Over the years I have seen a common practice of cutting employee development during difficult economic times. Though this may seem a fiscally good idea, the real costs say otherwise. One significant facture is the cost of turnover. Equally important, an unengaged employee provides poor service, high absenteeism and can slowly destroy a corporate culture. There really is no upside to eliminating developing your human capital.
“A recent survey indicates that 40 per cent of employees who receive poor job training leave their positions within the first year. They cite the lack of skills training and development as the principal reason for moving on.
Consider the cost of turnover. With one fewer worker, your company’s productivity slips. Sales decline. Your current staff members are required to work more hours. Morale may suffer. To find a replacement, you spend time screening and interviewing applicants. Once you hire someone, you need to train that person. The cost of staff turnover adds up. Figures vary, but it can cost as much as $2,500, depending on the position, to replace a frontline employee. That is a hefty price to pay for not training staff.” Excerpt from “EMPLOYEE TRAINING IS WORTH THE INVESTMENT” www.go2HR.ca
Reducing turnover is only one factor there are other motivational and cultural benefits to developing your most valuable resource.
- A competitive edge. If you have dedicated engage employees you are ahead of your competition. They will be the banner for your marketing, service/product delivery and customer service. An organization cannot grow their market share and profits without them.
- Recruiting quality out of the gate. If you have a quality training and development program this will make you attractive to talent out there looking for a “home”. The days of money being the primary motivator are fading away. We have become a society of engagement and this is what the emerging workforce is looking for. Give them a reason to come to your first.
- Retention. This goes without saying. Happy employee stay and are vested in the success of the organization. Keep your talent. You don’t want a situation where they get experience under their belt and go elsewhere.
- Keeping long time employees engaged. People who have been in an organization for a number of years can become complacent and burnt out. Offering opportunities to learn new skills, develop areas of interest and potential for advancement can have a significant impact on continuing their productivity over time.
- Creating balanced workloads. Here is where cross training comes in. Training people within an area or department to cover for coworkers is a valuable tool. This can help reduce burnout, balanced workloads and give you a competitive advantage. If you can provide service without interruption how much could you expand your bottom line?
So what does these mean for you? If you have an employee training and development program excellent. Always look for areas to expand and be flexible with changing work and economic conditions. If you do not, start now. Do research on what is being offered in your industry, talk to colleagues who have had success with this and local human resources associations. Get a clear picture of your needs and where the gaps are. Then work with human resource and training professionals to help you design your human capital investment program. You will be glad you did.
Cynthia Marsh-Croll is a Training & Performance Improvement Specialist as well as former Entrepreneurial Assistance Program Manager at the Orange County Chamber of Commerce. She can be reached at 845-649-2778 or cmc@CrollPS.com.