Why should you invest in employee development? Think about it like this:
Imagine you have two friendships: in one, your friend frequently checks in with you to see how you’re feeling, provides help and support, and even introduces you to new people and ideas when possible.
In the second relationship, your friend comes to you only when they need help. When you communicate something you’re struggling with, they quickly change the subject. Your conversations feel stagnant, always circling the same few topics.
Which friendship would make you feel more connected and loyal? Where would you prefer to invest your time?
People are appreciating assets. Whether in our personal or professional lives, the more we give to those around us the more we receive. When organizations invest in employee development, they see benefits that significantly impact the bottom line.
In this article, I’ll share 6 big reasons to invest in employee development and ways you can do so. Let’s dive in.
What is Employee Development?
Employee development is a process in which time, resources, and energy are invested in an employee’s personal and professional development. It’s meant to help the employee learn new skills, make strategic decisions to streamline their career path, and take steps to improve in a variety of ways.
Employee development initiatives typically include things like:
- Training programs
- Employee performance assessments
- Activities pertaining to company culture
- Day-to-day KPIs
- Soft skills development
- Technical skills development
- Leadership development (where applicable)
Successful career development initiatives are generally implemented by the human resources team and supervised by the individual’s manager or leader.
6 Reasons To Invest In Your Employee’s Development
Truly, there are countless reasons why talent development efforts lead to success. Nurturing great employees by presenting them with learning opportunities yields a multitude of benefits that extend across your work environment.
But let’s take a look at a few of the most powerful reasons to invest in employee development:
1. Increases Proficiency
Perhaps the most obvious benefit of employee development is that it has the potential to turn good employees into great employees. In helping people become better at their jobs, you instantly improve the company’s bottom line by enhancing the success of the initiatives that the employee touches.
In her “Inbound Bold Talk” entitled “Radical Candor”, Kim Scott recounts the time that Google offered to pay for her to work with a speech coach. As a result, Scott’s career path took a new turn, and her efforts for Google became even more successful.
2. Creates a Talent Pipeline
Employee development future-proofs your business by creating a talent pipeline to see you through the succession process. When the time comes for your senior leadership to retire or move on, having invested in an employee development plan will enable you to have a roster of existing talent to pull from.
External new hires are 61% more likely to be fired from their jobs than internally promoted candidates, and they also cost 18 to 20% more to attract. Investing in internal talent development opportunities makes the succession planning process easier and more cost-effective.
3. Enhances Your Employer Value Proposition
Why should job seekers choose your company as their next place of employment? A recent LinkedIn survey indicated that for active candidates, the number one factor motivating them to switch jobs was the potential of improving their career opportunities.
Employee development programs demonstrate your company’s commitment to nurturing talent and taking team members where they want to go. This makes learning an essential part of your employer brand proposition, or what you offer to your people as an employer.
4. Turbocharges Onboarding
The employee development process doesn’t need to wait until a new hire becomes a veteran team member. The process can start as early as onboarding.
New employees need plenty of information on your company culture, day-to-day priorities, and how they can succeed in their new role.
Onboarding presents a perfect opportunity to jumpstart the mentoring process and make connections between new and existing employees to develop both the soft skills and technical skills they’ll need on the job.
5. Improves Employee Retention
The fact is that top talent simply won’t stick around if there isn’t room to grow and progress on their career path. Employers who offer employee development programs have 34% higher rates of retention than competitors who don’t offer similar programs.
If you want to nurture your great employees and keep them around for years to come, give them the opportunity to grow and help them take the steps to get there.
6. Increases Employee engagement
Similar to the numbers on employee retention, employers who offer employee training programs have 15% better engagement rates. Talent development sparks life into those who are simply coasting, and further motivates those who are eager to develop.
Engaged employees go above and beyond in their job rather than doing the bare minimum. Since they enjoy their work and derive meaning and satisfaction from completing their tasks, their output improves in both quality and efficiency.
Ways to Invest in Employee Development
The question remains: How does a company go about investing in employee development? The options will vary widely based on your organization’s industry and scale. But some common methods include:
Dedicated Development Plans
Begin by sitting down with employees, assessing their current skills, and identifying any gaps. Ask them where they want to go in their career and make a plan to incrementally support them in that journey.
Leadership Development Programs
Leadership development programs provide curricula to enhance the skills of existing leaders and prepare future leaders for success. To find one that’s perfectly suited to your organization, check out our list of the best leadership development programs.
Pair up new hires with veteran employees in their field. Mentorship programs enhance team bonding while encouraging the growth and progression of younger employees. Even better, ensure mentorship is backed up with sponsorship.
Google famously encourages its employees to put 20% of their time towards self-directed learning. This initiative has led to huge innovations like Google News, AdSense, and Gmail.
Budget for Training
If training is a priority for your organization, you’ll need to put your money where your mouth is. Set aside a dedicated budget for courses, books, and other resources so that team members are financially supported in their learning.
One way to ensure that employee training is delivered to the highest standard is to partner with an academic institution such as a University (see Moderna’s efforts below).
Though two departments might have completely different functions, you might be surprised what they have to offer each other when it comes to employee development.
Knowledge sharing across the organization tends to spark new ideas and bring different perspectives to solving problems.
Similarly, putting the systems in place to encourage internal mobility opens up further avenues for personal and career development.
One of the most cost-effective options for employee development is to put on virtual events. Webinars, lunch-and-learns, and online workshops negate the need for travel expenses while offering valuable insight.
Invest in the right tools
There are various tools out there to aid with employee development. One of the most popular is a learning management system (LMS).
These help you create, store learning, and disseminate learning content, create personalized learning plans, and track each team member’s learning progress.
To learn more about which tool is right for your team, check out our articles:
- Best learning management systems for employee training
- Best enterprise performance management systems
Examples of big companies investing in their employee development
Though Google is always top of mind when it comes to employee value proposition and employee development, there are several other organizations that have notably invested in training pursuits.
One such example is biotech giant Moderna, who recently partnered with Carnegie Mellon University (CMU) to deliver an artificial intelligence (AI) curriculum. The program was tailor-made to suit the busy schedules of their workforce, and is accessed via an interactive educational platform. “Moderna University” students have the opportunity to connect with CMU faculty online and in-person while completing the program.
PMP’s Tim Reitsma recently sat down with Moderna University’s Vice President, Noah Rabinowitz, to discuss the learning culture at Moderna. You can listen to the full podcast episode here.
Bottom Line: When Done Right, Investing in Employee Development is a Great Return on Investment
Successful implementation of employee development programs takes time and planning. But, with the right tools and team to execute your strategy, it’s one of very few “wins” that can be almost guaranteed in a business setting.
Investing in your employees is one of the smartest decisions you can make.
For more information on creating a learning development strategy, check out this article:
- How to Create a Learning and Development Strategy in 7 Steps
- Learning And Development: A (Very) Quick Guide
- How To Effectively Develop Managers To Lead Your Organization
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