Leadership Article


The Point of Employee Development

By Karen Mathews

Part of my experience at the conference included having a booth for the first time. I enjoyed standing at my booth and having very in depth conversations with passersby. Some people even stopped by to say that they really wanted their boss to have me come in to help them. Their company was in trouble. Mistakes were being made or the processes were broken. And no one was doing anything to fix it.

That is a common situation in my work. I hear about the damage that is being done to a company's reputation, the customer dissatisfaction, the poor work quality, etc. People tell me that their management doesn't hear it.

Then I had a hardcore high tech business owner try to convince me that with only 100 people he didn't need that kind of help. He has a Manager that was promoted but just isn't cutting it. His solution is to fire him. I was amazed. How could a business owner believe that firing someone was better than offering him help with professional development. What is the cost benefit here?

In this case, a highly competent and effective employee is rewarded with a promotion to a management position. He or she is probably lacking some of the skill for the new role. Has the owner considered what it will cost to replace this employee in terms of company specific knowledge and technical expertise? Never mind the brain trust that will be lost.

Recruiting and hiring costs for an employee can be as much as 100% of the annual salary of the position. In this case, around $150,000.

How much would it cost to provide professional development and coaching to improve the management skills of the promoted employee? Even if the costs were 25% of the $150,000, wouldn't the value of the retained manager make this a good return on investment?