The Link between Learning and Development and Company Performance

Since the Coronavirus pandemic, non-financial factors have become even more important to employees. Along with the expectations that employees had of their employers, employees’ motivations changed. We know that at the end of the day, employees primarily want to feel valued. Aligned with this, businesses are increasingly acknowledging the crucial role of making their employees feel valued through empowerment. Continuous training and development efforts are an example of how companies can do just this to distinguish themselves as industry frontrunners.

After improving their talent progression and promotion, and offering higher wages, offering effective reskilling and upskilling learning opportunities is the third most focused priority of businesses when rethinking their EVPs (34%). Research companies reported that investing in learning and on-the-job training are two of the three most common strategies adopted to deliver business goals within the next five years. In addition, we know that continuous learning is going to become even more critical, as 6 in 10 workers will require training or retraining before 2027.

While businesses exist to make a profit, nurturing talent should not be left by the wayside. Choosing to invest in your employees holds much more value than might be expected. And with only half of employees seeming to have access to adequate training today, the opportunity to increase this is ripe for the taking. Deliberately choosing to invest in your employees holds much more value for your business than you might realise.

The relationship between ROI and L&D is reciprocal. Organisations invest in learning and development to enhance employee skills and performance, which in turn contributes to improved organisational performance.

Research conducted by McKinsey was clear – companies that build human capital are more consistent and resilient performers and are better at attracting and retaining talent.

Companies that focused on people and performance jointly ranked more successfully on six different factors; return on invested capital, economic profit, outperformance likelihood, peak pandemic revenue growth, upward mobility, and attrition rate. By focusing on both people and performance, the companies ranked higher overall than companies that purely focused on profit or purely on people.

As evidenced by the heightened focus on upskilling initiatives, businesses are cognisant of the imperative to equip their workforce with the necessary tools and competencies to thrive in an ever-changing landscape. As seen from the above, the symbiotic relationship between investment in learning and development and organisational performance cannot be overstated. Research underscores that companies committed to nurturing human capital consistently outperform their counterparts, not only in terms of financial metrics but also in a multitude of other key indicators.

By prioritising both people and performance, you can stand to reap multifaceted benefits, ranging from enhanced profitability to heightened employee satisfaction and retention. As the imperative for continuous learning becomes increasingly apparent, seizing the opportunity to invest in employee development represents not only a strategic business decision but also a testament to your organisation's commitment to its most valuable asset - your people.