Building an employee development plan: What you need to know [with examples]

The Society for Human Resource Management conducted a study on the skills gap in companies in 2019. They found that 83% of HR professionals were having difficulty finding talent with the skills their companies needed. They concluded that there was a skill shortage in the available candidates. 

Where can companies find talented employees with the skills they need? The initial reaction of many companies is to look externally to find talent. But the studies done by SHRM show that it might not be out there. Instead, companies should consider nurturing their existing employees to close the skills gap. 

Companies need to modernize (or implement) their employee development plan to build the skills they need internally. In doing so, they’ll successfully upskill their teams, increasing engagement and building learning cultures that will thrive in the future of work. This article is all about employee development and how to introduce it in your company.

What is employee development?

Employee development is the organizational process of identifying employees' skills, the skills the company needs, and working out a plan to close the gap between the two. 

In contrast to hiring to fill skill gaps, HR leaders invite their employees to build new capacities. Employee development ties both the organizational and personal goals together to find meaningful professional growth while they help the organization reach its goals. It’s an alignment of skills and goals between the organization and employees.

Types of employee development plans

There are several types of employee development plans, each with its own unique focus, goals, and objectives. Following are some of the most commonly used employee development plans that you can follow.

Performance-based plans

These plans are designed to improve an employee's job performance by identifying areas for improvement and developing a plan to address them. It typically starts with an assessment of the employee's current performance, which may include input from managers, peers, and the employee themselves.

Based on this assessment, specific goals are identified, along with the actions that need to be taken to achieve them.

Performance goals may include improving specific hard or soft skills, meeting certain performance metrics, or completing certain projects. Once the goals are set, a timeline is established for achieving them.

Managers typically schedule regular check-ins to monitor progress and make adjustments as necessary.

Succession plan

Succession planning is the process of identifying and developing employees who have the potential to fill key leadership roles within the organization in the future. The succession planning process helps ensure that the organization has the right people in place to maintain continuity in key positions, as well as to provide growth opportunities for employees.

Succession plans typically begin by identifying high-potential employees who have the skills and potential to move up in the organization. Once these employees are identified, development plans are created to help them acquire the skills and experience they need to prepare for future roles.

This may involve providing mentoring, coaching, and training opportunities, as well as providing exposure to different areas of the organization.

Management-by-objectives

Management-by-objectives (MBO) is a goal-setting framework that aligns employee goals with the overall goals of the organization. In an MBO-based employee development plan, specific, measurable, and achievable goals are established for each employee.

These goals should be tied to the organization's overall strategy and should be aligned with the employee's job responsibilities.

To ensure that the goals are being met, regular check-ins are typically scheduled to monitor progress and make adjustments as necessary. These check-ins provide an opportunity for the employee and their manager to discuss progress, identify obstacles, and adjust goals as needed.

Ad-hoc plan 

Ad-hoc employee development plans are created on an as-needed basis to address specific employee development needs. These plans are often used for short-term development needs, such as learning a new skill or taking on a new project.

Ad-hoc plans can be a useful tool for quickly addressing specific development needs that arise in the course of an employee's work.

Ad-hoc plans can also provide opportunities for employees to take charge of their own learning and development. By giving employees the flexibility to identify their own development needs and find resources to address them, organizations can foster a culture of continuous learning and development.

Leadership development plans

Leadership development plans focus on developing the leadership skills of employees who have the potential to become future leaders within the organization.

They typically involve a combination of training, mentoring, coaching, and on-the-job experience.

These plans may focus on developing specific leadership skills such as communication, problem-solving, and strategic thinking, as well as providing opportunities for the employee to gain exposure to different areas of the organization. This may also include opportunities for the employee to take on leadership roles in projects or teams to gain experience in managing others.

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Why is it important to have an employee development plan? (Statistics)

Companies that invest in their teams through employee development plans stand to experience a lot of benefits. From a return on investment perspective, companies can mitigate significant recruiting costs that can amount to 40% of an employee’s salary.

There are numerous examples of successful employee development programs that yielded not only positive financial outcomes but also exponential results ranging from retaining junior employees (Millennials and Gen Z) in a post-COVID world to providing leadership with a fresh perspective from junior employees — and promoting and empowering people to practice inclusion and embrace the diversity of countries the organizations operate in. The benefits are endless!

