Why it pays to invest in existing talent

03 May 2024 Consultancy.uk 3 min. read

When faced with the ultimatum of hiring new talent or upskilling existing staff, business leaders need to base their expectations in reality and understand the skills required to thrive in a particular role. Entec Si’s Eman Al-Hillawi explains how upskilling existing staff could provide a powerful solution to increase efficiency within the business whilst improving retention rates.

It’s not just the cost of a new employee's salary to consider when beginning a hiring process; there can be plenty of other unexpected costs that might quickly mount up. It is estimated the scale ranges from tens of thousands of pounds to two times their annual salary, of which recruitment, pension contributions, National Insurance and holiday and sick pay form a large percentage.

Other considerations include fees to a recruiter, overheads such as office space – which can be heightened for businesses operating in London or other large cities, new equipment and essential software licenses.

Why it pays to invest in existing talent

All of this means that recruitment remains a costly solution to ensuring the workforce operates at its best. In a time where the economic outlook is still largely uncertain, business leaders should therefore consider whether members of the existing workforce could be trained to mitigate identified pinch points and drive productivity and performance.

To do this, a holistic overview of each job role within the business is needed, including existing responsibilities and a clearly defined description of each role. Armed with this information, decision makers can more easily identify which individuals, or even departments, could be best suited to taking on additional training and responsibilities.

Encouraging upskilling within the workplace puts businesses and employees at a competitive advantage. For employees, upskilling can help to future-proof their role and protect them from external factors such as enhanced automation or AI. For businesses, upskilling can lead to increased productivity, improved morale and high levels of retention. Furthermore, it encourages adaptability and enables employee development at a professional and personal level.

Targeting employee investment as a key practice within a business is also a fast-track way of developing a high-performing workforce. According to a report published by IBM, in the best-performing organisations, 84% of employees received the training they needed in comparison to the worst-performing companies that trained just 16% of employees.

To further accelerate workforce performance, businesses should adopt thorough annual training plans if these are not in place already. These plans could include everything from mandatory refresher training for essential company software to training programmes that encourage employees to develop new soft or hard skills. By preparing these plans throughout quieter periods such as December through to January, business leaders can quickly ensure the new year begins on the right track.

Employee turnover can be a costly process, both financially and in terms of time. When hiring new employees to replace leavers, a period of training and low efficiency is to be expected as new staff come to terms with their role. Investing in existing talent can go a long way to mitigate these issues to create a motivated, loyal and high-performing workforce that feel empowered within their working environment.

Eman Al-Hillawi is the CEO of business change consultancy Entec Si.