Measuring the Impact of Your Leadership Development Programs

BY Christopher O'Keeffe | June 09, 2025

How do you measure the true impact of leadership development? Despite significant investment in leadership development, many organizations continue to struggle with quantifying its impact. As companies pour billions into cultivating future leaders, measurable indicators of return remain elusive Only 24% of organizations feel like they’re doing a good job of measuring the impact of their leadership development programs, emphasized leadership experts at a From Day One webinar. 

At Otter Tail Corporation, a Minnesota-based holding company with utility and manufacturing businesses, CHRO Paul Knutson transformed the company's leadership approach after joining in 2012. “The board had just gone through their long term strategy, and one of the three imperatives had to do with developing our talent,” Knutson said. “The talent at our leadership level was lacking, and those that had been in leadership roles were not staying as long as we had wanted them to.”

The revamped program Knutson implemented identifies and connects high potential leaders across divisions empowering employees to solve real business challenges between previously unconnected avenues of collaboration. This cross-functional approach has generated unexpected bottom line benefits for Otter Tail throughout the frameworks of their enterprise, he says.  

“We wanted to create a sense of belonging within the corporate enterprise, to create an enterprise mindset so that people within each company weren’t thinking only about themselves or only about their company,” he said. Fostering a culture where the norm is reaching out to colleagues in other divisions creates a denser organizational network that accelerates innovation and decision-making.

Real Problems, Real Results

At Sundt Construction, a 135-year-old employee-owned builder with 4,300 employees, leadership programs directly tackle business challenges.

“Our executive team identifies pain points from our strategic plan,” said Melissa Moreno, vice president, director of administrative talent development at Sundt. “They tell our leadership teams, ‘Here’s a problem. It’s your opportunity to solve it.’”

Erik Williams of MDA Leadership spoke with leaders from Otter Tail Corp., and Sundt Construction (photo by From Day One)

This approach produced tangible results when one team addressed field engineer training deficiencies. They created a boot camp program that has become an essential part of Sundt’s operations. “That program is now in its fourth year,” Moreno said. “Many of the leaders who developed it are now instructors, and over 130 field engineers have completed the training.”

Enacting Measurement Principles 

Progressive companies using advanced measurement techniques can trace the ripple effects of leadership development across their organizations. By going beyond traditional surveys and tracking cross-functional collaboration among leaders, they’re seeing improved employee retention.

“Your measurement strategy needs to match your program objectives,” said Erik Williams, principal consultant at MDA Leadership. “If you’re trying to break down barriers between departments, measure cross-functional interactions. If developing future executives is the goal, track promotion rates and succession readiness.”

At Otter Tail, all leadership program participants reported spending more time developing talent on their teams after training, with 65% of their managers independently confirming this observation.

Despite economic pressures, companies like Sundt Construction are doubling down on leadership development. Its strategic plan through 2035 includes continued investment in its leadership pipeline. “The outcome of these types of programs, where you get leaders, you give them the opportunity to develop, to accelerate their leadership capability, to stack hands with one another. And over time, those relationships continue to deepen,” said Williams.

For organizations considering similar investments, the panelists offered practical advice. “Start with an effective assessment process,” Knutson said. “Self-awareness is the foundation of development.”

Moreno emphasized the importance of manager involvement. “Definitely include the managers of the participants. Early and often, they need to understand how they impact the success of their employees going through this program, what the expectation is for them, and how they can help them throughout the process.”

For skeptical executives demanding ROI evidence, Knutson offered his perspective: “Be clear about what’s not working and the cost of it not working. What’s going to happen if we don’t take care, if we don’t meet our needs, if we don’t fill this gap.” Especially today, leadership development may be less about creating individual stars and more about building networked teams equipped to navigate uncertainty together.

“The organizations that thrive will be those that can rapidly assemble diverse perspectives around emerging challenges,” Williams said. “That doesn’t happen by accident, it’s cultivated through intentional development that connects people across traditional boundaries.”

Editor’s note: From Day One thanks our partner, MDA Leadership, for sponsoring this webinar. 

Chris O’Keeffe is a freelance writer with experience across industries. As the founder and creative director of OK Creative: The Language Agency, he has led strategy and storytelling for organizations like MIT, Amazon, and Cirque du Soleil, bringing their stories to life through established and emerging media.

(Photo by Nansan Houn/iStock)

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