Additionally, employees benefit from training and development that helps them professionally and increases their engagement at work and sense of accomplishment. Employees that find growth and fulfillment at work are much more productive and build better cultures. Here are several more benefits of creating an employee development plan:

• Productivity and upskilling. Employees that grow at work are more productive. Studies show that happy employees are 13% more productive.
• Turnover and retention (employees want growth). Workplaces that have employee development programs experience less turnover. Research reveals that 40% of employees who don’t receive training will quit within the first year. 
• Attract new talent. Just as retention increases with employee development programs so too does job applicants. 59% of millennials (the largest part of the workforce) say learning is extremely important to them when looking for a job.
• Build a learning culture. Companies that prioritize employee development can expect to see a significant jump in engagement; it’s the second most significant factor in determining engagement.
• More adaptable to change. A joint study between Harvard Business School and Bostom Consulting Group found that employees were eager to learn new skills to prepare for the future of work.
• Aids succession planning. Studies into the connection between succession planning and employee development led researchers to assert that employee development helps companies build better leaders rather than “finding a new version of the departed colleague.” They build better leaders—they don’t just replace them.

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Why employee development is more than just training

It keeps you competitive and builds your company culture. Your employees can learn new skills in isolation, but that won’t make them love your company or want to see its success. Consider these two examples; which is better?

Example 1: Highlighting areas for improvement 

An employee has a performance review at the end of each quarter. The manager highlights the strengths they’ve seen in the employee and where they’ve shown improvement and growth. They encourage them to continue in these areas. Additionally, they also outline areas for development. To help them improve on those areas, their manager gives them some tips and suggests certain courses or training programs designed to improve these areas. The employee responds to the critical feedback by pursuing training opportunities in those areas. 

Example 2: Building a roadmap to career progression

An employee connects with the manager for their quarterly review. The manager reviews their strengths and weaknesses similar to the previous example. However, where they go farther is that instead of pointing them in the direction of training, the manager takes a step back. They explain where the company is headed in the next quarter and its goals. The manager also outlines the skills they’ll need to achieve these goals. Following that, the manager outlines the gap between where the employee is now and where they need to be for the organization to hit its targets. In this way, the manager ties the employee's skill gap to the organization's goals. It doesn’t end there. The manager then drafts up a plan with the employee to close this skill gap. It includes resources like courses, books, or articles and individuals inside the organization or outside that can coach or mentor them in these areas.

In the second example, the manager takes an active role in charting a path for the employee to improve. This is in contrast to the first example where the manager simply pointed them in a direction, leaving them with little more than “you need to improve these areas. Consider taking a course.” Further, which example will instill more loyalty in the employee? If an employee's managers get more involved in helping them develop, it will signal that they care about their growth and want to prioritize it. 

Heather Stewart, a consultant and coach at GlobaLocal HR Solutions in Los Angeles, shared in an SMHR article how managers should approach employee development like a coach:

"Simply ask good questions and get out of the way. The power of these questions, combined with active listening and dedicated one-on-one time, will be appreciated far more than you imagine. Think about it: How many times have your own bosses held these types of conversations with you throughout your career? Probably not many. That's why holding one-on-one meetings like these at planned intervals during the year will catapult your own career effectiveness as you are able to delegate more according to people's talents and interests while also strengthening their sense of independence.”

The point is: employee development involves more than just training. There are several key parts of an employee development plan that we’ll cover below:

Examples of what to include in an employee development plan

An employee development plan has five key components. They are:

1. Individual development plans (IDPs)
2. Mentoring relationships
3. Peer coaching
4. Job shadowing
5. Cross-training and stretch-assignments 

If you’re serious about building an employee development plan having each one of these components will guarantee that it has a high impact across your organization in the short and long term. It’ll be well worth the effort. Let’s explore each in detail.

Individual development plans (IDPs)

There will be many employees participating in your employee development program. Each employee, they’ll need to have their own individual development plan which is a shared document that outlines clear, actionable steps that help employees work on. Their manager or mentor (more on that in the next section) are usually the ones to take the employee through building an IDP. There are several parts to an IDP. They are:

• Professional goals and aspirations
• Strengths and talents
• Development opportunities
• Action plans

Once employees align with their manager or mentor on where they currently are and want to go they can begin getting to work on those areas. But not without support from mentors and peers.

Mentoring relationships

A mentor is someone who helps you grow your skills, make better decisions, and gain new perspectives on your life and career. Rather than learning through trial and error, a mentor is a person you can look to for direction and a role model to imitate. Mentoring relationships can be 1-on-1 or as a group where there are several mentees. Group mentoring can be particularly beneficial for succession planning.

See Why Group Mentoring is key to building future leaders.

For an employee development plan, mentors are crucial. It’s what separates an impersonal approach where managers point out their faults and leaders who allow employees to lean on them for support. It can be challenging to grow; having a mentor there to help you sort out your career path can be invaluable.

Further down, we cover stretch assignments and cross-training. These new experiences can be stressful and challenging. Having a mentor you can lean on (and vent to occasionally) can be what keeps employees motivated to grow. Here are several benefits of having a mentor: 

• Mentors provide guidance on a mentees career and professional path. 
• Mentors can expand their mentee's professional network, opening up opportunities for more learning and development.
• Mentors hold their mentees accountable for work toward their goals. 
• Having a mentor is a valuable opportunity to engage in knowledge sharing to get a more mature perspective on your career or organization.

