Learning and development is a critical component of every business, regardless of industry, size, or business model.
With effective L&D practices, organizations can build a workforce capable of delivering their business goals.
In this piece, we will cover the following:
Investing in employee learning and development is a reliable way for organizations to generate a greater return from their staffing expenditure, improving overall profitability.
A broad term, L&D covers all professional development within an organization and is considered a core function of human resource (HR) operations. This includes formal, instructor-led educational programs and informal, employee-driven learning. L&D is sometimes referred to as talent development, training and development, or learning and performance.
Beyond improving performance, staff learning and development initiatives can produce greater employee engagement and retention rates and foster an additive work culture or learning ecosystem.
L&D is also vital to an organization’s talent management strategy, offering new opportunities to help acquire and maximize employees.
The importance of employee training and development has only increased, given the introduction of new technologies into the workplace.
With the digitization of many business practices, organizations now require technically capable workforces.
L&D is a critical tool to bridge the growing skills gap and future-proof employees by ensuring they have the digital literacy to operate effectively in the modern economy.
Employee learning and development initiatives can take many forms, from classroom-style training courses or online learning to mentorships and personalized educational programs designed to maximize each individual’s skills.
L&D can aid every aspect of the employee lifecycle. For example:
The critical difference between L&D and HR is that HR manages all aspects related to employees, and L&D focuses on the specific task of employee development.
While HR staff deal with payroll, employee relations, recruitment, and employee benefits, L&D professionals’ sole focus is the growth of employees and their acquisition of new skills.
There is a significant overlap between the two involved in onboarding, change management, succession planning, and employee assessment.
While sometimes L&D is independent or the responsibility of each department, generally speaking, it is overseen by the HR department.
Regardless of how a business organizes its HR and L&D operations, both must work in parallel to create a productive workforce capable of achieving the broader business goals.
While several related terms can be used interchangeably within the field, it is good to ensure you clearly define each concept and recognize the slight nuances between them. These include:
Learning and development is essential for staff, leadership, and customers. It helps employees develop their skills and expertise to advance their careers and open new opportunities.
Businesses can build the workforce they need, improve performance, and increase profitability.
Finally, customers have a better experience interacting with well-trained, knowledgeable staff who know how to help them and can make insightful suggestions.
Employees care about whether organizations invest in L&D. It shows their leadership is committed to their personal growth and is willing to develop existing staff members rather than looking to progress through new hires.
In addition, L&D solid programs are linked to greater internal mobility, with organizations willing to take the time to teach employees skills that could help them in new, often more rewarding, roles.
LinkedIn’s 2022 Workplace Learning Report found internal mobility alongside extensive employee training and development programs increase the time employees remain at an organization. The average rises from 2.9 years for regular organizations to 5.4 years for organizations that promote from within and emphasize internal mobility.
Research also shows the importance of L&D is only growing for younger demographics.
For example, a Gallup report found that 87% of millennials (typically defined as the generation born from the early 1980s to the mid-1990s) rate “professional or career growth and development opportunities” as important when looking for a job.
In addition, 59% of millennials say opportunities to learn and grow are critical factors when applying for a new job.
Emphasis on L&D produces a range of benefits for employees themselves.
LinkedIn found learning and personal growth to be primary drivers of exceptional workplace culture and greater employee engagement. When people feel like they are learning and progressing in their professional life, they are more committed to their employers, willing to work harder and go further for a common cause.
A previous LinkedIn report found community-based L&D strategies were particularly advantageous, fostering a sense of belonging, according to 92% of L&D professionals surveyed. This comradery meant employees were 5.2 times more likely to be engaged in their work.
Employee engagement, enhanced through L&D programs, generates a range of benefits:
While these benefits are great for existing employees, they filter through the hiring process. Companies that demonstrate their commitment to L&D, making it part of their employer branding, do better when looking to recruit new talent.
Employees are excited to work for companies that invest in them, potentially helping their careers long-term. This leads to the following:
While L&D improves employer branding to help the hiring process, it also reduces the need for it.
Retraining staff to learn new roles within the company benefits employees, who get to advance their careers, and employers, who cut workforce costs.
Upskilling or reskilling employees to improve performance or fill vacancies saves companies money.
Conservative estimates from Gallup suggest it costs 1.5 to 2 times an employee’s annual salary to replace them.
And LinkedIn’s 2022 Workplace Learning Report found that 79% of L&D professionals say it is more expensive to recruit new employees than reskill existing ones.
Customers also benefit when they get to deal with skilled employees that are good at their job and understand what is being asked of them.
When contacting a company, customers want to deal with enthusiastic, engaged employees who are experts in their field and clearly understand the product or service being discussed.
L&D can reduce the time it takes to answer any queries and improve the quality of responses, so customers are more likely to get a quick and accurate solution the first time. This boosts customer satisfaction and helps produce repeat customers willing to return after a successful experience.
