Every year, organisations around the world spend somewhere between $60 billion and $100 billion on leadership development.
And, every year, the results fall well short of expectations because every year, the same cycle repeats: programmes are designed, leaders attend them, and organisations wait — hopefully — for the change to materialise.
But, talking to CEOs around the world, it rarely does.
After two decades advising executive teams across industries and continents, I’ve reached a conclusion that is uncomfortable but increasingly difficult to ignore: the vast majority of leadership development doesn’t fail because of poor content, insufficient investment, or the wrong facilitators. It fails because of a set of unexamined assumptions about how human beings, leaders in this case, actually learn and change, and because of where the learning happens, which is almost never where it needs to take root.
This matters at any time. But, in the context of the organisational need to drive innovation-led growth, it has now become a strategic crisis.
The Evidence Is Damning
In my opinion, the numbers should be forcing a fundamental rethink. Jami Dix and Morgan Miller, writing in the Chapman & Co. Leadership Institute’s People and Performance Playbook, frame the problem with a rare directness I really like: “Leadership development isn’t failing because we’re teaching the wrong skills. It’s failing because we’re only teaching skills.”
That observation lands because it’s both accurate and at the same time, unsettling. Organisations are not getting poor value from good investments. They are making structurally flawed investments and wondering why the returns don’t come.
Meanwhile, the data on innovation tells its own uncomfortable story. Eighty-four percent of executives consider innovation critical to their organisation’s future. But, only six percent express satisfaction with their innovation results. That gap isn’t a strategy problem, or a budget problem. It’s a leadership capability problem — and conventional development approaches are not built to close it.
McKinsey’s research on scaling leadership capability makes a compelling case for systematic approaches to leadership development. But I think even that framing misses a critical dimension: you cannot build the leadership capability that innovation-led growth requires through the same methods used to build operational management capability. The behaviours are different. The psychological demands are different. And therefore the learning environment needs to be fundamentally different.
The Hollow Doll Problem
Dix and Miller use a vivid image to describe what most organisations are actually building: a Russian nesting doll that looks complete from the outside but is hollow within. They identify three layers that genuine leadership development must address — skillset, mindset, and heartset — and observe that most programmes go no deeper than the outermost shell.
The skills layer is where almost all investment lands. Communication techniques, delegation frameworks, feedback models etc. These are taught in workshops, reinforced in coaching sessions, and measured in 360 assessments. Just to be clear, leaders need skills, they matter. But skills training without the underlying layers produces what Dix and Miller aptly call compliance rather than commitment. Leaders perform behaviours without personal connection to why those behaviours matter.
The mindset layer — how leaders think about their role, their people, and the purpose of their work — is the bridge between who someone is and what they do. Without critical mindset shifts (from seeing employees as resources to recognising them as people someone else deeply cares about; from believing leaders must have all the answers to understanding that listening is itself a form of leadership), the skills layer sits on unstable foundations. And, under pressure, it collapses.
Then, beneath both sits heartset: the personal values, the things a leader genuinely cares about, the internal compass that determines whether new behaviours feel authentic or performative. Dix and Miller are blunt about this: “You can’t train someone into caring. You can’t workshop your way to inspiration. And you definitely can’t mandate pride.”
When organisations ask why their people lack ownership, or initiative — and this is one of the most common complaints I hear from leadership teams — they are identifying a heartset problem while pursuing a skillset solution. The mismatch is fundamental.
The Neuroscience of Why Training Doesn’t Stick
Theresa Carik, Ph.D., also writing for Chapman & Co., provides the scientific architecture that explains exactly why this happens which is fascinating. Her argument is as clear as it is damning: “A lot of leadership training fails because it confuses inspiration with implementation. It gives people a message, maybe even a memorable one, but stops short of helping them translate that message into action. A compelling story or a well-crafted quote can generate real motivation in the room. But motivation is not behaviour, and the room is not where leadership actually happens.”
This is not a metaphor. It is neuroscience. Carik draws on Hebb’s Law — neurons that fire together wire together — to make explicit what learning science has known for decades: habitual behaviour requires repeated activation to become neurologically embedded. A single workshop exposure produces minimal lasting change. Spaced practice and retrieval dramatically improve retention compared to massed learning. One event, however impactful in the moment, is largely forgotten within a week.
Kegan and Lahey’s Immunity to Change framework adds another dimension. Adults don’t resist development because they lack motivation — they resist it because they have competing commitments and unconscious assumptions that actively work against the changes they say they want. Development is not just a learning problem. It’s a psychological one. And training programmes that ignore this architecture are setting both leaders and organisations up for disappointment.
