Law of Diminishing returns in Leadership

When More Becomes Less: The Law of Diminishing Returns in Leadership

Ever felt that despite working harder, staying longer, and being constantly available, your impact as a leader has plateaued- or even declined? That’s not burnout alone. It’s the Law of Diminishing Returns quietly showing up in your leadership.

What Is the Law of Diminishing Returns?

Economically speaking, it's the principle that after a certain point, adding more effort, time, or resources leads to smaller increases in output-and eventually, even decline. Applied to leadership, it’s the moment where over-involvement, overthinking, or over delivering starts to backfire.

A corporate senior executive I coached was known for his relentless drive and deep expertise. He took pride in staying across every detail, attending every meeting, and being the go-to problem solver. His logic? “The more I give, the more we grow.”

Yet, despite all this effort, his team’s performance was stagnating. Decisions slowed down, innovation was absent, and he felt increasingly frustrated. “I don’t get it- I’m doing more than ever, and yet nothing is moving.”

So what was limiting him?

In our coaching conversations, he began to see the blind spot: his value-add had hit a ceiling. His over-functioning was undercutting his team’s growth. People had stopped taking initiative because he would eventually step in. His presence, once empowering, had become overbearing.

His leadership had fallen into the trap of diminishing returns—he was investing more energy but receiving less outcome, and unknowingly stalling the potential of those around him.

This is how It got unpacked through Coaching

Through reflective coaching, he started to:

✅Pause and delegate instead of stepping in

✅Redefine success from control to empowerment

✅Build trust in his team’s abilities

✅Set boundaries for his own involvement

He shifted from being the central hub to being the enabling force behind his team’s autonomy. Within months, the team’s responsiveness grew, ideas flowed more freely, and he reported feeling lighter and more impactful.

Here's What Leaders Need to Be Mindful Of

The Law of Diminishing Returns in leadership often shows up as:

🔹Constant busyness with little strategic impact

🔹Micro-managing masked as diligence

🔹Exhaustion with minimal satisfaction

🔹Team disengagement or dependency

More isn't always better. 

Sometimes, the best thing a leader can do is step-back-to-allow-others-to-step-up.

As a seasoned global Leadership & Executive Coach I helped him see what he couldn't see- the very habits that once fueled his growth but now stifle progress. Coaching created a reflective space to notice patterns, challenge assumptions, and build new leadership muscles rooted in clarity and intentionality.

Are you Ready to Reclaim Your Impact?

If you’re a senior leader sensing diminishing returns despite your best efforts, you don’t have to figure it out alone.

Let’s explore how you can unlock sustainable leadership impact. Write to me at - pritigupta.coach@gmail.com for an exploratory call

My R.A.I.S.E framework helps leaders shift from overdoing to leading with clarity and purpose for sustainable impact.

Success doesn’t come from doing more things right- it comes from doing the right things less often.

-Adapted from Greg McKeown, Essentialism

As an ICF PCC Leadership & Executive Coach with over 1500 hours of coaching experience, I support global leaders to navigate complex change, unlock clarity, and achieve lasting impact. If this blog sparked reflection, imagine what a conversation could do.