Learning and Development can cost a lot of money – but it doesn’t have to. Here’s how to help your employees develop when you need to keep your costs as low as possible.
Owners of small businesses are constantly told that the modern workforce wants to learn and develop – "if they’re not learning, they’re leaving". Big businesses are typically able to simply throw money at the problem, with massive L&D budgets. This path isn’t always available to small companies. Money is often tight, so it’s understandable that a small business owner might push L&D onto the pile of “to be done in a few years” tasks.
The good news is that you can still invest in L&D when you’re low on cash. You just have to be smart about it. Here’s how.
A little L&D goes a long way
An effective, simple and low-effort way to invest in L&D is through a designated learning budget. Typically, this is a chunk of money which people in your team can then spend on costs related to their own personal development, managed by a platform like Learn Amp.
This puts the onus on your team members to take control of their personal development. That’s great for two reasons: first, it gives them more independence, and shows you have faith in them. Secondly, it takes a chunk of costly and time-consuming admin off the hands of the business.
If you’re still worried about this cost, look at it this way:
Even a small learning budget – of, say, £200 a year, feels like a useful, tangible amount to your employees. That could cover the cost of a handful of books, or a number of online courses, which could genuinely help them progress. While it’s not a huge amount of money in the grand scheme of things, few people have the luxury of spending a chunk of money like that purely on their own development.
It’s also not taxed – so while you’re only paying £200, they’re getting more money than they would if it was just tacked onto their salary. And if you’re still worried about the costs adding up – consider this: £200 a year is, most likely, less than giving someone in a junior role a 1% pay rise.
If you don’t have money, you still have options
If you’re really strapped for cash and can’t dedicate any budget to L&D, you’ve still got some options.
There’s a cost to implementing any form of L&D – but you can sometimes choose to pay for it with time, rather than money. Here are some examples:
Free online resources. There are a wealth of free tutorials, courses and other resources online that people can use to acquire and hone skills. Highlight them and make time for your team to take advantage of this. Don’t make the mistake of believing free means poor quality, but you do need to sort the wheat from the chaff. A YouTube tutorial might give more actionable advice on a specific area like pivot tables than a day-long excel course covering lots of extra, irrelevant stuff.
Mentors. This one’s big in startup-world, but it’s hardly a new idea: a junior person builds a relationship with a (comparatively) senior person to learn from their experience. If you’re running a business, it’s likely you’ve got a pile of contacts that people in your team would love to talk to. Who could you invite in to do a talk? Get this right, and you’re providing an extremely exciting opportunity to members of your team. This one can seem like a daunting task, so if you’re worried, check out this post by CharlieHR CEO Rob O’Donovan.
Internal knowledge transfer. No matter how big or small your company is, you can guarantee that there are people in it with knowledge that others would find inspiring or benefit from hearing. Make spaces for people to share their knowledge – such as a casual lunchtime session where, say, someone in sales explains how they manage customer relationships, or an engineer outlines some common programming concepts. Sessions like this are great: people enjoy talking about things they specialise in – and, even if it’s not directly helpful to their job – learning about different areas of the business is an interesting and rewarding process.
Volunteering. One highly overlooked way of gaining fantastic experience is through volunteer work. This is particularly useful for people who are in high-level leadership positions in your business, and might not have anyone internal they can learn from. Do you have a manager who wants to be a director, but doesn’t have much experience? Help them look for a volunteer position on an advisory board for a charity, and they’ll gain fantastic experience.
Build communities. This one’s a final, general point – and leaves room for a great deal of your own improvisation. If you can build communities which revolve around sharing knowledge and experience, you’ll have created a truly standout space for learning and development. Forums, Slack groups, lunchtime or dinner clubs – whatever the format, building a group of like-minded people who can swap ideas and knowledge is a fantastic project – and one that costs you time, not money.
Recognise the value that Learning and Development will generate
Finally – you should never be thinking of money spent on learning and development as a sunk cost. This is a worry a lot of business owners have – they suspect that they’re going to pour money into developing people on their team, only to have them leave the business in the next couple of years.
The crucial thing you’re missing, however, is that investing money into L&D is one of your best tools for making sure that they do stick around.
Learning and development is strongly linked to improved employee retention. Culture Amp found that people who believed their job contributed to their personal development were 21% more likely to stay with their employer.
Improved retention saves a lot of money. Replacing an employee is expensive, and filled with hidden costs. People spend time on the hiring process rather than other tasks, the new employee will require onboarding and training, and will take time to reach peak productivity.
Add this up, and the cost of replacing an employee reaches eye-watering levels. A report from Oxford Economics placed the average cost for replacing a single member of staff at £25,000. Managers and more senior leaders almost certainly cost more – this post from Lattice suggests that the true cost of turnover might be as much as double the employee’s yearly salary.
From this perspective, spending a few thousand on Learning and Development looks considerably less intimidating.