Bandura’s social cognitive theory reinforces the point: meaningful behaviour change requires calibrated feedback to develop both self-efficacy and accurate outcome expectations. Without feedback, people either overestimate their competence or stall through underconfidence. And Kolb’s experiential learning cycle makes clear that learning cannot be completed without concrete experience followed by reflection, conceptualisation, and active experimentation. You cannot move through the cycle without attempting something.
Carik’s conclusion is unsparing: “All of this points to the same conclusion: leadership development fails not because the content is wrong, but because the conditions for learning are wrong.”
I would go further. For executive development in the context of leading for innovation, the conditions for learning are wrong in organisations almost as a structural default.
Why This Becomes a Crisis for Innovation Leadership
Standard leadership development — improving communication, decision-making, delegation — at least operates within an existing cultural logic. Leaders return to familiar contexts and attempt to deploy new techniques in recognisable situations. The failure rate is high, but the failure is quiet.
Leading for innovation is different. It requires behaviours that contradict both our evolutionary wiring and traditional management training. Tolerating ambiguity when organisations have historically rewarded certainty. Modelling vulnerability when career progression has rewarded flawless execution. Allocating resources to uncertain outcomes when governance systems have demanded detailed ROI projections. Creating psychological safety in teams when our brains are neurologically wired to feel potential losses twice as intensely as equivalent gains.
These are not skills that transfer from a workshop to a board meeting. And they are not mindsets that shift through a two-day offsite. They require something more demanding: the kind of heartset alignment, mindset shift, and repeated behavioural practice that the research consistently shows most programmes fail to provide.
Research bears out what this gap costs. The Corporate Executive Board has found that sixty percent of employees have withheld innovative ideas specifically because they feared negative consequences. That is not a training failure. That is a leadership behaviour failure — and it persists precisely because the leaders responsible for creating psychological safety learned about it in a room entirely divorced from the moments in which it actually needs to be demonstrated.
Carik cites the business case bluntly: replacing a leader costs fifty to two hundred percent of annual salary. The hidden cost — the innovation that wasn’t generated, the ideas that weren’t voiced, the problems that persisted — is orders of magnitude larger.
The Translation Gap
What I’ve observed across two decades of working with leadership teams is a structural problem I call the translation gap. Organisations invest in the learning, but they leave the translation entirely to chance. They assume that if leaders understand something clearly enough, they will naturally apply it. Experience tells us — repeatedly, expensively — that this assumption is wrong.
Here is what typically happens. Leaders enter a programme. The content is credible, the energy in the room is genuine, and the intentions are real. People leave with new frameworks and new language. Then the real world returns.
Client pressures. Quarterly targets. Operational demands. Internal politics. The urgency of what was already on the table before the programme existed. And gradually, often within weeks, what felt clear and important fades back into the organisation’s existing patterns. Not because participants lacked commitment. Not because the programme lacked quality. But because the learning happened in one place, and the actual work — the decisions, the conversations, the moments that shape culture — was happening somewhere else entirely.
This is precisely what Carik identifies as the structural flaw in most design. Development that actually changes behaviour, she argues, must connect directly to challenges leaders are facing right now, build in repetition and practice rather than one-time exposure, use feedback to calibrate self-awareness, and leave people with a next step specific enough to use. She draws on implementation intentions research: vague intentions such as “I’ll be a better listener” rarely translate into behavioural change, while specific if-then plans dramatically increase follow-through.
The science is unambiguous. And yet the vast majority of leadership programmes are designed in direct contradiction to it.
A Different Approach: Learning in the Work, Not Before It
There is a fundamentally different way to approach executive and leadership development, particularly for organisations serious about innovation-led growth. Rather than asking leaders to learn and then figure out how to apply what they’ve learned, the more powerful approach brings the learning directly into the work itself.
Not a case study from another industry, transplanted into contexts where the underlying conditions bear little resemblance. Not a hypothetical scenario designed to be instructive but consequence-free. Not a simulation that allows leaders to perform growth without actually growing.
A real business challenge — with all the ambiguity, pressure, competing priorities, and genuine stakes that real work entails — becomes the learning environment itself. The organisation’s own questions become the curriculum. The problems people are already trying to solve become the vehicle through which they develop the capability to lead differently.
This approach directly addresses what the research demands. The content is not just relevant — it is the work itself. Repetition is built in because the challenge unfolds over weeks and months, not days. Feedback is continuous because the environment responds to every decision in real time. Practice happens in conditions that feel psychologically meaningful but are calibrated so that the actual consequences of experimentation remain manageable.
