What do employees want more – L&D or salary?
If you had two job options – one with more money, and one with better learning and development (L&D) opportunities, which would you choose? According to our data, most people would be more likely to choose the latter. Once salaries get to a certain hygiene point – as they are in most of the industries we work with (retail is the only exception) – what helps you attract and retain great people isn’t money.
In all the data that we see at Culture Amp, L&D is one factor that comes up time and time again as a key driver of engagement, retention, and productivity. And when we zoom in and look specifically at whether someone chooses to stay or leave a company, L&D is often at the heart of the decision. As a matter of fact, lack of development opportunities has been found to be one of the top three reasons an employee chooses to leave a company, according to Culture Amp research.
So here’s my brief manifesto on what good L&D is (and what it is not), why it matters so much and how it’s changing.
L&D opportunities are one of the biggest consistent drivers of engagement
Our data consistently shows that learning and development opportunities are one of the biggest levers a company has to increase engagement. As a result, L&D contributes directly to just about every aspect of a positive and resilient organization.
But most importantly, L&D is an amplifier that helps the company to move faster. When it’s done well, L&D accelerates the entire organization.
So if you have a good manager, it may take them 10 years of experience to become a truly exceptional manager. A company with a strong culture of L&D can accelerate the process so that manager becomes a great leader in a much shorter space of time.
This amplifier effect makes L&D incredibly valuable to a company, but it’s even more valuable to your people because they know that they’ll grow faster with you than anywhere else.
If you don’t invest in L&D, your only tool for improving performance is to replace people
While L&D isn’t the only thing that impacts the growth and culture of a business, there’s a clear impact. After all, L&D focuses on improving people’s performance, and, without it, your only tool to improve performance is to replace people.
It’s a harsh reality, but a lot of management literature really just boils down to this fact. If you want to improve your business you can hire better managers or salespeople (or any other role) or you can help employees grow.
Individual growth is more important now because what we need from people is more complicated. Job roles are changing at an increasing rate. There are literally no 10-year experts in Snapchat marketing. Or Bitcoin finance. The industries haven’t been around long enough.
Snapchat and Bitcoin might be extreme examples, but the sentiment holds true across many industries and roles. In a fast-moving world, it’s not always possible to find people with deep expertise who are ready to hit the ground running.
Learning and development is more than training
One of the biggest L&D mistakes I see is an overload of training. Training alone is not learning or development.
L&D is about people growing, it’s not about training programs. Harvard Professor David Maister said it best in his book First Among Equals: How to Manage A Group Of Professionals. He writes, “The only training worth its salt is the training that an employee will be willing to go up the side of a mountain on a goat for.”
Often in our attempt to create a place where people can grow we force courses on people. Most people aren’t interested in them, aren’t involved enough in them, or simply learn nothing from them. But if someone is willing to chop off their right arm to learn how to do something that's the time you should give them that opportunity.
For the best people, incremental growth matters more than compensation
I see many organizations that fall into the trap of thinking they have to keep paying high-performing people more to retain them. While it’s necessary to compensate people well, it’s not enough to keep them motivated. Eventually, they’ll reach a point where they’re paid enough and they can see that there are things that are much more valuable.
At this point, L&D becomes an opportunity cost for people to consider when they’re thinking of leaving your business. The thinking process often runs along the lines of, “I’m happy to earn the same or even less somewhere else if I'm given greater growth opportunities because I want to be better tomorrow not just today.”
When you look at exit data you can see that L&D is a key driver of retention. In research for our whitepaper How learning and development opportunities impact retention, we were able to combine engagement survey data with exit data. We discovered that people who leave an organization are 38% more likely to feel there was not a career opportunity for them at the company. People who stayed were 24% more likely to say they had access to the learning and development opportunities that they needed.
What do employees want? Growth
From time to time, every person, in every organization asks themselves “Is this company investing in my growth?” If that question can’t be answered strongly in the affirmative, there are consequences for engagement, retention, and productivity. This isn’t rocket science – most of us have experienced at some stage how demoralizing it is to work in an organization that’s not investing in the growth of its people.
Ultimately no company can grow or change at a rate faster than its people. This is the guiding principle for any successful approach to L&D. It is not about training for the sake of training. It is about growing people to ensure that you can compete and win.