions of dollars spent trying to change management and management skills.

Jackson: Yeah, and that's a lot of math that we've thrown at you. Don't worry, we're going to stop for a little bit. Because what we're really going to talk about today is not whether your leadership development program is good or bad. I'm sure it's wonderful. But we are going to talk about whether it should exist at all in its current form, and whether the entire discipline is in fact a workaround for a design failure that we never thought about and we never fixed. So let's, as we do at this time every podcast, call out a few assumptions that get leaders really stuck. Let me start with a couple of the really easy ones.

Scott: Well, I think number one is a really easy one. It's one that I think if you listen, you've probably heard some variant of before. The assumption is that the best individual contributors make the best managers, and that functional excellence somehow translates into leadership excellence. If somebody's good at the work that they do, they're going to be great at leading others who do that work. Sound familiar? A lot of us have heard it. And it's maybe not something that we say out loud, but it is absolutely how we tend to act. And if you want a good example, think about the best salesperson who gets tapped to be the sales leader.

Now, Jackson, going back to the way you opened us up in the episode, 60% of new managers fail in the first 24 months, says Gartner. So being a good individual contributor should have some bearing, for certain, right? We're not talking about don't look at people who don't do their job well, but it's a qualifier. And what I think we need to recognize, the first bad part of the assumption, is that if you're great in the individual contributor role, that earns you consideration for the next role. But that next role is different from your current role. And your fitness for that role has to be evaluated as if it is a different role and not a continuation of the current one.

All right, now here's the reality that counters that assumption. Gallup found only about 10% of the people have the natural talent to manage. And companies tend to miss the mark on managerial talent in 82% of their hiring decisions. We promote based on the wrong criteria, and then we wonder why leadership development programs don't fix what's wrong.

That's assumption number two. Hang with me, Jackson. I want to do one more. And I think this one builds on the one that I just started with. Leadership development is how you build leaders. So the assumption here is that development is a process that should be owned by HR and delivered by HR, and that leaders are going to get built through programs and experiences and coaching interventions that are administered by specialists.

Now, here's why I think that this is important. Because if we make the mistake about individual contributors becoming the great leaders, and if we put people in that don't have that talent to lead, then we set ourselves up for the second part of the failure. And that second part starts with a mindset on HR's part. Are we a service provider or are we a strategic partner? Here's why that matters. If we're a service provider, we're figuring out ways to take work off of managers. If we're a strategic partner, we're helping them do the work that they need to do more easily, but not taking it from them.

The number one job of a people leader is developing the team. And I think we flip the script on that. We say, okay, you're going to be in this leadership role. Here's all your individual contributor things that you have to do, and you're going to lead a team. And that is a flipped script. The number one job that that people leader has is developing the team, which means that their number one job is leadership development for the people who report to them. Not HR, not learning and development, that manager. If we've made the first mistake on that bad assumption and we make the second mistake here, we now offboard all of the work to somebody else who isn't the manager. That's a big problem.

Jackson: I can tell that this is something you're passionate about because you just did our second and third segments in the first one. But let's pull back into the assumptions that we're challenging. One of the ones that I hear loud and clear, usually from people reporting to me, to be honest, is our leadership development programs show very strong return on investment. And that's $7 for every $1 spent that the industry shows. That assumes that we are tracking the right stuff. I don't believe that we are tracking the right stuff.

What I usually see is completion satisfaction scores, which is really just a Rotten Tomatoes for corporate life. Self-reported behavioral change sometimes, but they don't impact real life leadership quality. And it's not just me that thinks that. If you look at the leadership development benchmark report, only 39% of L&D professionals even measure whether participants apply what they learn. And to be honest, I think that 39% is pretty high. Only 22% measure those applications in business results. And 77% of programs rely on learner feedback, 73% on completion statistics. We measure what's easy, we don't measure what matters. And the function is surviving by being unmeasurable.

So here's another one. If managers had better development, they would develop their people. That assumes that the problem is that managers lack the skills to develop others. Give them the skills and they're going to go do it. The problem is that development isn't part of the job as we typically define it in the workforce today. When something is secondary, it gets delegated, it gets outsourced. Enter the leadership development program. The function was built to do what managers should have done to begin with and never did. So every program that you create deepens that structural abdication.

How about this one, Scott?

