As an entrepreneur, you know that running a successful business means making a wide range of different investments. Companies must invest their time, money, and resources into a variety of different channels including technology, research and development, advertising and marketing, social media, security, and much more.
Your employees are also investing their energy, talent, and time into working towards achieving the success and vision of your business. But are you investing in them?
Making smart investments in your employees has many benefits and is investing directly in the future of your business. Investing in employees doesn’t always have to cost a large amount and can be one of the best ways to improve your company’s value and secure your market position – one of the golden lessons taught by the Elon Musk and Jeff Bezos.
There are many tactics that you can use to invest in your workforce, as a result, helping your employees become more loyal to your company and improving engagement, productivity, loyalty, and interest overall. And, investing in employees promotes and establishes a culture of employee development that will help you attract the best new talent to your company.
We’ve put together some of the main reasons why investing in your employees is a win-win situation for everybody.
Good Employees Are Expensive to Replace
The cost of replacing an employee could end up setting you back double the amount that you pay for their salary, or in some cases, even more. On the other hand, investing in your employees and supporting the development of their talents is more likely to produce an engaged, loyal workforce who aren’t thinking about leaving to work anywhere else. It helps you build stronger relationships with your employees which not only leads to better productivity but also means that you save yourself the unnecessary expense of having to replace them by recruiting and training new employees.
A Lack of Communication Will Cost You
Investing in your employees doesn’t always have to involve giving them financial bonuses. In fact, offering clear and consistent training, the right information, and the best resources for the job can be one of the best ways to achieve a stronger relationship with your workforce and boost work productivity levels on a daily basis. A study involving hundreds of major businesses found that poor communication, particularly in terms of training and information pertinent to the job, costs organisations millions each year as employees’ talents and efforts end up being misdirected. On the other hand, investing in making sure that your employees are well-prepared for their work will help them make the best decisions for your company.
Attract More Talent
Investing in growth opportunities for your employees is a sure way to ensure that they feel valued and appreciated at their workplace, and as a result, they’re more likely to share this fact with the people in their professional network and include it in any employee reviews that they write about working for your business. Your employees might directly recommend your company to people that they know who are currently looking for a job, while anything positive that they write online about working for you will be read by similar job seekers who will gain a favourable impression of you as an employer and be interested in working for you. One of the best ways to not only improve relationships with your current employees but also gain more interest from top talent is to offer employees the option of improving their qualifications while working for you. Many employers work closely with educational institutions to provide subsidised undergraduate or postgraduate degree qualifications to employees, such as an online MBA; click here to learn more about online degrees in the Middle East.
Offering employees the option to study online while supported by your company is an ideal choice as courses tend to be flexible and designed for those working full-time.
IBM conducted a study that suggested that employees were twelve times more likely to start looking for work elsewhere if their current employer was not helping them grow in their career. Most employees are not satisfied with feeling like they are getting nowhere in terms of career progression and will naturally begin to look for more exciting opportunities elsewhere if they feel that their career is becoming stagnant with a certain employer. That’s why smart employers know that it’s crucial to invest in those employees who are motivated to succeed by providing them with a range of opportunities for career development, further training, and professional growth.
Avoid Micromanagement and Build Relationships:
Nobody enjoys being micromanaged and the feeling of mistrust that comes with it. But companies often shoot themselves in the foot by failing to invest in helping employees to do their jobs well. As a result, employees may be more likely to procrastinate or get things wrong as they are simply unsure of how to get started or successfully complete assignments. And an employee who is confused about what needs to be done is less likely to be productive and more likely to make potentially expensive mistakes compared to those who are given clear guidance and instructions. As a result, this often leads to micromanagement, which in turn tends to go hand-in-hand with higher employee turnover, poor teamwork efforts, and more employee sick days. Instead, investing in good employee training and providing the right resources means that employees have what they need to confidently manage themselves and be more productive at work.
