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What is employee development?

Last updated

18 July 2023


Dovetail Editorial Team

Reviewed by

Shawnna Johnson

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Employees are an organization’s greatest asset. Employee development involves creating an opportunity for your workforce to improve upon current skills, gain new ones, and push their careers forward. This can benefit both the employer and the employee while helping your business retain and attract top talent.

Let's take a closer look at the importance of employee development and review successful employee development programs.  

Employee development explained

Employee development is the process of helping employees improve their skills and expertise as well as develop new competencies to support their growth and the company's goals. By leveraging the support of learning and development teams, employees can leverage their new or improved skills to assume new roles, take on greater responsibilities, become proactive contributors, support innovation, and much more.

Examples of best practice employee development include training and workshops, mentoring and coaching, participation in action learning teams, pairing with subject matter experts, hands-on learning, internships, and more. There’s no one-size fits all.

The importance of employee training and development

With employees being an organization's greatest asset, the importance of their development is impossible to overlook. Improving your existing assets is generally a better choice than acquiring new ones.

For example, when you have an employee who lacks the necessary skills to contribute to the success of your project, your first impulse may be to remove them or terminate them and look for better-skilled candidates. However, such an approach may cost you considerable time and money and put the company at risk of a high turnover rate.

Recent data shows the cost of replacing an employee can be as high as 200% of their annual salary. Meanwhile, employee training and development are likely to cost much less, require less organizational effort, and lower the turnover rate. This is especially important amidst the Great Resignation when 70% of employees are thinking of quitting before the end of the year.

Employee development has a high return on investment since it drives productivity, improves retention, reduces turnover and hiring costs, increases employee engagement and morale, and positions the company as an employer of choice. 

The key benefits of creating a comprehensive employee development plan include:

Better performance

The main goal and benefit of employee development is performance improvement. When you offer employees a way to improve current skills or gain new ones, you’re investing in productivity for both the employee and the organization. Development provides employees with the expertise they need to handle daily tasks, take on additional responsibility, or even transition to a new role.

Besides improving employees' ability to work, you’re cementing their loyalty and devotion to the cause. This, in turn, drives productivity further. Employees who are constantly striving to improve their performance contribute to the competitive edge of the organization. 

Empowered and satisfied employees

Employee development makes your workforce feel more empowered. When they hone and gain skills, your employees are more likely to make independent decisions and act upon them.

Empowered employees make better decisions and resolve problems faster. They can contribute to the success of your projects and generate innovative ideas for business development.

When employees feel empowered, they feel satisfied. This, in turn, improves the workplace environment and drives retention.

Higher employee engagement

Employee development helps your staff feel connected to the company and its mission, which drives higher levels of employee engagement.

According to Gallup, high employee engagement can achieve a drastic decrease in absenteeism and reduce turnover by 18% while increasing profitability by 23%. Engaged employees are willing to give discretionary effort to the organization.

Appealing environment for top talent

Top talent aren’t just looking for high salaries, excellent benefits, and magnificent workplace culture. They want an organization that cares about them and provides an opportunity to grow. Since the Great Resignation is inflating perks and salaries offered across many industries, standing out from the crowd without a sizable HR budget is close to impossible.

By offering employee development options, you’re positioning your business as a resource of impressive career opportunities. This can attract qualified and motivated individuals looking to grow and advance within the company.

Since employee development improves the workplace environment and workforce satisfaction, it turns employees into brand ambassadors and encourages them to assist you with passive recruitment.

Employee retention

With top talent switching jobs at a high rate, holding on to the workforce is becoming a serious challenge. One of the top reasons why employees quit is the lack of opportunities for advancement in the workplace.

By providing employee development options, you’re giving your workforce a chance to improve, advance, and move up the career ladder. This is likely to keep your ambitious talent in place and allow them to contribute to your company's success.

When employees feel that their employer is contributing to their development, they’re more likely to stay loyal to the company. New skills make employees more optimistic about their ability to succeed within the organization.

Improved flexibility

When your workforce is productive, satisfied, and engaged, your company has an opportunity to grow and develop in any direction you choose. Organizations that boast high engagement and retention rates are constantly evolving. Employee development paves the way for new ideas and better decisions. 

A side benefit to preparing your employees for their next role is the ability of the organization to quickly pivot and weather both upturns and downturns in the market. Having readily prepared staff that can take on new roles or cross-train to fill gaps also ensures organizational stability.

The world of employee development is changing regularly. Staying up to date with the latest trends can help you design a successful employee development plan. There are many options to consider, ranging from large investments of time and money to low-cost to no-cost options. Employee development doesn’t require a large HR budget to be effective.  

The new tactics that are worth your attention include:


If your employees are too busy with their daily tasks to take extended time off for learning and development, you could explore microlearning. 

Microlearning is the use of self-paced learning materials for delivering skill-based education in small sections, sometimes called “micro-bytes.” Microlearning materials for employees are usually around five to ten minutes long. 