Scott: Leadership development's a strategic function. Sounds good. I think the assumption here is that L&D sits at the table because building capability is essential to executing strategy. And that part really kind of makes sense. The CHRO's investment in development is a capital allocation decision that's tied to business decisions.

But here's what I would suggest on that assumption. If I teach somebody a skill and there's a significant gap in time before they can apply it, and I think, and this is important, and be coached as they apply it, then anything that they gain from that instruction is going to begin to degrade. Second point that I would make on that is if I teach somebody a skill or concept and I return them to an environment that doesn't reinforce and support it, then it's rarely going to be applied. So where is the strategy in that? I think there is none, right? If we want strategy, we're going to deliver clarity and we're going to make the manager the deliverer, as you just said, of that clarity. That's a lot more strategic, I think, than the way that we're approaching it right now.

Jackson: Yeah. And in the unlikely event we still have L&D people that are listening to the podcast, here's another one that I hear. We just need better programs. And that assumption is that if we upgrade the content, we modernize the delivery and integrate AI, because that's what we talk about now, we'll finally crack the code. But I don't think a program will ever fix a role design failure. The manager job is architecturally flawed. Development is positioned below the functional delivery in the job description, if you even have one. You don't select on their ability to build talent. You do that, and then you're stuck until you redesign the role. Every program is going to be a workaround layered on top of a broken foundation.

Scott: You know, I think that last one's killer. It's not just because of what we do at Propulsion AI, but I just think you've hit it on the head. Every vendor is effectively selling better programs, more technology, more personalization. And all of that assumes that the foundation is sound. And in my opinion, it's not.

Jackson: Ram Charan in the book Talent Wins wrote years ago that the inability to identify and develop leaders has become one of the chief constraints on growth at most companies. But here's the thing that he understood that we keep forgetting in human capital. You cannot develop people by outsourcing development to a function. Development is a manager's job. We talk about defining that clarity in the talent philosophy framework that we did a few months ago. And I said most of these are matters of choice, but this one I think is actually not one.

And yet we say managers are accountable for developing their people. Most HR people, we say that. And then we develop a function that allows it to be outsourced. And the minute you take that off the manager's core accountability, the minute you let them off the hook, you're done.

All right. Now that we can relax, we've gotten through the faulty assumptions. Before we get into what to do about it, I do want to name the thing that's underneath everything. Because if we don't do that, if we don't understand how we got here, I think we'll just build new workarounds on top of the old workarounds, and that's not going to get us anywhere.

Scott, you and I talked about this in our pre-show discussion, and you really sparked this idea for me, and I appreciate it. At its core, this is about the solutions order. We defined the managerial role with the solutions in the wrong sequence.

Scott: Yeah, talk more about that. Keep going with that.

Jackson: Well, it's your idea, but I'll do it. When you design any role, you're making a choice about what problem the role exists to solve first. What's the primary output? What is the thing that we cannot tolerate this person failing at? And for the managerial role, we have made a choice. We said the primary problem this role serves is functional delivery. Hit the numbers, ship the product, close the deals, manage the budget, whatever it is. And then we said, oh, and you also have people now. So develop them when you can. We don't actually ever say that out loud. But if you think about how we select for the roles, what we talk to them about, that is in fact the expectation in the system that we ultimately run. Right. So the current solution order is functional delivery first.

Scott: And then second, if there's time, build your team.

Jackson: Exactly. And that ordering isn't neutral. It's not a list. It is a signal to every manager about what actually matters. What are they going to be measured on? That's what they will focus on. What will they get promoted for? That is what they will focus on. What will they get fired for? That is what they focus on. And when development is second and you're not making those decisions based upon how they develop their teams, not only is it second, it's probably optional. And when it's optional and you have constrained resources, time, energy, effort, calendar, whatever, it's not going to happen. And that's not because managers are bad people. They're just doing what the system told them was their job, and they're not doing what the system said is not your job.

Scott: I think that's really well said. Let me go back to the point that I was trying to make earlier in the assumption section. What matters here is how we select managers in the first place. We look at individual contributors, or we tend to look at individual contributors who are really good at the functional work, the best engineer or the best salesperson or the best analyst, and we say, look, you're really good at that work. You really know this stuff inside and out. So you should now lead the people who do the work.

