Executive Summary
The best-performing companies invest 1 to 2 percent of total revenue, not their HR budget, into leadership, culture, and people development.
Most companies spend a fraction of that and pay for it slowly: lost productivity, six-figure turnover, and high performers who stall. This article shows what 1 percent actually buys, what the gap is already costing you, and why the question is a strategy question, not a budget one.
The smartest business leaders are investing in their people. Here is why it pays off.
You invest in product, marketing, sales, and infrastructure.
When was the last time you invested in your people with the same intentionality?
We have all read the line that “people are our greatest asset.” Most companies still fund leadership development as a workshop or a vague line item under training.
The research and the results point somewhere else. The best companies in the world invest 1 to 2 percent of their annual revenue into leadership, culture, and people development. Not 1 to 2 percent of the HR budget. One to two percent of total revenue.
“I Tried to Hit the 2% Target. It Was Harder Than I Thought.”
Jim Schleckser, CEO of The CEO Project, shared in Inc. Magazine that while the top-performing companies in his network invested around 2 percent of revenue into people development, his own organization struggled to reach it.
Even with full support for education, coaching, and training, “the highest we ever got was 1.25 percent.” Even that made a measurable difference.
At Leaders Rising Network, we see this every day. Companies that develop their people as a business strategy, not a perk, build teams that perform better, stay longer, and lead with confidence.
Culture Is a Strategy
We work with executive teams who have tried everything: off-the-shelf trainings, corporate retreats, internal HR programs. They are still stuck.
High performers are hitting ceilings. They are not growing into leaders. Turnover is costing six figures per hire. Trust is low. Meetings are unproductive. Self-preservation is replacing ownership.
In our GPS Discovery sessions, we hear it directly:
- “We’re moving too slow, or too fast, and burning out.”
- “We don’t have a leadership pipeline we can count on.”
- “Our best people are stretched too thin.”
- “We need to stop random acts of leadership development.”
They do not need another motivational talk. They need a scalable, measurable people development strategy that drives performance and reinforces culture at every level.
The Cost of Doing Nothing
You are already paying the cost. It just does not show up on a budget line: lost productivity, slow execution, high turnover, disengaged teams, missed opportunities.
The cost of inaction
$175K+
One LRN client calculated that a single poor leadership transition cost over $175,000 in less than six months. Not in salary. In productivity loss, rework, and lost talent.
When companies resist investing in leadership and culture, they rarely save money. They lose it more slowly, and more painfully.
So What Happens When You Do Invest?
When organizations put just 1 percent of revenue into leadership and culture, here is what we see:
What the investment returns
In one six-month engagement with a $30M firm, our Next Level Teams solution produced measurable gains in trust, communication, and execution across senior leadership. The CEO told us:
“This gave me margin back in my life. I’m not in every decision anymore. I trust my team, and they trust each other.”
That program cost 0.6 percent of their annual revenue. Not even the 1 percent mark. It still delivered outsized returns.
What 1% Actually Buys You
You do not need a massive budget. You need a measurable plan.
If your company earns $10 million in revenue, 1 percent is $100,000 a year. That could cover:
- A full 12-month Leader Academy for mid-level managers
- Two cycles of Next Level Teams for key teams or departments
- Leader Intensives or executive coaching for your C-suite
- Team-wide GiANT OS access, assessments, and culture dashboards
- Internal Catalyst certification to build leadership into your own DNA
All of it for less than the cost of losing one key team member.
Start With a Strategy
At Leaders Rising Network, we are not asking you to spend more than you can afford. We are asking you to treat people development as a core growth investment, not an afterthought.
The goal is not to check a box. The goal is to equip every leader in your company to lead with confidence, communicate with clarity, and build culture on purpose.
Key Takeaway
1 percent of revenue is a strategy decision, not a budget line. You are already paying the cost of skipping it.
See What 1% Could Unlock in Your Organization
The clearest place to start is an honest read on what your people development is returning today, and where it is leaking.
Next Level Leaders
Accelerate the growth of your emerging leaders.
A high-impact cohort for rising influencers ready to lead with confidence, clarity, and character. Develop the leadership pipeline your future demands.
