Skills Development, also commonly referred to as Human Capital Development, is not a novel concept in the South African organisational environment. While methodologies, models and alternate ways of funding skills development have come to light over the years, the essence of investing in one’s workforce remains the same. You may be asking yourselves why you should be spending more money on your employees when you already remunerate them at a fair and competitive salary. Is skills development another type of benefit for employees? Who actually benefits from this rather expensive investment? The answer to these questions is rather simplistic.

Skills Development in South Africa has been regulated by the government since the Skills Development Act and Skills Development Levies Act were enacted in 1998 and 1999 respectively. The purpose behind the enactment and implementation of the Skills Development Act was to improve overall productivity and efficiency of organisations through the expansion of skills, knowledge and competencies of its most valuable asset – its human resources, its workforce. In essence, human capital development aims to enhance the competency portfolio of employees, thereby allowing them to make a bigger and more significant contribution to the organisation. Is skills development selfish on the part of the organisation? Why do organisations only invest in employees if it will benefit the organisation primarily? [1]

The importance of skills development is two-fold; both parties benefit from this investment. Investing in your employees can take various forms – you can enhance soft skills in the workplace, such as developing communication skills, time management, interpersonal skills, active listening etc. Skills that lead to the development of a new competency can be developed; knowledge leading to tertiary qualifications can also be developed. Human capital development is all-encompassing; the type of skills which you choose to invest in and the manner in which you go about this development should suit both the employee and the organisation.

Not only does human capital development improve employees’ competency profile, it can also serve to enhance their quality of life, their future career prospects and labour mobility by equipping them with a transferrable set of skills that makes them all-round achievers. By improving upon the skill profile of your workforce, you are investing in your inputs, meaning that your processes, outputs and productivity benefit from this enhancement. You are creating more efficient, knowledgeable and competent employees who will be in a more skilled and advantageous position to carry out their responsibilities, thereby increasing your organisation’s competitiveness and ability to deliver quality products and services.

Investing in your employees is the ultimate form of trust. It shows that you not only believe in them, but also that you believe in their potential and ability to be more than just another employee. In addition, it’s great for morale, it can lead to enhanced employee engagement, it may significantly lower staff turnover and you have the ability to identify employees for future promotions and leadership positions. [2] The benefits of investing in your workforce profile can be immense. Not only will you see changes in your productivity, but also most likely in the creative and innovative ability of your staff, their willingness and ability to work in teams, their commitment to the organisation and the company’s ability to attract top talents.

This is all good and well – but companies need to exercise caution in their efforts to develop their staff. [3]

It is extremely important to work with your managers and supervisors to identify potential skills and competency gaps within each department. The development of a Workplace Skills Plan with an accompanying budget is also vital. You need to know who you will be investing in and why, the duration, the type of development that will be taking place (soft skills, on-the-job skills training, formal qualifications etc.), the cost incurred (both direct and indirect) and the ideal results that should be achieved from such an activity.

If you need assistance in conducting a skills audit, drawing up a skills plan or even just reporting on training and development which you have conducted for the year, do not hesitate to contact Joubert & Associates.  We will ensure that you have reported on your Skills Development initiatives to your relevant SETA before the deadline – 30 April 2021.

[1]https://static.pmg.org.za/docs/2000/appendices/000229SDASummary.htm#:~:text=The%20Skills%20Development%20Act%20aims,of%20work%20and%20labour%20mobility

[2]https://www.skillsyouneed.com/rhubarb/invest-employee-skills.html

[3]https://bookboon.com/blog/2019/11/6-essential-reasons-to-invest-in-soft-skills-development/