Talent management has been among the biggest challenges facing business leaders in recent years. In the 2024 New Era of Leadership report, a third of CEOs reported changing worker expectations as a top challenge they’re facing in the current year. This was followed closely by difficulty hiring the right talent (30%) and keeping up with disruptive technologies (30%).

The tight labor market is a particular problem for employers in industries dealing with ongoing skill gaps, such as technology, manufacturing, and healthcare. The truth is, though, 70% of leaders across industries say they have a skill gap at their company that is negatively affecting performance. And that problem isn’t likely to go away on its own. Recent census figures show the next decade is likely to see the slowest growth of the working age population since the U.S. Civil War, meaning employers can’t count on new entries to the labor force to fill in these gaps.

Nurturing and developing internal talent is one way to overcome this challenge. Not only does this provide your team with the skills it needs, but it is also an effective way to keep top talent with your company, sparing you the need to hire from a tight talent marketplace. Let’s take a closer look at the benefits of offering employee development, along with some effective strategies for creating this kind of program in your organization. 

The importance of offering internal growth opportunities for employees

In SHRM’s 2022 Workplace Learning & Development Trends report, nearly half (48%) of respondents said that the training opportunities available were a factor in choosing their current role, while 76% said they’re more likely to stay with a company that offers continuous learning.

Those two statistics highlight some of the key reasons it’s important for employers to provide professional growth and skill development opportunities. By building a culture of employee advancement, employers can attract top professionals to their talent pipeline and maximize the potential of their teams.

Some of the specific benefits of nurturing talent through upskilling, career development programs, and promoting from within include:

• Higher employee engagement and morale. When employees see that strong performance can open up the opportunity for an internal promotion, that gives them extra motivation to excel. It’s also a sign that their hard work will be rewarded, and sends the message that the company is committed to their career advancement. All of this makes them more committed to the organization’s success.
• Increased employee retention and loyalty. In a 2022 report from Jobvite, 20% of job seekers said that growth opportunities were their top factor for seeking a new job, second only to compensation (27%). This makes offering employee development opportunities like leadership development, upskilling, and reskilling one of the best employee retention strategies, preventing your top performers from feeling like they need to look outside the company to further their career progress.
• Stronger workplace culture. Offering professional development opportunities fosters a culture of continuous learning in your organization. This makes employees feel more connected to their workplace, imbuing them with a sense of purpose and accomplishment while encouraging them to be innovative and adaptable.
• Smoother succession planning. Leadership training programs create a pipeline of future leaders within your organization. Paired with clear internal promotion strategies, this can help to ensure stability and continuity in leadership, allowing you to move people into those roles who already understand your culture and brand identity.
• Improved productivity and performance. The goal of talent development programs is to help employees learn new skills or strengthen the capabilities they already have. This doesn’t just benefit them by opening up new career opportunities, but also benefits your company by expanding the skills available on your team. Promoting from within also improves the knowledge retention across your organization since long-term employees have a better understanding of your brand identity, internal systems, and customers.

Common challenges to internal talent development

If learning and development programs and other forms of employee advancement are so valuable in the workplace, why don’t more employers use them? The truth is, implementing this kind of program in an organization isn’t always easy. There are several common challenges that companies need to overcome in order to develop effective career development strategies for employees.

For one thing, these programs are not free. Implementing training, coaching, or mentorship programs requires a financial investment, and especially when budgets are tight it can be a challenge to get leadership buy-in for that expense.

Granted, in the long-term, the data shows that employee training programs actually improve profitability. Companies with formal training programs are 17% more productive and bring in 218% more income per employee than those without them. That’s on top of the amount saved in recruiting and training new hires thanks to the higher retention. Demonstrating the long-term financial benefits of L&D programs can be one way to convince reluctant leaders that they’re worth their price tag in the present.

Financial resources for workforce development aren’t the only thing that can be lacking in an organization. These programs also require time and resources to develop and implement. When your team is stretched just meeting the immediate needs of the business, it can be difficult to find time to implement these kinds of long-term initiatives.

Determining what kind of training and development to offer—and who to offer it to—is another common impediment. To maximize its effectiveness, workforce development programs should be aligned with the organization’s goals, tailored to meet both their current and future business needs. It also needs to be offered to the right people who will not just directly benefit from this skill development but can put it to use for the good of your team.

