Investing in your people - is it really worth it?
Reviewing what resources to invest time and money into for your organisation is an ongoing requirement of business owners and leaders.
Thinking from a commercial standpoint, if people are viewed as a business resource just like IT equipment or machinery required to make and produce a product, you will consider the opportunity cost for investing in that resource and the benefits you expect to get as a result. You will also consider what spec or standard of equipment you want to invest in and will expect a performance output that will match the quality of the product. We can consider an investment in training, coaching and or mentoring on this way.
By offering these development supports to your employees they have an opportunity to develop skills in the workplace but also to develop themselves on a personal level too. The output of coaching and mentoring can result in a mindset shift, a new perspective and new or better habits that can be used in the workplace but also in their own lives outside of work. This creates a rounded level of benefits for the employee and in turn the company and one that can last a lot longer than a one-off task focused training course. How and why is this?
An employee will feel valued when a company invests time and money into training and coaching them, an employee can develop a new level of self-awareness and can feel more engaged in the work they do and can start to see opportunities for themselves both with the company and outside the company.
I appreciate this latter point may strike concern for some people when considering this investment. When you invest in a machine there is no threat they will up and leave and go and work for someone else. You invest in it; you own it, and it stays with you.
If you invest in people, there is a chance that they will decide to move on to another organisation. So, once again, why should you invest in the people in your business? Well, of those companies who have made the investment in their people for professional development *67% of them have cited an increased level of productivity from those same employees. *55% of companies have cited a direct correlation between investing in people to increasing their overall company profits. From this we can ascertain that there is a real return on investment to be achieved when considering investing in people development.
This consideration and these statistics do not remove the threat of employees leaving your business after you have made your investment. It does however increase your chances of retaining these higher performing employees. In like a lot of situations, as individuals we consider it from a “what’s in it for me?” perspective and employees who see their employers investing in them & helping them with their own personal career aspirations are more likely to stay while they feel it is of value to them. This value will be more than the monthly take home salary they receive. It will be the development choices you make as a business leader.
Even if your employee decides to move on - let’s say they are looking for that next step in their career and you do not have the opportunity available at the timing they would like and so although things are amicable you are still losing a good employee that you have invested in. This employee will have added more value to your business for the duration of their employment than from someone who may have stayed a few years longer but operated as a less engaged employee who was just biding their time. Without the investment from you they felt there was no real value to them other than their monthly salary & so never went that extra mile, never really pushed themselves in terms of creativity, problem solving, sharing their knowledge & experience with other employees. This is the difference between the business that invests in their employees and those that consciously chose not to. You are dealing with a different calibre of employee, a different standard of quality. The last couple of years have required a lot of flexibility from people and may have required you and your team to think and operate differently. This flexibility and extra level of input from you and them may be the reason you have been able to stay in business and react to the sudden changes imposed on your business. If you have not invested in your people up to now it may be the correct time to review this and ensure the people who work for you are given every opportunity to stay working with you in their most productive way.
When investing in people development it should be taken as a strategic investment and you should look to the longer-term needs of the business. If a company truly adopts a culture of development you will be able to withstand when a good employee leaves, you will be able to see the value you got from having them on your team and you will be able to see the good advertising it offers your business when they move onto another employer and talk positively of their learning & development experience at your business. This will feed into your employee attraction strategy. Whether an employee stays with you for 1 year, 5 years or 10 years what you really need to ensure is that they give you the best they can give you when they are with you. You may have an employee who is willing to do this irrespective of investment – there are just wired that way. BUT if you are hedging your bets on all or most employees operating this way it may be a case of wishful thinking. If we go back to the simple basis of the employment contract and that it captures the exchange of a service (the employee’s time, knowledge and experience) in exchange for a fee (the employee’s salary). If you want something more, you need to be able to offer something more. Training, coaching and mentoring is a way to do this that offers long term gain for both the business and the individual employee.
So, before you determine whether your business needs to invest in its people ask yourself if you want that higher performing employee or if your business can maintain itself with employees who meet the baseline requirements of productivity. -
* Statistics taken from www.pushfar.com