Your employees are your business, it is that simple. The people you bring on, train and put into strategic positions throughout the organization are what will make or break your success. From the bottom to the top of the hierarchy, your human capital is your most important capital. This is why it makes so much sense to invest in these people. From sending employees on a leadership career track to business school to simple online seminars or cross-training opportunities, professional development takes many forms. If you are considering an MBA for an employee, keep in mind that there are MBA admissions consultants out there to help you make the right choice.
Employers must start to think of human capital development in terms of ROI. With that in mind, below are some of the ways investing in employees can benefit your company.
A Gallup poll from 2018 indicated that only 34 percent of employees in the United States felt engaged at work, which was broadly reflective of a worldwide crisis of engagement. There are a variety of reasons for this lack of engagement, including feelings of burnout from job creep, organizations failing to align philosophically with employees, apathy that comes from a lack of job security but also, importantly, a lack of investment in human capital on the part of employers.
Too often employers see the labour force as mere tools and means to ends, rather than strategic assets to be developed. When employees feel that their professional development and career health is taken seriously by their employers, engagement will increase in turn. Engagement corresponds to more job satisfaction, bigger and better brand advocates for the business, better collaboration and better employee retention.
Attract New Talent
Another reason it pays dividends for an organization to invest in its current workforce is that doing so has future benefits for recruitment and talent acquisition. Surveys have shown that the vast majority of people are willing to trade less money for more meaningful work, which translates into a lot of different things, but among them is work that allows them to develop and utilize their skills and core competencies.
The implications for talent acquisition are easy to see and potentially enormous. If a business is able to establish a reputation as a place that nurtures talent, invests in its people’s professional development and provides opportunities to constantly grow and improve skill sets, it will be a much more attractive place to work for talented, ambitious people looking for a challenge and interested in lifelong learning.
Investing in people should also be seen as a necessary part of future-proofing the organization. The rate of economic change that is taking place and will continue to do so obligates leadership to take a future-proofing approach to business. The pandemic proved that entire business models could dry up overnight and that the resulting skills gaps could potentially cripple an organization or industry. Your people are your best chance against being blindsided by the future.
Investing in employees can provide the organization with valuable skills–particularly digital ones–to ensure a more seamless transition to a much more digital business environment. It can also ensure that the mission-critical skill sets required for business success are always in supply. Having employees who are able to cover for one another, pick up the slack for absent coworkers and take on new responsibilities when necessary make the organization much more agile.
Investing in employees also has implications for productivity. Employees who are confident that their employer has their professional best interests at heart and are committed to providing them with opportunities to improve and increase their skills are more likely to want to do their best for the company. The management and organizational behavioural literature over the last year have been almost singularly obsessed with the phenomenon of decreasing productivity, what to do about it and when, if ever, it will be back.
Of the many things that we know about productivity and the influences on it, employees who believe they are supported in their professional development by their employers are more likely to want to exert themselves on behalf of the company and to make the best use of their working hours. The quality of the employee-employer relationship is dictated by many things, but among them is certainly the extent to which the former believes the latter is concerned about their careers and professional development.
The problem with many organizations is that labour expenses are seen as something to be kept as low as possible at all costs. Professional development and enriching the organization’s human capital takes a back seat with such a philosophy. What these businesses don’t realize is that they are shooting themselves in the foot in the medium to long-term. Investments in employees, and particularly promising people with a demonstrated desire to learn, improve and add value, are investments in the business.