As originally published by SkilledUp.
No matter what their product or service, companies need people. Investing in the continued professional development of people is beneficial, for both employee morale and for the corporation’s bottom line.
Employee training is, according to Jessica Rohman of Great Places to Work, becoming more of a priority, especially in certain industries. The firm provides leadership coaching and culture consulting services to businesses in 45 countries.
Rohman, senior content producer, says, “Companies can position themselves well by showcasing their opportunities.” Training is also beneficial to the organization, as it can teach them how to attract higher quality employees.
In essence, learning and development is at the core of what high impact performing organizations do, according to Todd Tauber, vice president, Learning & Development Research, Bersin by Deloitte. It leads to higher customer satisfaction, more innovation, lower costs and faster growth.
Making the case
The success of training can be argued via its return on investment. The companies identified in Great Places to Work had 65 percent less voluntary turnover than industry peers. Many factors play into those numbers, but learning and development is one.
Training needs to be a strategic priority for it to be effective. Rohman explains that employees need to feel comfortable taking the time to attend training.
And for many companies, training is an integral part of their strategy. In 2013, according to the presentation, “Redefining Measurement for Continuous Learning” given by Tauber at Bersin’s IMPACT 2014 conference, the average investment was $1,200 per learner — a 15 percent leap over the previous year.
For the past four years, learning and development budgets have been growing. That same presentation by Tauber, for example, estimates total spending on employee training at $150 billion in the U.S. Tech firms lead the way, with an average of $1,847 spent each year per employee.
Take the leap
There should be a firm investment on part of leaders to prioritize training as a place to spend money. Rohman says, “If your organization values its employees, it’s not too much of a leap to see how investing in your employees will make the organization stronger.”
If you look at the organizations who are industry leaders, explains Tracey Maurer, director of new business development at the University of Vermont Center for Leadership and Innovation, it’s not a coincidence that they invest highly in training. Some companies throw more money at marketing, but if they have a well-trained and engaged workforce, they will have more to promote.
The aim of the Center for Learning and Innovation is to help companies bring their people to the next level, through project management, human resources management, and leadership training. The on-campus center works with Vermont-based businesses, like Dealer.com, Green Mountain Coffee, and Fletcher Allen Health Care, as well as Fortune 1000 companies with a strong regional presence — namely IBM — all which have high growth and invest heavily in their workers.
Learning and development programs need to keep pace with shifting corporate goals. The top topic areas for learning and development are supervisory, compliance, and processes and procedures, reports the American Society of Training and Development.
Each year Training Magazine ranks the top 125 organizations for employee development. The mean training budget is almost 6 percent of payroll, while 69 percent link managers’ pay directly to the development of their direct reports.
Increased revenue is another standard goal across many organizations. Investing in employee training to support that goal has paid off for these companies:
- The Cheesecake Factory invests an average of $2000 annually per employee on training. The chain enjoy sales of $1000 per square foot, almost double the restaurant industry average.
- ADP coaches some sales associates on managing virtual teams and time management. Those that participate had an average of 7 percent growth in sales.
Yet corporations realize they are not doing enough. In each region surveyed in Deloitte’s Human Capital Trends index, learning and development was named a top five trend for 2014. Interestingly, in the Nordic countries, it was given the highest priority, ranking as the second most-important capital trend of the year.
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