How To Thrive By Boosting Employee DevelopmentOct 05, 2022
"You must manage human capital as wisely as financial capital."
The authors of the influential business book Talent Wins (Ram Charan et al, 2018) argue that talent is a critical business input and businesses should assess and invest in human capital, just as they would financial capital.
A study by McKinsey & Company, suggest that UK companies will need to transition a large part of their workforce into new roles or skill levels over the next decade and without concerted action by employers, two-thirds of the UK workforce could lack basic skills by 2030, while more than ten million people could be underskilled in leadership, communication and decision making.
Pre-COVID-19 research on workforce trends in the UK showed that the demand for occupations such as managers, technology specialists and health professionals could rise by nearly 20 percent by 2030, while the demand for administrative and manual roles could decline just as steeply.
Skills already in shortage, such as those needed in e-commerce, are likely to face higher demand not just in the crisis but over the long term. Moreover, many low-skilled jobs displaced in the crisis may never come back.
So given the scale of the challenge, what is standing in the way of employee development?
Without doubt there is a lack of clarity about the skills gap between current capabilities and those that the company requires, but the bigger barrier, in my view, is a concern about the cost of training and development.
L&D as a cost
With a UK average of 4 training days per employee each year, employee development presents businesses with costs.
A business that views L&D with a cost mindset tends to focus on the numbers rather than the impact of any L&D activity. This can lead to a culture of “use it or lose it” which results in less than optimal L&D investment and makes it difficult for the L&D team to fully demonstrate their value.
As we have all witnessed through the Covid-19 pandemic, L&D has been the first thing to go.
L&D as a value add
If we shift to a mindset that focuses on the value that can be brought by L&D, we start to recognise the importance of developing our employees and their capabilities to take our businesses out of difficulty or up to the next level.
We start to recognise the impact that training and development can have, not only on capability, but on employee engagement, recruitment, organisational design and employee retention.
We start to recognise the impact learning & development professionals have on the performance of our business as a whole.
So how do we move from a cost mindset to understanding the value of L&D?
We start by making a business case for learning and development.