Who Is Responsible for the Professional Development of Your Employees?
In the past, many companies provided professional development (PD) to their employees as part of normal business practices. Large enterprises such as General Electric, Procter & Gamble, and many others wereand in some cases, still arefamous for it. They made it part of their strategy to attract the best and the brightest employees, who look for such a benefit to help them stay at the top of their game.
Smaller companies, on the other hand, find it’s not easy to fund training for their people unless it’s needed to handle the latest equipment or software or tools purchased to keep the company competitive.
Tangible Results from “Soft Skills” Development
Investment in staff professional development makes many business leaders and CEOs uneasy, especially those running small and medium-sized enterprises. When they invest in machines, buildings, or raw materials, for example, the path to making that investment pay off for the business usually is quite clear and well-understood. Typical concerns are:
- People can leave, and if they do, the investment walks out the door with them.
- The return on investment from people development is hard to calculate accurately.
The truth is several key areas directly affected when leadership and related skills are either missing or done poorly. These areas have well-known metrics which can be tracked and linked to training and development outcomes.
Studies show over and over again that the number one reason people leave a company is because of the poor behavior of their direct manager or supervisor behavior. The cost of replacing a salaried employee is estimated to be 6 to 9 months of the employee’s salary. A CAP study found that replacing a $10/hour employee costs $3,328.
For the employees who stay, those who see high turnover tend to disengage and lose productivity. Richard Branson, a successful entrepreneur many times, over has said:
“If your best people aren’t growing in their careers as your business gains traction and expands, they will quickly lose enthusiasm for their work. And before you know it, you’ll be dealing with unsatisfied customers as well as unsatisfied employees.”
Errors, Rework, Cancelled Orders
Company performance as a whole suffers when employees do not have a clear idea of what is expected of them. Ben Horowitz was very frustrated with how little value his program managers contributed to the business. He started with simple training that he did himself and was shocked at the dramatic improvement of his team’s performance.
Some questions to consider:
- How much does a disruptive or domineering supervisor or manager cost your company in terms of employee productivity and turnover?
- What is your turnover rate and the recruitment and hiring costs go with it?
- What is your customer retention rate and the factors that drive it?
For companies of all sizes, investing in development of other skills such as can provide as great a returnor greaterthan traditional capital investment.
Align Professional Development with Company Vision and Goals
To align professional development with the goals of your business, a good time to make the decision of how much to invest in your people’s professional development is during the creation or update of your business strategy. Having staff whose skills and knowledge are largely the same as they were when they joined your company means trying to achieve your vision with people whose skills are not current.
Your vision and goals for the next 3-5 years will be implemented in a world that’s changing every day. Looking at where you are and where you want to go will tell you what role PD needs to play in achieving your strategy.
(Read more about how we can help you establish vision and strategy.)
In today’s world, skills such as leadership, management, sales, teamwork, and communication are becoming a key component of every company’s unique value to their customers. Everyone can buy the same technology, but no two companies can have the same set of employees. With support and training, your employees’ attitude, behaviors, and skills will significantly contribute to setting you apart from your competition.
Why Offer Professional Development to Your Employees?
In her book, Profit at the Bottom of the Ladder: Creating Value by Investing in Your Workforce, author Jody Heymann reports the opposite. Research has found that firms offering training opportunities attract more competent workers who are also more likely to stay with the firm. In addition, the studies conducted by the author showed that companies can substantially profit from providing the least-advantaged workers, not just professional and management level employees, with training opportunities, both general and job-specfic.
The better question to ask is, “What happens if we don’t invest in training our people, and they stay?”
(Read more about our leadership and management development services.)
So, What Is The Next Step for YOU?
Contact us today for a complimentary initial consultation. We have helped large and small companies and nonprofits provide professional development to their employees and significantly improve their outcomes as a result.