While I can understand the need to cut costs in a business, the training and development of your employees is not a good place to start. Companies that invest in their staff have more competent employees. The more competent an employee is, the more confident they feel -in their job, in their department, in the company. Employees who are more confident in their positions tend to be more loyal to their managers and company overall. Strategic spending on training and development should be treated as an investment in order for your business to run better, faster, and smoother, and with happier people.
One might think that investing in employee training during economically challenging times would be counter-intuitive because it requires a significant investment and thus increased costs. But when you consider the long term reward, this might be the best investment yet.
With the recent change to the BBBEE scorecard, a bigger weighting has been placed on skills development; companies are now required to spend 6% of payroll toward skills development.
What are the consequences if targets are not met?
According to the T&Cs, if targets in the codes are not met, the company will not obtain the maximum number of available BBBEE points. Under the new codes, ownership, skills development and, enterprise and supplier development are identified as “priority elements” and companies are expected to comply with the following minimum requirements:
- >40% of the “net value” targets for the ownership element. “Net value” measures the “debt free” portion of the BBBEE ownership of a firm;
- > 40% of the total weighting points for the skills development element;
- > 40% for each of the three subcategories of the enterprise and supplier development element (being preferential procurement, supplier development and enterprise development).
Skills development has become an absolute priority for companies in South Africa.
Anything a company can do to showcase itself as a great place to work will yield dividends down the line. Knowing that a company offers employees room for advancement and room to improve is going to be a big drawcard for potential employees. Having that opportunity in front of them also encourages them to be more engaged in their position.
What benefits can be expected from skills development
- Education is linked to better earning opportunities –Employees are kept motivated when they feel financially secure; and the more you learn, the more you earn.
- Lower turnover – When employees know that their company cares about their career, and is willing to offer training and opportunities to improve themselves and advance, they tend to stay around longer.
- The company’s image will improve – Being known as the company with the most competent and talented employees will lead to repeat business therefore growing your bottom-line.
- The general skill level of the entire country increases , thereby raising the wages at the lower levels, and alleviating poverty in the long run.
One of the best things about training your employees is that it does not have to cost you much at all. You can offer in-house training such as coaching, workshops, a buddy system, gamification etc., on a multitude of topics that relates to the workplace. All it takes is innovation and vision to see beyond today!