The management guru Peter Drucker described the twenty-first (21st) century as an era of accelerated change, overwhelming complexity, tremendous competition, and lightning communication. This assertion is playing out in every sector of human existence.
Since the beginning of the 2000s, the pace of change has sped up to a dizzying level; globalization, borderlessness, rapid-fire technological innovation, the increasing demands of welfare economics and the impact of the global financial meltdown have pushed economies into a state of ceaseless turmoil. The complexities confronting public officers today call for a radically new kind of government structure, agile and elastic enough to adapt instantly to changing economic conditions, directed by leaders with the emotional and intellectual discipline to adapt to any level of change at a moment’s notice. Organizations are working hard at aligning strategy and operations to their people-focused demands. It is becoming more glaring that organizations must initiate, adopt, and adapt to robust employee career development interventions as a retention and motivation strategy. The impact on organizational performance in the medium and long term cannot be over-emphasized.
Career development speaks to how employees progress and move up the ladder in their organizations. However, you do not get promoted to the next level until you become overqualified for your current level. Hence, when the concept of Career development is considered holistically, it includes the learning and development interventions that prepare and equip employees for the next level of their career. When an organization pays attention to the career development of its employees, the bottom line is impacted positively, and the organization becomes more competitive in the global space.
It has been discovered that a vital ideology that makes organizations invest in the career development of their employees is the simple but profound truth that every legally operating entity has two (2) sets of customers: internal and external. The external customers consume the products (goods or services) an organization works hard to produce, while the internal customers are the employees. As much as it is imperative to satisfy the desires and needs of external customers, the aspirations of internal customers should also be a critical factor for consideration. It is the key to how employees grow and develop within the organization.
In the wake of the ‘Great Resignation’ (massive employee resignations prompted by employee dissatisfaction), organizations that invest in the career development of their employees have a higher probability of retaining their talent, increasing market share, maximizing profit, and minimizing losses. It is the story of leading organizations globally.
Investing in the career development of employees is an effective employee retention strategy as depicted by Michael LeBoeuf, PhD, in his book titled How to Win Customers and Keep Them for Life, published by Berkley, New York (1987). Even though LeBoeuf was considering a typical business, when he posited that most companies hear from only 4% of their dissatisfied customers. The other 96% go away quietly, and 91% will never return. These statistics depict financial loss for companies whose people do not know how to treat customers and a tremendous gain for those that do. Again, think of customers in the context of both internal and external. While external customers stop patronizing the services or goods of the company, internal customers resign and leave. Another survey on “why customers quit” found the following:
• 3% move away
• 5% develop other friendships
• 9% leave for competitive reasons
• 14% are dissatisfied with the product and
• 68% quit because of a wrong attitude of indifference towards them by the organization (when organizations don’t invest in the career development of their employees, employees perceive such organizations as not caring for their aspirations. Progress is a crucial component of life).
Furthermore, a dissatisfied customer will tell 8 to 10 people about their problem. One in 5 will tell 20. It takes 12 positive service incidents to make up for one negative incident. The mistake most organizations make is to think that such statistics relate only to their external customers. It is one of the main reasons why companies have high attrition rates and spend a lot on recruitment fees only for the same employees to leave before they have a chance to contribute to the bottomline of the organization.
Organizations must start to see their employees more than they currently are and begin to see them in terms of what they could become. Career development is about ensuring your employees realize their potential to make a long-term difference to an organization.
Written By: Joshua A. Ademuwagun Senior Manager, KPMG