It goes with saying that employee development benefits employees, offering greater opportunities to learn new skills. But it also benefits employers. Gallup found that organizations that made a strategic investment in employee development reported 11% greater profitability and were twice as likely to retain employees.
In this article, we take a closer look at what employee development is and why it’s important for both staff and businesses.
What is employee development?
Employee development is the process of honing employees’ existing skills and helping them develop new ones to achieve your organizational goals. Development programs allow employees to learn new technologies, techniques, and approaches, stay up-to-date with industry updates, and strengthen both hard and soft skills relevant to their roles.
Employee development always includes three focus areas:
- Experience: on-the-job experience; for example, job rotations, micro-lessons, stretch tasks
- Exposure: learning through observation; for example, 1-1 meetings, shadowing a co-worker, coaching, mentoring
- Education: structured training; for example, online learning, courses, workshops, conferences
It’s important to note that employee development isn’t just about learning and development (L&D) strategies, mandatory employee training, or yearly reviews. Instead, it’s a holistic approach to training that meets the needs of both employee and employer.
Why is employee development important?
Employee development is an investment of both time and money, so what are the reasons to invest in workforce upskilling? Let’s explore the various ways that employee development benefits staff and employers, and why it’s an important part of any workplace culture.
You can find our top employee development ideas here.
Increases employee satisfaction and retention
As LinkedIn’s Global Talent Trends report shows, employees value development opportunities. They want to progress, enhancing their skills, knowledge, and careers.
Employers sometimes worry that by investing in learning and development, they’re equipping employees with the skills they need to find a better job elsewhere — they pay for the training and another company benefits. However, research suggests the opposite is true.
Employees who don’t have access to consistent development opportunities are two times more likely to leave their employer within a year. If you want to retain your staff, development is the way to go.
Reduce hiring costs
When you take into account the recruitment, interview, and onboarding process, the cost of hiring new or replacement team members is estimated to be 3 to 4 times the value of a new hire’s salary. As training improves staff retention, it eliminates these costs.
Employee development also improves team productivity so you achieve more with the personnel you already have.
Attracts top candidates
86% of professionals would change jobs if a new company offered them more opportunities for professional development. When you’re the one offering quality employee development, you’re on the right side of that statistic.
A strong employee development program benefits your employer brand. It also incorporates the opportunities for career advancement that top talent seek. This means you’ll find it easier to attract talented, eager-to-learn candidates who can make a real difference to your organization.
Improves performance and productivity
According to Gallup, developing employee strengths leads to an 8% to 18% increase in performance. That’s because employees who continuously develop their abilities get better at their jobs, as they acquire the skills needed to take on new responsibilities and complete existing ones more effectively. A comprehensive training program also improves employee engagement, which leads to better productivity and performance.
Whether you’re upskilling your workforce by developing them internally or attracting top candidates thanks to your employee development programs, you’re improving company performance.
Increases business profitability
Employee development is an investment — one on which you get a high return because it helps increase profitability and reduce costs.
We’ve already talked about how employee development can reduce recruitment costs for your organization, but it boosts your bottom line in other ways too. As employees get better at their jobs, they provide an improved service for customers, use resources more efficiently, and become better problem-solvers, decision-makers, and managers. So, for every salary you pay, you can count on improved productivity, efficiency, and efficacy.
Supports business growth
From new technology to fresh approaches, the world of work is constantly changing and evolving. So, your employees need to too.
Employee development keeps your organization ahead of the curve. Deloitte found that organizations with a strong learning culture were:
- 92% more likely to develop novel products and processes
- 52% more productive
- 56% more likely to be the first to market with their products and services
Develop the right skills and knowledge within your organization and you’ll find it easier to grow your business and stay ahead of the competition.
Start focusing on employee development goals
So, how do you make employee development part of your company culture? How do you ensure both employees and your organization reap the benefits of development? The right learning management system (LMS) is the foundation for all great employee development programs. It can support employee training by:
- making online training readily available
- making training relevant and engaging
- helping to track employee progress and completion
- allowing employees to provide feedback on their training and its usefulness
Every organization is different, so it’s important to find an LMS that can be tailored to your employees and your employee development goals. Check out this helpful guide on what you should consider when choosing an LMS for your organization.
