Do you have the skills to future proof your role? The reality is that we may not. In a recent LinkedIn Learning report as much as 25% of the skills we needed five years ago have changed. Further, LinkedIn has predicted that this skill gap will increase to 40% by 2025. We don’t want you to push the panic button, but that is only three years away!
We have the best intentions to grow our people. When we are busy, development is the first focal point to drop off the radar. Why? Because it takes effort, empathy, and engagement from both parties. Don’t take our word for it. A recent study RMIT revealed that 77% of managers believe that their organisations do not focus enough on development! Why, conflicting priorities, time, and budget.
Development isn’t the only area that we need to focus on when it comes to investing in our people. In fact, we believe that there are 5 factors worth investing in – and the payoff is worth it.
Investing in our people is the best investment we can make as leaders. Let us tell you why
Warren Buffett said, “The best investment you can make, is an investment in yourself.” The same is true for organisations and their employees. How often have you had to push back on development opportunities? Often it is because management is concerned about spending.
We know the common reason why most employees leave organisations is for better pay.
63% of people, in fact, decide to quit for pay.
Did you know that the same 63% of people also decide to leave roles because of a lack of development and growth opportunities?
What would happen if we invested in the development and growth of the 63% of people who left? Let’s do some math.
|Without Investment||With Investment|
|Scenario One: An experienced middle manager decides to leave because they have had no development or growth. They have been with the organisation for 3 years. They have made a significant contribution to the organisation and their immediate team. They have built strong relationships and a vast amount of tacit knowledge.||Scenario Two: An experienced middle manager states that they need more stimulation to grow in their role. Development is important to them. Development engages them. However, they feel that they are currently not receiving the development they require. They feel that specific development will assist in managing their team and the organisation.|
Financial impacts (Averages):
General set up and induction: $5000 – $10000
This considers access, equipment, travel, welcome packs, and induction training.
Total: $54,000 (And the manager hasn’t even started on any projects or impactful work!)
Formal Leadership Course: $16,000
Internal Mentoring: $0
Exposure to projects and Cross-Functional roles: $0
Loss of Knowledge Management (KM)
Specialist employees who leave organisations take a largely untapped resource of knowledge. This knowledge is acquired knowledge and is commonly referred to as tacit knowledge. KM experts spend copious amounts of time strategizing how to maintain internal knowledge. It is not easily passed on or quickly acquired by new employees. The acquired knowledge can be a large hidden cost to organisations if it leaves the business.
Getting base pay right is an important and foundational practice. It is not the only driving motivator to engage individuals to stay. As we can see from the scenarios, we are better to invest in people than have them leave. Yet, development is not the only factor that organisations can lean into when it comes to people investment.
Below are our top 5 factors organisations should consider investing in. We have included the benefits and outcomes which drive high engagement, tenure, and performance.
1. Individual Development Programs and Strategy: Skills, Knowledge, and Abilities.
Benefit: High engagement, longer tenure.
Employees are able to innovate and build future-ready solutions and skills. Individuals whose organisations invest in their development at 3.2 times more likely to stay with an organisation.
2. Employee Value Proposition Program and Strategy: What is the internal value for employees?
Benefit: Creating purpose and meaning
Employees who connect to an organisation’s value proposition are more likely to go above and beyond for the organisation. This is because they are connected to the common purpose and contribute to shared meaning.
3. Self-Leadership Programs and Succession Strategy: How do you support your change champions, agents, and future leaders?
Benefit: Strong leadership and management capability
Embracing a ‘leaders at all levels’ mindset encourages leadership development. It strengthens your competitive advantage and internal capability and advocacy. Leadership development assists employees and organisations to remain agile and efficient. Good leaders embrace the paradox of leadership while still being person-centred.
4. Well-Being Programs and Strategies: Consider how to support mental, physical, environmental, and financial health aspects.
Benefit: Sustain environments where individuals can thrive. Safety culture.
Well-being is no longer a buzzword, in fact, did you know that most organisations now have a CWO – Cheif Well-being Officer. The application of well-being strategies can increase individual well-being and reduce burnout. This means less sick leave, less stress, and more engaged productivity. Safety plays a big role in this. Environments that embrace mental, physical, environmental, and financial safety report higher levels of well-being.
5. DE&I Programs and Strategy: What type of environment are you creating?
Benefit: An inclusive workplace where connection flourishes
Investing in people means investing in differences. We are all different and bring a wealth of shared and individual experiences into the workplace. Organisations that are forward-thinking, and inclusive of individuals’ experiences will foster environments of belonging. Strong DE&I approaches increased your talent profiles and reach, as well as diversify your internal capability.
The math is clear if organisations want to save money, they need to spend money! Investing in people saves money in the long run. But, more importantly, it gives employees value. How are you and your organisation focusing on people investments? We can support you in reviewing your strategy and approach to building capability and strong, healthy organisations through consultation and our workshops. Reach out to Red Wolf Group today.