UK firms overlooking their most useful asset

Too many employers fail to make full use of their most effective weapon - people - to edge ahead of competitors and increase profits, new research warns today.

Investment in developing core staff by UK firms is unfocused and unplanned. Instead businesses look to recruit outside talent to fill jobs, according to data published by Skills for Business, the network of Sector Skills Councils.

The research, carried out amongst 13,000 employers, shows three out of five are unable to find the right staff to fill jobs. And over a third are reporting a gap between the skills that their staff possess and those that they need to perform their job effectively.

But, the Skills for Business report argues, this could be partially combated by schemes to develop existing staff instead of depending on recruiting talent externally.

Lesley Giles, Head of Research at Skills for Business, said: Encouragingly, about four fifths of employers do engage in some form of staff development through role stretching and on-the-job coaching. Nevertheless, only four in ten have a formal training plan, and the general picture we’re seeing is that businesses aren’t necessarily thinking of internal staff development as the first step to combat skills issues.

Professor Carnall, Director of Executive Programmes at Warwick Business School, added:

A carefully balanced mix of formal and informal training is usually most effective. From our experience formal training enhances staff skills but coaching follow-up really consolidates that development ensuring confidence in new skills....the mix is what gives real impact.

Lesley Giles continued: Businesses need to reconsider the way they approach formal staff training and start building it into the fabric of their business planning. The study shows that employers - especially smaller ones - are aware of the importance of staff development, but they don’t know where to start planning and aren’t sure where to go for help with this, and are still worried that investing in training might lead to staff being poached. Once they start viewing staff training as an essential part of their business strategy, they will recoup the initial investment through the improved performance of their better-equipped staff.

She concluded, The challenge for Skills for Business is to act quickly to help employers find the most beneficial and suitable training for their staff so they can reap the benefits through enhanced business performance.