Which totally makes sense if you believe the manager's job is to be the best at the functional work. And look, I know that we never say this, but that is what we ultimately reward and incentivize. So if you believe the manager's job is to build people who can do the work, then it makes no sense. But those are two different jobs. They require, oftentimes, two different talents. And Gallup says that only 10% of people have the natural talent to manage. But we keep promoting people based upon functional excellence, which has almost no correlation with people development abilities.

So the solutions order, if that's a term, it starts with selection. We pick the wrong person because we defined the job wrong. And I mean, I don't know how many CHRO jobs have we interviewed for that wanted somebody to roll up their sleeves rather than build the strongest team? I can think about it in almost every CHRO job posting that I've seen. And so I think even within the profession, we're just as guilty as any other managers.

Jackson: Yeah. And then what happens, I think, Scott, is the loop kicks in. I thought about this last night when we were done talking. So here's how I think this works. And forgive me, this is just my systems thinking hat that comes on.

So sequentially, step one, the manager's hired or promoted based upon their functional expertise. Think about a sales manager who used to be a sales rep and is now a sales manager. The job description says deliver results first, develop people second, if it says anything about people at all.

Step two, the manager then focuses on functional delivery because that's what they are good at, that's where they're comfortable, and that's what gets measured.

Step three, development doesn't happen. Not because the manager is lazy, but because the manager understands it's not the job. It is line seven on a list that they only get to the first three or four.

Step four, the organization notices that there's a capability gap. People aren't getting better. The bench is thin.

So step five, HR comes to the rescue, and we're strategic, and we create a program that closes the gap. Leadership development is born. And we're very excited. We don't even have to wear a cape because everyone knows that we're the superhero.

Step six, programs become how we then develop leaders. The manager's role in development becomes nomination, not ownership and accountability. They identify who needs help and then they hand them off to somebody else.

Which leads us to step seven. HR measures what they can measure, which is vanity metrics: enrollments, completion, satisfaction scores. None of those tell you whether the manager or the leader ever got better.

Which leads to step eight. Nobody is accountable for developing the outcomes. The manager nominated, so they did their part. HR ran the program, so they did their part. And the employee participated, and they did their part. But nobody owns whether the person actually got better.

Which leads us to step nine. The system confirms what everyone suspected. Development is, in fact, HR's job, not the manager's job.

And then step 10, the next manager gets hired because the last one got fired because they had a team that underperformed, and the loop starts yet again. It's like those swallows returning to San Juan Capistrano.

And if you follow those 10 steps logically, then it kind of leads you to the conclusion that leadership development is not a solution. It's a symptom. It exists because the role design created a vacuum, and nature abhors a vacuum.

Scott: But here's a question that I have for you. Why is this not self-correcting? If the programs aren't working, why does the system keep running?

Jackson: Yeah. I think it might be because the existence of leadership development programs reinforces the original design error. There's no self-correcting mechanism. Every time we build a program to close the capability gap, we are telling managers, we got this, you don't have to do this. Somebody else is going to handle it. So every program we develop, even when we do it with the best of intentions, is a permission slip for the manager not to do their job.

Scott: You know, I'm going to add one to it. And I think anybody who's listening to us right now probably sees that there's a chain of events here from how you select to who you actually have in place, to then this stuff that we're talking about, about putting the responsibility with the manager where it actually belongs. And that feels like a lot to change. And I think that's got to have something to do with why it isn't changing.

These programs, though, they tend to create their own constituency. L&D teams have headcounts and budgets and metrics that they report. And activity, by the way, feels really, really good. It feels like we're doing something. They have an interest in the programs continuing. And I say that from the point of view of having led a learning and development function. And so I don't think it's cynical. I just think that the organization asked them to build what they built, and now it's in place.

So what are the CHROs that you talk with seeing? Are they seeing this dynamic? I mean, you're coaching an awful lot of very, very good CHROs right now, Jackson. What are they saying?

Jackson: They're seeing the same thing. They want to be seen as strategic, they want to be seen as helpful. This feels like something we should own. And so there's also the element that if you're running a big leadership development function, it feels like you have that proverbial seat at the table, which of course is only a participation trophy in corporate lingo. But it feels visible, it is measurable in the sense that you can point to the number of people that went through the training, easier than telling the CEO that you need to redesign the whole manager job and that results aren't the most important part of the equation. I get it. That's hard, which is why when I've come into organizations, I've put these things in. The difference is I recognize we're not actually going to change performance, but it does allow me at least to nudge my way into being a part of the solution.