Smaller companies often face an additional challenge, which is that there may not be a lot of internal promotion opportunities to go around. When leadership roles in a company are limited, and turnover from those roles is low, employees who have completed training and development programs may be frustrated with how long they have to wait for an advancement opportunity to open up. Creating alternate career pathing options, that promote employee career growth in ways besides direct promotions, is one way to side step this issue—but that again requires time and resources that aren’t always readily available.

How to promote employee growth in the workplace

Despite the challenges noted above, the benefits of implementing employee growth strategies are too significant to ignore. It’s worth the effort for employers to find ways around these potential roadblocks and provide continuous education opportunities to their team. A structured and carefully planned approach is often the best way to ensure success. Here are some steps that talent management professionals can take to design and implement effective workforce development programs.

1. Identify high-potential employees.

One of the advantages of L&D programs is that it enhances employee empowerment, giving your team members more agency over their own career path and future with your company. The first employees you want to provide this to are the strongest performers that you want to keep on your team long-term. Tailoring your initial training offerings to these high-potential employees can help you to be successful in this goal. High-performing employees are also the ones who are most likely to take advantage of development opportunities, so your programs are likely to get more engagement from the start if you focus first on meeting the needs of top performers.

2. Assess your team’s current skills and competencies.

We mentioned earlier that professional development programs should benefit the company as well as employees. The best way to ensure this is to implement training programs that directly address current skill gaps or add capabilities that you anticipate needing in the future.

The first step to this is assessing your organization’s needs. Conduct a skills gap analysis and survey both management and employees about what skills they feel are lacking, or would benefit them the most to add. At the same time, do some research into current industry trends or changes to help you identify what kind of learning or skill-building will help your team adapt to the needs of the future.

3. Define the program’s goals and objectives.

Helping employees develop is an admirable big-picture goal, but it is also too vague to be tracked and assessed. In order to gauge and demonstrate the success of your program, you should have clear, measurable goals in place from the start. Use a SMART goal formula and set specific, measurable, achievable, and relevant expectations around your L&D program, along with a clear timeline for the program’s implementation and when you expect to see results.

4. Provide easy access to learning resources.

A development program can only be effective if your employees actually engage with it. The easier it is for employees to take part in the learning options you offer, the more likely they’ll be to benefit from the program.

One way to do this is to provide learning resources in a variety of formats. Digital learning platforms provide on-demand access for self-guided learning from anywhere, giving employees freedom to develop skills on their own schedule. You don’t need to create your own internal Learning Management System to do this, either. Taking advantage of courses already available through providers like Coursera or LinkedIn Learning reduces the workload for your company while allowing you to offer a variety of learning options relevant to individual employees.

Ensuring that employees have the time to pursue these training options is part of this, as well. Not all employees will be able or willing to undertake professional development in their free time. Integrating learning time into the work day is one way to make it more accessible to all workers. This can take the form of mentorship and coaching, project-based or on-the-job learning, or short micro-learning training sessions that can become a part of employees’ daily routines.

5. Design clear career pathways.

One tricky thing about creating employee growth strategies is that not all employees are going to have the same end goals and motivations. Working with employees to understand their individual career aspirations, and how those align with your business needs, can help you to provide development opportunities that benefit everyone.

The first step to this is often to clarify what career advancement means within your company. Establish specific skills, experience, and competencies that are expected at each level of your organization. Once you have these details outlined, it will be much easier to plot career pathways onto those levels, giving team members defined benchmarks they can work toward in order to reach their career goals.

6. Use performance reviews and one-on-ones as vehicles for growth.

One step that’s often lacking in employee skill building programs is assessment. Providing learning opportunities is a great start, but you also want to take the time to gauge their effectiveness and continue the skill development work after they’ve completed the initial training.

Performance reviews and one-on-ones with managers are an ideal time to conduct this kind of assessment. Use these meetings as opportunities for leaders and their reports to collaborate on developing individualized development plans, ones that target the employee’s specific weaknesses and skill gaps to improve their overall performance and effectiveness within the workplace.

Best practices for talent development and internal promotion

Following the steps outlined above is one path to effectively promoting employee growth and internal promotions within your company. Here are some other tips that you can follow to help you implement these programs in a way that brings the greatest benefit to both your organization and the professionals who make up its workforce.

Upskill and reskill for the future.

Recent research from the National Skills Coalition shows that roughly 92% of jobs today require some kind of digital skills. Unfortunately, nearly a third of workers lack those skill sets, leading to a disparity between the skills candidates have and the ones employers need.

