The Importance of Employee Development

Employees are your most important asset—yet employee turnover rates exceeded 17% in the last few years. To keep employees long-term, you need to engage and motivate them.

Research has shown that a lack of learning and development opportunities increases the risk of turnover. Employee development plans help employees learn new skills, which increases engagement and motivation. They also serve as a way to future-proof your workforce.

What is Employee Development?

Employee experience platform Culture Amp defines employee development as “the practice of learning new skills and honing existing ones.”

This investment in skill development encourages employees to continue growing in their roles. Learning new skills also affords employees more career opportunities than staying stagnant.

Why Employee Development is Critical Today

Employee development programs provide a number of benefits for forward-thinking companies:

• Attracts the best talent: Many job seekers are looking for positions that will allow them to grow into a career.
• Improves employee retention: Retention rates improve when companies offer continuing education.
• Improves employee performance: Investing in employee development closes skills gaps that arise when employers expect skills that staff members don’t have.
• Improves company culture: A culture of continuous learning boosts employee engagement and retention.
• Improves compliance and reduces risk: Training in these areas helps companies improve performance while reducing incidents that can harm your business. 

Training vs. Education

Employee development comprises both education and training—and both play a role in skill development. 

Employee education is about broadening an employee's knowledge and skills for long-term growth and future roles. It often encompasses a wider range of theoretical and conceptual learning. 

Employee training is focused on teaching specific skills and knowledge needed for the immediate improvement of job performance. This often involves practical, hands-on learning. 

Employee training helps employees learn new skills they’ll need in their roles—whether that’s a tool, process, or new technology. Training usually takes place on-the-job and over a short period of time, with the goal of quickly implementing what they’ve learned.

Employee education tends to cover topics related to operating within the context of a business, such as communication and collaboration skills. The goal is to foster long-term intellectual and personal growth, preparing employees for future roles and responsibilities.

Because employee education covers more concepts, theories, and principles, it tends to be more structured. It’s often delivered through methods like degrees, certifications, workshops, seminars, and continuing education courses.

Designing a Strong Employee Development Program

Designing a strong employee development program requires several steps and starts with getting employee feedback. Open communication with staff helps you assess what they need from a training program. That feedback can inform the objectives this program achieves for employees and your company.

Next, you’ll need to consider your budget. Research from Gallup shows that it can cost double an existing employee’s salary to replace them. This highlights how much more cost-effective it is to invest in employees’ growth and development.

Once feedback, budget, and goals are in place, you can now allocate resources to design a program. After launching, regularly assess the program. Ongoing feedback from employees and managers keeps you on task, attaining goals, and maintaining employee satisfaction.

The best programs understand when employees require training and when they need education. Let’s take a closer look at some of the key goals of designing an employee development program.

Goal #1: Closing the Skills Gap

There are many examples of skills gaps in the workplace today. A 2022 survey showed that the most common skills gaps include:

• Critical thinking and problem-solving abilities, which are necessary at every level. For example, a customer service rep needs to know how to help a customer with an unexpected problem or a complicated challenge.
• Leadership skills like management and supervision for career development. One example is understanding how to provide recognition and correction to staff in an encouraging and sensitive way.
• Communication and interpersonal skills are useful when employees disagree and leaders must diffuse the incident in a way that is respectful to everyone involved.

Before you can design programs to close these skills gaps, you need to first measure employees’ skills in these areas. You can use tools like 360 reviews, emotional intelligence (EQ) assessments, and performance reviews to uncover how employees are performing in each of these areas.

Communication, leadership, critical thinking, and problem-solving skills are all great examples of when employees need education, as they each take time to develop.

Goal #2: Reskilling and Upskilling

The modern marketplace requires a reskilling revolution. AI and technology are rapidly advancing. New hires and tenured employees need to keep up with the ever-changing demands if they want to stay in their field long term. 

To address these issues, you’ll need to educate or train employees and new hires. There are two main approaches. Reskilling helps employees when their roles change, like a promotion or a transition into leadership. Upskilling improves an employee’s competency in their current job, examples of which can include new technology training or improving soft skills.

Developing a plan requires you to evaluate needs and create a strategy to address them. You must then execute against the development plan. Finally, you’ll need to reassess over time to refine the plan to benefit future employees. Reskilling and upskilling lead to significant benefits, including increased employee motivation and retention.

Goal #3: Succession Planning

Succession planning involves identifying and developing internal personnel with the potential to fill key leadership positions within the company. Effective employee development programs are integral to this process.

Development programs can help identify employees with the potential to take on leadership roles. By observing their progress in training and development, companies can pinpoint those who exhibit leadership qualities and readiness for more significant responsibilities.

Succession planning requires a thorough understanding of the skills and competencies needed for future leadership roles. HR teams create development programs to bridge these gaps, ensuring that potential successors are well-prepared for their future roles.

A well-developed succession plan ensures that there are no disruptions when key positions become vacant. By having trained and prepared successors, companies can ensure a smooth transition and continuity in leadership.

Employee Development Programs Future-Proof Your Workforce

Employee development programs are critical for much more than employee retention. With careful planning and execution, these systems save you money, attract new talent, and build your reputation. A corporate culture that embraces continuous learning for its staff will stay light years ahead of its competition.