Employees are a company’s biggest asset, and investing in talent is vital to sustainable business growth and success. Businesses go through lengthy processes to recruit and hire qualified and suitable staff, but often the emphasis on caring about employees stops there. According to a Gallup study, workgroups that engaged in employee development saw a sales increase and profits double compared to workgroups that didn’t engage at all. Dedicated training and development fosters employee engagement, and engagement is critical to your company’s financial performance.
Workgroups that engaged in employee development saw a sales increase and profits double compared to workgroups that didn’t engage at all.
Investing in your staff’s professional development is vital for team retention to the point that 94% of employees would stay at a company longer if it invested in their career development. Replacing talent can cost more than retaining the employees you originally had. A report from Gallup revealed that 38% of the US workforce is powered by millennials, and in 2025 it is estimated to grow to 75%. However the rate of turnover amongst millennials is high – only 50% plan to be with the company one year from now. Gallup estimated that employee replacement costs can be 150% of the worker’s annual salary or more. Caused by a lack of workplace engagement, turnover costs the US economy $30.5 billion a year. The internal economic detriment could be brutal, for both small and large organizations. It’s a costly mistake and one that can be easily mitigated.
As the business landscape becomes increasingly competitive, improving your team’s performance is imperative within evolving markets. Employee development and training is no longer an additional perk reserved for the C-suite, it’s essential for the growth of your business and the workforce that propels it.
What is employee development?
Employee training and development is a term often used interchangeably, across sectors, and encompasses various employee learning practices. More specifically, training involves programs that enable employees to learn precise skills or knowledge to improve performance. Development programs involve a more expansive employee growth plan, for future performance rather than immediate career role improvement. Now, more than ever, learning and development are taking top priority, with 27% of organizations preparing for budget increases within development initiatives. As new markets emerge, so will new technologies; both having a profound impact on education and development. Recognizing new skills and ways of learning will help a company evolve and innovate for the future. Merging contemporary technological platforms with creative learning methods will ensure that teams learn dynamically, through a future-oriented approach.
94% of employees would stay at a company longer if it invested in their career development.
The benefits of training and development in the workplace
The top benefit of driving employee development is to shape a more efficient, competitive, and engaged workforce. Companies that have actively interested and dedicated employees see 41% lower absenteeism rates, and 17% higher productivity.
Here are the reasons why employee training and development is important:
1) Positive employee retention
Hiring and retention can become a major challenge to employers. However, this can be avoided through career development. Training programs have become so centralized within businesses that it is often used as a competitive advantage when hiring. Offering programs within employment contracts establish an employee’s sense of value within the company, and fosters loyalty and ultimately staff retention. What’s more, a business with an engaged workforce will achieve a 59% lower staff turnover rate.
2) Training future leaders
Targeting skills and employees for future leadership will help establish a business for growth and change. Acquiring leadership talent can start from the initial acquisition, or Human Resource professionals can select current employees as managerial candidates. Having established leadership development programs ensures that an organization is always considering future organizational goals by preparing promotable talent.
3) Employee empowerment
Leaders who feel empowered within the workplace will be more effective at influencing employees and gaining their trust. Consequently, those employees will feel a greater sense of autonomy, value, and confidence within their work. Forbes measured empowerment along with employee engagement in data from over 7,000 employees and found that employees who felt a low level of empowerment were rated with engagement in the low rankings of the 24 percentile, compared to those who felt a high level of empowerment and were in the 79th percentile.
4) Increase workplace engagement
Boredom in the workplace can create feelings of dissatisfaction and negative working habits. Regular development initiatives can prevent workplace idleness. Having frequent training programs will also establish regular re-evaluation – of employees, skills, and processes. Training and development will also influence company culture by instilling an emphasis on planning.
Skill development can prompt company analysis and planning; it requires employers to review existing talent and evaluate growth and development opportunities internally, rather than via recruitment. Assessing the current skills and abilities within the team will enable managers to strategically plan targeted development programs that consider any potential skills gap. Organizations also need to consider the rise of digital and online learning in talent development. From the Linkedin Learning survey, 58% of employees prefer opportunities that allow learning at their own pace. The same report revealed that 49% prefer to learn when the point of need occurs – making accessible, independent online learning the most suitable for an increasingly diverse, multi-generational workforce.
How to create a high-impact employee training plan
Companies that immediately engage in employee growth and potential learning opportunities – from the moment that an individual is hired – will greatly impact future employee performance and dedication. The 2017 Workplace Learning report garnered insights from 500 learning and development professionals across Canada and the US and found that 80% of executives believe developing employees is a top priority. The report also found that 90% of executives agree there’s a skills gap in the US workforce – a gap that training and development can greatly bridge.
Here are a few effective strategies for developing workplace talent:
1) Target soft skills
The latest Linkedin Workplace Learning report found that training for soft skills was the number one priority for talent development in 2018. Driving this, is a surge of industry change, automation, and technological advancements. The modern workplace requires adaptable, critical thinkers that can communicate effectively.
2) Personalize employee development
Previously, training programs approached workplace development with a “one size fits all” mentality. This technique, however, is counteractive to a growing, diversified workplace. Employees need to be analyzed and acknowledged in terms of their specific skills, technological fluency, and approach to learning. When developing a program, businesses should think of employees as consumers.
3) Digital learning
Ensuring employees make time for learning was the number one challenge talent development faced in 2018. Employers need to reduce any resistance to learning by engaging talent through the existing platforms they chose to spend their time on. Training should be delivered through multiple platforms, dynamic in its accessibility (mobile and on-demand), personalized, and offer ongoing support.
4) Create a strategic development plan
According to Forbes, 82% of middle-skill jobs need digital abilities, and over seven million job opportunities require a level of coding skills. As the skills gap continues to widen, employers need to take the initiative in teaching and upskilling employees. The steps involved in creating a development plan begin with establishing business goals. Employers and development professionals should ask themselves what business factors and objectives do we hope to impact through training. Leaders also need to decide what skills are needed within the business, again aligning it to the overall objectives. The development plan itself needs to incorporate various stages for effective tracking, that analyses the before, during, and after.
Regardless of whether a company has existing and functioning training programs, the development will not be effective if the work environment does not accommodate learning. Organizations need to support a culture of constant development, and the internal business systems need to mirror this too. Companies and employees also need to be committed to change, and in that sense, committed to addressing problems and the relevant training it may address.
As the workforce grows, changes, and adapts, so will the internal cultures, structures, and processes of businesses. The Deloitte 2018 Global Human Capital Trends report examines how businesses are being evaluated beyond their financial success; organizations are now measured on and being held responsible for their impact on society. The report acknowledges how millennials take up the majority of the workforce, which has initiated the trend of ‘the power of the individual’. A business’ social capital plays a huge part in where this group decides to work, and what they choose to consume and endorse. What this means is that employees now expect more from their employers.
Development programs speak about the shift towards empowerment – a transformative quality within workers and leaders. Companies that design for growth and development will actively practice it too. The benefits and value of skill development act as a domino effect; leaders feel competent and can efficiently influence employee performance; happy and skilled workers create job satisfaction, commitment and thus retention; workforce improvement and engagement impacts the overall profit. Despite the type of training and development, it needs to align with the general trend of future workplace skills, support the company’s business objectives and be delivered in an innovative way that mirrors the digital shift in business. Organizations within this complex, diversified working world will need to understand that human capital is the most valuable asset.