Does your organization bring out the best in its employees? If asked, chances are they’ll answer “no.” A stunning 72 percent of employees feel they need to learn new skills for their current jobs. Just 30 percent feel that employers are “very helpful” in learning new job skills, according to one survey. Of course, businesses lose when employees don’t have skills required to do their jobs. But the problem goes even deeper. A Glassdoor survey found that employees are 71 percent more likely to resign when they don’t feel their skills are being developed. And the cost of replacing just one employee earning $75,000 per year totals more than $40,000, the Society for Human Resource Management reports. It’s no wonder that companies that prioritize comprehensive training programs have been found to enjoy a 24 percent higher profit margin per employee and 218 percent higher income per employee. In this post, we’ll help show you how.
Training: A Short-Term and Long-Term Investment
Agility and adaptability are no longer luxuries for businesses—they’re requirements. We’re living in a time of unprecedented change in the business landscape. About 50 percent of S&P 500 companies are expected to be replaced by 2024, and the average company is expected to spend just 12 years on the S&P 500 by 2027, down from an average of 33 years in 1964, strategy and innovation firm Innosight reports. Disruption has become the rule, not the exception. With technological innovation, mergers and acquisitions, and sociopolitical changes disrupting businesses at a breakneck pace, employee training programs can be a sound investment that yields short- and long-term successes.
Short-Term Benefits of Employee Training Programs
Author and human performance expert Laura Stack notes that not providing the right training is one of the biggest speed bumps in today’s turbulent business environment. In her book Faster Together, Stack writes, “Regular training for you and your teammates is integral to productivity and profitability, so you can face change head-on and wrestle it to the floor.” The short-term benefits are threefold, Stack explains:
- Reach higher. Employee training “boosts your spirits and reassures you that you can achieve levels 0f competency and productivity you may not have realized in the past.”
- Boost efficiency. Employee training reduces errors and allows employees to work with less supervision, allowing your organization to spend less time problem-solving.
- Increase profits. In addition to reducing costs, employee training can improve your bottom line; the Nations Hotel Corporation saw a 221 percent return on investment in a coaching program a few years back, for example.
Sure, training helps employees learn new skills that allow them to perform day-to-day tasks more efficiently. But that’s only the beginning. It also improves morale, increases expectations, and better positions your company to adapt to changing conditions.
Long-Term Benefits of Employee Training Programs
Gallup has found that just 31 percent of employees across the country say they are “truly engaged” at work. And, unsurprisingly, 51 percent of U.S. workers are actively searching for a new job. The cost of turnover and disengagement not only kills company growth—it jeopardizes sustainability. After all, companies with higher rates of employee engagement report 10 percent higher customer service ratings, 22 percent higher profitability, and 21 percent higher productivity. So, how can employee training programs help you get there long-term?
Michael C. Bush, a global expert on high-performance workplaces and the CEO of Great Place to Work for All, the organization behind Fortune’s famed list of the 100 Best Companies to Work For®, explains that “being a workforce known for helping people develop into their best selves” is critical when it comes to attracting and retaining talent. The key to accomplishing that, Bush writes in his book A Great Place to Work For All, is to create opportunities for training and advancement for all employees—not a select few.
“While some organizations have cut learning and development budgets over the years amid recessions or for fear that their trained talent will jump ship, the 100 Best Companies to Work For have increased their commitment to boosting employees’ skills. The average company on the 1998 100 Best list offered employees approximately 35 hours per year of training. That number has grown to more than 58 hours for hourly employees and 65 hours for salaried—a 76 percent increase.”
In the end, top-performing companies invest more in employee training. They’re rewarded with higher levels of engagement, better performance, lower turnover rates, and better employee recruitment.
Laud Learning, Experimentation, and Failure to Spark Innovation
It would be difficult to train employees to be innovative. However, training can be used to foster a workplace culture that’s more conducive to innovation. It’s all about emphasizing learning and experimentation—and accepting that failure is part of the process. After all, research indicates that companies that invest more in employee training see more product and process innovation in return. And it’s sorely needed. Eighty-four percent of executives say that innovation is important to growth strategy—yet just 6 percent are satisfied with their organization’s innovation performance. Your employee training program can help turn the tide.