So I don't think the CHROs I coach are any different. They optimize the workaround instead of fixing the root cause. There's no ill intent. It's all about incentives, and it feels strategic, and it's helpful. So I think the real question, Scott, is what's the CEO's role in this?

Scott: Well, I mean, I think a lot of CEOs don't ask the hard question because they don't know to ask it, right? They see the spend on leadership development. They make the assumption that it's working. Again, they're human like the rest of us. Activity feels good. We're sending people, we have some kind of intervention. They see engagement scores not moving, though, and they assume, like maybe the rest of us, that we just need better programs.

Jackson: And that's a big problem. I mean, who breaks that loop? Nobody. Everyone has a version of the same escape hatch. The CEO abdicates by not giving the CHRO the mandate to fix role design. The CHRO abdicates by building programs instead of confronting the underlying structural problem. And the manager abdicates by nominating people for development instead of owning the development themselves.

But with all of that happening, the system's still stable. It is just not effective, but it is stable. Everyone knows their parts. Nobody is accountable for the outcome.

Scott: You know, I guess that's why the numbers haven't moved in 20 years. I mean, we said it earlier. Gallup's been tracking engagement since the year 2000. And about a third of the employees were engaged then, and about a third of the employees are engaged now, and we've spent billions of dollars and nothing's changed because we were never really solving, I think, the actual problem. We were funding a workaround. We called it strategy.

And so, you know, you're, I like the duality between us. I'm the optimist, you're the pragmatist. I think that works for us. But I'm going to put this one back on you. What does it take to actually change this?

Jackson: Yeah, well, let me take something off the table. The question should not be how do we build a better program, no matter how many vendors pitch that they can come and solve your manager issues. I think the underlying mechanism in play is where you need to solve. You have to identify the root cause. And I talk about this at length. Our job is to look at the business through a talent lens, predict what's going to happen, identify the root cause, and prescribe actions. We do a good job of predicting. We do a great job of prescribing actions. We don't always focus on what the root cause is. I think the root cause in this case is we have a manager role design problem. And so you have to move development of their team into a primacy position. So that is the actual job.

Scott: Yeah, I could not agree with you more. And I think that raises a much harder question, though, because it requires admitting that the architecture is wrong. And that's sometimes a hard admission. That's a hard truth to confront. It likely requires dismantling some of the systems that a lot of people have built careers around. And it requires the CHRO to give up a function that I think many of us, including myself at various times in my career, feel like differentiates HR, or maybe separates us from compliance and governance and administration and those kinds of things. And I think an important thing when we get to the playbook is it doesn't have to all be done at once, but it's got to start with confronting the actual truths. And I think we just named them.

Jackson: Now you've completely set me up on this. I get what you're saying. Okay. Accepting the argument has cost. For the CHRO, there's a cost. It means owning a redesign instead of optimizing a workaround. For L&D leaders today, it means the function probably shrinks dramatically and gets focused on specific problems to solve, not just solving broader development issues. For managers, it means development accountability is something they get measured on. They probably have to get hired based on it. They probably get fired based upon it, which today, I've been through so many hiring processes. And if we were to be real honest and pull the mirror up, how many times have we looked and said, this person is great at developing their teams, I'm going to put them in a role to do that? I haven't done that very often.

I'm the reformed smoker that's telling everyone that it's bad for them, right? So this is not me saying I'm better. I've done all of this stuff. And ultimately, I think you just need to rethink the current system because it protects everyone from being accountable for outcomes. That is why it persists. But if what we're trying to do is have a human capital agenda that is part of the business narrative rather than sitting adjacent to it, it's the work that you have to go do.

Scott: All right, let's move this a little bit, Jackson. And I think we should start to try and reframe this. One of the things I think is great about this pod is we're willing to look at some subjects differently than other folks might look at them. But I think the more important thing is we're also willing to be really practical about it. So let's reframe this thing and make it practical. How do we move from leadership development as a compensating mechanism to development as a management accountability? And I think we can think about that in sort of four different fronts.

