Why Measuring Talent ROI Has Been So Hard - And Why That’s Changing (CEO Magazine)
Published March, 2026
Dr. Carylynn Kemp Larson examines why investments in people—such as leadership development, well-being, and culture—are often undervalued and vulnerable to budget cuts, despite their significant impact on business performance. She explains that the core challenge is not a lack of value, but a lack of clear, accessible ways to measure that value in terms leaders can use to make confident decisions.
Challenging traditional approaches to ROI, she introduces a more practical and scalable method for estimating impact—one that focuses on measurable shifts in areas like engagement, retention, performance, and well-being. By linking these changes to financial outcomes, organizations can better understand which initiatives deliver the greatest return.
Dr. Larson highlights that the most meaningful gains occur when leadership development influences not just individual performance, but broader organizational outcomes. With clearer ROI data, leaders can make more informed investment decisions, protect high-impact programs during budget constraints, and continuously refine their people strategies over time.
Ultimately, she positions the ability to measure and communicate the impact of people investments as a critical leadership advantage—one that allows organizations to treat these initiatives not as discretionary expenses, but as essential drivers of long-term value and success.
Key Takeaways
People programs are often undervalued—not because they lack impact, but because they lack clear measurement.
Without strong ROI data, even high-impact initiatives can be difficult to justify and are often the first to be cut.Traditional ROI approaches are too complex and rarely used.
Many organizations abandon measurement altogether due to cost, time, and data challenges.Impact can be measured more simply than expected.
By focusing on meaningful shifts—like engagement, retention, and performance—leaders can estimate financial value more efficiently.Leadership development creates the greatest value when it scales.
The biggest returns occur when leadership growth influences teams, decisions, and organizational performance—not just individuals.ROI data transforms decision-making.
With clear impact metrics, leaders can evaluate people investments alongside other business priorities.High-impact programs become easier to protect.
When budgets tighten, data allows organizations to retain the initiatives that deliver the greatest value.Measurement enables continuous improvement.
Tracking outcomes over time helps organizations refine programs and focus on what truly works.Making people investments visible is a leadership advantage.
When impact is clearly communicated, these initiatives move from discretionary spend to strategic priority.
Authored by Carylynn Kemp Larson,