TORC

Younger employees in today’s market look for a company that can provide them with ‘an experience’, not just ‘a career’ at work. Also they are incredibly well networked through social media and can share information about their work experiences quite freely.

Most companies struggle to facilitate internal career progression and the majority have succession plans only for their senior management team.

Why is career development so important? Quite simply it is good business. Most of the high performing companies we know of have highly skilled and competent employees, often with long tenure. Not only are tenured people more skilled – they understand how the company works, they can build on relationships to get things done, and they have the confidence to improve and suggest change.

Think about the economic curve of a typical employee. During the first six to nine months most employees cost the company money. As they stay longer at a company, they become increasingly productive and they develop additional skills to accelerate their performance over time. If they are highly engaged the curve tips even higher as they like the company and enjoy their work even more.

When an employee leaves the company for a better position elsewhere, you need to find a new recruit who will start from scratch. This means the company incurs the:

– Cost of hiring
– Loss of productivity
– Diminished learning curve of the new employee

The new person may have excellent skills and prospects but it may take one or more years to replace the knowledge and expertise that’s lost.

On the other hand, if you can offer your people a process for stretch and career development, you may keep high performers – these employees thrive on challenge. Other positive side effects are likely to be a stronger internal culture and increased engagement.

* Adapted from “Predictions for 2015”, Bersin by Deloitte