One, and you've said this a couple of times, I'm not going to spend a lot of time here, but let me double-click on it. Redefine the manager's job. Development is their primary output. We have got to stop designing managers as individual contributors plus team oversight. We've got to start designing them as: your job is to build the people who do the work. That doesn't require a whole lot of other changes. And it's not semantics, it is a structural shift. We have to set that expectation, we've got to write it into the job description, and we've got to make sure that we communicate to whoever those new incumbents are with that job description. Their primary accountability is leadership.

And when you do that, everything changes. Most job descriptions are going to list that as a bullet item. We like to put it front and center. The number one, we call it achievement, relates to developing the team. You're going to put that right at the top and then measure it. And I think this is important. I think you'll appreciate this one. I think you've got to cut bait. I think you've got to fire the people who don't do it once you've put them into that role, because you're trying to send a signal. Right now we promote based on functional expertise and hope development happens. And that's not going to happen unless you start to flip that script.

Jackson: Yeah. And so I've been in sales compensation for a long time. We've actually done that there. We put a part of your sales compensation, usually a multiplier of some kind, that is tied to the percentage of your team that is on plan. That is a way of doing it. Outside of that, it gets hard. So how does an organization actually make the shift when you don't have a comp plan that you can just attach to it? And by the way, every manager was hired under the definition that didn't include this.

Scott: You know, I think you've got to start with new hires and promotions, Jackson, and you're not going to change the entire system all at once. But here's another thing, it's probably obvious, but I'll make it more explicit. You've got to look around the organization for people who can be allies in this effort, managers who believe this the way that we believe it, and who are willing to go with you and who are willing to say, yes, I'm going to do it for myself, yes, I'm going to do it for my team. Because you're not going to change everybody overnight, but you can change who you promote next, and you can change how you write that job description, and you can change what you measure for everybody starting right now.

Jackson: Great. I'll take the second one. I think you have to kill the nomination model, which means putting the managers accountable for the development rather than sending them to a class. So the current system, we talked about this a little bit. The manager identifies someone who needs development, they nominate them for a program, they let someone else handle it. The manager's accountability ends at the nomination. There's not a before and after measure. It is a 100% abdication machine. And it routes development away from the person who knows the employee's actual gaps, and puts them into a program designed for no one in particular. Perhaps broad systemic gaps that need to be addressed, but that is not how you build individual skills.

So instead, I think what you've got to do is manage your system so the manager is accountable and responsible for the development plan and its execution. HR's role is to provide resources, not to own the outcome. And if the employee is not developing, that is the manager's problem. And we need to hold that manager accountable in their review for their performance in that spot if it is the first thing on their list. Because right now, what happens is we need another HR program. And that's not the signal.

Scott: And, you know, think what that does, though, to the manager's identity. Right now, their success is defined by functional results, and developing people is a nice-to-have. The reframe is your success is defined by whether your people are getting better. That's a different job.

Let me move us on. Measure outcomes, not inputs. Hold the function accountable. Leadership development has survived by measuring activity: enrollments, completions, hours, satisfaction scores. None of this tells you whether leaders got any better. Outcomes means: are managers actually developing their people? Are the people that those managers lead performing at a higher level? Are they being promoted at a higher rate? Are they staying? If you can't connect your development spend to those outcomes, then you don't have a development program. You don't have a development function. You have an activity center, for lack of a better word.

And I mean, this is hard. It requires tracking individual development over time and controlling for variables and being willing to see uncomfortable truths, maybe. But I think, while many organizations would rather stay in the dark because it's safer, really forward-thinking CHROs are going to push outside of that comfort.

Jackson: So why would they? Walk me through the incentive structure. Because I think that's what's pushing back today.

Scott: Well, I mean, I think the incentive is that the current approach is not working and it is incredibly expensive. And think about even a fraction of that money used for different programs which are highly relevant today that CHROs say that they want to engage in, but can't because they don't have the budget for it. So you can stay flat or you could try something different. And I think the data says the current model is failing. The question is whether you want to keep paying for it to fail. I recognize that that's going to be incredibly unpopular. And it takes guts. So the big question is, do you want to do it?

Jackson: What do you think? Yeah, I do think you need to shrink the function. And maybe not shrink the function. Maybe the right way of saying that is we have got to focus the function on solving specific issues. And so instead of being a generic source of programs looking for a predefined problem to solve with what we've already built, which is what we do a lot, I think we need to figure out a way to be an intervention specialist.