When people are working on something genuinely consequential — something that matters to the organisation, something where the outcome is uncertain, something they care about — they listen differently, question differently, and engage differently. And crucially: the heartset engagement that Dix and Miller identify as the missing layer in most development becomes available, because the work is real and the outcome matters to them personally.
How It Works in Practice
I work with leadership teams to identify specific live challenges — business problems meaningful enough to develop real capability, but not so mission-critical that the perceived risk prevents genuine experimentation. These are the kind of challenges that persist in organisations for years, not for lack of intelligence or intention, but because the usual leadership behaviours don’t solve them.
Small, cross-functional teams are assembled to work on these challenges — typically across a four to six month period. But here is the critical distinction: the primary focus is not on solving the problems, though that often happens and creates genuine commercial value. The focus is on developing the leadership behaviours required to enable teams to solve them.
Throughout this process, leaders must practise — in real time and with real consequences — what leading innovation actually demands. Creating psychological safety by responding to uncertain, early-stage thinking with curiosity rather than immediate judgement. Allocating modest resources and authority without demanding guaranteed returns. Modelling vulnerability by sharing their own uncertainties and past failures. Removing the bureaucratic and structural barriers that habitually prevent people from collaborating across functions. Recognising and celebrating learning from failure, not just outcomes.
The context is authentic. The problems are real. The teams are working within actual organisational constraints. The solutions they develop will be tested in the real world. Leaders experience all the discomfort and uncertainty they would feel in higher-stakes innovation initiatives — but the actual consequences of getting things wrong remain manageable. The perceived risk is high enough to be developmentally meaningful. The actual risk is low enough to permit genuine experimentation.
This is where innovation courage is built. Not in the abstract, but in the moment. Not theoretically, but with real feelings, real friction, and real results.
What Changes
The outcomes I have observed consistently across this approach go beyond the measurable improvements to the specific problems being addressed — though those matter. Teams I have worked with have reduced process inefficiencies by significant margins, identified customer experience improvements that shift satisfaction scores materially, and developed cross-functional collaboration models that scale across the organisation.
But the more significant transformation is what happens to the leaders themselves. Leaders sceptical of “innovation initiatives” witness firsthand — in their own organisation, with their own people, on challenges they recognise as real — that a different way of leading produces different results. And because the experience reaches the heartset and mindset layers that Dix and Miller identify as the missing depth in most programmes, it sticks. The behaviours don’t require effort to sustain because they are now connected to something the leader genuinely values.
This is the difference between compliance and inspiration that Dix and Miller describe. And it is only achievable when development happens where the work happens.
The ripple effects extend outward. Other teams begin requesting similar approaches. Middle managers — the layer that translates executive aspiration into operational reality, and the group that most determines whether culture change succeeds or fails — start adopting facilitation and enabling behaviours they observed modelled at the leadership level. Organisations with strong middle management engagement in innovation are thirty-eight percent more likely to succeed; but that engagement requires leaders who have genuinely changed, not leaders who attended a programme.
The Urgent Question
Carik poses a really interesting question every organisation should take seriously: “What would have to be true for our current approach to produce lasting behaviour change?”
It’s a better question than most leadership development budgets are ever asked to answer. And the honest answer, for the vast majority of programmes currently in use, is that what would have to be true is not true.
The science is clear. Development requires psychological safety, relevance to real work, spaced and repeated practice, calibrated feedback, and concrete application. Adults rarely change because they heard something smart or well-intentioned. Most already know a great deal of what they should do. The challenge is turning that knowledge into behaviour that actually holds under pressure, in real relationships, during real work.
For organisations trying to drive growth through innovation — not innovation theatre, not the language of disruption without the substance, but genuine organisational capability to identify and solve problems that customers value — the inadequacy of conventional leadership development is not peripheral. It is central to why most innovation investments and transformation efforts underperform.
Building the leadership required for innovation-led growth means developing something most programmes do not try to build: the emotional courage to act differently under pressure, in real situations, when the quarter is difficult and the path forward is genuinely uncertain. That is only achievable by putting development where it belongs — inside the work that matters, not alongside it.
The question for every CEO investing in leadership development is not whether their leaders attended the programme. It is whether anything has actually changed in the moments that shape culture: the decision to protect an experiment’s budget, the response to an early-stage idea that sounds incomplete, the willingness to acknowledge uncertainty in front of a team that is looking for certainty.
When learning happens where those moments happen — in real work, on real problems, with real consequence — the answer to that question begins to change.
That is where executive development needs to be.