Less Sick Days:
While taking time off sick sometimes can’t be avoided, it can be frustrating for employers to lose a member of staff even for just a day or two. The solution to reducing sick days is to invest in your employees. Studies have found that companies who invest in the health and wellness of their employees tend to have lower rates of absenteeism and employees tend to be more productive overall. Investing in employee health doesn’t have to come in the form of free gym memberships and office yoga, either – there are several things that you can do to support the well-being of your employees that don’t have to cost a lot. Offering more autonomy at work, for example, tends to lead to better mental health amongst employees which, in turn, has a positive effect on several aspects including teamwork, productivity, employee loyalty, and your bottom line.
Employees Who Share Your Vision:
When employees feel that they are invested in, valued, and appreciated at work, they are going to be more likely to stay loyal to your company and in turn, be personally invested in your vision and values. For employers, this comes with many benefits. Many employees – especially younger ones – are often happy to accept a lower pay grade when the values of their employer are closely mirrored by your own. One of the best things that you can do to invest in your workforce is to spend some time getting to know your employees and what is most meaningful to them in terms of their work, and ensure that your corporate values align with their feedback. As a result, this can encourage a greater level of employee loyalty and dedication to your business.
Investing in your employees as people can help to encourage better teamwork, which results in improved productivity and a better atmosphere in the workplace overall. Invest time and money into encouraging employees to get to know one another better through off-site team-building activities and social events, which can help you build a better team culture and environment during working hours. Employees who feel appreciated, valued, and understood by not only management but each other will often have much better teamwork and camaraderie between each other in the workplace, which leads to a range of benefits including better communication, improved results, productivity, and creativity.
Improve Your Reputation:
One of the main things that today’s professionals are looking for in an employer is a good work-life balance. And while some companies might be able to achieve short-term success by pushing employees to work crazy hours with a huge workload, you’d be hard-pressed to find an employee willing to stick around for a while and be loyal to a brand under these circumstances. Instead, promoting a good work-life balance for your employees will help to build your reputation as a workplace that really cares about and supports the people who put the effort in for you. Invest in strategies that allow employees to spend more time at home, whether it’s streamlining processes to allow for earlier finishes or getting more done throughout the week so that employees can enjoy a longer weekend than most.
Better Customer Service:
When employers create the right conditions for employees to feel engaged in their work and loyal to the company that they are working for, customers enjoy a far more positive and authentic representation of your company, which is more valuable than any kind of advertising. Engaged, motivated employees who are satisfied with their work conditions can even increase sales by around 20% and tend to provide a much higher standard of customer service because they are personally invested in the company that they work for and want to ensure that they create a good impression of the brand that they represent. As a result, high employee satisfaction leads to more satisfied customers.
Train From Within:
If you’ve grown your company from the ground up, you might have already gone through periods where it’s important to create new senior positions in order to best manage the growing business and adapt to the changes that it brings. Investing in your employees means that when the time comes, you have a wider pool of suitable candidates to choose from for these positions, which can help you avoid the time and cost that comes with hiring from outside the company.
For example, a highly-motivated, loyal employee could easily end up becoming a hugely valuable senior manager or board member if you provide them with the right tools to help their career development in this direction, such as helping them fund an online MBA qualification. It’s often much cheaper and easier to promote from within and hire from the outside to fill the position that employees have moved up from. And, employees who know that there are promotion options to consider in their place of work tend to be more engaged and motivated compared to employees working for companies who typically hire from outside the company for more senior vacancies.
Many Options for Employee Investment:
When it comes to investing in your employees, there are many options to consider.
You can make small, large, short-term, and long-term investments in your workforce, and these can cost anything from next to nothing to thousands of pounds, depending on what your business and your employees value the most. Investing in your employees could mean giving them the freedom to work from home when needed or providing unlimited holidays, which has actually proven to be effective for encouraging employees to take as little days off as possible since they no longer feel that they have a certain amount of days that they must take. On the more expensive end of the scale, investing in all or part of the cost for a degree program or other professional qualification for promising employees means that you have more talented people working for your company. Not only does it help individual employees reach their career development goals, but it also means that they can bring what they learn to the table and are more likely to be loyal to you as their employer since you helped make their career development happen.
The key to successfully investing in your employees is spending time to get to know them and what is most important to them. Build relationships with both individuals and teams and request regular feedback to help determine what you could be doing in order to invest in your employees more and improve the outcome for your business. Tailoring investments to particular teams or employees shows that you care about the people who work for you and their needs.