Effective Leadership Development - Driving Business Impact by Connecting the Dots
31
Oct
2024
Picture this.
Your business is facing serious disruption. A merger is creating employee uncertainty and stress, while interruptions in your supply chain are causing production delays and increased costs.
How prepared would you be?
Now, imagine your leaders fully understanding the challenges ahead, creating the right environment, and turning those challenges into opportunities – keeping everyone on the same page and achieving real results.
The fact is, many leadership programs feel too vague or disconnected from what the business really needs. The link between leadership development and business results often feels like a leap of faith rather than a clear, measurable connection. Operational teams need to see that the leadership skills being developed help achieve real outcomes.
Instead of asking, "What does good leadership look like?" start with, "What results do we want, and why?" This way, your organisation can focus on leadership behaviours directly tied to achieving those results, creating a clear connection between leadership development and business success.
When leadership is tied to clear, measurable goals and the right conditions are in place, organisations can spot risks – helping them focus resources, plan strategies, and make the most of new opportunities.
Learn why it is essential to align any leadership development to the desired business impact of your organisation. Discover how leadership programs can go beyond basic skills like giving feedback or handling tough conversations and focus on the context – connecting these leadership skills to measurable business results.
What is business impact?
Business impact is what the organisation aims to achieve and why. It refers to the measurable impact a company’s decisions, actions, or changes have on operations and performance – safeguarding its future. These measures include:
- Financial performance and operational efficiency, such as sales, profits, time, and people.
- Customer satisfaction and retention. For example, increased loyalty and repeat business from customers.
- Market position such as competitive advantage, brand positioning, and public reputation.
It’s clear that business impact is essential for any organisation. Yet, just 22% of leadership development is evaluated by linking to business impact.
Let’s understand why.
Two-thirds of well-formulated strategies fail because they are unable to define and maintain direction and focus too much on internal issues. Connecting leadership to clear, measurable goals helps businesses face challenges and turn them into opportunities.
When leadership development is included in conversations about the organisation’s strategic direction and aligned with outcomes, it becomes a powerful tool. Business leaders start to see it as indispensable rather than a nice to have. Therefore, a joined-up conversation is needed to fully understand what sits behind organisational impact measures.
For a leadership programme to work well and achieve the desired business impact, it must focus on connecting the dots between leadership behaviours and the desired business impact.
But, setting clear and ambitious goals for business impact is just the beginning.
Everyone must understand what these goals mean for their everyday work and how they need to perform, and for Leaders how they create the environment for their teams to perform at this level by demonstrating the right behaviours.
Overcoming ambiguity in desired business impact
Many companies mistakenly believe their teams understand business impact when they actually don’t. This gap can create huge problems in how strategies are implemented.
When leaders think everyone is aligned, without checking, they can miss chances to clarify goals and reinforce how everyday tasks connect to those goals. It’s essential to clear up this ambiguity and ensure teams grasp the business objectives. By doing this, organisations can create a culture of clarity and responsibility, leading to better results and stronger performance.
Effective Leadership - building a compelling narrative
When Leaders craft a clear and compelling narrative that provides the context within which they operate, it helps teams and stakeholders understand the reasons behind decisions and initiatives. This narrative should explain not only what the organisation aims to achieve but also WHY those goals matter.
Let’s consider a sales team that concentrates on meeting quarterly sales targets without understanding how those targets relate to long-term business sustainability or customer satisfaction. Yes, there may be short-term gains, but long-term success is at risk. Teams might prioritise immediate results over sustainable growth, which jeopardises future achievements.
When leaders provide the context and explain how short-term targets fit into long-term business strategies, teams see the bigger picture.
Cue the LIW leadership impact chain.
Using the impact chain framework ensures that your leadership development initiatives are not just theoretical , but closely tied to practical business outcomes, driving real results and sustainable success.
Plus, by breaking down the elements to prevent gaps in understanding, the impact chain allows for quick action if issues arise. It shows how a leader’s behaviour affects different parts of an organisation through connected steps and includes:
- Knowing what business results you want to achieve
- Understanding what performance is required from the Leaders team to achieve the desired business impact
- Agreeing on the right conditions, the Leaders need to put in place to achieve the desired performance to boost performance
- Recognising what kind of leadership behaviours are needed to create that environment
By fostering an environment where employees feel informed and included in the narrative, organisations can drive business impact and maintain motivation.
