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Empowering Employees to Develop Themselves

At this company, employees get an annual allowance of $1,500 that they can spend to learn about (almost) anything.
COLLABORATORS Ilan Mochari
The Projectline professional development request form
The Projectline professional development request form

BUILD STAT

On average, 23 percent of new employees leave during their first year on the job.


TALENT MANAGEMENT

A special Build supplement in the December 2013 issue of Inc. magazine.

The Build Report: Talent Management Powers Growth

How to Screen Candidates for Curiosity and Positivity

What Motivates Employees Better Than Cash? A Break

12 Questions to Gauge Employee Engagement

Empowering Employees to Develop Themselves

Hiring new talent is both costly and time-consuming. According to a 2012 survey of 500 human resources professionals, the average cost to fill a position is nearly $11,000, and it generally takes new employees eight months to become fully productive.

But wait, it gets worse: Companies typically lose 23 percent of new employees during their first year on the job. So the time and effort managers spend to hire and train new talent is often wasted. Think of all the resources you could save if you simply worked harder to retain existing staff.

What more could you do? Projectline Services, a $27 million marketing consultancy, has a simple (and replicable) answer. The company helps its people stay engaged by helping them grow. Each full-time employee — there are currently 175 — gets a $1,500 annual allowance to spend on professional development.

“We encourage everyone to think about personal development and personal education,” says CEO and co-founder Mike Kichline. “It could be buying a book. It could be taking a class. It could be getting a degree or a certification. . . . The intent is that people will use this to develop or strengthen skills needed for their current role, or it can be used to prepare them for their next role based on personal or professional goals.”

Here’s how it works:

  • Each staff member meets regularly with his or her manager to talk about professional development. The employee may propose a plan for spending the allowance.
  • The manager may suggest alternatives.
  • Following the discussion, the employee submits a formal request.
  • Assuming the request is approved, the funds are released.

When the employee’s effort is complete, results are reviewed with the manager. Sometimes staff members share their pursuits with the rest of the company. For example, a small group recently presented what it learned in a class about infographics during a brown-bag lunch.

Projectline tends to give people plenty of latitude. One employee took a filmmaking class, Kichline says, after demonstrating that “even though this wasn’t necessarily in direct line of sight for his current role, it would be something he could apply to many areas within the company.” Since taking the class, the employee has produced multiple videos for the company.

Helping employees achieve their goals has become a defining trait of Projectline’s culture. Last year, for example, the company introduced the International Employee Volunteer Travel Grant, which allows employees to travel abroad to help charitable causes. Through the grant, one employee went to Tanzania to help a nonprofit group address the HIV/AIDS epidemic.

Perhaps as valuable as the professional development is the dialogue it fosters between employees and managers. By seeing how staff members spend their allowances, Projectline management gets a window into what empoyees really value — both inside and outside the office.

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THE PLUS

There are other ways to offer fresh yet affordable employee development programs. In an article in CFO, Michael Lehman, former chief financial officer of Sun Microsystems, lays out a seven-step plan that “helped propel at least eight of his former staffers into their own CFO roles.” And on the Mindflash blog, author Bill Cushard offers three simple steps for making development a “two-way street” where employees have a say in the opportunities they pursue. Read more about training and development.

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