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  • Writer's pictureRukiya Robinson

Why Leadership Training and Development is Risk Management

Recently, news and social media outlets were flooded with headlines about an advertising and branding agency whose brand was literally tarnished in a matter of hours. As a consultant, I was intrigued by the buzz around this. I decided to research and learn more. I learned that dialogue that occurred in a company meeting resulted in local and national news coverage for this agency. 

How could such an experienced agency whose core expertise is to enhance the brands of other organizations do a 180-degree plummet in a matter of hours? From the reports, it was because of a misstep of the founder. As a result, it cost the company several big-name clients. One misstep and just like that - it’s time for damage control. 

This is a risk. 

It takes years to build a roster of high-profile clients that trust your organization with their brand. So, how could such a revered agency with skin in the game, producing high-quality products and services for decades, have trusted relationships in the industry, lose several big-name clients in a matter of 24 hours? 

When I learned of this story, I was disheartened. I thought to myself, it would have been cheaper to invest in leadership training, development and coaching. But unfortunately, in my profession, I have seen this many times over - leaders assassinating business relationships with their words. Leaders speaking without being attuned. Organizations being reactive in situations that were avoidable. 

Losing clients and employees happens every now and then. That’s business. Losing several big name clients in a matter of hours is a problem. That is a Human Capital Management and a Risk Management problem. 

How can companies mitigate exposure to risk? Part of this includes companies being proactive by investing in Leadership Training, Development and Executive Coaching. This is part of risk management and should be included in the budget.

It’s not enough for a leader to have the strategy and technical skills today. Businesses are composed of people. Businesses do business with people and need their people. Businesses need the business of other businesses to generate revenue and profits.  

Do you see the connection? People need people. Therefore, leaders must know how to relate to people. 

Unfortunately, the leader didn’t possess the emotional intelligence needed to prevent this unfavorable outcome. The lack of this critical skill exposed this organization to risk. The business landscape is in a volatile climate and leaders must be sensitive to the needs of their teams. Leaders should not assume that their biases are shared with their teams, peers, and business partners. Most times people aren’t aware of their biases.  

This was not a question of the leader’s industry competency or technical skills. But there’s a distinction and strong technical skills don’t equate to strong leadership skills. 

According to the news reports, the leader released a statement of regret and apology. Likewise, the company also released a statement separating themselves from the leader’s ideals. While this is admirable, it was avoidable.  

Boards, Leaders, and Executive teams must consider the risks if their teams are not trained. Organizations should not assume that their leaders are resonant and prepared to lead regardless of the length of tenure and strength of their technical skills. The risks that the organization was exposed to created challenges that include:

  • Loss of clients

  • Loss of revenue

  • Leadership turnover

  • Disrupted business operations

  • Accelerated succession planning and execution

  • Temporarily tarnished brand and PR strategy to restore trust and confidence

Risk can be mitigated by taking into consideration that the lack of developed leaders is a risk. Organizations can’t afford not to invest in their leader’s training, development and getting them an experienced executive coach. The risks are too great. This must be a proactive effort and part of the company culture. 

Each has their benefits but together, the ROI on leadership training, development, and executive coaching are transforming.  Developed leaders are impactful, empowered leaders and empower their team to produce desired results for the clients. 

This was a hard lesson for this organization. Lessons can be good when they are learned from. They appear to have pivoted quickly and released their plan which includes employee training.  

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