So if development is the manager's job, then leadership development as a standalone discipline isn't as relevant. What remains, though, is a specific intervention function that doesn't run programs for everybody. It provides very targeted support when a manager can't close the gap themselves. They work with the manager's manager, they work oftentimes with the HR business partner. So think about this in terms of high-stakes coaching, role-specific skill building, transition support for first-time leaders. That's a different mandate for the function. So it might be smaller, but it's going to be way more expensive per intervention, and it will actually become accountable for the outcomes every time they intervene, which right now is not there. So it's a different operating model than what most L&D teams are built for.

Scott: Yeah, and I think that's a really hard one, Jackson. And I don't think we should gloss past that because it's going to mean that L&D teams have to let go of the program factory identity. Fewer enrollments, fewer completions to report, but the actual impact on actual leaders. That's a trade worth making.

Jackson: It is. So the real question becomes: are CHROs willing to stop being program operators, a low-altitude mandate in the lingo that I've been using recently, or do you want to become a system architect, a high-altitude mandate in the same lingo? Are they willing to tell their CEO that spending money in the $366 billion industry is a workaround and the actual fix needs to do something different?

It means redefining the job so that people development is the primary role, redesigning all of the incentive structures, and then ultimately redesigning and reimagining the L&D team as an intervention specialist designed to rapidly and urgently improve outcomes for a particular incumbent in a particular role, hopefully one of the ones that has an outsized impact on the overall organization.

And that is scary. I'm not going to lie, it totally is. It's way easier to upgrade the programs, to report completion rates, but we've got to do something different.

So let's lean into what we do starting this week. You can't boil the ocean. I get it. So what can we do right now that will make an impact?

The first thing I would do is I would look at your job description for your largest multi-incumbent job that has people leadership accountability. Find the words develop, coach, build capability. Take a look how far down on the list that is. And if it's not in the top three accountabilities, now you have documented proof that what we've just been talking about is in fact what is real.

Scott: I would, since I led the L&D function, say that the number two step in that playbook is go to your L&D leader and ask them one question. It's actually two questions. What percentage of your participants are actually applying what they learned, utilizing data? And how do you know that? If they can't answer you with specific data, not gut instinct, then you've just identified that you're measuring inputs and not outcomes, and that's a really good starting point.

Jackson: We've talked on other pods about the clarity ratio. That's a really helpful way to measure it.

The third thing I would do, and this is my old industrial engineering piece: run a time study of some managers. Pick a handful of them, not too many, no more than 10, but maybe only five or six. Ideally, some good ones, some average ones, some ones that need some help. And then ask them to track how they're spending their time for a short time period, a couple weeks. Figure out what percentage is going towards developing people versus producing functional work. Most CHROs are going to be shocked by the number, I think, because it will expose the gap between what we say matters as a corporation, what our senior team says over and over, and what the system actually is performing and what it's reinforcing.

Then you've got to start cutting someplace. So pick one program. Pick your lowest impact leadership development program. Pick the one that's been running for years because it's always run and kill it. And use the savings, both time and financial in some cases. Use those savings to fund a pilot where five managers get explicitly held accountable for developing their people with measurements and consequences. Transform that one program.

Scott: Yeah, I love that. I hope everyone listened all the way through to this part of it because I think that is amazing. And then the last one I might throw up there is: you can't change the entire organization, but you can change your team. So find someone on your team who has people leadership accountabilities, and then rewrite their performance expectations and rewrite their performance reviews the next time you get an opportunity. Remove the functional results section and replace it with how did your people develop this year and what is your evidence? How many of your people are performing at the levels you set for them? Run it as a pilot, see what happens. And when that becomes the review, you'll get a sense for whether it will actually drive the right incentives and instincts.

Jackson: You know, I think that one's probably the most important one right there, because it shows that we're actually putting into place what we're going to ask the rest of the organization to do. We probably should have made that one the first one, not the last one.

Let me put the last one on the table and it relates to the CEO. You've got to have the conversation with your CEO about this. You have to talk about the $366 billion leadership development industry that exists because we designed the manager role incorrectly, because we flipped the script on it. You've got to show them the Gallup data on the 70% variance related to the manager, not programs, not perks, the manager. And you've got to propose that developing people becomes the primary accountability for every manager, and then reassure them that you are going to shepherd this program through. You are going to help that transition happen, because that conversation is where real change either happens or dies. It is the alignment, as we've said in other pods, with your CEO and how this is going to contribute as an extension to that CEO's narrative.

