Most businesses don’t plan to have a leadership problem, but many end up with one. People get promoted into roles they aren’t prepared for. Managers struggle to engage their teams. Succession plans stay hypothetical. And the result is a quiet crisis that eats away at performance from the inside out.
It’s called the leadership gap, and it’s costing you more than you think.
If you’re feeling growing pains, struggling with retention, or sensing tension in your team culture, chances are the real issue is upstream. You don’t just have a staffing challenge. You have a leadership pipeline problem.
Let’s look at what the research actually says and why now is the time to invest in developing your managers.
Leadership Is the Lever That Moves Everything
According to Gallup, managers account for 70% of the variance in team engagement. That means most of what determines how productive, loyal, and motivated your people are… comes down to one thing: who’s leading them.
And yet, leadership development often gets pushed to the back burner.
- 83% of organizations say it’s important to develop leaders at all levels, but only 5% have actually implemented development at scale.
— Brandon Hall Group - Only 35% of companies have a formalized succession plan in place.
— SHRM
That’s not just a missed opportunity, it’s a business risk.
Poor Leadership Costs More Than You Think
When managers aren’t equipped to lead, it doesn’t just affect their own performance. It affects everyone they manage.
The cost of poor leadership includes:
- Turnover: Employees don’t quit jobs, they quit managers.
- Low engagement: Disengaged teams are less productive and more prone to errors.
- Culture erosion: Inconsistent leadership creates confusion and conflict.
- Lost opportunity: Managers bogged down in fire-fighting can’t coach or innovate.
And here’s the kicker…
Companies spend more time recruiting for leadership than developing it from within, which is both more expensive and less effective long-term.
Early Development Has a Compound Effect
The best time to develop a leader isn’t when they’re promoted. It’s before they are.
Investing in your future managers while they’re still individual contributors creates:
- Stronger internal pipelines (less scrambling to backfill leadership roles)
- More confident transitions into leadership
- Greater loyalty from employees who see a path forward in your organization
Research from DDI’s Global Leadership Forecast found that companies with strong leadership pipelines are 4.2x more likely to outperform competitors financially.
Companies that Build from Within Win
Organizations like Amazon, Microsoft, and Marriott all have structured leadership development programs — and not just at the executive level. They invest early, often, and intentionally. Why? Because they know the ROI of building leaders from the ground up.
You don’t have to build a billion-dollar L&D program to follow that model. Even simple, role-specific leadership training can have a ripple effect across your business, especially when it’s embedded into your culture and systems.
Closing the Gap Starts with One Step
You don’t need a fancy title to be a leader. But you do need skills.
And if your future leaders aren’t building those skills today, you’re going to feel it tomorrow — in turnover, missed deadlines, and declining performance.
The good news? This is a solvable problem. With the right training, coaching, and development tracks, your managers can go from overwhelmed to effective. And your teams? They’ll feel the difference.
Don’t Wait for a Crisis to Invest in Leadership Development
Strong leadership doesn’t just show up when you need it, it’s built ahead of time. The longer you wait to invest in your managers, the greater the risk. But when you start now, you don’t just close the leadership gap, you’re preparing your organization to grow and thrive in the future.
Because when leadership grows, so does your business.
If you’re ready to start investing in your leadership pipeline, our comprehensive platform and courses are ready for you. Get started here.
