CFOs, Leadership Development, and the Cost of Losing Talent

Source: Forbes.com

Michael Pickrum has written a good article for CFO magazine titled, "The CFO's Role in Leadership Development."   He argues that talent is crucial to achieving an organization's strategic and financial goals, and that the job of leadership development does not rest only with the chief human resource officer.  The CFO can and should play a vital role.  Among other things, Pickrum argues that the CFO can help the organization recognize the value of leadership development efforts.  He writes,

Use data and more holistic analysis to aid better decision-making. What are the costs for contracting or recruiting externally versus upskilling internal high performers? Apply your visionary eye to this analysis. What are those costs over the long-term, given the value of in-house knowledge and retaining those who possess both the expertise and the experience with your organization’s way of working?

In short, Pickrum makes the case that CFOs can help organizations identify and quantify the costs and risks of losing key talent.  What precisely is the damage done by high employee turnover?  What benefits will we acheive if our development efforts improve the retention of highly talented employees?  Many CFOs (and other top executives) question the ROI of leadership development efforts.   Yet, CFOs should do more than ask the question in a theoretical way.  They should help the organization develop an accurate and thorough understanding of the potential benefits of leadership development efforts as well as the risks and costs of NOT investing in leadership development.   The connection between development and retention is crucial, and understanding the true cost of employee turnover is essential.