This divide is only likely to grow as technology continues to advance in the coming years. Upskilling and professional development programs give employers the power to prepare their teams for those future needs, in addition to ensuring they have the capabilities needed today. Stay current on trends and forecasts for your industry to identify the skill sets that will likely be the most in-demand in the future and use this knowledge to shape your continuous learning initiatives. This way, you can future-proof your workforce at the same time you’re giving them tools to further their career progress.

Communicate learning opportunities broadly and frequently.

We mentioned above that employee growth strategies can only be effective if your team members actually take advantage of them. They’ll never do that if they don’t know what options exist. Whatever learning and development options you have for your team, make sure all employees are both informed about them and encouraged to take part in them. Some individuals may choose not to pursue these opportunities, but you don’t want a lack of awareness to be the reason for low engagement.

Make use of peer learning like job rotation and cross-functional collaboration.

Employees don’t need to take a formal class to learn new things—they can also learn things from each other if you give them the opportunity to interact and share knowledge in the course of their work.

Peer learning doesn’t need to be formal. Simply fostering a learning culture, where employees are encouraged to share advice and knowledge with their colleagues, can be an excellent first step. You can expand these opportunities for mutual learning by creating cross-functional teams to collaborate on projects, giving individuals exposure to different perspectives and areas of expertise they might not have thought about otherwise.

Job rotation or shadowing can be another way to expand employees’ skill sets, especially for those who are actively working toward promotion. Understanding how various roles in the organization work together can be excellent preparation for a leadership role, at the same time it deepens the employee’s knowledge of their job and how it fits into the overall objectives of the company.

Acknowledge and reward employee growth.

In some sense, learning is its own reward, especially if that skill building directly leads to higher pay or a new position. That said, it always feels good to have your hard work recognized and rewarded, and that’s as true with professional development as it is with other aspects of work.

At the very least, make sure leaders and managers within your organization pay attention to which employees are taking advantage of training and make a point of acknowledging their successes. Adding other incentives for those who complete the training can also increase the number of employees who take advantage of it.

This doesn’t need to be a direct monetary bonus to have an impact. For example, you might reward employees who have completed training by covering the cost of their registration for an associated certification exam, or could reward employees with bonus PTO equal to the amount of time they invested in learning after they’ve successfully finished the training. The bottom line is that knowing there’s some kind of reward waiting for them at the end can give employees the extra motivation they need to complete the training provided and enjoy the full benefits from it.

Track key performance indicators to improve your talent development over time.

Tracking employee progress is an important step to ensure your L&D offerings are useful, and you should do this on a big-picture scale, too. Identify the key performance indicators you should track to best evaluate the effectiveness of your training program, then use this information to refine and improve your offerings over time.

While the specific metrics that will be the most useful often vary between organizations, some that are often smart to track include:

• Employee participation rate – The percentage of employees who engage in development programs. A high rate indicates employees see the program as valuable. A low rate could indicate the training isn’t well-aligned to employee needs, that the program needs to be made more accessible, or that you need to communicate better with your team about the learning options available.
• Completion rate – This tracks how many employees who start courses or training see them through to the end. A high rate indicates the content of the program is useful and the course is engaging. A low rate could indicate issues with the content of the course or how it’s being offered to employees.
• Employee satisfaction – Collecting direct feedback from employees about their experience with learning systems is an excellent way to gauge this. Survey employees who have taken the training to find out what was effective, what wasn’t, and how useful they found the training program overall.
• Performance improvement – If your training programs are effective, you should see employees applying the skills and knowledge they’ve learned to their day-to-day work. Tracking metrics like productivity or quality of work after completing training is a vital indicator of the functional success of your training program.
• Employee retention – We’ve mentioned that successful L&D programs often correlate with higher retention. Track the retention of employees who participate in ongoing learning against those who don’t to evaluate the impact of development programs on your employees’ long-term commitment to the organization.
• Internal promotion rate – A high promotion rate among employees who participate in training demonstrates that the program is effective at developing team members for higher level roles and more responsibility. If this is low, it could indicate that you need to adjust the types of skills you focus on with this training.

Skill-build today for a more successful team in the future

As employee expectations continue to shift, and the pace of technological change continues to accelerate, workforce development programs are becoming a must-have for any organization that wants to be a leader in their field. The good news is, the plethora of learning and development tools that are available today make it easier than ever before to foster a culture of ongoing learning in your organization. By keeping your top talent on your team, and providing them tools to expand their skills even further, you can prepare both your company and your employees for the opportunities of the future.