Training programs for managers in particular are powerful tools to advance innovation. Alan Robinson, an author, educator, and expert on corporate creativity, and Dean Schroeder, an author, educator, and expert on strategic management, argue that few managers know how to harness the knowledge and creativity of those who work for them. Training programs can help managers learn to leverage that creativity to fuel innovation, and to build employee-manager relationships more conducive to innovation. In their book, The Idea-Driven Organization, Robinson and Schroder explain how 80 percent of an organization’s potential for performance lies in ideas that come from frontline workers. Meanwhile, 20 percent of potential organizational growth lies in management-driven initiatives. But this “80/20 Principle” isn’t a natural concept for most managers. “Managers can easily fall into the trap of believing that they know best and that their jobs are to issue orders and make certain those orders are followed,” Robinson and Schroeder write. They outline the importance of managers learning to build a “high-performing idea system” to engage front-line workers in system-wide innovation. Employee training can help accomplish that. Does your organization train and equip managers to create systems that spark innovation at all levels? If not, simply offering resources such as The Idea-Driven Organization is a great place to start
Empower Employees Take Ownership of Training, Offer Options
Believe it or not, an HR Dive survey of 5,000 employees from around the world found that corporate training was their least favorite workplace activity to engage in. Given earlier stats we cited on how important employee training and professional development is to workers, that survey might come as a surprise. But it shouldn’t. Employees are constantly asked to do more with less, and research shows that is a driver of employee burnout. Employee training can be viewed as yet another task to complete. Also, learning styles differ greatly among employees. The HR Dive survey, for example, found that worker opinions of different modes of training, such as classroom instruction or e-learning platforms, differ greatly. Successful training programs must reflect the realities of differing learning styles and cluttered schedules. Otherwise, employees could view them as a burden instead of a benefit. These three employee training pathways can help prevent that:
1. Online learning platforms
As rapidly changing technology creates an ongoing need for employee training, Forbes contributor Kaytie Zimmerman notes that, “Online learning has really become a viable, convenient, and affordable way to expand skills necessary for their job or career.” And microlearning—bite-sized, on-demand training sessions available via online portal—has been found to increase training engagement by 50 percent. It’s also ideal for busy schedules and agile workplaces that require employees to constantly learn new skills.
2. Mentorship and apprenticeship programs
Noted leadership development expert and researcher Henry Mintzberg notes that the transfer of tacit knowledge is a critical component of workplace training. Mintzberg writes in Simply Managing, “Tacit means not easily accessible, which is why the practice has to be learned on the job, through apprenticeship, mentorship, and direct experience. Moreover, much of that kind of knowledge develops in context—the situation at hand—meaning that the learning cannot easily be carried from one managerial job to another, often not even from one function in a particular organization to another, let alone across organizations and industries.” Mentorship can play a critical role in the transfer of tacit knowledge.
3. Books and additional training resources
Books and other employee training resources can be a great resource to introduce employees to new concepts, literacies, and leadership styles. Choosing materials that are timely and help an employee, or a group of employees, address a specific challenge they’re facing can be especially helpful. From promoting cohesiveness to boosting efficiency to improving communication, valuable resources are available on virtually every workplace topic.
Employee training programs face a number of obstacles. The need for ongoing training amid rapid changes in technology is a big one. Busy employee schedules, and differing learning styles, are also big factors. Employee training programs must offer a number of pathways to overcome these challenges.
Driving Company Growth Through Employee Training: The Final Word
Your employee training program is not only critical to your company’s growth—it’s also critical to your company’s sustainability. Leveraging employee training improves performance in the short-term. It also offers the long-term benefits of reducing turnover, bolstering recruitment, and fostering innovation. But, in order to achieve those goals, your employee training program must be flexible. It must offer multiple pathways to meet the diverse needs and learning styles of your employees. That’s the best way to foster the growth of individual employees—and of your company as a whole.