Leadership Development: What’s Money Got to Do With It?

When LLC was evaluating a cluster of leadership programs working on the same issue, we were asked the thorny question, “Where are we getting the most bang for our buck”? The variation in cost among these programs was enormous (more than $75,000). We could not come up with a fair equation that didn’t feel like comparing apples and oranges because they were serving very different groups, in different regions, and with different desired outcomes.

There are a lot of reasons for avoiding this question. The pure economic calculation doesn’t necessarily speak to values. When we compare a programmatic investment to an investment in an individual we might say, “Wow! $50,000 seems like a lot to invest in an individual, just think what an after school program could do with that money that would effect hundreds of young people.” That does sound like a lot until we are reminded that most middle-class families invest far more than this educating their children and we don’t think that’s an inappropriate investment in an individual. Leadership investments could serve to level the playing field, if that was the perspective we brought to it. Of course there does not seem to be any evidence in the leadership field that we are investing more in those who have had less or conversely, less in those who have already had ample opportunities.

Of course leadership investments are about impact. In the spirit of due diligence, many foundations are asking about the ROI (return on investment) and whether, support for a particular leadership program proves to be a strong investment in health reform, social justice, non-profit effectiveness, HIV/AIDs. We have also been reluctant to take on the ROI question because many of the changes we are seeking will take place over a long time frame. Despite the many difficulties of a cost-benefit analysis of leadership work, there have been some strong champions for digging into this issue head on. Jean Burkhardt, a long-term participant in LLC from the Northwest Area Foundation www.NWAF.org, has some very compelling arguments for paying attention to the costs of the changes we are seeking. The NWAF has a very ambitious agenda, the reduction of poverty in Minnesota. Jean is very concerned about replication and costs if they are to have the reach they will need to effect poverty throughout the state. Clearly, for any of us that have very large goals (or very limited resources) the question of how to best use our resources in a leadership strategy that will move us closer to our goals is very important.

To begin tackling this question we developed a survey to help us understand the cost of different leadership program approaches and what was being achieved relative to these costs. We want to thank all of you who participated in this survey and the subsequent meetings to discuss the findings. Almost all of the survey respondents wanted to learn more about the minimum bundle of program activities that will deliver results. Claire Reinelt, LLC’s Steward of Emergent Wisdom, has suggested an attempt to learn more about program components by developing program design logic models that attach program elements and anticipated outcomes. Participants in the LLC evaluation circle have raised concerns that we might miss the interplay of program elements if we try assess each program element independently.

Sally Leiderman, a seasoned evaluator and member of the LLC evaluation circle helped me out with a big “aha” when she pointed out the dangers of per participant program cost by helping to refocus us on the benefit side of the equation. She told a story about a leadership program for principles that had as one of its outcomes student readiness and performance. She suggested that the costs and benefit equation should be the number of students whose performance improved (hundreds) instead of the 20 or so participants in the leadership program.

LLC hosted two circle meetings, the Funders Circle and the Bay Area Circle to engage LLC folks in working with the survey findings. We began by dividing the meeting participants into 4 groups that were each given a context and set of desired community health outcomes that would be achieved through some form of leadership support. Then each group was given a different budget to work with covering the full spectrum from $10,000 - $100,000. One group was given unlimited funding. What happened was pretty interesting. The $10,000 and $100,000 groups came up with remarkably similar designs (wow!) and the group with unlimited funds was unable to come to any agreement at all!

The Black Box: In the group exercises the $10,000 and $100,000 designs were heavily participant driven and more focused on process than curriculum, acknowledging that if participants of their leadership programs had resources they could access for training they felt they needed. Trainings according to the surveys are the most costly part of programs across the board and a program component that respondents felt contributed strongly to program outcomes. We know little about the specific training/curriculum approaches of most leadership programs. This could be a rich area for exchange, learning and cost savings since this is where most of leadership resources are going. Do we really know the value of our trainings or alternative design approaches? We would like to invite leadership programs in the LLC to begin uploading and sharing the content of the programs so that we can better explore the “black box” of leadership development.