Journal: People Science - Human Capital Management & Leadership in the public sector Volume 1, Issue 2 Spring/Summer 2014 | Page 28

Jack J. Phillips

Measuring ROI
in Leadership Developement
Is it Possible? • Is it Necessary?

Introduction
As we are involved in measuring leadership development
in public sector, two questions quickly surface: Can you
really measure the return on investment (ROI)? Should
you measure ROI? The answer to the first is “yes,” and
the second is “maybe.” You certainly can measure the
ROI of leadership development if there is a need and it is
appropriate to do so. On the second question, it depends
if ROI is really needed. Figure 1 presents the possible levels
of evaluation. The vast majority of leadership development
should not be measured at the ROI level. We suggest
about half of leadership development measures should be
measured at Level 3, application, maybe only 10% at Level
4, business impact, and at most 5% at Level 5, ROI.
The ROI should be reserved for programs that are

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expensive and are designed to deliver business value. In
the government setting, there are many opportunities for
business value. In every work unit, there is output, quality,
cost, and time measures that define the performance of
the work unit. For example, in the work of processing visas
for international travelers coming to the United States,
the visa section has output (number of visas processed),
quality (the number of errors made on visas), time (the time
it takes to process a visa), and cost (the unit cost of a visa).
A leadership development program for the leader of that
unit should connect to, and improve, one or more of those
measurement categories, which are all business measures.
The difference in the private sector and public sector is that
the public sector does not have revenues or profits, the two
types of output measures.

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