Peer coaching

A mentor is essential for developing employees. But along with looking to someone above you for advice and direction, it’s equally beneficial to have support from others going through a similar journey. Employees need peer mentors as well. A peer mentor is a colleague at a similar level in the company. Both colleagues mentor one another because both of them have different experiences and unique skills or knowledge to offer. 

A peer mentoring relationship is more than just a work friendship. It’s focused on mutual growth. It’s likely that it will lead to a friendship, but at the start, it’s an intentional relationship where you two support each other through encouragement, discussing your goals, and holding each other accountable to grow.

Job shadowing

Job shadowing can be a great opportunity for employees to get first-hand experience with a new role or skillset from an experienced employee. Employees can follow their mentors or a peer around for a day to gain insight into their role in the company and their responsibilities. Doing so can help them clarify their career goals.

Cross-training and stretch assignments

Cross-training is when employees take on other roles than those they’re normally responsible for. Employees can accelerate their development through cross-training because it allows them to widen their breadth of experiences at the company. Likewise, stretch assignments are projects that challenge employees to get out of their comfort zone and apply some of the new skills they’re learning.

Employees not only apply new skills but can learn more about their strengths and weaknesses in different contexts which will further help them grow. They’ll also learn what job functions and responsibilities engage them more than others. For employers, this is a good opportunity to fill a job opening from an existing employee rather than recruiting external candidates.

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5 Steps to create your employee development plan

Following are the 5 steps to create your own employee development plan.

Step 1: Assess your organization's needs

The first step in creating an effective employee development plan is to assess your organization's needs. This involves identifying the skills and knowledge that are required for your employees to succeed in their roles, as well as any skills or knowledge gaps that need to be addressed. To assess your organization's needs, you can use a variety of tools, such as employee surveys, performance evaluations, and interviews with managers and team leaders.

Once you have identified the skills and knowledge that are required for your employees to succeed, you can then create a list of development areas that need to be addressed. This list can be used to guide the rest of the employee development planning process.

Step 2: Define and discuss your employee’s career goals

These goals should be aligned with your organization's overall strategy and should also support the professional growth of your employees.

It is important to avoid making assumptions about the goals of your employees. Learn about their career plans by speaking with them.

Consider your employee’s career ambitions in the context of their lives. By keeping an open dialogue about their career ambitions, you can ensure that their goals align with the company’s needs, while also taking into account their personal lives.

Once you have defined the goals of your employee development plan, you can then create a plan that outlines the specific actions that will be taken to achieve these goals.

Step 3: Identify development activities and resources

The next step is to identify the development activities and resources that will be used to achieve desired goals. This may include training programs, workshops, coaching and mentoring, job shadowing, and on-the-job learning opportunities.

To identify the most appropriate development activities and resources, you should consider the needs of your employees, their learning styles, and the available resources and budget.

You should also consider the most effective delivery methods for the development activities, such as in-person training, online learning, or a combination of both.

Step 4: Create a development timeline

Once you have identified the development activities and resources, the next step is to create a development timeline. This should outline the specific steps that will be taken to achieve each goal, along with timelines and milestones for each step.

The development timeline should be realistic and achievable and should take into account the resources and budget available. It should also consider the availability of employees and any other factors that may impact the timing of the development activities.

Step 5: Evaluate, Feedback, and Adjust

The final step is to evaluate and adjust the plan on an ongoing basis. This involves monitoring the progress of the plan, collecting feedback from employees and managers, and making adjustments as needed.

The evaluation process should be focused on identifying what is working well and what could be improved and should be used to inform future development planning efforts. This may involve revising the goals of the plan, adjusting the development activities and resources, or making changes to the development timeline.

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Start your employee development program

The benefits of workplace developmental programs go beyond advancing a particular employee but extend across the entire organization. Likewise, it’s more than just online training or one-day seminars from outside consultants. Employee development programs can include these, but a more holistic approach that leads to real impact is one that involves mentorship and employee connection. 

Together empowers organizations to accelerate their employee learning and development through mentoring programs. With 1-on-1, peer, and group mentoring, we enable organizations to level up their employee development initiatives. 

Organizations leverage mentorship programs to:

• Support diversity, equity, inclusivity, and belonging initiatives
• Prepare high potential employees to take on leadership roles
• Build communities of well-trained and experienced managers
• Set up new hires for success with buddy programs
• Build meaningful connections between your remote employees

If you’re ready to learn more about how our software makes it easy to connect your employees chat with us for 30 minutes today.