Effective Leadership - building understanding of the message
While effective communication is crucial for business impact and demands huge effort in crafting and sharing information, organisations often overlook ensuring teams understand that message.
The fact is; poor communication costs businesses more than $15,000 per employee. Simply sharing information is not enough; organisations must actively ensure that team members understand the narrative and their roles within it. From a leadership development perspective, transforming the workplace requires leaders to prioritise clarity in their messaging.
Our Clarity on a Page (COAP) framework is important for several reasons. First, it gives leaders a clear way to define their team's purpose. This clarity is essential because any confusion can lead to mistakes and wasted time. By focusing on the key questions of why, what, and how, the framework helps everyone see how their individual work contributes to the bigger picture.
When leaders and their teams understand and agree on their goals, it creates a culture of transparency and accountability. This means that everyone knows what they are supposed to do and why it matters, which reduces mis-understanding. When team members understand the purpose behind their work, they feel more engaged and motivated because they can see how their efforts make a difference.
Plus, this shared understanding encourages team members to take ownership of their roles. When people know how they fit into the larger goals of the organisation, they are more likely to feel responsible for their tasks and work well with others. This leads to better communication and meaningful conversations that drive improvements in performance and new ideas.
The COAP framework not only provides clarity and focus but also helps teams perform better. With everyone having a shared understanding and aligned with the same goals, organisations can achieve higher efficiency, greater engagement, and better business results.
Developing effective Leaders by ensuring alignment to desired business impact
It’s not surprising that three-quarters of leaders are challenged to plan for and adapt to a constantly changing environment. Today’s leaders need skills in giving clarity and direction to their teams and inspiring them to stay motivated and ready to tackle whatever obstacles lie ahead.
Identifying the level of business impact to align with can be challenging in large, complex organisations and small, agile ones. Help your leaders recognise the significance of this alignment and practice building their capability to convey this understanding to others.
We frequently engage with Learning and Development (L&D) professionals and culture representatives who express frustration that despite numerous attempts to develop leadership skills, they struggle to achieve lasting behavioural change.
Why?
We believe this issue often stems from a misalignment between the skills taught and the specific business impact the organisation aims to achieve.
L&D can figure out what they need to focus on by working closely with key stakeholders to understand the company’s desired business impact and challenges. They should review business objectives, the performance required, and the environment they need to create to identify the skills and behaviours that will drive success. Finally, L&D needs to understand the behaviours needed to create that environment.
But this task isn’t just for L&D. Leaders going through a program should go through the same thought process, starting with business impact and working back to get complete clarity.
Measuring business impact
To make sure a car runs at its very best, you need to understand how all its parts work together, right? The same idea applies to measuring business impact. Think of the car as the organisation’s goals and each moving part as the leadership skills that help the team succeed.
Just like a well-tuned engine helps a car perform optimally, strong leadership creates a high-performance environment where everyone can do their best work. By focusing on improving these leadership skills, organisations can unlock their full potential and achieve great results.
As the starting point, with clarity on the desired business impact, it is then about confirming which measures will help determine if it has been achieved, It can be useful to consider these from three angles:
- The system (organisation) level
- The Team level
- The Self level
With clarity on these measures leaders can see the bigger picture and it also encourages a meaningful discussion about the desired state versus the current reality. As leadership development progresses, these measures can be revisited to show the improvements made.
The key is to have clear goals ("in order to") so leadership development has a defined purpose and can be measured. This provides motivation and a strong reason to stay focused on ongoing improvement.
Effective leadership: Take a holistic approach to deliver business impact with LIW
Leadership doesn’t occur in isolation – it needs context. By focusing on measurable business outcomes, understanding how leaders influence them, and ensuring alignment across the organisation, leadership development becomes more than just skill-building—it becomes a strategic driver of success.
Let’s work together to drive business impact. LIW can help deliver your strategic leadership priorities, develop your leaders to understand business impact and share the bigger picture with the team. Contact us today to find out more!
