The business case for skills development

Ask employers what their  biggest challenge in running and growing their business is, most will tell  you it is the inability to find the right employees. The reason for this is not difficult to figure out looking at our low quality education and  a value system that supports sub-optimal work culture.

Small- and medium-sized businesses are the most affected because they lack the brand and sometimes the resources to attract the few skilled and ‘already-made’ employees that are available. So what is the way forward? skills image3

Most employers have solved this problem by putting in place a good skills development system. This system has at its core a strategy that organizes activities to build the skills and knowledge of employees.

It goes beyond having an annual budget that helps pay for training of some staff in a year. An effective skills development system is inclusive of all activities and programs that are consciously designed and used to enhance staff skills and knowledge and it is unique for each organization.

If you have the natural fear that after developing your employees they will leave, listen to Zig Ziglar: “The only thing worse than training employees and losing them is not training them and keeping them”.

The truth is, it is better to have a productive employee for a short while than to have an unproductive employee over a long time. Besides, who says employees must leave after you’ve developed them. Some stay and it’s partly because the employer cared to develop their skills.

Also, looking at this from another perspective, who will develop employees? Educational institutions don’t. They only lay the foundation for skills development and this constitutes less than 25% of skills requirements for disciplines outside medicine, pharmacy, and engineering.

So if every employer is looking for already developed employees, where will they come from? This is one of the reasons for shortage of skilled labor – everybody is afraid of training employees and losing them, so no one trains. And yet employers look for skilled people in a non-existent talent pool.

Rightly, you may ask, can I afford to put time and money into skills development? But looking at some of the following measurable, bottom-line benefits, the real question should be, can I afford not to?:

  1. Increased productivity
  2. Increased customer satisfaction
  3. Stronger sales performance and/or competitive edge
  4. Fewer errors or defects
  5. Improved morale, increased loyalty and lower turnover (resulting in lower recruitment costs)
  6. Ability to expand and grow the business
  7. More freedom for the employer (since competent employees will be better able to manage the daily business).

Skills development may sound expensive, but turnover can be devastating. Recruiting, hiring and training one new employee can cost you between 70 and 200 per cent of that person’s annual salary! With this in mind, in the next article, we will take a look at ways to develop employees.

2 Responses to The business case for skills development

  1. obinna michael azubuike says:

    Nice one shall

  2. Richard says:

    OK contact me.

Leave a Reply

Your email address will not be published. Required fields are marked *