Microlearning allows employees to learn while performing their jobs. Each microlearning section is followed by a quiz, a call to action, and a reward.


Gamification in training can increase employee engagement by 60% and productivity by 50%. Employers are focusing on adding interactive and immersive learning content to their employee development tactics.

Since your staff are busy with work, long hours of training can be taxing and lead to burnout. Gamification makes the process dynamic, fun, and engaging while powering immersion and satisfaction.

Wellbeing support

The success of employee development depends on how much the employer stresses the well-being of its workforce. By creating a supportive environment that focuses on well-being, health, and work-life balance, an employer contributes to employee development and retention.

This trend is gaining momentum after the COVID-19 pandemic when burnout was a serious issue that led to low productivity and high turnover.

Personalized experience

Personalized development experiences can yield more effective results than a training program designed for large teams. By customizing the development plan for each employee, you’re enhancing the process and achieving better results. There’s no one-size fits all way to learn and develop, and the options are endless. It’s suggested that employers seek multiple modes of learning to encourage employees to invest in their development in the way that works best for them.

The goal is to foster individual success in order to drive business growth. Such an approach usually has a high ROI for the organization.

How to design an effective employee development program

An employee development plan helps employees improve their skills and gain new knowledge to support their roles in the company. Below is a set of steps to help you get started with your employee development program.  

Conduct a skills gap analysis

To determine which training and development tactics are needed and can work the best for your organization, you first need to identify what’s needed and which skills are currently lacking on individual and department levels. Take care to also assess positions at the next level in your organization and those being considered for the future.

Next, assess the skills and competencies of your current workforce against the gaps identified. You’ll then be able to identify the gaps between what you need and what you have and put together a plan to develop those skills and competencies at an individual or group level.

Review employee development goals

Once you’ve identified the gaps, it’s time to put together a development program. Individual development should be goal based and aligned with the organization’s needs. Including employees in determining the goals and how they’ll achieve them will go a long way to ensure buy-in and success.

To structure and track employee development, you may want to consider the SMART (Specific, Measurable, Achievable, Relevant, and Time-Bound) goal-setting technique.  

Ask for employees' assistance

When designing an employee development plan, you need to involve employees in the process. You’re likely to find that employees know much more than you do about the skills they require to contribute to the company's success. Your staff also know their strengths, weaknesses, and the most effective learning approach.

Incorporating employees' opinions into the program allows you to reap more benefits from the development process while keeping employees engaged.

Choose development and training tactics

Based on employee needs and your budget, you can choose which development methods suit your workforce and will be most effective. The type of learning and development offered can include:

  • Coaching

  • Mentoring

  • Cross training

  • Job shadowing

  • On-job or off-job training

  • Job rotation

  • Internships

  • Workshops or seminars

  • Action learning teams

  • Training and courses

If you have an opportunity to give employees time off work to focus on training, it can be an excellent individualized solution. However, in most cases, you need employees to combine work and development. This may require some adjustments to the work process.

Set targets and deadlines

Similar to sales and marketing, you need to track the success of your employee development program.  

To do this, you would have to arrange regular meetings with employees. You may need to decide how to gather regular feedback and incorporate it into further development methods.

While tracking the effect of development strategies on employees, you also need to set KPIs and metrics for tracking the effect on the company. After some time, you need to clearly understand how your employee development efforts are impacting the company's bottom line.

An employee development plan example may look like this:

  • List of development goals for the company

  • List of development goals for the employee

  • Metrics to track progress

  • Types of training and development

  • Timeline and milestones

Budget is an integral part of your employee development plan. You can either calculate a budget for the training and development of your entire workforce or a budget for each employee individually.

Usually, companies allocate between 1% and 5% of an individual's salary for development needs. This is a good choice for smaller businesses.  

Taking full advantage of employee development programs

Employee development is becoming an integral part of successful business operations. Without empowering your employees and giving them opportunities to grow, you may be impacting retention and slowing down company development, flexibility, and innovation.

By implementing a successful employee development plan, you can achieve many business goals without inflating your recruitment budget. Since employee development has an impressive ROI, you can save time and money while streamlining business operations and gaining flexibility.


What is the difference between employee growth and employee development?

Employee development is the process of gaining new skills and improving existing capabilities. Meanwhile, employee growth is an all-encompassing concept that describes the employee's progress throughout their lifecycle with the company. Accordingly, employee development is usually part of employee growth.

What is the role of the manager in employee development?

Managers play a major role in employee development since they help determine development opportunities, identify skills gaps, design an individual development program, and align employee goals with the organization's goals. The manager supports and encourages an employee throughout their development journey.

What is the difference between an employee improvement plan and an employee development plan?

Employee improvement plans are typically required after an employee has exhibited a performance deficiency that needs correcting in order for them to be successful in their role.  Performance improvement plans are typically associated with employee performance reviews.

Employee development plans are proactive plans intended to prepare an employee for their next role, to take on additional responsibility or scope, or to fill a gap identified within the organization.

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