Employees trained to deal with customers directly and help them on their sales journey produce a range of benefits.
For example, IBM found organizations taking advantage of learning solutions to generate skilled workforces have significant customer benefits, including a 16% increase in customer satisfaction when using learning tech and a 35% reduction in the time it takes to search through sales content.
When successful, L&D produces engaged, knowledgeable staff that improves business performance.
This can be measured in various ways, including:
These benefit business performance, affecting the bottom line and increasing profits. The same IBM study mentioned above found that skilled workforces are 10% more productive than their counterparts at companies less focused on L&D.
Research shows utilizing L&D to enhance employee strengths leads to an increase in profit ranging from 14% to 29%. Other studies have found a direct correlation between L&D budgets and profitability, with companies investing over $1,500 annually per employee reporting 24% more profit than those with smaller spending.
While L&D is critical for business success, the process itself is not without its challenges:
L&D is a broad term, and the specifics of its implementation vary considerably depending on the size of the company.
Larger companies typically have the resources to implement highly structured L&D strategies overseen by a dedicated team within the HR department working full-time to improve employee capabilities.
This generally incorporates technology such as a learning management system (LMS) to store and deliver training material or a learning experience platform (LXP) to track individual employees and tailor specific development programs.
With more resources available, employee learning and development at larger companies can feel more formal and prescribed compared to smaller operations.
Moreover, with more employees to teach, big companies can invest in external training providers to deliver specialist information to a large number of people at the same time.
In comparison, L&D for smaller companies is generally less formal and more ad-hoc or improvised, occurring on the job as they work.
Small companies often ask employees to chip in on tasks outside their comfort zone. While sometimes stressful, this type of employee development can rapidly teach staff how to perform several roles at the company.
Staff learning and development in small companies is much less structured and casual, often described as social learning. They don’t have the budget for formal training events or valuable learning resources, instead relying on existing employees’ expertise and ability to transfer knowledge to others quickly.
While this isn’t the only method small companies utilize for employee learning and development, it is rarely seen in larger companies.
Rather than having dedicated L&D teams, employee development is the remit of the chief operating officer (COO), operations manager, or supervisors directly overseeing staff.
L&D methods, such as mentoring or pairing senior employees with newcomers, are standard among smaller companies as they don’t cost much and help to disperse institutional knowledge across the workforce efficiently.
While there is no right or wrong way to structure employee training and development, ultimately, there need to be people at the organization responsible for L&D operations, regardless of business size.
Typically, this breaks down into a series of L&D roles explained below.
While there is a wide range of roles within L&D, there are several skills common among them all:
Several professional bodies offer educational courses to help develop the skills L&D professionals require.
There are many examples of successful L&D programs in the business world, often from largely successful companies that utilize employee training and development to achieve success. Famous examples of excellent L&D programs include:
Etsy offers thorough employee training and development based on various methodologies, including sociology, adult learning theory, and organizational psychology.
Learning is delivered through traditional practices, retreats, online resources, and providing one-to-one coaching for employees.
Etsy’s L&D staff makes choosing a career easier for employees, working closely with them to identify their options and help them along their desired path. This includes the “Etsy School,” where participants can become acquainted with various topics, from specific hard skills to soft skills like leadership and perseverance.
AT&T divides its learning and development opportunities into two options:
The company has a range of L&D initiatives, including “AT&T University,” where participants can participate in courses led by company executives, and the company’s ongoing partnership with Georgia Tech and Udacity, creating an online Master’s degree in computer science. This degree delivers meaningful skills and knowledge to existing AT&T employees and helps anyone looking for online education.
Google is known for its innovative approach to business, which extends to how it educates employees. The tech giant allows employees to be flexible in how they want to learn new skills, focusing on social or peer-to-peer learning.
Through “Google-to-Google,” the company has developed an internal network for social learning where staff can train and teach colleagues while tracking their progress through various KPIs.
There is a vast array of delivery methods to choose from when looking to implement new L&D programs.
Your choice should depend on the specifics of your company, the industry you operate in, the demographics of your workforce, and information on how your employees like to learn.
Some of the most popular options for you to choose from include:
However you choose to deliver training material to employees, L&D teams have several critical decisions to consider. These include mass vs. individual training programs, formal or self-motivated training, and whether participants will be assessed to determine their knowledge level post-training.
L&D’s role is constantly evolving to match the new demands of modern business.
Given the current climate, the most significant challenge in future employee learning and development is the rapidly expanding need for technical skills to keep pace with new technologies and automation.
Estimates suggest automation could displace 85 million jobs by 2025.
Thankfully, technology is also part of the solution, and L&D can incorporate digital transformation by implementing new solutions to help deliver current training initiatives producing the skills organizations are crying out for. This includes:
The future of L&D is continuous learning driven by technology, where employees are continually encouraged to improve themselves and the people around them.