Introduction
The budget draining impact of ineffective employee development
Companies spend upwards of $145 billion USD every year on employee training, yet less than 50% of these programs pay off in any measurable way, according to Gartner/CEB. As competition for talent heats up, and uncertain economic factors increase pressure to tighten budgets, organizations can’t afford to maintain the status quo. Sparse, impersonal, and ineffective talent development are draining budgets while doing little to help engage or retain your most valuable asset: your talent.
Meanwhile, the Skills Gap is Getting Worse
Despite HR’s best intentions, ineffective L&D does nothing to shrink the skills gap that seems to be pervading every company. Eighty-seven percent of organizations are either facing a current skills gap or expect gaps to develop within the next five years. Recruiting fresh talent isn’t the answer either — 20% of new hires turnover within their first 45 days. Not to mention, research says it takes a new hire one to two years to achieve the productivity level of an existing employee. Closing the talent gap, keeping your workforce engaged and productive, and maximizing L&D ROI demands a strategic approach. L&D that is tailored to your employee’s personal goals and business outcomes helps you retain, engage, and enhance your current workforce. And if you need a compelling number to convince your executive team, here you go: the average cost of upskilling an existing employee is just one-third of recruiting a new one ($1,300 vs. $4,425).
Quantifying the impact of strategic L&D
The need for a better approach to employee training and development is clear. It’s the key to unlocking a broad range of interconnected benefits. Combined, these benefits culminate in a more engaged, committed, motivated, and skilled workforce that is equipped to achieve optimal business results. Here are just some of the ways strategic L&D pays off:
Develop employee skills and close skill gaps
Employee development led by subject-matter experts and verified mentors, coaches, and trainers empower workers to expand their skill sets and increase their performance. Ninety percent of employees say training and development programs increased their job performance. At the same time, developing the skills your organization needs to compete and innovate in-house helps shrink the skills gap, fast.
Attract, retain, and develop talent over the long term
Workers rank “opportunities for L&D” among the top criteria for joining an organization — and it’s a powerful retention tool. Ninety-four percent of employees say they would stay longer at an organization if it invested in their development. Not only does personalized and targeted L&D promote employees’ individual career goals, it fosters greater alignment between employee growth and strategic business goals.
Deliver business outcomes
The difference between conventional L&D and strategic L&D is alignment with business goals. A strategic approach to employee growth and development is developed alongside business objectives so that employee learning is measurable and supports business KPIs. As a result, HR leaders can confidently prove ROI and quantify the impact of L&D on the bottom line. Boost productivity and profitability When L&D is effective, it has a significant impact on employee productivity. Virtually all HR leaders (90%) say L&D has an uplifting effect on productivity. And, with greater productivity comes better business performance. Companies that invest at least $1,500 per employee for L&D report earning 24% more profit than those that invest less.
Foster a culture of learning and motivation
Employees in a growth mindset are 34% more likely to feel a strong sense of ownership and commitment to the company. Plus, knowing that one’s company cares about their individual growth strengthens culture and morale. Opportunities to learn and grow is the No. 1 factor that employees say defines an exceptional work environment, while 75% of employees say meaningful L&D increases their engagement and satisfaction at work.
Why conventional L&D tools fall short
A strategic approach to L&D is anchored by a customizable, data-driven, and expert-led employee development platform. With the right solution, organizations of all sizes and industries can run personalized, measurable, outcomes-driven employee development that addresses individual goals and enhances business value. On the other hand, L&D technologies that are not designed with individual learners or business goals in mind will result in wasted time, resources, and potential. Unfortunately, most existing L&D technologies, such as LMS tools, are not equipped to drive strategic employee training and development. Their most common pitfalls include:
- Impersonal matching between trainers and employees
Instead of matching trainers and learners based on subject domain relevancy or expertise, conventional L&D platforms rely on generic information, such as demographics or preferences for a man or woman trainer. As a result of this disconnect, trainers are unable to meet individual employees’ unique needs or help them develop the specific skills they want to build. Even worse, employees begin to view L&D as a burden and a waste of their time. - Lack of structure and focus
Most L&D platforms rely on an “all you can eat” model, in which mentors and trainers attempt to address as many subjects, skills, and challenges as possible during sessions. Instead of allowing employees to focus on developing one key skill — and actually making progress – their ability to improve is spread thin across too many things. A far more effective approach is a focused sprint-based model, in which mentoring, coaching, or training sessions are boiled down to one or two core goals. This drives greater efficiency, quicker progress, and faster time-to-value. Plus, it makes L&D success far easier to measure. - Inability to accurately quantify growth
Like any business domain, HR is expected to demonstrate a return on its investments and prove how L&D initiatives enhance business performance. Yet most conventional approaches to L&D are not designed to be measured. Any quantifiable metrics hinge on self-reported surveys, which are subjective and unreliable. Instead, strategic L&D is designed to be measured from multiple angles. In addition to self-reported progress, managers also assess learner success. And, to get a high-level view of L&D impact, the platform should easily integrate with other core HR technologies, such as HCM platforms, the HRIS, and employee engagement/ satisfaction surveys.
Stop wasting valuable HR resources on ineffective L&D
The truth is, that investing in ineffective L&D tools is just as detrimental as not having an L&D plan in place at all. The key to maximizing your impact, achieving all of the benefits of effective employee growth and development, and enhancing business performance is adopting a data-driven, strategic L&D platform.
With Growthspace, everything you need for strategic L&D is built in, by design
Growthspace was founded on the belief that successful talent development benefits individuals and drives business outcomes. The platform is designed modularly and supports fully customizable, multi-experience programs including one-on-one sessions with external experts, internal mentoring, and a variety of group workshops and experiences. Leveraging the world’s most robust talent development dataset and network of global experts, Growthspace helps employees and organizations drive successful professional growth, at scale. Stop settling for the status quo. Growthspace is here to help you overcome today’s workforce woes. Want to learn more? Get in touch today.
About Growthspace
Successful employee development not only improves individual and team performance but drives overall organizational growth. The Growthspace employee development platform is designed to support personalized and outcome-driven growth and development programs, including one-on-one development, team coaching, workshops, and internal mentoring. Leveraging the world’s most robust talent development dataset and network of global experts, Growthspace works with organizations to achieve successful professional growth and performance, at scale. Hundreds of customers currently realize the benefits of the Growthspace platform, including Siemens, Microsoft, EY, Johnson & Johnson, Zoominfo, BioVectra, and several United States Government agencies.
