Employees play a critical role in ensuring the performance of an organization. The choice of these employees should be pegged to their ability to execute the company’s goals and possess the requisite skills and knowledge needed in the place of work. While every organization desires to have a productive employee base, the factor of resources comes into play and affects the composition of the workers in the company. Balancing between the quality of the skills and the resources available is a tall order for most organizations that focus on cutting the cost of operations.
The main question is whether the entry knowledge and skills remain relevant as the business environment changes. The obvious answer is no. The business world is rushing, and relying solely on traditional knowledge might fail to help a company meet its current needs and remain relevant in the future. The entrenchment and appreciation of new technologies such as the Internet of Things, Artificial Intelligence, and others demand employees to refresh their knowledge. This affects all professions and, hence, the need for employee development.
Well put, employee development is defined as improving employee competencies and skills to gain new capabilities to help an organization achieve its objectives. Key points in this definition are that employee development is not just about developing organizational strategies; it’s more than implementing compulsory training and stretches beyond meeting with employees annually to discuss their shortcomings.
Employee development involves understanding the company’s journey and aligning the workers’ competencies with that plan. This article will discuss the benefits of employee development, effective employee development methods, and employee development areas.
Benefits and importance of employee development
Investing in employee development is a deliberate move aimed at positioning a company in the right place to deal with foreseen and unforeseen events. The commitment to invest in employee development is the most assured way to remain in business and avert the challenge of being wiped out of the market. Why? The study by Cappelli (2023) notes that most companies that rely on fixed skills and employee knowledge risk closure. This is because they are met by market uncertainties that existing skills and talents cannot solve.
Performance Improvement
One of the essential aspects of employee development is performance improvement. Business performance, in general, comprises two components: financial and non-financial performance. It is critical to control the two for any business. Interestingly, the quality of the skills in your organization impacts the two components of performance. For example, well-trained employees understand their jobs well and are productive, improving the company’s financial position. In a 2017 report on employee development’s impact on performance, CSO Insights (The research division of Miller Helman Group, 2017) showed how sales manager development can drastically improve performance metrics such as quota attainment, revenue attainment, and win rates. In some cases, investing as little as $500 in employee development yielded 46.1%-win rate improvement, while a $5,000 investment produced 51.4% more wins for the company.
Better handle unexpected situations
Secondly, employee development makes it easier to handle unexpected situations better. Today’s business environment is all about change. This change not only challenges the workforce but also opens up new opportunities that never existed. The workforce needs to handle the change effectively and efficiently, which is only guaranteed by having the skills and knowledge to do that. According to Touati et al. (2024), adaptable employees are good at improvising solutions to some of the challenges within an organization, as opposed to less developed employees who remain solid with the status quo. As noted earlier, the rapid changes in the business world value individuals who can deal with emerging challenges by being creative. As a business transforms through different seasons, having well-developed employees helps it handle challenges and innovate.
Save money by retaining employees.
Employee retention is the deliberate move by an organization to retain productive and talented employees, mitigating employee turnover by creating a positive working environment. Due to increased competition, organizations are scouting for the best talents in the market to help them achieve the needed goals. However, most enterprises find hiring talented employees challenging. Implications include in-house development, which creates a pool of the skills necessary to move the company forward without increasing salary.
AT&T discovered that about 50% of its global 250,000 workforce could not take it forward. This discovery necessitated the management to focus on a re-skilling program to prepare for the future. How did this help the company save money? Working out the math, it was established that the cost of replacing a worker lacking requisite skills would be 21% of that employee’s salary. This cost increased as the base salary of the employee improved with time. As such, retraining the employees was more cost-effective than replacing them. Also, valuable institutional knowledge is preserved through retaining and retraining the existing staff.
Flexibility to expand and compete robustly within the niche
The opening up of the global market through technology has increased visibility and set up companies for competition. Any business aiming to make strides in the international market must appreciate that players have increased their competitive strategies against a market share that has remained static for a while. This understanding makes it paramount to prepare employees to focus their energies on creativity, innovation, and flexibility.
It is high time that an accountant in the office was flexible enough to do data analysis using modern statistical software and be part of the strategic team. The current times are teaching us the need to embrace teamwork and understand, though not entirely, what other professions in your company entail for better decision-making. This underscores the importance of developing skills in emerging areas that relate to the business.
What are the most effective employee development methods?
The previous paragraphs have elaborated on what it means to employ employee development and its benefits to an organization. The next question we should ask ourselves is what methods are appropriate for employees’ development. This question will be partly answered by defining employee development methods, which are thought of as a set of activities that help employees learn new skills, improve existing knowledge, and put their knowledge into practice.
The choice of the development method to adopt depends on the nature of the work an organization is doing. Different tasks require varied skills, and the management should understand their industry to prescribe what is suitable for the employees. Notably, industry direction dictates the development method to be administered. There are different employee development methods, some of which are highlighted below;
- Training. This is the actual teaching of the employee through a defined curriculum to gain skills in a particular area.
- Job rotation. The employees shadow experienced workers in different sections to learn about the company’s operations.
- Coaching. This is whereby an experienced person, called a coach, provides guidance to achieve a professional goal.
- Self-study. This happens by encouraging the employees to register for courses to bolster their knowledge in their areas of specialization.
The choice of method depends on the company since some are more effective than others. Equally, a company can develop a self-developed approach to ensure the employees attain the needed development in their skills and knowledge. The central point is to adopt a method that works best for your company.
What are the employee development areas?
Employee development aims to enhance the company’s performance, improve its image, and handle competition effectively. It is not simply enough to decide that an organization needs employee development. It has to be informed by statistics that point towards the nature of the industry in the future. Therefore, a human resource manager can only recommend something backed by data if these developments make sense for the company.
Due to the increased need to improve business and expand to new territories, some areas are critical for consideration. The interconnected world of business demands that employees be well-trained in soft skills and conflict management. These skills are rarely taught in mainstream careers, but they are elemental in helping settle deals and create avenues for future opportunities. The list below shows the possible areas of consideration in employee development;
- Communication skills. Employees need to learn how to deal with clients and communicate information internally.
- Conflict resolution. Workers’ interactions at work prompt misunderstandings, and they should be able to solve them to enhance productivity.
- Leadership skills. This should be directed at supervisors and managers so that they can manage a diverse workforce.
- Organization skills. A critical competency is ensuring that employees relate to others well and that tasks are completed as planned.
- Creativity and innovation skills. Employees should be encouraged to learn new ways of doing things to prepare for the disruption in the market environment.
Conclusion
The changes in the market environment cannot be ignored, and an organization willing to remain relevant now and in the future should be prepared to change how they do things. This starts internally by constantly reviewing the competencies of its workforce compared to what the market demands, and aligning their skills to future goals. As emerging trends disrupt business operations, management should plan for the best areas for employee development.
