Talking to the Business about L&D: Why is L&D so Important?
Just over half of L&D leaders agree that L&D has a seat at the executive table. While that’s an increase of 19% compared to 2020, there is still room to grow (LinkedIn Learning, 2022).
One of the most common pain points expressed by L&D practitioners is the function’s lack of standing in the business. Learning professionals often report a lack of awareness among stakeholders of L&Ds true value in an organization. And when times get tough, and budgets become stricter, L&D is usually one of the first things to lose out.
Part of this lack of understanding stems from the fact that L&D is often viewed as being separate from the business. Reflecting a disconnect between the perception of the value of learning and organizational outcomes. It’s as if learning stands apart from the commercial core of the enterprise. Increasingly however, many organizations are beginning to recognize the impact of learning and development and that employing resources that possess the necessary knowledge, skills and capabilities that are central to a business’s most important value-creating processes, is only as valuable as their ability to continue to develop them.
As a discipline, learning and development is not as securely professionalized as a strategic contributor of a business as marketing or finance, for example. The growth of utilizing digital learning had been picking up steam for years before COVID-19. Even before organizations needed to make the pandemic-prompted switch to remote working, many recognized the value of online learning sessions in terms of convenience, logistics, and impact. And yet, the news of the business value of these changes seems not to have arrived in the boardroom. Training is still too often narrowly conceived as something that happens in a physical room, away from the day-to-day context of work – or on a screen, as self-contained modules of ‘click-next’ e-learning. This lack of understanding means L&D sometimes feels isolated and undervalued. Talking to the business is seen as something that is difficult to do.
For these reasons, Learning Pool has drilled down into this area, asking some practitioners about the challenges they have faced in talking to the business and the strategies they have used to make for more productive conversations.
Why is L&D so important?
The rise of remote work, mass layoffs and organizational restructuring, as well as phenomena such as “the great resignation” or the “she-cession” have demonstrated just how quickly the working world can change. Following on from lessons learned during the COVID-19 pandemic, maintaining an effective workforce has fast become the biggest asset in modern business and is the source of most differentiators in a busy marketplace. Companies are increasingly facing the need to pivot their strategy and then pivot again, often in directions they weren’t able to plan for in advance. With the question no longer being as straightforward as “Do we have the right strategy?” but rather “will our people be ready to perform when that strategy needs to change?”
The need to attract, develop and retain high-caliber talent has never been more business-critical than it is now. Greater attention to strategic talent management and development is therefore crucial.
When we look at talent management in this respect, we realize that learning and development is one of the central elements of the employee value proposition for attracting and retaining key talent. Whether it is about on-boarding new team members faster and more effectively, raising current business productivity and performance, filling current skills gaps, or by the development of strategic capabilities to succeed in the future, learning is key.
There are many overarching benefits of adopting an L&D strategy. Let’s take a closer look.
1. Develop the skills and capabilities of your people for optimum performance –
According to the World Economic Forum, more than half of all employees will require significant reskilling and upskilling by 2025. But according to Fosway’s Digital Realities Survey 2022, less than 20% of L&D leaders believe they are “effective at upskilling and reskilling, onboarding or business change.” The future of work is changing more rapidly than ever before, meaning job roles and functions are no longer so black and white. Previously, businesses would have looked to hire people to bridge the gap, but that can prove difficult in this increasingly competitive job market requiring time and money, something many organizations find is in short supply. Thus looking instead to L&D to help build your organizational ability to retain, and reposition staff is the next logical step. In doing so, you develop a prepared workforce with a strong set of skills that can be used in a range of situations.
2. Attract and retain talent –
In a world where skills are the new currency, it is no surprise that learning and development contribute to employability. According to the 2023 LinkedIn Learning Workplace Learning report, 93% of organizations are concerned about employee retention. Workers are now in charge of their own personal and professional development and the report indicates that three of the top five factors that people consider when pursuing a new job reflect their desire to grow and develop new skills. An investment in L&D can help to improve morale and productivity and reduce the time and cost of training and retraining when talent moves on. It can also help save on recruitment costs which can have a significant business value. According to new benchmarking data from the Society for Human Resource Management (SHRM), the average hard cost per hire was nearly $4,700. But when combined with the soft costs many employers estimate the total cost impact to hire a new employee is upwards of three to four times the position’s salary.
3. Motivate and engage employees –
According to LinkedIn Learning, 83% of organizations want to build a more people-centric culture (Workplace Learning Report 2023). One of the most impactful ways to engage employees is to provide them with opportunities to learn and develop new competencies. Research has shown that one third of employees say increased training/education would increase engagement & loyalty. According to data shared by MindTools, there has been a massive swing in personal development being the motivation for employee learning, rising from 20% in 2018 to 57% in 2021. Thus when highly engaged employees are challenged and given the skills to grow and develop within their chosen career path, they are more likely to be energized by new opportunities at work and satisfied with their current organization.
4. Increase productivity –
Productivity is essential for profitability. And offering employee training is one of the most straightforward ways organizations can increase their outputs. This fact is not new, in a study conducted in 1995 by the National Center on the Educational Quality of the Workforce (EQW), increases in an educated and well-trained workforce education were far more effective at increasing productivity than increases in the value of equipment. Determining that a 10% increase in education produced a productivity gain of 8.6% vs. a mere 3.4% gain seen from upgrading equipment. The simple reality being that effectively training employees on how to use new technologies or tools has a bigger positive impact on profitability than the tools themselves. This benefit is compounded when adding to it the benefits of training employees on soft skills such as time management and delegation which can contribute to streamlined processes and saving time.
“An investment in knowledge always pays the best interest.”―Benjamin Franklin
5. Improve onboarding –
During the pandemic, organizations have had no choice but to onboard new hires remotely. This has led to innovative uses of technology, but it’s often been an ad hoc and haphazard process. Nevertheless, remote onboarding has shown that it’s possible, even desirable to use digital technology to onboard new employees no matter where they’re working. Digital onboarding is deliberately designed and planned to cater to all new hires whether they are in an office or working remotely. While retaining many of the features of the remote variant, digital onboarding achieves a more blended approach: keeping the social contacts that create a sense of belonging, while using digitization of resources and the connectivity that ICT allows to automate and enhance the admin and training components of onboarding. This can create a more personalized, tailored, self-directed onboarding experience that not only formally inducts employees into the organization but also better prepares them for what happens next.
Download our ‘Talking to the Business’ eBook to discover some tried and tested strategies for changing attitudes to L&D across your organization.
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