Scott: Yeah, I'd prefer the term Sherpa to shepherd, but I think outside of that, everything you said is right on.

And I get it. It's scary. It is. Because you're kind of admitting what most people have thought for a while. And if they didn't believe that, why is leadership development one of the first things that gets cut? Right? So it's a known problem in organizations. But I think you earn the elevation of altitude when you have these conversations, because ultimately what you're saying is I want to be accountable for driving the business outcome, not a functional one. And yeah, it means telling CEOs that these programs and the spend were workarounds, but I think they probably already know. But that's the work, right?

So until somebody does it, we're going to keep pouring money into a fire suppression system, as I mentioned before, while the wiring stays faulty.

Jackson: All right, senior leaders. Here is your Talent Sherpa summary. And as you know, Scott says some of the weirdest things. And this time he, well, as Scott always says, the best leadership development program is a manager who knows their job is to develop people because everything else is just fancy daycare for adults with not enough wine.

Scott: I've literally never said that, but I like these more and more.

Jackson: All right, summary.

First, leadership development exists in a vacuum that is created by faulty role design. We historically built the manager role as an individual contributor plus oversight, and then development of the team under them became somebody else's problem.

Two, the investment isn't producing an outcome. We spend $366 billion globally on development, but 60% of managers get no training. 60% fail within two years and engagement has barely moved in two decades.

Three, the leadership development function survives by measuring inputs like enrollments and completions and satisfaction, because we have a really hard time measuring outcomes. Only 39% of L&D professionals track whether the learning actually gets applied. And that means we're optimizing for the wrong thing.

And fourth and finally, the fix is not better programs. It's redesigning that manager job so that development is the primary accountability, not a secondary task that gets delegated or, worse, taken by HR.

Scott: Yeah, look, we talked a lot on this pod about this is where senior leaders come to rethink how human capital really works. I'm really proud of this episode because I think we focus a spotlight on something we all see but refuse to look at. And so I guess the key takeaway for me on this topic is that the leadership development function is a confession. It is an admission that we built the manager role wrong and we compensated with a function instead of fixing the design.

So the question for every CHRO or senior leader who is listening is whether you want to keep running programs that insulate everyone from accountability, or whether you are willing to name the structural problem and then redesign around it.

Jackson: Thank you everyone for tuning into the Talent Sherpa Podcast. This is where senior leaders come to rethink how human capital really works. And it's so much fun to do with all of y'all. And a quick shout-out to one of our favorite listeners, Hytark from Islamabad, Pakistan. Thank you for being a part of the Talent Sherpa community. And we thank everyone for listening, whether that's in East Northport, New York, or in, help me with this, Safranbolu in the Karabük province of Turkey. Yeah, we saw that you guys were listening. It is so great to have you with us.

Scott: I love that we have an international audience, even when Jackson and I cannot properly pronounce the names of the places that people are listening. If you liked today's episode, please do us a favor and hit the like button. Do us a bigger favor and subscribe. That helps us with the algorithm. It is, in fact, the mechanism that spreads this pod to other senior leaders. You can leave us a review on your favorite platform, whether that's Apple Podcasts or Spotify or YouTube. We are ubiquitous. And it benefits the community. Just take a moment, write us a review. That's going to be really, really helpful.

Jackson: Yeah. And if you're wondering where do you start your AI journey, I'd like to invite you to check out the very cleverly titled www.getpropulsion.ai. They are building a team of AI teammates who help human capital leaders focus on what matters to the business.

Scott, what do you help people with?

Scott: Well, one thing related to today's episode is we have digital coaches that we've built that will help you to redesign roles. Not activity focused. Outcomes focused.

And don't forget, if you're an early-stage CHRO, you're listening to this pod and you're saying, this sounds right, I want to do it, and I don't know how, I want to remind you that Jackson has helped people just like you to thrive through personal coaching. The CHRO Ascent Academy, which you can gain access to on the website or through his best-selling Substack, you can find access to all of these and more at mytalentsherpa.com.

Jackson: Thank you, Scott. And thanks to everyone who's been listening. And until next time, keep raising the bar. Stop building programs and start building accountable managers. And keep on climbing.