We consistently hear executives say that the challenge isn’t attracting diverse talent or getting people in the door; it’s keeping them. And we’ve found that the solution is almost always the same: To retain underrepresented employees, invest in their development.
One of the clearest ways that companies can demonstrate that they value their employees is by making real investments to help them gain new skills. And more often than not, companies that invest in cross-training and upskilling earn their employees’ loyalty while also cultivating a reliable pipeline of talent for management positions.
Employer-sponsored skill development enables employees to advance within the organization and in their careers more broadly. It can include:
- on-the-job training;
- cross-training, stretch assignments, and internal job shadowing;
- professional development funds; and
- tuition assistance.
Why it works
Black and Latinx workers are often at the front lines of the organization, concentrated in low-wage jobs. Therefore, in industries with large frontline workforces, such as retail and food service, investments in cross-training and upskilling can make a real difference. Investing in upskilling low-wage workers can dramatically expand economic opportunity for the people who need it most. It also helps solve an increasingly urgent business challenge: According to the World Economic Forum, companies estimate that by 2024, nearly 40% of workers will need up to six months of upskilling.
In addition, many companies have struggled to meaningfully improve the number of diverse candidates that they recruit and hire into management positions. But upskilling frontline talent establishes a path for developing and raising up diverse talent from within the organization.
The adoption curve
At most companies, some degree of upskilling happens organically at all job levels, but proactive professional development tends to be available only to more senior-level employees. And while it’s common for employers to invest in upskilling through programs such as tuition assistance and tuition reimbursement, those opportunities are mostly reserved for white-collar employees. To ensure that tuition assistance advances diversity, equity, and inclusion (DEI) goals, employers should prioritize up-front payments over reimbursement—the latter puts the initial payment burden on employees and can often lead to negative employee sentiment.
Formal programs that enable entry-level and frontline employees to gain additional skills outside of their day-to-day jobs are far less common. It’s an area ripe for investment across cross-training, job shadowing, stretch assignments, and more. As employers scale upskilling programs, prioritizing lower-wage roles and focusing on the equitable distribution of opportunities among diverse and underrepresented talent will be key to improving DEI outcomes.
How H-E-B took action
H-E-B, a Texas-based supermarket chain with more than 350 stores, has made a steadfast commitment to developing its workforce. The company supports its employees, which it calls “partners,” through various formal programs.
For instance, H-E-B’s School of Retail Management helps high-performing employees build careers as store managers. It includes department-specific, on-the-job training; leadership development; financial skills training; and management skills training. In addition, H-E-B’s Manufacturing, Warehousing, and Transportation Leadership Development program is a comprehensive 9- to 12-month program that prepares employees for highly mobile supply chain careers. Beyond programs for specific career paths, the grocer offers all employees cross-training and rotational assignments, as well as classroom and online training. It also helps them create tailored development plans.
In return, H-E-B consistently earns spots on lists such as Glassdoor’s Best Places to Work and Forbes’ Best Employers for Diversity. The grocer also sees far higher retention and engagement than its industry peers, with a retention rate for department and store managers as high as 95% in recent years. This loyalty extends through all levels of the organization: According to employees, 53% say they would not leave H-E-B if they were offered a job with better pay, and 79% say they are excited to go to work every day.
“This is a purpose-driven place. Part of our mission is to help our partners have great careers,” says Craig Boyan, H-E-B’s president and chief operating officer.