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.1 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.2 Replacing talent can cost more than retaining the employees you originally had.3 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%.4 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.5 The internal economic detriment could be brutal, for both small and large organisations. 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 programmes which enable employees to learn precise skills or knowledge to improve performance. Development programmes involve a more expansive employee growth plan, for future performance rather than immediate career role improvement.6 Now, more than ever, learning and development are taking top priority, with 27% of organisations preparing for budget increases within development initiatives.7 As new markets emerge, so will new technologies; both having a profound impact on education and development. Recognising new skills and ways of learning will help a company evolve and innovate for the future.8 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 for 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.9
Here are 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 programmes have become so centralised within businesses that it is often used as a competitive advantage when hiring.10 Offering programmes within employment contracts establish an employee’s sense of value within the company, and fosters loyalty and ultimately staff retention. What’s more is that a business with an engaged workforce will achieve a 59% lower staff turnover rate.11
2) Training future leaders
Targeting skills and employees for future leadership will help establish a business for growth and change.12 Acquiring leadership talent can start from the initial acquisition, or Human Resource professionals can select current employees as managerial candidates. Having established leadership development programmes ensures that an organisation is always considering the future organisational 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.13 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.14
4) Increase workplace engagement
Boredom in the workplace can create feelings of dissatisfaction and negative working habits.15 Regular development initiatives can prevent workplace idleness. Having frequent training programmes 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.
Training and 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.16 Assessing the current skills and abilities within the team will enable managers to strategically plan targeted development programmes that consider any potential skills gap. Organisations 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.17 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 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.18 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 2018.19 Driving this, is a surge of industry change, automation, and technological advancements. The modern workplace requires adaptable, critical thinkers that can communicate effectively.
2) Personalise employee development
Previously, training programmes approached workplace development with a “one size fits all” mentality.20 This technique, however, is counteractive to a growing, diversified workplace. Employees need to be analysed and acknowledged in terms of their specific skills, technological fluency, and approach to learning. When developing a programme, 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 2018.21 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), personalised, and offer ongoing support.22
4) Create a strategic development plan
According to Forbes, 82% of middle-skills jobs need digital abilities, and over seven million job opportunities require a level of coding skills.23 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,?24 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.25
Gallup estimated that employee replacement costs can be 150% of the workers annual salary, or more.
Regardless of whether a company has existing and functioning training programmes, development will not be effective if the work environment does not accommodate learning. Organisations need to support a culture of constant development, and the internal business systems need to mirror this too.26 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; organisations 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’.27 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 programmes speak about the shift towards empowerment – a transformative quality within workers and leaders. Companies that design for growth and development will actively practise it too. The benefits and value of training and development act like 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. Organisations within this complex, diversified working world will need to understand that human capital is the most valuable asset.
- 1 (2017). ‘State of the Global Workforce’. Retrieved from Gallup.
- 2 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 3 Craig, W. (Aug, 2018). ‘8 Ways to successfully develop employees year-round’. Retrieved from Forbes.
- 4 Rigoni, B & Nelson, B. (Aug, 2016). ‘Many millennials are job hoppers – but not all’. Retrieved from Gallup.
- 5 Rigoni, B & Nelson, B. (Aug, 2016). ‘Many millennials are job hoppers – but not all’. Retrieved from Gallup.
- 6 (2018). ‘What is employee training and development?’. Retrieved from Allencomm.
- 7 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 8 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 9 (2017). ‘State of the Global Workforce’. Retrieved from Gallup.
- 10 Bashin, H. (Mar, 2018). ‘5 Reasons employee development is important to your company’. Retrieved from Marketing91.
- 11 (2017). ‘State of the Global Workforce’. Retrieved from Gallup.
- 12 Bishop, C. (Sep, 2018). ‘Seven learning and development trends to adopt in 2019’. Retrieved from Forbes.
- 13 Lee, A, Willis, S & Tian, A. (Oct, 2018). ‘When empowering employees works, and when it doesn’t’. Retrieved from Harvard Business Review.
- 14 Folkman, J. (Mar, 2017). ‘The 6 key secrets to increasing empowerment in your team’. Retrieved from Forbes.
- 15 Bashin, H. (Mar, 2018). ‘5 Reasons employee development is important to your company’. Retrieved from Marketing91.
- 16 Taulli, T. (Jun, 2018). ‘How to create an effective company training program’. Retrieved from Forbes.
- 17 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 18 (2017). ‘2017 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 19 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 20 Bishop, C. (Sep, 2018). ‘Seven learning and development trends to adopt in 2019’. Retrieved from Forbes.
- 21 (2018). ‘2018 Workplace Learning Report’. Retrieved from Linkedin Learning.
- 22 Bishop, C. (Sep, 2018). ‘Seven learning and development trends to adopt in 2019’. Retrieved from Forbes.
- 23 Taulli, T. (Jun, 2018). ‘How to create an effective company training program’. Retrieved from Forbes.
- 24 Taulli, T. (Jun, 2018). ‘How to create an effective company training program’. Retrieved from Forbes.
- 25 (Dec, 2017). ‘7 Steps for creating an employee development plan’. Retrieved from Getsling.
- 26 Carucci, R. (Oct, 2018). ‘When companies should invest in training their employees – and when they shouldn’t’. Retrieved from Harvard Business Review.
- 27 (2018). ‘The rise of the social enterprise – 2018 Deloitte Global Human Capital Trends’. Retrieved from Deloitte.